Escolar Documentos
Profissional Documentos
Cultura Documentos
REPORT
Performance at a glance 6
Corporate Information 7
Notice of AGM 11
Chairman’s Message 14
Directors’ Profile 18
Managment 22
Directors’ Report 25
Events Highlight 41
Pre-Paid connections
230 Volt Single Phase (up to 7kw load demand)
400 Volt Three Phase (above 7kw to 49kw load demand)
Services
Providing Temporary and permanent electric connection
Customer requested shutdown
Customer requested Disconnection and Re-connection
Transformer Rental
Electric Line Accessories Supply
Electric Line and Substation related Services
Customers’ Meter Testing, Installation and Inspection Services
Feasibility Study for line expansion
Customer Solar Panel inspection
Tariff Change service
Electric Bill re-print and delivery
Delivery of Bill payment statements and Certificate
Prepaid Card issue and re-issue
Customer Service Cable Change
Customer Meter Change (with or without accessories)
Annual Inspection of Customers’ Transformers and associated equipment
Servicing of Customer Transformers and associated equipment (if required)
Rental of Trolley mounted transformers (for maximum 30 days)
Performance at a glance
Residential
25,000 16,251 Industrial 50%
37%
20,000
15,000
2011-12 2012-13 2013-14 2014-15 2015-16
Financial Year Consumption Pattern
Number of Cunsumer
3.49 760844
3.50 705234
3.02 641933
Percentage
2.00
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2011 -12 2012 -13 2013 -14 2014 -15 2015 -16
40 35.97
32.82 34.16 1,400
Taka
35
1,200
30
25 1,000
2011-12 2012-13 2013-14 2014-15 2015-16
20
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Financial Year
Financial Year
Industrial 669
800
Commercial 446
600
Others 400
200
Residential -
90% 2010 -11 2011 -12 2012 -13 2013 -14 2014 -15 2015 -16
Financial Year
Corporate Information
Board of Directors Management
Chairman Brig. Gen. Md Shahid Sarwar, ndc, psc (Retd.)
Md. Mahbub-ul-Alam, ndc Managing Director
Md. Rofi Uddin
Directors Executive Director, Finance & Accounts
Brig. Gen. Md Shahid Sarwar, ndc, psc (Retd.)
Engr. A. K. M. Mostafa Kamal
Brig. Gen. (Retd.) Md. Nazrul Hasan Executive Director, Procurement
Selim Abed Engr. Noor Mohammad
Engr. Ataul Mahmud Executive Director, Operation
Dr. Ahsan Aktar Hasin Md. Abdullah Al Masud Chowdhury
Executive Director, Human Resources
Minhajuddin Ahmed
Engr. Jagadish Chandra Mandol
Md. Anisur Rahman
Executive Director, Engineering
Independent Directors
Head of Internal Audit
Kazi Rowshan Akhter
S. M. Zamil Hussain
A. K. M. Humayun Kabir
Engr. Md. Rabiul Hasnat Statutory Auditors
ARTISAN, Chartered Accountants
Company Secretary
Engr. Zulfiquar Tahmid Governance Auditors
Rahman Mostafa Alam & Co., Chartered Accountants
Board Audit Committee
Major Banking Partners
A. K. M. Humayun Kabir Dhaka Bank Ltd.
Engr. Md. Rabiul Hasnat Janata Bank Ltd.
Pubali Bank Ltd.
Md. Rofi Uddin Rupali Bank Ltd.
Engr. Zulfiquar Tahmid Agrani Bank Ltd
Standard Chartered Bank Ltd.
Registered Office
Dhaka Electric Supply Co. Ltd
22/B Faruk Sarani, Nikunja-2, Khilkhet, Dhaka – 1229, Bangladesh
Tel 88 02 8900110-11, 8900220-23 (PABX), 02 8900330 (Direct), Fax 88 02 8900100
e-mail csdesco@desco.org.bd, www.desco.org.bd
Technical and
Commercial
Highlights
Annual Report 2016 9
Technical and Commercial Highlights
Technical
Particulars 2011-12 2012-13 2013-14 2014-15 2015-16
Commercial
Registered Office:
POWER IS YOURS 22/B, Faruk Sarani, Nikunja-2,
Dhaka Electric Supply Company Limited Khilkhet, Dhaka-1229.
ISO 9001:2008 Certified Visit us at : www.desco.org.bd
sd/-
Engr. Zulfiquar Tahmid
Company Secretary
Notes:
a) Shareholders whose names appear on the Depository Register on the ‘record date’ i.e.
November 17, 2016 shall be eligible to attend the Meeting;
b) Eligible shareholder wishing to appoint a proxy must deposit the proxy form, duly stamped, at
registered office of the company by January 5, 2017 during office hours;
c) If non-receipt of annual report, sent through courier service, shareholders may collect the
annual report from registered office or collect from the website of the company;
d) No children will be allowed in the AGM;
e) Registration counter will remain open from 8 am to 10 am on the meeting day.
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12 Annual Report 2016
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Annual Report 2016 13
Vision Mission
To be an enabler of economic development and Bringing comfort to customers, supporting
social progress by providing safe, reliable and business and commerce and building strong
sustainable electricity. communities. Achieving and maintaining the
highest degree of efficiency, reliability and
responsiveness for variety of customers.
Chairman’s Message
P
ower is the most essential element for the finalized soon. In line with the planning, Ministry
development of a nation. It is the blood has taken variety of programs to improve power
line of industrialization, trade and social production situation. There are short-term, mid-
development as well. Dhaka Electric Supply term and long-term planning which are also
Company Ltd. (DESCO) is one of the pioneering entangled to achieve Sustainable Development
company in power sector which is engaged to Goals (SDGs) set by United Nations.
supply power to the densely populated northern The company has 8% of market share of power
part of the capital and its adjacent area. Our distribution business in the country. During last
efforts are centered in better customer service, financial year energy purchase and sale both
uninterrupted quality power supply and addition increased by 18.94% and 14.26% respectively
of value to its different stakeholders. due to enhanced power generation in the
You are aware of that Government of Bangladesh country. Although in last year the company
has ‘Vision 2041’ to become a high-income reduced the operating cost by 1.78% but due
country by 2041. In order to achieve that goal to unfavorable tariff rate, that did not reflect
Power Division, Ministry of Power, Energy and in the profitability. Net profit was Tk. 44.61
Mineral Resources prepared a Power System crore last year whereas the profit of previous
Master Plan 2016 with the assistance of Japan year was Tk. 163 crore The EPS is Tk. 1.12,
International Co-operation agency which will be Net Asset Value per share Tk. 37.04 and Net
Annual Report 2016 15
System, Modernization of Grid Substations,
Modernization of Metering System, Application
of Geographical Information System,
Development of Human Resources, Adoption of
State of Art Information Technology etc.
Although the company has a monopoly
We are committed to our business but it faces several challenges. Tariff
of Electricity determines the profitability of the
customer to ensure better company which is beyond our control. DESCO
service and bring positive could not made significant profit this year due
change in the society through to unfavorable tariff rates. Other challenges
like timely implementation of the projects,
delivering values to the Construction of its own head office building,
stakeholders. maintaining high standard of ethics and
morale of the employee. In order to face the
challenge DESCO has already submitted tariff
Md. Mahbub-ul-Alam enhancement proposal to BERC, follow the time
Chairman bounded action plan for project implementation,
Board of Directors engaged consulting firm for construction of
head office building and extensive training of
the employee in line with national integrity
strategy.
Board of Directors is comprised of eleven
members. There are three independent directors
among them. Most of the Directors are from the
Power Division, Ministry of Power, Energy and
Mineral Resources, Government of the Peoples’
Republic of Bangladesh. Managing Director of
DESCO is the only executive director in the
Operating Cash Flow perShare Tk. 8.23 for last Board. Main role of the Board is to consider and
financial as against Tk. 4.11, Tk. 32.53 and Tk. approve different business proposals and policy
7.88 respectively for the previous financial year. support to ensure sustainable growth and
Reduction in operating income and interest protect the greater interest of the company.
income are the main reason of fall in rate of
In this journey, we are thankful to Government
profit. Considering business performance,
of the Peoples’ Republic of Bangladesh, our
future investment requirement and stability in
development partners Asian Development Bank
growth, the Board has recommended total 10%
(ADB), Asian Infrastructure and Investment
cash dividend for the financial year 2015-16. In
Bank (AIIB), Japan International Cooperation
last financial year DESCO contributed Tk. 195
Agency (JICA), Asian Institute of Technology
crore to the Government Exchequer.
