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Auditors find mistakes in EVN’s annual report   2008-11-27 - Thanh Nien

State auditors have found inconsistencies in the earnings report submitted by Electricity of Vietnam (EVN) after auditing the corporation’s financial records for 2007.

 

 

The State Auditor or said EVN’s reporting of revenues resulting from an increase in electricity prices ratified by the government in December 2006 was VND640 billion (US$37.69 million) lower than what auditors had calculated.

Auditors said the revenues in question should be around VND3.4 trillion ($200.23 million) instead of VND2.76 trillion ($162.54 million) as reported.

As a result, EVN’s total pre-tax profit for 2007 is VND4.37 trillion ($264.85 million), and total revenues are VND58.2 trillion ($3.53 billion), or 29.57 percent higher than that of 2006.

Auditors also calculated the corporation’s total assets to be VND185.2 trillion ($11.2 billion).

The State Audit said EVN could have lowered expenses by reducing electricity losses and better managing personnel, equipment and materials.

“They should strive their best to reduce these costs,” said Chief Auditor Vuong Dinh Hue.

Hue said if EVN could manage to reduce electricity losses to 8 percent by 2010 – as previously targeted in a project for the 2004-2011 period – it would save about VND1.4 trillion ($84.85 million). Such losses amounted to 6.91 billion kWh, or 10.56 percent, in 2007.

The chief auditor also recommended EVN to concentrate on electricity production rather than other businesses.

The firm has invested VND3.59 trillion ($217.58 million), or 7.2 percent of its total capital, in other fields including telecommunications, banking, stocks and insurance.

“That sum is enough to build a thermo-electricity plant with a capacity of 50MW,” Hue noted.

EVN is a state-owned monopoly which controls all of Vietnam’s transmission grids and power retailers, including Hanoi Electricity Company and Ho Chi Minh City Electricity Company.



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