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INTERNSHIP REPORT ON MEPCO (WAPDA) MEPCO CIRCLE MULTAN Internship report submitted to the Bahaudin Zakariya University to fulfill the requirements of M.Com Degree BY M.Com Roll No. 18 Session: 2008-2010 COORDINATOR Prof: Khawaja Shaber APPROVAL SHEET
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Page 1: my report

INTERNSHIP REPORT ON

MEPCO (WAPDA)

MEPCO CIRCLE MULTAN

Internship report submitted to the Bahaudin Zakariya University to

fulfill the requirements of

M.Com Degree

BY M.Com

Roll No. 18

Session: 2008-2010

COORDINATOR

Prof: Khawaja Shaber

APPROVAL SHEET

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INTERNSHIP REPORT ON MEPCO

SUPERVISED BY -----------------------------

DESIGNATION -----------------------------

SIGNATURE -----------------------------

EXTERNAL EXAMINER

NAME -----------------------------

DESIGNATION -----------------------------

SIGNATURE -----------------------------

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PREFACE

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INTERNSHIP REPORT ON MEPCO

Genius makes its observations in short hand; talent writes them out at length.” 

          Christian Novell

As mentioned by the above quotation observing and on site viewing are very firm base for learning. We learn a lot more by seeing theories, we read in books, applied practically by the

pros and by seeing how they actually put them to work.

If we over the significance of internship program then we will be able to bare the facts that internship enhance ones practical loom towards work and provide maximum chances for learning, which will obviously help out candidate in the practical fields. The intention about internship program is that the students can analyze, observe, feel, examine the organization environment and equip themselves with the tools to face the ever shifting challenges in the organizations. In short internship plays a pivotal role in the future sensation & stir of the candidate.

This Report is specially meant for the student of M.com. It is concerned to a brief study of the operation, Function, tasks and services of MEPCO.

The effective system at MEPCO was a piece of art and to see it in working process was a treat itself. 

MEPCO has fine organizational structure and a well defined fully working effective system that helps and aids managers to do their jobs at best. Our knowledge was further enlightened when we had some of the lectures from the senior managers of MEPCO, they knew quite a lot about the organization and the subject and they left no stone unturned.

In preparation of this Report is have tried my best to provide all Possible information about the operation, function and tasks of MEPCO in brief and comprehensive form. It also includes a brief department worked during internship. I have also tried my best to use simple and easy words and language.

This report is an entire work of my first step of practical work about MEPCO operations & practices. In my view it is a credible and comprehensive compilation of facts. In this report I wrote principally on the issues pertaining to job duties & responsibilities, operations & practices and its future prospects with some recommendations.

When the time came to give this information a convenient shape I was confronted with a view of what to put in. One leeway was to include all details with explanation & second preference was to point out some worthy issues with some details. Last solution looked more practicable to me therefore I opt for second solution i.e. to present some relevant feasible details. These details entail information about management philosophy, practices, and functions, strong and weak areas of MEPCO.

I take this opportunity to express my gratitude to all who helped me in the preparation of this valuable report.

Then internship report ends with some recommendation after identification of some problems observed during the course of internship.

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INTERNSHIP REPORT ON MEPCO

All praise to Almighty Allah, the most merciful and compassionate, who gave me skills and abilities

to complete this report successfully.

I am grateful to my parents who are always been a source of encouragement for me throughout

my life and from start to the end of this report. I am thankful to all MEPCO STAFF who helped me

gathering data and collecting lectures.

I found everyone very co-operative and helpful for providing me the theoretical as well as practical

knowledge about the functions and operations of the MEPCO.

The whole MEPCO Team that helped me by providing all the needed information I needed to compl

ete 

this report. 

Sadaf Javed

M. Com

Govt. Commerce College Multan

Session 2008 - 2010

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ACKNOWLEDGEMENT

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DEDICATION

I dedicate my work to firstly MUHAMMAD (S.A.W.W) and also my most respectable parents and teachers whom prayers and hard work made me able to have such an opportunity of

working in the Government Sectors and get experience.