(AIT), Thailand for their heartfelt cooperation.
The company continued its investment in Our sincerest appreciation is extended to our
infrastructure development, system stability, stakeholders and our people for their firm
capacity building, Safety and Security of people, commitment and dedication.
materials and equipment and the system as a
whole. There are several projects for construction
of Grid Substations, Distribution Substations,
Underground Grid Network, Renovation or up-
gradation of Distribution Network, Installation Md. Mahbub-ul-Alam
of Supervisory Control and Data Acquisition Chairman, DESCO Board
16 Annual Report 2016
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Directors’
Profile
18 Annual Report 2016
Directors’ Profile
Md. Mahbub-ul-Alam, ndc capacities of military and civil administration. He
appointed as Director and passed National Defence Course from National
Chairman of DESCO Board in Defence College in 2010. He participated in
October 22, 2015. He is the different Engineering courses in home and abroad.
Additional Secretary He served as Director of Electrical and Mechanical
(Development) of Power Engineers (DEME) under Army Headquarters. Brig.
Division, Ministry of Power, Gen. Sarwar was the Deputy Managing Director of
Energy and Mineral Bangladesh Machine Tools Factory (BMTF); Deputy
Resources, Government of Commandant of Bangladesh Ordnance Factories;
the People’s Republic of Director Administration in Directorate General of
Bangladesh. Prior to his current responsibility he Forces Intelligence (DGFI); Joint Secretary of
was Joint Secretary (Admin.) of Power Division and Defence Ministry of People’s Republic of
Director, Implementation Monitoring and Evaluation Bangladesh. He also served in United Nations
Division, Ministry of Planning, GoB. At present he is Peace Keeping Missions in 1994 (Mozambique)
also working as Chairman of the Board of Directors and 2003 (East Timor). He is an alumni of Mirzapur
of North-West Zone Power Distribution Company Cadet College.
Limited. He is also nominated Director of the
Bangladesh-India Friendship Power Company Ltd., Kazi Rowshan Akhter is
Director of DESCO Board since
Coal Power Generation Company Bangladesh
June 16, 2016. She is Additional
Limited and Dhaka Metro Rail Company Ltd. He has
Secretary, Power Division,
completed his Masters of Science Degree in Botany
Ministry of Power, Energy and
in 1983. Soon after he joined Bangladesh Civil
Mineral Resources,
Service in January, 1986. He has passed National
Government of Bangladesh.
Defence Course from National Defence College,
She joined in Bangladesh Civil
Dhaka. He also participated a training program
Service (BCS) in early 1988.
titled Managing at the Top 2 (MATT-2) in Bradford
She worked in the field
University, UK and Management course in Duke
administration in Jessore and Brahmanbaria till
University, USA. He also participated in different
1992. Afterward she served in Cabinet Division,
courses in Asian Institute of Technology (AIT) and Ministry of Education, Prime Ministers’ Office, Ministry
Mahidal University in Thailand and BRAC University, of Public Administration, NGO Affairs Bureau, BCS
Bangladesh. He also participated in training course Admin Academy, Bangladesh Chemical Industries
on Public Procurement in Engineering Staff College, Corporation in different capacity for 28 years. She
Bangladesh. He has around 31 years of experience obtained Hons and Master’s Degree in English from
in different capacity of government service. Dhaka University in 1983. She also completed
Brig. Gen. Md Shahid Sarwar, Masters in Governance Studies from Northern
ndc, psc (Retd.) joined as University, Bangladesh in 2008.
Managing Director of the Brig. Gen. (Retd.) Md. Nazrul
Company as well as ex-
Hasan was appointed as
officio Director of DESCO
Director DESCO Board on
Board on December 30,
March 8, 2012. Currently he
2014. He is also a nominated
director of Dhaka Power is the Managing Director of
Distribution Company Ltd Dhaka Power Distribution
(DPDC). He is a Graduate in Co. Ltd. (DPDC) and
Electrical and Electronics Engineering from nominated director of
Bangladesh University of Engineering and Electricity Generation
Technology (BUET). Brig. Gen. Sarwar served Company of Bangladesh Ltd. (EGCB). Earlier he
Bangladesh Army for 34 years in different was Chairman of Dhaka Electric Supply Authority
Annual Report 2016 19
(DESA) as well as Chairman of DESCO Board from September 12, 2012. He is also a nominated
2006 to 2008. After passing Higher Secondary director of North West Power Generation Company
School Certificate from Rajshahi Cadet College he Ltd (NWPGCL). He started his career in 1991 in the
was commissioned as officer of Bangladesh Army BCS Administration Cadre. He has wide experience
in 1979 of 1st BMA Long course. Subsequently, in in the area of management. He has attended a
1985 he got Bachelor of Science in Electrical and good number of training at home and abroad.
Electronics Engineering from Bangladesh Earlier in 1985 he completed his post-graduation
University of Engineering and Technology (BUET). in Management from Dhaka University. He also
After that he graduated in Chinese Language participated a training program titled Managing
from Beijing Language and Cultural University, at the top 2 (MATT-2) organized by Bangladesh
China in 1990. He completed his MBA Degree with Civil Service Training Centre in collaboration with
Gold Medal from American International University Department of International Development (DFID),
Bangladesh in 2009. In his professional career he
UK in 2012. He has 25 years of exposure in
served Bangladesh Army as workshop officer,
Government and Corporate Business environment.
Instructor Class ‘B’, Deputy Assistant Adjutant &
Quarter Master General & Interpreter (Chinese) of Engr. Minhajuddin Ahmed is
Project M-87, Group Officer, Officer Commanding, Member (Company Affairs)
Assistant Director (inspection and Technical of Bangladesh Power
Development) , Commandant, Director welfare Development Board (BPDB).
and rehabilitation and Director Electrical and
He is a Graduate in Civil
Mechanical Engineering in Army Head Quarter. For
Engineer from Bangladesh
his outstanding performance in service and use of
University of Engineering
indigenous method and local resource he received
and Technology (BUET). He
Chief of Army Staff Commendation with Medal (A
Highest Award from Chief of Army Staff). He was also did his M.Sc. in Civil
also served as General Manager (Planning and Engineering from BUET and MBA in Finance from
Training) and acting Deputy Managing Director Dhaka University. He has 36 years of experience.
Bangladesh Machine Tools Factory Ltd. He also He has specialization in project implementation in
participated in United Nations Peace keeping BPDB. He is currently Nominated Director of West
Mission in Mozambique as Workshop Platoon Zone Power Distribution Company Limited,
Commander in 1993.He was also Director of Trust Bangladesh-India Friendship Power Company
Bank Ltd., Trust Technical Training institute, (Pvt.) Ltd and Member of Bangladesh Energy and
Bangladesh Machine Tools factory Ltd., Power Research Council.
Bangladesh Diesel Plant Ltd., Trust Overseas
Engr. Selim Abed was
Recruiting Agency & Trust Bank Investment Ltd.
appointed as Director DESCO
under Bangladesh Army. He has around 36 years Board on March 24, 2014. He
of experience in different organization of is Deputy Secretary of
Bangladesh Army & Power Sector of Bangladesh. Government of the People’s
Republic of Bangladesh.
A.K. M. Humayun Kabir is a
Now he is Personal Secretary
Joint Secretary, Company to the Hon’ble State
Affairs, Power Division, Minister, Ministry of Power,
Ministry of Power, Energy Energy and Mineral
and Mineral Resources of Resource. He is also nominated Director of
the Government of the Karnaphuli Gas Distribution Company Ltd. As a
People’s Republic of BCS Cadre he served in field administration and
Bangladesh. He is an different Ministries for more than 23 years. He
Independent Director of got Post Graduate Degree in Business
DESCO Board and Chairman of the Audit Administration (MBA) from Institute of Business
Committee. He joined in DESCO Board on Administration (IBA), Dhaka University in 1992.
