CHENNAI: In a bid to improve its financial position and transparency, Tangedco is adopting Indian Accounting Standards (IND-AS) and submitting its balance sheet for 2020-21 in accordance with it.
This is the first time Tangedco will be adhering to standardised accounting practices since its registration under the company’s act in 2010.
By aligning with Indian Accounting Standards, Tangedco aims at enhancing its market standing and gain support from financial institutions that provide loans to the utility. The expected outcome is a potential reduction in the utility’s interest rates, resulting in substantial annual savings of around Rs 500 crore.
Tangedco’s move reflects its commitment to improving financial stability and creating a favourable economic climate for its operations, a senior official said. “The main objective of IND-AS is to ensure the provision of high-quality, transparent and comparable information across all periods. It also serves as a suitable foundation for accounting in accordance with IND-AS,” he said.
He added that since the formation of the Tamil Nadu Electricity Board, the utility had followed the Electricity Act. However, in 2010, TNEB was registered under the company’s Act. From fiscal year 2017-18, the power utility was required to adopt the IND-AS system.
However, it had not implemented the accounting standard and prepared its balance sheets based on the Electricity Act. The Comptroller and Auditor General in its reports had also noted this several times. Another official said the process of transition began in 2022 and has reached the final stage.