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EXECUTIVE SUMMARY

“Experience is not what happens to you, it is what you do with what happens to you.” -Aldus Huxley

I judge my time spent at MEPCO (Finance) departments being the most productive and

exhilarating experience of my corporate life. Few of the main highlights of my work experience

while at Finance Department were:

Good Leadership

Congenial Work Atmosphere

Challenging Tasks Assignment

Employee Empowerment

Proactive Problem Resolution

Before the details description of the report I started with the summary of work I had done. The

basic purpose of this summary is to given an idea about the contents and efforts made behind

the completion of the report to the reader.

It was assigned me to visit the MEPCO to view the working environment, function, procedures

and behavior of doing work. Internship was started from 11-01-2011 and end on 10-03-2011,

this period was the real experience of my life and I saw the setup, working process and formal

documentation of the MEPCO.

The MEPCO is a very big organization with several departments in working in the head office.

The human resource department which deals with the internees has assigned me MEPCO

Khanewal Road Multan for 8 weeks. MEPCO gives me the opportunity to view, how the books of

accounts are prepared, how to fill the different forms, how to behave with customers and about

the record keeping. I worked in different section of MEPCO and learned about distribution

system of MEPCO, technical correspondence between departments and flow of data between

departments. Here staff gives me opportunity to do practical work. It was a really nice

experience for my upcoming practical life.

I would like to conclude by saying that even though every person will have a different story to

tell. I have given more than 100% of my efforts to keep up that good work and I am sure that my

colleagues have done the same. I am hopeful that as we pass through the corridors of this great

institution into the real world, this legacy will be kept and upheld by the future generation

commerce.

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PURPOSE OF THE STUDY

General Purpose :

To get acquaintance to the MEPCO operations.

To know what sort of changes management brings in managerial activities.

To see the application of our Professional studies especially.

Specific Purpose :

Specific purpose of the study includes.

A partial fulfillment as a requirement for the completion of M.Com degree.

To objectively observe the operations of MEPCO in general and the operations of MEPCO in specific.

To make recommendations or implementation plans for the improvement of the operations of MEPCO in the light of our professional studies.

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INTRODUCTION

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WAPDA, the Pakistan Water and Power Development Authority, was created in 1958 as a Semi-Autonomous Body for the purpose of coordinating and giving a unified direction to the development of schemes in Water and Power Sectors, which were previously being dealt with, by the respective Electricity and Irrigation Department of the Provinces.

Since October 2007, WAPDA has been bifurcated into two distinct entities i.e. WAPDA and Pakistan Electric Power Company (PEPCO). WAPDA is responsible for water and hydropower development whereas PEPCO is vested with the responsibility of thermal power generation, transmission, distribution and billing. There is an independent Chairman and MD (PEPCO) www.pepco.gov.pk replacing Chairman WAPDA and Member (Power) who were previously holding the additional charges of these posts.

WAPDA is now fully responsible for the development of Hydel Power and Water Sector Projects.

PEPCO has been fully empowered and is responsible for the management of all the affairs of corporatized nine Distribution Companies (DISCOs), four Generation Companies (GENCOs) and a National Transmission Dispatch Company (NTDC) and also in (IPP’s). These companies are working under independent Board of Directors (Chairman and some Directors are from Private Sectors).

The Companies are administratively autonomous and leading to financial autonomy by restructuring their balance sheets by bringing their equity position to at least 20 percent, required to meet the prudential regulations and to facilitate financing from commercial sector (approved by ECC).

The Loan Liability Transfer Agreements (LLTA) has been signed with Corporate Entities and execution of loan transfer is complete.

All Entities have the physical possessions of all their operational assets. On 24th Feb. 2007 Ministry of Water & Power notified NEPR Approved Tariff for all

Distribution Companies replacing unified WAPDA Tariff. Legal Agreements such as Business Transfer Agreements, Operation Development

Agreement, Energy Supply Agreement, Business Supplementary Agreement and Fuel Supply Agreement etc. were executed between WAPDA and Corporate Entities to facilitate commercial operations.

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WAPDA (Water and Power Development Authority)

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Regulatory instruments like Grid Code, Distribution Codes, Performance Standard for Distribution Companies and Transmission Companies were  drafted and got  approved from (www.nepra.org.pk) in 2007.