20 Annual Report 2016
Prior to that he did his B.Sc. in Agricultural Dr. Ahsan Akhtar Hasin is a
Engineering from Bangladesh Agricultural Professor, Department of
University in 1988. Industrial and Production
Engineering, Bangladesh
Engr. Ataul Mahmud is Vice University of Engineering
President (Service and and Technology (BUET). He
Welfare) of Institute of acted for four years as a
Engineers, Bangladesh (IEB). member of Board of
He appointed in DESCO Directors of Bangladesh
Board on June 20, 2014. He Council of Scientific and
is also Chairman of M & M Industrial Research (BCSIR), Ministry of Science
Engineering Ltd and Director and Technology. He has around 26 years of
of 3M (Pvt.) Ltd. He has experience in Education and Research in
completed his Graduation in Bangladesh, Thailand and Vietnam. He has
Engineering in Electrical and Electronics authored several books and chapters in books,
Engineering (EEE) from Bangladesh University of published from the USA and UK. His one of the
Engineering (BUET) in 1997 and obtained MBA research papers was awarded “The Best Research
Degree from Dhaka University in 2010. Paper” of that year in the world. He was the Head
of the Department and Director of Directorate of
Engr. Md. Rabiul Hasnat is a Continuing Education, BUET. In 1988, he completed
Business Entrepreneur. He is his graduation in engineering in Electrical and
an Independent Director of Electronics from Bangladesh University of
DESCO Board and member of Engineering and Technology (BUET). There after
the Audit Committee. He is in he completed M.Sc. in Industrial & Production
DESCO Board since June Engineering from Asian Institute of Technology,
20,2014. He is also the Thailand. He also completed his PhD from the
Managing Director of same Institute in the same subject. He joined in
Standard Construction Ltd. DESCO Board on June 20, 2014.
Rosh Ltd. Shorr Food and
Bakery Ltd. Ross Bohumukhi Firm Ltd. and Md. Anisur Rahman joined
proprietor of STADCO. in DESCO Board on August
14, 2016. He is holding the
He is the director of Real Estate and Housing position of Chairman, ATCO
Association of Bangladesh (REHAB) and chairman Limited for last five years.
of Building Development Committee. He completed He is ex-cadet of Barishal
his B.Sc. in Civil Engineering from Bangladesh Cadet College. He did his
University of Engineering and Technology B.A (1992) and M.A (1995)
(BUET). He holds the membership of BUET from Dhaka University. He
Alumni Association, Kurmitola Golf Club, REHAB, was involved with
Bangladesh Agro & Sweetmeat association etc. Bangladesh Students League since he was a
He has wide experience in the area of Government student of the university. Currently he is Assistant
and Corporate Event management. He has vast Secretary of Bangladesh Awami League Central
exposure in Real Estate sector, International Sub-Committee.
Trading, Engineering and Food business.
Management
22 Annual Report 2016
Mega watt
Government has a vision to supply electricity 377
to all with a reasonable and affordable cost by 400
2007 -08
2004-05
2001 -02
2013 -14
2015 -16
2010 -11
megawatt by 2030. Government aims to erect
Financial Year
9,560 Circuit Kilometer transmission line and 1 lac
Kilometer distribution line in this regard.
Substation Erected
Currently power production capacity of Bangladesh Companytries to be consistent with load growth
is approximately 15 thousand megawatt with over and capacity enhancement. As such it took
100 numbers of power plants (including captive various projects for capacity building. In FY 2015-
power plants). Power production has been 16 the company has completed two nos. 33/11 kV
enhanced from 220 kW to 371 kW per head per new substations and upgraded two nos. 33/11
year which is 69% higher than that of in year kV substations, as a result of which capacity
2009. Now 70% of population is under electricity enhanced to 120/168 (~160 MW Max)
facility which was 47% in the year 2009.
Source: Annual Report 2014-15 of Power Division Sl. No. Name of the Substation Capacity (MVA)
01 Purbachal 2x20/28
Industry Outlook
Power Sector of Bangladesh are segregated in three 02 BIHS Mirpur 3x20/28
type of companies according to their functions. 03
Augmentation of Baridhara 33/11
1x20/28 (10/14)
Power Generation responsibility lays on Bangladesh KV Substation to 20/28MVA
Power Development Board (BPDB) and its subsidiary 04
Augmentation of Tongi 33/11 KV
1x20/28 (10/14)
companies. There are several Independent or Private Substation to 20/28MVA
or Rental Power Producers companies including REB 120/168 MVA (160
Total Capacity Enhanced
who sell electricity to BPDB. MW Max)
An open Architectural Design competition was Estimated cost of the project is Tk. 128 (One
arranged through IAB (Institute of Architects Hundred and Twenty Eight) crore. And the project
Bangladesh) for selecting the design. Among 69 is expected to be completed within 2020.
(sixty nine) participants in the competition, the best
design was selected by the jury board comprised New Connections
of renowned architects and expert members. 52,021new connections have been added to our
system this year. With these new connections, the
The Head office building will be “Iconic” and total number of electric connections under DESCO
prestigious one with the state of the art facilities. stands at 760,844at the end of the financial year.
Highly Energy efficient, sufficient natural light
usage provision, safe & secure, sustainable and Categorywise Consupmtion Growth
symbolic to electricity distribution business. The 2015 -16 2185 1614 456 155
Complex shall be as per RAJUK approved layout 2014 -15 1993 1444 398 125
Financial Year
plan with well air ventilation system and there 2013 -14 1885 1351 383 103
shall be enough space to arrange comfortable 2012 -13 1714 1256 345 97
sitting arrangements for officers & staffs of 2011 -12 1563 1139 314 95
head office to carry out their official activities. 500 1000 1500 2000 2500 3000 3500 4000 4500
MKwh
Total land area of the building site is 40.25 katha Residential Industrial Commercial Others
3000
enhance the Consumer service. An initiative has
2000 been taken to enhance the DESCO established
1000
Meter Plant as a full-fledged Manufacturing Plant
to meet up not only the DESCO’s demand but
0 also the whole Country with export possibility in
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16
future.
Import Sales Fiscal Year
With a view to facilitating incessant supply of ADB funded Project 95,500 7,500 100,000
Pre-Paid meter in future, DESCO has set up a
“Meter Plant” at Mirpur on 2007. The company In this fiscal year DESCO has collected Tk.42.87
has manufactured 20,000 Single Phase and 3,000 crore under Uttara Sales & Distribution Tk.0.43
Three Phase Pre-Paid Meters. Around 29,000 crore under Uttarkhan Sales & Distribution
30 Annual Report 2016
Corporate Social Responsibility (CSR) at a nominal rate from the Ijtema Committee,
The ethos of DESCO for pursuing its activities provides support to the freedom fighters& the
in social arena has got further momentum with family of the National Poet Late Kazi Nazrul
continuous enthusiasm and support of the Islam and alsocontribution to other social
stakeholders. Besides running on commercial activities as decided by the Board from time to
basis, DESCO also recognizes some social time.
responsibilities such as collects electricity bills
Financial Results And Appropriation
The synergy of technical and commercial activities is reflected in the improved financial results of the
Company year to year as under:
Figures in Million Taka
Particulars 2015-16 2014-15 2013-14 2012-13 2011-12
Revenue from Operations 31,890 27,966 24,993 22,242 16,251
Cost of Sales 29,989 25,427 24,063 21,646 14,388
Gross Profit 1,901 254 931 595 1,863
Total Expenses (1960) (1,556) (1336) (1,090) (878)
Operating Profit/Loss (59) 983 (405) (495) 985
Financial Expenses (342) (333) (320) (325) (343)
Exchange Fluctuation (Gain/loss) 16 72 19 274 (758)
Non-Operating Income 985 1,268 1,633 1,674 1,282
Taxation (154) (356) (258) (323) (328)
Net Profit for the year 446 1635 669 805 839
Dividend (proposed) 39.8 568 688 748 650
Un appropriated profit carried 7,951 7,520 6,227 6146 6,324
forward
On the other hand reason for decrease of earnings are (1) Employee expense increase due to
increase of salary and implementation of pay structure and (2) Interest income decrease due to
decrease of interest rate and amount of FDR.
Net Asset Value Per Share 37.05 34.16 32.82 35.97 40.54
Capital Structure
35
32.82 34.16
Taka
3 30
2.43 2.34 25
2 1.94
20
1.12 2010-11 2011-12
1 2012-13
2013-14
2014-15
2015-16
0
2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 Financial Year
Financial Year
Distribution Of Shareholdings
Number of Shareholders on 30th June, 2016 stood at 7,509 nos.
