Compliance Financial Performance
Maharashtra

Report of 2009 - Financial Audit on Commercial of Government of Maharashtra

Date on which Report Tabled:
Fri 23 Apr, 2010
Date of sending the report to Government
Government Type
State
Sector Finance,Transport & Infrastructure,Power & Energy,Industry and Commerce,Art, Culture and Sports,Social Welfare,Social Infrastructure

Overview

Audit of Government companies is governed by Section 619 of the Companies Act, 1956. The accounts of Government companies are audited by Statutory Auditors appointed by CAG. These accounts are also subject to supplementary audit conducted by CAG. Audit ofStatutory corporations is governed by their respective Legislation. As on31 March 2009, the State of Maharashtra had 61 working PSUs (57 Companies and four Statutory corporations) and 24 nonworking PSUs (all Companies), which employed 2.02 lakh employees. The working PSUs registered a turnover of Rs 35,495.23 crore in 2008-09 as per their latest finalised accounts. This turnover was equal to 5.09 per cent of the State GDP indicating an important role played by the State PSUs in the economy. The working PSUs earned overall profit of Rs 545.55 crore in 2008-09; however they had accumulated losses of Rs 5,768.17 crore as on 31 March 2009.

As on 31 March 2009, the investment(Capital and long term loans) in 85 PSUs was Rs 47,268.03 crore. It grew by 103.98 per cent from Rs 23,172.65 crore in 2003-04 mainly because of increase in investment in power sector. Power Sector accounted for 79.37 per cent of the total investment in 2008-09. The Government contributed Rs 3,965.84 crore towards equity, loans and grants/subsidies during 2008-09.During the year 2008-09, out of 61 working PSUs, 34 PSUs earned profit of Rs 1,274.91 crore and 22 PSUs incurred loss of Rs 729.36 crore. Four PSUs prepared their accounts on no profit no loss basis and one PSU was under construction and had not prepared profit and loss account.

The major contributors to profit were Maharashtra State Power Generation Company Limited (Rs 479.08 crore),Maharashtra State Electricity Transmission Company Limited (Rs 356.11 crore), Maharashtra State Road Transport Corporation (Rs 159.23 crore), Maharashtra State Electricity Distribution Company Limited (Rs 121.22 crore). The heavy losses were incurred by MSEB Holding Company Limited (Rs 339.88 crore) and Maharashtra State Road Development Corporation Limited (Rs 337.59 crore). The losses are attributable to various deficiencies in the functioning of PSUs. A review of three years Audit Reports of CAG shows that the State PSUs losses of Rs 3,396.06 crore and infructuous investments of Rs 125.25 crore were controllable with better management. Thus, there is tremendous scope to improve the functioning and minimise/eliminate losses. The PSUs can discharge their role efficiently only if they are financially self-reliant. There is a need for professionalism and accountability in the functioning of PSUs.

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