All major lenders gave their consent for transfer of their loan from WAPDA to Corporate Entities, thus 326 loan assumption agreements were signed amongst respective Companies, WAPDA and EAD (Economic Affairs Division) GOP.

CPPA is established under the coverage of NTDC for payments from DISCOs to IPPs, GENCOs and NTDC. Ultimately, it will function independently under Federal Govt. and all forthcoming IPPs will be under CPPA.

Charter of Duties of WAPDA:

The Charter of Duties of WAPDA is to investigate, plan and execute schemes for the following fields:

Generation, Transmission and Distribution of Power. Irrigation, Water Supply and Drainage. Prevention of Water logging and Reclamation of Waterlogged and Saline Lands. Flood Management. Inland Navigation. The Authority comprises of a Chairman and three (3) Members working through a

Secretary. WAPDA is one of the largest employers of human resources in Pakistan. Over the years

WAPDA has built-up a reservoir of Technical know-how and expertise which has made it a modern and progressive organization.

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PAKISTAN ELECTRIC POWER COMPANY

The Pakistan Electric Power Company (Private) Limited (PEPCO) has been entrusted the task of managing the transition of WAPDA from a bureaucratic structure to a corporate, commercially viable and productive entity. It is a mammoth task and progress in the initial months was rather slow, but one should keep in mind that responsibility is enormous and transition is a long drawn process.

Before going into further details of the restructuring program, it is necessary to understand the shift in the GOP policy. The GOP, in line with its Strategic Plan of 1992 approved by the cabinet committee, in its MEPCO decided into three regions (GENCOS, IPPs, and NTDC) and to restructure the entire power sector in the country

De-regulation of power sector Promotion of IPPs Restructuring of WAPDA Privatization of select corporate entities

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PEPCO

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Vision:

To make Pakistan Power Sector customer friendly, efficient, able and responsive in meeting tee electric energy requirements of industry, business and domestic customers, and move to an energy sufficient model from the current energy deficient scenario, on commercially viable and sustainable basis, in order to support the high growth economy and to meet the government's objective of "Power for All".

Mission:

To fully enable the reform and restructuring of the Pakistan Power Sector and to transform the fourteen (14) Corporate entities (CE's) into autonomous and commercially viable enterprises, thru induction of effective corporate management, best business and utility practices, and well engineered systems, and bridge the ever growing supply-demand gap, so as to meet customers electric energy requirement on a sustainable and environmentally friendly basis, thru best utilization of resources, in an efficient, ethical and customer friendly manner, with responsibility to the community and the Nation.

Objectives:Pakistan Electric Power Company (PEPCO) unveiled new face of Pakistan's power sector with the crisis management objectives to improve the efficiency of the power sector and to meet customers' electric energy requirements on a sustainable and environment friendly basis. The specific objectives of PEPCO are:

Stop load shedding,

Constructing new grid stations,

Reducing line losses; minimizing tripping and  theft control,

Revamping of generation units and to improve customer services and

Development of an integrated automated power planning system for generation, transmission and distribution to ensure system stability, fault isolation and upgrade relying, metering and tripping system at NTDC as well as Discos level.

INNOVATION OF COMPANIES TO WAPDA:WAPDA, As being the largest operating and generating department of this country, was to managed. So during year 1997, WAPDA was divided into thirteen well handling units and transmission units , on the basis of their working nature i-e generation, distribution and transmission.

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WAPDADISCOSNTDCGENCOS

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Power Wing is currently headed by Member (Power). Power wing of WAPDA comprising of Generation, Transmission and Distribution has been restructured into fourteen (14) public limited companies. These fourteen (14) Corporate Entities are;

DISCO (DISTRIBUTION COMPANIES):

Out of thirteen units, nine were Discos, means distribution companies. These are:

1] (LESCO) - Lahore Electric Supply Company

2] (GEPCO) - Gujranwala Electric Power Company

3] (FESCO) - Faisalabad Electric Supply Company

4] (IESCO) - Islamabad Electric Supply Company

5] (MEPCO) - Multan Electric Power Company

6] (PESCO) - Peshawar Electric Power Company

7] (HESCO)- Hyderabad Electric Supply Company

8] (QESCO) - Quetta Electric Supply Company

9] (TESCO) - Tribal Electric Supply Company

GENCO (GENERATING COMPANIES):