Range of holding in numbers of Number of % of % of
Number of Shares
shares Shareholders Shareholders Share Capital
Share Capital 2,926 38.97 491,704 0.12
less than 501 Shares 2,926 38.97 491,704 0.12
501 to 5,000 shares 3,418 45.52 5,954,979 1.50
5,001 to 10,000 shares 482 6.42 3,389,628 0.85
10,001 to 20,000 shares 303 4.04 4,264,331 1.07
20,001 to 30,000 shares 101 1.35 2,476,334 0.62
30,001 to 40,000 shares 58 0.77 2,005,615 0.50
40,001 to 50,000 shares 38 0.51 1,731,310 0.44
50,001 to 100,000 shares 73 0.97 4,994,538 1.26
100,001 to 1,000,000 shares 94 1.25 23,828,500 5.99
Over 1,000,000 Shares 16 0.29 348,432,865 87.64
Total 7,509 100.00 397,569,804 100.00
and Production Engineering (IPE), BUET, (6) Mr. Un-audited 3rd Quarter Statement of Accounts
Minhajuddin Ahmed, Member (Company Affairs), for the fiscal year 2015-16.
Bangladesh Power Development Board (BPDB), (7) Review Revised Budget for the fiscal year
Mr. Md. Anisur Rahman, Chairman, ATCO Ltd. shall 2015-16.
continue to act as Directors of the Board.
Review Draft Budget for the fiscal year 2016-17.
Auditors
Attendance of the Audit Committee Meeting shown
M/S Artisan, BSEC Bhaban (Level 10), 102, Kazi
at Annexure 3
Nazrul Islam Avenue, Kawran Bazar, Dhaka-1215,
the existing statutory auditors of the Company Acknowledgement
shall retire in the AGM upon accomplishment of On behalf of the Board of Directors, I would like
audit of the company. They have expressed their to express my sincere gratitude to all honorable
willingness vide letter received on 01/11/2016 shareholders, the Power Division, Ministry of
to be re-appointed as statutory auditors of Power, Energy & Mineral Resources, Economic
the company for the financial year 2016-17 with Relations Division, Ministry of Finance, Ministry
reasonable increase in fees. of Planning, Power Cell, Bangladesh Power
Development Board (BPDB), Dhaka Power
Audit Committee
Distribution Company Ltd. (DPDC), Bangladesh
As a measure of ensuring transparency and
Rural Electrification Board (BREB), Power Grid
good Governance in its functional area DESCO
Company of Bangladesh (PGCB), concerned
has formed a 4-member Audit Committee of
Government Departments, Asian Development
the Board headed by Mr. A.K.M. Humayun Kabir,
Bank, World Bank, Bangladesh Securities and
Joint Secretary (Company Affairs), Power Division,
Exchange Commission (BSEC), Dhaka Stock
Ministry of Power, Energy & Mineral Resources.
Exchange Ltd. (DSE), Chittagong Stock Exchange
The other members of the Committee are (i) Engr.
Limited (CSE), ICB Securities Trading Company
Md. Rabiul Hasnat, Director, Real Estate & Housing
Limited, and other development partners for
Association of Bangladesh (REHAB) (ii) Mr. Md. Rofi
their continuous assistance, guidance and advice.
Uddin, Executive Director, Finance and Accounts,
I would also like to express my heartfelt thanks
DESCO and (iii) Engr. Zulfiqur Tahmid, Company
to all the employees of the company on behalf
Secretary, DESCO. The attendance record of the
of the Board of Directors for their sincere and
Audit Committee is shown at Annexure-IV. During
relentless efforts in performing their duties and
the Financial Year 2015-2016, the Audit Committee
responsibilities for prosperity and development of
held 11 (Eleven) meetings in which, among other
the company.
things, reviewed the followings:
In the end, I pray to the Almighty Allah that may
Draft Auditors Report & Audited Accounts of
the Company continue its performance gloriously
the Company for the fiscal year 2014-15.
throughout the years ahead.
Review the activities of the Internal Audit
Department of the company. On behalf of the Board of Directors,
Un-audited 1st Quarter Statement of Accounts
for the fiscal year 2015-16.
Un-audited half yearly Statement of Accounts
for the fiscal year 2015-16. Md. Mahbub-ul-Alam
Chairman, DESCO Board
Annual Report 2016 37
ANNEXURE-1 : Corporate Governance Guidelines Compliance
% of shares as on
Sl. No. Name Number of Shares
June 30, 2016
01. Bangladesh Power Development Board 293,104,259 73.72
02. Dhaka Electric Supply Authority 5,072,954 1.28
iii) Shareholding of CEO, CFO, Company Secretary and Head of Internal Audit
Number of % of shares as on
Sl. No. Name
Shares June 30, 2016
01. Chief Executive Officer and his spouse and minor children - -
02. Chief Financial Officer and his spouse and minor children 4,700 0.00118
03. Company Secretary and his spouse and minor children - -
04. Head of Internal Audit and his spouse and minor children - -
Hon’ble State Minister, Ministry of Power, Energy and Mineral Resources visited the exhibition on Design competition for
construction of DESCO Head office Building.
Location : Shilpakala Academy, Dhaka.
Ceremony for receiving ISO 9001:2008 Certificate for Quality Management System in DESCO from Bureau Veritas.
Location: Biddut Bhaban, Dhaka.
Monowar Islam, Secretary, Power Division, Ministry of Power Energy and Mineral Resources visited Baridhara S & D Division.
Annual Report 2016 43
ADB Country Director Mr. Kazuhiko Higuchi met the Management at DESCO Head Office.
Contract signing with LS system Ltd, Korea for high voltage Underground Inter Gride sub station Connectivity on Turnkey Basis.
44 Annual Report 2016
Contract signing with Hyosung Corporation, Korea for Construction of Grid Substations on Turnkey Basis.
Mr. Jonathan Shaw, Executive Director and Mr. Fazle Karim, Senior Program Specialist (Head of ITE), AIT Extension, Thailand
visited DESCO Head Office.
Best Customer of DESCO 2015 (Domestic) received the Award from Hon’ble State Minister. Ministry of Power, Energy and
Mineral Resources.
Annual Report 2016 45
DESCO Executives are answering the queries of the visitors at Electricity Fair 2015 at BICC, Dhaka.
Prize Distribution Ceremony for Annual Indoor Games. Signing of MoU with Institute of Architect, Bangladesh for
conducting Design Competition for selecting potential
consultant for construction of DESCO Head Office Building.
46 Annual Report 2016
ISO 9001:2008 Certification for Quality Management System 12th National Award for Best published Accounts and Reports – 2011
Certification body Bureau Veritas Certification Holding SAS - UK (First Prize,Service Sector Category)
Awarded by Institute of Chartered Accountants
Auditors’ responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with Bangladesh Standards on Auditing (BSAs).
Those standards require that we comply with ethical requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free from material
misstatements.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial statements. The procedures selected depend on the auditors’ judgment, including the
assessment of the risks of material misstatement of the financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control relevant to the entity’s
preparation and fair presentation of the financial statements in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of accounting estimates made by management, as
well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our qualified audit opinion.
50 Annual Report 2016
The valuation of those assets of Tk. 279 crore was not supported with any vendor agreement with
DESA .
Qualified Opinion
In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinion
paragraph, the financial statements give a true and fair view of the financial position of Dhaka
Electric Supply Company Limited (DESCO) as at 30 June 2016 and its financial performance and cash
flows for the year then ended in accordance with Bangladesh Financial Reporting Standards (BFRSs)/
Bangladesh Accounting Standards (BASs) and comply with the applicable section of Companies Act
1994, the Securities and Exchange Rules 1987 and other applicable laws and regulations.
1. We have obtained all the information and explanations which to the best of our
knowledge and belief were necessary for the purpose of our audit and made due
verification thereof;
2. In our opinion, proper books of account as required by law have been kept by the
Company so far as it appeared from our examination of those books;
3. The Company’s statement of financial position and comprehensive income along with
the annexed notes 1 to 44 dealt with by the report are in agreement with the
books of account ; and
4. The expenditure incurred and payments made were for the purposes of the Company’s
business.
ARTISAN
Chartered Accountants Dated: Dhaka, 23 October, 2016
Annual Report 2016 51
Dhaka Electric Supply Company Limited
Statement of Financial Position
As at 30 June 2016
Particulars Note 30 June 2016 30 June 2015
Taka Taka
Assets
Non Current Assets: 16,632,707,653 13,077,369,673
Property, Plant & Equipment 2 14,163,535,885 11,414,491,554
Capital Work -in- Progress 3 2,469,171,769 1,662,878,119
Current Assets: 28,096,500,621 25,465,786,914
Stores and Spares 4 7,622,034,713 3,683,150,440
Accounts Receivable 5 3,680,184,550 3,678,780,423
Advances & Security Deposits 6 623,388,963 2,106,756,139
Advance Income Tax 7 1,029,337,057 786,445,247
Cash and Cash Equivalents 8 15,141,555,339 15,210,654,665
Total Assets 44,729,208,274 38,543,156,587
Equity & Liabilities
Capital & Reserves: 14,724,191,733 12,933,033,214
Share Capital 17 3,975,698,044 3,786,379,090
Share Money Deposit 18 75,000,000 75,000,000
GOB Equity 19 2,722,140,000 1,552,140,000
Retained Earnings 20 7,951,353,689 7,519,514,123
The accounting policies and other notes from 1 to 44 and Annexure-A form an integral part of these Financial Statements.
Company Secretary Executive Director (F&A) Director Managing Director
Signed in terms of our separate report of even date annexed.
ARTISAN
Dated: Dhaka, 23 October, 2016 Chartered Accountants
52 Annual Report 2016
D. Cash & Cash equivalents increase /(decrease) during the year (69,099,326) (382,185,293)
E. Cash & Cash equivalents at the beginning of the year 15,210,654,665 15,592,839,958
F. Cash & Cash Equivalents at the Ending of the Year 15,141,555,339 15,210,654,665
The accounting policies and other notes from 1 to 44 and Annexure-A form an integral part of these Financial Statements.
Company Secretary Executive Director (F &A) Director Managing Director
Dated: Dhaka, 23 October, 2016 ARTISAN
Chartered Accountants
54
Dhaka Electric Supply Company Limited
Statement of Changes in Equity
For the year ended 30 June 2016 Figures in Taka
Share Money
Particulars Note Share Capital GOB Equity Retained Earnings Total
Deposit
Balance at 01 July 2015 3,786,379,090 75,000,000 1,552,140,000 7,519,514,123 12,933,033,215
Net profit for the year - - - 446,181,845 446,181,845
Priors year’s adjustment 37 - - - 553,614,584 553,614,584
Stock Dividend 189,318,955 - - (189,318,955) -
Cash Dividend - - - (378,637,909) (378,637,909)
Annual Report 2016
The accounting policies and other notes from 1 to 44 and Annexure-A form an integral part of these Financial Statements.
Company Secretary Executive Director (F &A ) Director Managing Director
Signed in terms of our separate report of even date annexed.
Dated: Dhaka, 23 October, 2016 ARTISAN
Chartered Accountants
Annual Report 2016 55
Dhaka Electric Supply Company Limited
Notes to the Financial Statements
For The Year Ended 30 June 2016
1. Legal Status & Nature of the Company, Significant Accounting Policies and other Relevant
Information:
All property, plant & equipment purchased by DESCO are recorded at cost considering
its purchase price and any directly attributable cost of bringing the assets to working
condition for intended use inclusive of inward freight, duties and non-refundable
taxes
1.4.2.1 Property, plant & equipment taken over from the Dhaka Electric Supply Authority
(DESA) in the Mirpur area have been valued at Tk.1, 271.194 million as per joint survey
report between DESA and DESCO, while those of Gulshan and Tongi areas have
been provisionally estimated by DESCO at Tk.1,998.92 million and Tk.795.04 million
respectively.
1.4.2.2 DESCO also took over two Grid Substations (Bashundhara and Uttara) from DESA at
provisional estimated cost of Tk.1, 245.71 million, including cost of land, as per Vendor
Agreement signed between DESCO and DESA.
1.4.2.3 Independent valuers had been appointed to physically verify and value the assets
56 Annual Report 2016
taken over by the company from DESA. The valuers have submitted their draft report
which has been placed by the management before the Board for finalization.
1.4.3 Depreciation:
1.4.3.2 The company has acquired 0.1532 acres land from National Housing Authority (NHA)
at Tk. 7.45 lac on 99 years lease in the year 2005. The amortization of the cost of this
land would have been Tk. 7,529/- per year, which would not have any ‘material impact’
on the profitability of the company, hence no amortization has been considered.
1.4.3.3 Full year’s depreciation is charged on assets acquired during the year and put into use
for six months and over, while no depreciation is charged on assets acquired for less
than six months during the year.
1.1.1.4 Depreciation on the assets taken over in Gulshan and Tongi area has been charged on
the value and economic life as provisionally estimated by DESCO.
(b) Other operating income arising from connection/disconnection fees, bills against
materials, meter-testing fees, LPC (Late Payment Charge) etc, are recognized on cash
basis.
Annual Report 2016 57
(c) Interest on short-term deposits (STD) and on FDR’s with banks is recognized as income
on cash basis
(b) Gratuity
The Company maintains a Gratuity Fund, approved by the NBR under Income Tax
Ordinance, 1984. Under the Gratuity Scheme, the company pays to a retired employee,
58 Annual Report 2016
having completed at least 3 (three) years of service, at the rate of two and half
months’ last drawn basic salary for every completed year of service. The company
pays to the fund for the liability at the end of each year considering the number of
years of service of employees eligible under the scheme.
The liability shown in the Balance Sheet does not reflect the present value of the
expected payments by the company’s retirement plan to existing and past employees
attributable to the service already rendered and is therefore not in compliance with
BAS 26.
1.13 Taxation:
(a) Current Tax
The tax currently payable is based on taxable profit for the year. Taxable profit differ
from net profit as reported in the income statement because it excludes items of
income or expenses that are taxable or deductable in other years and it further
excludes items that are never taxable or deductable. The Company’s liability for current
tax is calculated using tax rates that have been enacted or substantively enacted by
the balance sheet date.
02.01 Detail of addition & disposals of assets are shown in Annexure-1 attached.
3.00 Capital Work -in- Progress:
33/11KV OH/UG Cable Line (Note 03.01) 31,164,708 22,036,587
33/11Kv Sub- Station - Turnkey Project (Note 03.02) 1,829,391,183 1,520,013,362
33/11Kv Sub- Station - Turnkey Project (Note 03.02) 35,162,789 60,687,013
33/11Kv Sub- Station - Turnkey Project (Note 03.03) 377,038,235 -
Construction of Workshop Building & Others (Note 03.04) 196,414,854 60,141,157
Total 2,469,171,769 1,662,878,119
03.01 33/11kv overhead & under ground cable works are in progress at Mirpur, Gulshan and Tongi circle
respectively. The total contract price of the works is Tk. 121.80 million.
3.02 The Company entered into an agreement with Ideal Enterprise and Energypac to implement 8(Eight)
nos. 33/11Kv Sub -Station & 4 (Four) nos 33/11Kv Sub -Station under DESCO Fund . The total contract
price are Tk 1,503.31 & 805.00 million respectively.
3.03 The Company entered into an agreement with Hysung Corporation to implement 05(Five) nos.
33/11Kv Grid Sub -Station & 04 (Four) nos 33/11Kv Sub -Station under ADB Fund . (Including local
fund Tk.779.04 million) . The total contract price are Tk 5,843.08 million
3.04 Civil work under work in process at DESCO Mirpur area (Central Store, Kafrul Sub Station) & Tongi office
Building. The total contract price of the works is Tk.248.82 million.
4.00 Stores & Spares :
Stores & Spares (Note-04.01) 4,287,696,171 3,681,656,839
Stores in Transit (Note-04.02) 3,334,338,542 1,493,601
Total 7,622,034,713 3,683,150,440
04.01 Cost of Stores & Spares
Cable & Accessories 2,093,862,611 2,218,489,094
Pole & Pole fittings 299,057,085 257,170,204
Distribution transformers 739,788,997 326,132,952
Meter & Meter accessories 111,240,696 450,588,890
Sub-station equipment & spares 935,050,228 325,690,846
Tools, equipment & others 108,696,554 103,584,853
Total: 4,287,696,171 3,681,656,839
60 Annual Report 2016
4.02 This presented cost of materials, including L/C charge and Pre -Shipment- Inspection (PSI) expenses,
paid against imported materials for which post landing inspection (PLI) has not been completed.