Wapda has four GENCOs, which means generating companies. These are:1] Southern Generation Power Company Limited (GENCO-1) head quarter at Jamshoro

District Dadu near Hyderabad Sindh.2] Central Power Generation Company Limited (GENCO-2) head quarter at Guddu District

Jacobabad Sindh.3] Northern Power Generation Company Limited (GENCO-3) head quarters at TPS

Muzaffargarh 4] Lakhra Power Generation Company Limited (GENCO-4) Headquarter at WAPDA House

Lahore.5] District Muzaffargarh Punjab.

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POWER WING

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NTDC (NATIONAL TRANSMISSION & DISPATCH COMPANY):•

NTDC acts as buffer between DISCOs and GENCOs. Any DISCO can’t purchase electricity directly

from GENCOs. Thus NTDC acts as a bridge to distribute the GENCO production among DISCO on

the rate decided by NEPRA (NATIONAL ELECTRIC POWER REGULATION AUTHORITY) and

further checked and controlled by CPPA (CENTRAL POWER PURCHASE AUTHORITY).

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DISCOs NTDC GENCOs

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INTRODUCTION

MEPCO THE MULTAN ELECTRIC POWER COMPANY IS ONE OF THE BIGGEST DISTRIBUTION COMPANY OF WAPDA. IT'S AREA OF OPERATION IS FROM SAHIWAL TO SADIQABAD, BAHAWALNAGER TO BAHAWALPUR

AND TOUNSA SHARIF TO RAJANPUR AND BORDERING WITH SIND, BALOCHISTAN AND NWFP.

MEPCO was formed in 1997. It consist whole part of southern Punjab under its services. Like a proper limited company, MEPCO also has a Chairman, Board of Directors, Chief executive officer and Company Secretary, along with the departments of Operations. Maintenance, Constructions, Planning, Civil, Admin, Human Resources, Computers, Public dealing and Finance.

All of these departments have their own Managers, Deputy Managers, Asst Managers and Office staff. Further these departments are subdivided into sections and sub sections. As being entrance of Finance Department, my major concern of report relates to the Finance Department of MEPCO

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MEPCO (Multan Circle)

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WAPDAThe electricity supply service in Pakistan, initially, was undertaken by different agencies, both in public and private sectors, in different areas. In order to provide for the unified and coordinated development of the water and power resources, Water and Power Development Authority (WAPDA) was created in 1958 through WAPDA Act, 1958.

AREA ELECTRICITY BOARD MULTANThe local areas electricity distribution service was being performed by various Regions of WAPDA. Then the Area Electricity Board (AEB) Multan, on the eight AEBs in Pakistan, was established under the scheme of Area Electricity Boards in 1982, in order to provide more autonomy and representation to provincial government, elected representatives, industrialists, agriculturalists and other interest groups in functions of the AEBs.

The environment and structure of the power industry throughout the world are undergoing dramatic change. The power sector is moving from monopoly to privatization and from integration to disintegration. To keep pace with this change, the Government of Pakistan approved a Strategic Plan in 1994 as a consequence of which the power wing of WAPDA has been unbundled into 12 Companies for generation, transmission and distribution of electricity.

Multan Area Electricity Board was reorganized into one such corporatized entity under the name of Multan Electric Power Company (MEPCO) with effect from 14.05.1998, with the aim of commercialization and eventually privatization.

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MEPCO History

MEPCO

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VISION:To ensure convenient availability of high quality power in area of responsibility, in order to alleviate the poverty, improve quality of life and make the Industrial and Agriculture Sector competitive in the World Market.

MISSION

Ensure convenient availability of high quality electric power to the people at affordable price, retaining financial viability of the Company.