4.03 Stores & spares have been valued at weighted average cost method.
2015-16 2014-15
Taka Taka
5.00 Accounts Receivable:
5.02 No provision has been arisen during this year, Companies provision policy is @ 0.5% of the receivable
amount outstanding at the balance sheet date,.
This balance has been arrived at as under:
Opening Balance 99,088,395 100% 99,088,395 116,704,084
Add: Adjustment 391,329,939 0.50% 1,956,650
Total Cumulative Provision 101,045,045 -
Opening Balance 116,704,084 -
Adjustment related to previous year (15,659,039) 116,704,084
B) Security Deposits:
Telephone/ Mobile 708,621 706,621
Telephone Shilpha sangstha ltd against rent of store 5,000,000 -
Dhaka & Gazipur City Corporation (against road cutting) 114,030,365 46,663,298
Dhaka WASA 10,411 10,411
Central Depository of Bangladesh (CDBL) 500,000 500,000
Bangladesh Railway, Roads and Highway 4,300,000 300,000
Security Deposit - RDA Building 173,087.00
Security Deposit - Others 2,261,681 1,034,150
Sub-Total: 126,984,165 49,214,481
Total (A+B) 623,388,963 2,106,756,139
06.01 Advance against goods & services includes Tk. 8.01 million paid to Bangladesh Power Development
Board for (BPDB) against purchase of spun pre-stressed concrete (SPC) poles and Tk.72.67 million paid
to Telephone Shilpa Sangtha for purchase of Prepaid Meter.
6.02 Prepaid expenses include Tk. 13.26 million paid to Saju Enterprise and Tk. 32.73 million paid to Mars
Syndicate and 42.96 million paid to KDA & RDA for infrastructure development of office building .
7.00 Advance Income Tax:
Income Tax paid for 2011-12 229,237,646 229,237,646
Income Tax paid for 2012-13 219,823,570 219,823,570
Income Tax paid for 2013-14 204,168,639 204,168,639
Income Tax paid for 2014-15 133,215,392 133,215,392
Income Tax paid for 2015-16 (Note-07.01) 242,891,810 -
Closing Balance 1,029,337,057 786,445,247
07.01 Advance Income Tax paid during the year:
This arrived at as under:
Deducted at source (on interest on FDR & STD) 96,798,574 124,738,340
Deducted at source (on imported materials) 145,295,557 7,726,852
Income tax paid for FY 2015-16 797,679 750,200
242,891,810 133,215,392
8.00 Cash & Cash Equivalents:
Imprest cash with S&D divisions 1,842,333 1,842,333
Cash at banks (Note-08.01) 15,139,713,006 15,208,812,332
Total: 15,141,555,339 15,210,654,665
62 Annual Report 2016
2015-16 2014-15
Taka Taka
8.01 Cash at Banks:
Current account (revenue collection) (Note 08.01.01) 3,481,648,275 2,777,144,351
Current account (VAT) 252,423,001 179,066,731
STD accounts 1,505,056,405 2,260,829,742
Fixed Deposit Receipts (FDR) (Note 08.01.02) 9,900,585,325 9,991,771,508
This represents collection for the last one months, by the different collecting banks, which has been
08.01.01 transferred to the Company’s main account in the next month.
8.01.02 Fixed Deposit Receipts include Tk.37.41 million (2014-2015 :Tk 67.69) in ICB Islamic Bank Ltd. (former
Oriental Bank Ltd.) which is subject to phase wise withdrawal restriction imposed by Bangladesh Bank
under the reconstruction scheme. An amount of Tk 30.27 million has been realized during the year. As
per Bangladesh Bank reconstruction scheme balance amount will be realized by 2017.
10.01 This includes as payable Tk 60.69 million to M/S South China Electric Co. Ltd. against supply of
Transformer.
12.01 This represents provision at 0.05% of net sales value as “annual system operating fees” payable to
Bangladesh Energy Regulatory Commission (BERC) as per BERC rules.
2015-16 2014-15
Taka Taka
13.04 GOB Loan ( No: 1505 & 1731)
Opening Balance 32,605,241 64,778,527
Transferred from long term loan - -
32,605,241 64,778,527
Paid during the year 32,173,286 32,173,286
Closing Balance 431,955 32,605,241
15.01 This represent loan received from Rupali Bank ltd for lease payment and paid during this year against 19.5
biga land from RAJUK.
Authorized:
500,000,000 No. ordinary shares @ Tk. 10 each 5,000,000,000 5,000,000,000
7,500,000 No. Ordinary shares @ Tk 10 each, fully paid up in cash 75,000,000 75,000,000
11,961,9400 No. Ordinary shares@ Tk.10 each for consideration 1,196,194,000 1,196,194,000
Against Mirpur area assets taken over from DESA/BPDB
217,096,881 Nos Ordinary shares @ Tk.10 each issued as Bonus 2,170,968,810 2,170,968,810
34,421,628 Nos Ordinary shares @ Tk.10 each issued as Bonus 344,216,280 344,216,280
18,931,895 Nos Ordinary shares @ Tk.10 each issued as Bonus 189,318,954
397,569,804 No. of shares ,Tk. 10 each 3,975,698,044 3,786,379,090
66 Annual Report 2016
2015-16 2014-15
Taka Taka
18.00 Share Money Deposit:
The amount was received from DESA against shares of the company which have not yet been issued.
(i) This represents dollars amount drawn to date translated at exchange rate prevailing at balance sheet
date for import of materials/ equipment for 9th Power Project under the Subsidiary Loan Agreement
(SLA) entered into between the company and the Govt. of Bangladesh (GOB). The primary loan agreement
is between the ADB and the GOB.
(ii) According to the terms of the agreement the Principal amount of the subsidiary loan repayable by DESCO
and the Government under this agreement shall be in local currency equivalent, determined at official rate
of exchange prevailing on the date of repayments. The principal amount of the subsidiary loan is repayable
in 25 years including a grace period of 5 (five) years in 40 ( forty) consecutive semi- annual installments as
per Amortization Schedule. The installment is payable on a semi-annual basis (i.e. June 15 and December
15 in each year). The foreign exchange risk on the outstanding amount of loan shall be borne by DESCO.
(iii) The company shall pay to the Government in local currency interest at the rate of 4% per annum on the
local currency equivalent, determined at the official rate of exchange prevailing on the date of each interest
payment of the principal amount of the Loan relent to DESCO disbursed and outstanding from time to time
The interest is payable semi- annually on June 15 and December 15 , each year).
(iv) The term of the project under which the loan was sanctioned expired on 30th June, 2004.
68 Annual Report 2016
(i) This represents dollars amount drawn to date translated at exchange rate prevailing at balance sheet date
for import of materials/ equipment for 10th Power Project under the Subsidiary Loan Agreement (SLA)
entered into between the Company and the Govt. of Bangladesh (GOB), the primary Loan agreement being
between the ADB and the GOB.
(ii) As per the terms of the Agreement the principal amount of the subsidiary Loan repayable by DESCO to the
Government shall be in local currency equivalent, determined at official rate of exchange prevailing on the
date of repayment . The principal amount of the subsidiary loan is repayable in 20 years including a grace
period of 4 years in 32 consecutive semi- annual installments on a semi-annual basis (i.e. January 15 and
July 15 in each year). The foreign exchange and interest rate risks are to be borne by DESCO during the
repayment period of 20 years.
(iii) DESCO shall pay interest to the Government in local currency interest at the rate of 4% per annum on the
local currency equivalent, determined at the official rate of exchange prevailing on the date of each interest
payment of the principal amount of the loan relent to DESCO disbursed and outstanding from time to time.
The interest is payable on semi-annual basis, (i.e. January 15 and July 15, in each year).
(iv) The term of the project under which the loan was sanctioned expired on 30th June, 2006.
21.03 Loan from ADB (No - 2332 BAN, Sustainable Power sector Development Project)
(i) This represents dollars amount drawn to date translated at exchange rate prevailing at balance sheet date
for import of materials/ equipment for Sustainable Power Sector Development Project under the Subsidiary
Loan Agreement (SLA) entered into between the Company and the Govt. of Bangladesh (GOB), the primary
loan agreement being between the ADB and the GOB.