OUR COMMITMENT:Improve customer satisfaction Reduce Line Losses weed out corruption Increase revenue generation

MANAGEMENT PHILOSPHY:

Open door policy for all

Merit, justice, fair play be the hallmark

Transparency in all fields

Accountability of everyone

OBJECTIVES:

To play an active role to make “Sar Sabaz and Roshan Pakistan

To facilitate agriculture and industrial sector

To ensure un-interrupted & stable power supply to all our customers

State-of-art customer care for entire satisfaction of customers

To provide electricity to every village in jurisdiction of company

To establish, construct and operate reliable electricity distribution network

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MEPCO consists of the following eight (08) Distribution Operation Circles, one Construction and

two GSO Circles, as detailed below:

Operation Circles:

1. Multan Circle  6 Divisions / 33 Sub Divisions2. D.G. Khan Circle  3 Divisions / 12 Sub Divisions3. Vehari Circle  3 Divisions / 13 Sub Divisions4. Bahawalpur Circle 3 Divisions / 17 Sub Divisions5. Sahiwal Circle  4 Divisions / 18 Sub Divisions6. R.Y. Khan Circle  3 Divisions / 15 Sub Divisions7. Muzaffargarh  3 Divisions / 16 Sub Divisions8. Bahawal Nagar Circle 3 Divisions / 13 Sub Divisions

Total 31 Divisions / 147 Sub Divisions

G.S.O. Circles1. Multan Circle  6 Divisions

2. Sahiwal Circle

Project Construction Circle 8 Divisions

GRID STATIONS1. 132/11KV  77 No’s  2. 2. 66/11KV 27 No’s

Total 104 No’s

DISTRIBUTION TRANSFORMERS            1, 15,810 No’s

Capacity of Distribution Tfrs                5886.56 (MVA)

DETAIL OF INFORMATION GIVEN BELOW:-                                                           

1. Total Length of 132/66KV, T/Lines 4289 KM2. 132 KV Transmission Line. 2923 KM3. 66 KV Transmission Line. 1366 KM4. Total Nos. of Power Transformers 204 Nos.5. 132 KV Power Transformers 152 Nos.6. 66 KV Power Transformers 435 Nos.7. Distribution Transformers 115810 Nos.8. Capacity of Distribution Transformers 5886.56 MWA11. Peak Demand of 2010-11 2988 MW12. New G/S added in 2009-2010 06 Nos.13. Conversion for 66KV & 132KV 2009-2010 05 Nos.14. Augmentation during 2009-2010 20 Nos.

15. Extension 2009-2010 15 Nos.

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Organization Structure

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HT / LT LINES

1.   11 KV Feeders             884 Nos.                                                       

2.   Length of H.T Line        63,233 KM                                                   

3.   Length of LT Line          42,595 KM

JURISDICTION MAP OF MEPCO

PRODUCT LINES

CATEGORY WISE ELECTRICITY CONNECTIONS

1. Domestic A-1

2. Commercial A-2

3. Industrial B-1

4 Agriculture SCARP D-1

5. Agriculture D-2

6. Public Lighting G-1

7. Residential Colonies H-1

8. Railway Traction I-1

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FINANCE DEPARTMENT, MEPCO

Finance department MEPCO, under the guidance of MEPCO finance, controls the budgeting, Payment, expenditures, pensions, assets, collections, foreign loans, etc of MEPCO, WAPDA.

Everyday its own staff and officials. Description of every department is given in detail ahead. But first we will look at the official structure of this department with its senior officials and duties of the staff as being related to financials.

DUTIES OF MEPCO’s FINANCE OFFICER:

As being a financial officer or accountant in MEPCO, one has got following responsibilities to perform on each and every level. These are:

1. To act as a financial advisor.2. To act as a compiler of Accounts.3. To act as a primary advisor.

TRAINNING SECTIONS FOR AN INTERNEE:

As being an internee, finance department has offered us training in the following sections:

1. Banking & Imprest

2. Budget & Corporate Planning

3. Tax Cell

4. Pre-Audit

5. Assets/Salary Slip

6. Pension Cell

7. Compilation

8. Receivable/Payable

9. Audit Cell

10. Establishment

11. Admin

We spent recommended span of time in each section in order to get trained in the deep work of finance activities in this every department. Details of each section are explained as this report proceeds.