(ii) As per the terms of the Agreement the principal amount of the subsidiary Loan repayable by DESCO
to the Government shall be in local currency equivalent, determined at official rate of exchange rate
prevailing on the date of repayment . The principal amount of the subsidiary loan is repayable in 20
years including a grace period of 5 years in 30 consecutive semi- annual installments (i.e. May 1 and
November 1 in each year). The foreign exchange and interest rate risks are to be borne by DESCO
during the repayment period of 20 years.
Annual Report 2016 69
(iii) DESCO shall pay interest to the Government in local currency at the rate of 4% per annum. Such
interest shall be calculated on the total principal amount outstanding of the subsidiary loan. The
interest is payable on semi-annual basis, (i.e. May 1 and November 1, in each year).
(iv) The term of the project under which the loan was sanctioned expired on 30th June, 2013
2015-2016 2014-2015
US $ Taka US $ Taka
Opening Balance 4,811,997 378,944,725 - -
Add: Received 43,038,435 3,374,213,276 4,811,997 378,919,407
47,850,431 3,753,158,001 4,811,997 378,919,407
Less Transfer to current Liability - - - -
47,850,431 3,753,158,001 4,811,997 378,919,407
Exchange (Gain)/ loss - (1,684,199) - 25,319
Closing Balance 47,850,431 3,751,473,802 4,811,997 378,944,725
(i) This represents dollars amount drawn to date translated at exchange rate prevailing at balance sheet
date for import of materials/ equipment for Power System Expansion and Efficiency Improvement
Investment Program (tranche-2) project under Subsidiary Loan Agreement(SLA) entered into between
the Company and the Govt. of Bangladesh (GOB), the primary loan agreement being between the ADB
and the GOB.
(ii) As per the terms of the Agreement the principal amount of the subsidiary Loan repayable by DESCO
to the Government shall be in local currency equivalent, determined at official rate of exchange rate
prevailing on the date of repayment . The principal amount of the subsidiary loan is repayable in 20
years including a grace period of 5 years in 30 consecutive semi- annual installments (i.e. May 15 and
November 15 in each year). The foreign exchange and interest rate risks are to be borne by DESCO
during the repayment period of 20 years.
(iii) DESCO shall pay interest to the Government in local currency at the rate of 4% per annum. Such
interest shall be calculated on the total principal amount outstanding of the subsidiary loan. The
interest is payable on semi-annual basis, (i.e. May 15 and November 15, in each year).
(iv) The term of the project under which the loan was sanctioned will expire on 30th June, 2019
2015-16 2014-15
Taka Taka
21.05 Loan from GOB (No. 1505 & 1731)
(ii) The loan carries interest at 3% p.a, and is repayable as per Debt Service Liability (DSL) schedule
provided by the Government.
2015-16 2014-15
Taka Taka
21.06 Loan from GOB (loan No 2332)
(i) This represents 40% of the amount released to the Company by the Government under Annual
Development Program (ADP) to enable the Company to pay the customs duty & VAT on material/
equipment imported by the company under the ADB Loan, as well as to meet other project related
expenses . The balance 60% is accounted for under “ GOB Equity”. The loan is repayable in 30
installments starting from 2013 after a grace period of 5 years.
(ii) The loan carries interest at 3% p.a, and is repayable as per Debt Service Liability (DSL) schedule
provided by the Government.
Opening Balance
Add: Withdrawn 780,000,000 -
780,000,000 -
Less: Transfer to Loan:3087 - -
Less: Transfer to current liability -
Closing Balance 780,000,000 -
(i) This represents 40% of the amount released to the Company by the Government under Annual
Development Program (ADP) to enable the Company to pay the customs duty & VAT on material/
equipment imported by the company under the ADB Loan, as well as to meet other project related
expenses . The balance 60% is accounted for under “ GOB Equity”. The loan is repayable in 30
installments starting from 2020 after a grace period of 5 years.
(ii) The loan carries interest at 3% p.a, and is repayable as per Debt Service Liability (DSL) schedule
provided by the Government.
25.01 This represents application fee, disconnection / reconnection fees, cost of materials realized, meter testing fees,
meter rent etc.
26.00 Energy Purchase:
2015-2016 2014-2015
Unit (kwh) Taka Unit (kwh) Taka
4,795,115,212 28,956,565,428 4,320,976,096 24,344,811,425
26.01 Electricity is purchased solely from Bangladesh Power Development Board (BPDB) at the rate of Tk 5.85/ kwh effective
from 1st September -2015. The company also pays wheeling charge to Power Grid Co. Ltd (PGCB) at Tk 0.2791 per kwh.
72 Annual Report 2016
2015-16 2014-15
Taka Taka
27.00 Operating Expenses:
Commercial operation support services 149,557,243 145,113,827
Schedule & preventive maintenance 224,133,847 209,394,533
Special action team & collection drive 1,195,688 874,361
Consultancy fees for staking sheet 4,323,962 1,814,577
Maintenance of distribution of line & equipment 142,043,209 46,109,149
R&M of grid sub-station/sub-station 42,432,692 43,388,115
Repair & maintenance of transformer 11,378,597 60,312,508
Meter & service cable issue 5,625,264 84,163,470
Revenue stamp charge against consumer bill 64,608,135 59,588,716
System operating fee BERC ( Note 27.01) 15,630,044 13,679,075
660,928,680 664,438,331
Less: Receipt against deposit work 285,419,602 282,112,681
Total 375,509,078 382,325,650
27.01 This represents provision at 0.05% of net sales value as “annual system operating fees” payable to Bangladesh Energy
Regulatory Commission (BERC) as per BERC rules.
28.00 Administrative Expenses:
Directors’ Remuneration (Note 28.01) 1,362,125 1,345,500
Audit fees 270,000 270,000
Advertisement & Notices 7,792,011 6,257,053
Annual General Meeting (AGM) 3,052,136 2,879,507
Bank charges 4,582,065 3,898,399
Conveyance 1,886,838 1,951,169
Cleaning expenses 5,839,012 5,333,470
Electricity, gas & water 27,811,826 26,736,776
Entertainment 4,659,468 3,783,511
Fuel for vehicles 25,366,423 24,439,770
Honorarium to various committee members 1,298,850 511,750
Insurance of vehicles 2,225,984 2,568,490
Legal & Professional fees 6,740,005 5,479,226
Newspaper & Periodicals 455,803 437,563
Office maintenance 3,804,155 2,687,348
Office rent 46,103,438 37,506,630
Office security 36,742,979 36,786,003
Postage, telephone & internet 9,590,533 9,602,658
Printing & Stationery 24,059,785 24,450,765
Rates & Taxes 2,205,518 1,205,709
Repair & Maintenance of non operating assets 8,559,657 5,881,292
Repair & Maintenance of head office building 10,127,400 4,542,010
Repair & Servicing of vehicle 12,742,507 9,531,664
Recruitment expenses 6,654,397 384,192
Inspection survey & consultancy fees 1,560,573 1,286,307
Staff training 29,136,453 17,511,227
Listing fee & annual charges 2,263,018 3,767,298
Transport (hired) 25,842,810 25,657,651
Corporate Social Expenses 17,026,304 8,596,573
BERC license fee 2,557,500 2,500,000
Office shifting 240,754 46,867
Total: 332,560,327 277,836,378
28.01 Directors are entitled to a remuneration of Tk 5,000/- up to 23.01.16 & Tk. 7500/- from 24.01.16 for attending each
Board meeting.
Annual Report 2016 73
2015-16 2014-15
Taka Taka
29.00 Employee Expenses:
2015-16 2014-15
Taka Taka
Directors Executives Directors Executives
Salary and bonus 8,496,801 231,753,977 4,561,662 183,940,770
House rent 2,166,284 77,130,481 1,619,831 79,142,622
Provident fund 473,257 12,863,767 323,967 13,182,732
Total 11,136,342 321,748,225 6,505,460 276,266,124
29.02 Telephone bills and medical expense are reimbursed on actual basis to employees, subject to ceiling.
30.00 Interest Income:
Interest earned on FDR 873,196,599 1,129,847,378
Interest earned on STD 88,907,834 100,965,984
Total 962,104,433 1,230,813,362
31.00 Interest Expenses:
Interest expense against ADB loan 323,699,130 294,405,622
Interest expense against GOB loan 12,261,154 9,496,467
Interest expense against SOD loan (Rupali Bank) 5,564,496 28,615,571
Total 341,524,780 332,517,660
Exchange fluctuation gain of Tk. 16,112,606/- has arisen out of translation of foreign currency loan (in dollar) into
taka at Financial Position date at the rate of Tk.78.40/$1 (2014-15: at Tk.78.75/$1).
33.00 Miscellaneous Income:
Sale of tender documents 103,000 200,000
Sale of obsolete store materials and Others 23,001,127 37,472,828
Total 23,104,127 37,672,828
34.00 Depreciation:
Depreciation (operating) 656,993,375 699,960,243
Depreciation (non operating) 45,067,063 43,761,182
Total 702,060,438 743,721,425
35.00 Income Tax :
Current tax provision (35.01) (29,176,670) 424,858,698
Deferred tax provision (35.02) 183,579,386 (69,271,625)
Tax Expenses 154,402,716 355,587,073
74 Annual Report 2016
2015-16 2014-15
Taka Taka
35.01 The Company’s income tax assessment up to the FY 2010-2011 ( AY 2011--2012) has been completed and agreed
upon. The details of current tax calculation are given below:
Profit before tax as per income statement 600,584,561 1,990,459,182
Add: Accounting depreciation 702,060,438 743,721,425
Add: Bad debt Provision - 17,615,689
Add: Corporate Social Expenses (CSR) 17,026,304 8,596,573
1,319,671,303 2,760,392,869
Less: Depreciation as per 3rd Schedule of Tax Ordinance,1984. (1,436,377,984) (1,060,958,079)
(116,706,681) 1,699,434,791
Current Tax (at 25%) (29,176,670) 424,858,698
Current tax expenses (29,176,670) 424,858,698
35.02 Deferred Tax Provision:
Opening Balance 1,744,550,218 1,813,821,843
Provision for the year 183,579,386 (69,271,625)
Closing Balance 1,928,129,606 1,744,550,218
38.00 Subsequent Events-Disclosures Under IAS 10 “Events After The Balance Sheet Date”.
Proposed Dividend
38.01 Subsequent to the repoting date, 30th June, 2016, the Board of Directors in their meeting held on 20 October,
2016 recommended 10% cash dividend (Tk . 1 per ordinary share of Tk.10 each held on record date) amounting to
Tk. 39,75,69,804.00 for the year ended June 30, 2016. The dividend proposal is subject to shareholders’ approval
at the forthcoming 20th AGM.
Annual Report 2016 75
38.02 Except the fact stated above, no circumstances have arisen since the Financial Position date which
would require adjustment to, or disclosure in, the financial statements or notes thereto.
39.00 Related Party Transactions:
DESCO Purchased / Received energy and materials from the following related parties in the normal
39.01
course of business:
39.02 DESCO has following outstanding balances with the related parties:
2015-16 2014-15
Name of Taka Taka
Party
Receivable Payable Receivable Payable
40.02 An aggregate amount of Tk. 50,038,501/- claimed by BPDB as shown below is disputed by the Company.
Particulars 2015-2016
No credit facility existed under any contract as on June 30, 2016 other than trade credit available in the ordinary
course of business.
The Company has entered into various contracts for construction works, sub-stations, land development
installation, renovation dismantling O/H and U/G cables, etc. amounting to Tk 10939.01 million , works of which
will be started in the next financial year.
“b) Employment for a part of the year and in receipt of remuneration Nil Nil
aggregating Tk 3,000 or less per month.”
Total: 1502 1,497
44.00 General :
Previous year’s figures have been re-arranged, wherever necessary, to confirm to current year’s presentation to
facilitate comparison.
Notes:
1) Building includes Office Building, Store Godown Sheds and Boundary Wall.
2) Office Equipment comprise Communication Equipment , Computer & Peripherals , Electric and Store Equipment etc.
3) Addition to Distribution Line and Equipment includes 873.572 Km Conductor and 788.057 Km Service Cable etc.
4) Addition to Motor Vehicle Includes 10nos motor cycle and 1 no of Pickup
Annual Report 2016
77
78 Annual Report 2016
Certificate of Compliance
To the best of our information and according to the explanations given to us, we certify
that, as reported on the attached status of compliance statement, Dhaka Electric Supply
Company Limited has complied with the conditions of corporate governance stipulated in
the above mentioned BSEC notification dated August 07, 2012 as amended by
notification dated July 21, 2013.
Dhaka Office : Paramount Heights (7th Floor, D2), 65/2/1 Box Culvert Road, Purana Paltan, Dhaka- 1000, Phone : 9553449, FAX : 9551128, E-mail : rma@dhaka.net
Chittagong Office : Taher Chamber (2nd Floor), 10 Agrabad C/A, Chittagong, Bangladesh. Phone : 725314, E-mail : rmactg@gmail.com
Annual Report 2016 79
CORPORATE GOVERNANCE COMPLIANCE REPORT
Status of compliance with the conditions imposed by the Securities and Exchange Commission’s
Notification No. SEC/CMRRCD/2006-158/134/Admin/44 dated 07 August 2012.
Compliance Status
Condition No.
(Put in the
appropriate Remarks
Title column) (if any)
Not
Complied
Complied
1 Board of Directors
Compliance Status
Condition No. (Put in the
appropriate Remarks
Title column) (if any)
Not
Complied
Complied
Compliance Status
Condition No. (Put in the
appropriate Remarks
Title column) (if any)
Not
Complied
Complied
Chief Financial Officer(CFO), Head of Internal Audit (HIA)
2.0 and Company Secretary(CS)
Appointment:
The company shall appoint a Chief Financial Officer (CFO), a Head of
Internal Audit (Internal Control and Compliance) and a Company Secretary
2.1 (CS). The Board of Directors should clearly define respective roles,
responsibilities and duties of the CFO, the Head of Internal Audit and the
CS
Compliance Status
Condition No. (Put in the
appropriate Remarks
Title column) (if any)
Not
Complied
Complied
Tariff Rate
Bulk Purchase Tariff
Present Tariff
SL.No Tariff Category Level
( from September 01, 2015) Taka/KWH
132Kv 5.68
01 BPDB to DESCO (for energy)
33Kv 5.85
g) Flat 7.66
3 Small Industries - C h) Off-peak hour 6.90
i) Peak hour 9.24
j) Flat 9.80
5 Commercial & Office- E k) Off-peak hour 8.45
l) Peak hour 11.98
m) Flat 7.57
6 Medium Voltage – F (11 KV) n) Off-peak hour 6.88
o) Peak hour 9.57
p) Flat 7.49
7 High Voltage – H ( 33 KV) q) Off-peak hour 6.82
r) Peak hour 9.52
PROXY FORM
I/We...........................................................................................................of.............................................................................................................
.......................................... being a member of Dhaka Electric Supply Company Ltd. (DESCO) herby appoint
Mr./Mrs./Miss……………………………………………….……………………..……………….……........................................................................
Address………………….……………………...……………………………………………………………. as my/our proxy to vote for me/us on my/
our behalf at the 20th Annual General Meeting of the Company to be held on Saturday, 07 January, 2017 at
10 am and at any adjournment thereof.
Date:……………………………
Date:………….........
Note: The proxy form should reach the Corporate Office of the Company not less than 72 hours before the
time fixed for the meeting i.e. not later than January 5, 2017 within office hours. The proxy form must contain
revenue stamp of TK 20 as per Stamp Act.
Signature Verified
Authorized Signature
Registered Office:
POWER IS YOURS 22/B, Faruk Sarani, Nikunja-2,
Dhaka Electric Supply Company Limited
Khilkhet, Dhaka-1229.
ISO 9001:2008 Certified
Visit us at : www.desco.org.bd
ATTENDANCE SLIP
I hereby record my attendance at the 20th Annual General Meeting being held on Saturday, the January 07,
2017 at 10 am at PSC Convention Hall, Police Staff College, Mirpur-14, Dhaka-1216, Bangladesh
BO ID NO: ……………………………………………………………........................
Signature………………………………………………………………..
Date: …………………………………………………………………….
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DESCO Service Area
S & D Wise
DESCO Map
Tongi (West)
Tongi (East)
Uttar Khan
Uttara West
Purbachal
Dakshin Khan (Proposed)
Uttara East
Pallabi
Rupnagar
Baridhara
Joarshahara
Kafrul
Monipur
Shah Ali on
i
Agargaon Gulshan
Badda