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The Finance Director is working under the administrative control of Chief Executive Officer of MEPCO Multan. The function of this office is to obtain data from Operation Divisions and to reconcile and preparation of consolidated report & financial date of the company. The Finance Director is responsible for preparation of company’s Profit and Loss Accounts, Balance Sheet and Cash Flow statements, to control the Financial system of the organization, Mobilization of funds, Generation of funds and usage and allocation of funds as required by the Company’s Ordinance 1984, Income Tax monthly, Annually Statements, Income Tax Returns, Payment of Advance Tax on Quarterly (Turnover Tax) according to the Income Tax Ordinance, 2001 Monthly Sales Tax Returns , Monthly withholding Sales Tax Statement to the Sales Tax Department are also dealt in the Finance Departments.

The Finance Director also pass & paid different nature of bills like supply bills, contractor’s bills, employees claims etc. and approves the financial implications & Budget provisions during the vetting process of the files of purchase of material. This office is also responsible for preparation and control of overall Budget of the Company and other Divisions of the Company on monthly, half yearly & on annual basis. The revenue of the company which is collected by the authorized bank branches and transfer to Main accounts of the Company, is also maintained by the Finance Director & issues the funds to the respective division as per their requirements

TYPES OF SECTIONS:

1. Banking & Imprest

2. Budget & Corporate Planning

3. Tax Cell

4. Pre-Audit

5. Assets/Salary Slip

6. Pension Cell

7. Compilation

8. Receivable/Payable

9. Audit Cell

10. Establishment

11. Admin

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FINANCE DEPARTMENT

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BANKING & IMPREST SECTION

BANKING:In banking collection of revenue in shape of electricity bills are deposited in different banks. This section control and over watch whole activities of banking procedure. This section monitors collections of Electricity Bills, Security Deposits, RCO fees, and other receipt as well as remittance of collection in to Main Branches of Company at Multan.

If any bank fails to remit the company’s fund in time, this section ask for such omission and charged interest for late remitted of company’s fund. This profit is called Penal Profit. This section also deals with the reconciliation and related matters with banks. Moreover, this section releases funds to the different Accounting Units of the Company. All the Bank branch and Post Offices are allowed to collect the funds on behalf of MEPCO.

BANKING RECONCILIATION:The summary of collection which known as”C P 48” prepared in and by AM (CS). This summary is reconcile with bank statement and after preparation of reconciliation it has been sent to head office Lahore and all this procedure done and handled over the banking section:

REVENUE COLLECTION: This section collects revenue from different departments and remitted top the Head quarters. Billing revenue is at the top, which is a collected from the consumers in almost 80 lower and also Main and Feeding branches like 25 Bank branches and Post offices as well. This final revenue is sent MEPCO monthly. Plus there is a service level Agreement according to which each of these branches Charge some amount to MEPCO per bill and if any Bank fails to clear MEPCO’s accounts by the end of the month, it will pay MEPCO by following Formula: Amount retained × 0.00045× days (by which payment has been delayed)

Further such accounts are not allowed to be operated via cheques books and these are not issued for such accounts. Further revenue collection summary is known as CP 48.

IMPREST:Amount which has been withdrawn from collection for meets of monthly expenses, it is known as Imprest.It is described by “Finance Director” or “Chief executive” within described limits.

IMPREST CASH BOOK:In cash Book daily payments and cash used entries has been written by the cashier. This Imprest procedure has also handle by banking section but it is a different working way but also relates it.

Cash has been used for:

A] Regular Expenses (Such as allowance and Salaries).B] Contingent Expenses (this type of expenses demand is made and approved from the

authority)

BANKING FUNCTIONS:

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1. Collection of Electricity Bills from collecting branches and transfer to main designated banks account and finally remitted to Lahore.

2. Cash Management of funds.3. Maintenance of L/C’s which are established against purchase orders.4. Preparation of daily Remittance Report.5. Preparation of Daily Bank Position.6. Transfer of funds from one bank account to another bank account on need basis.7. Preparation of Bank Reconciliation Statement and follow up for adjustment in various

AM (CS) and Banks.8. Disbursement of funds to field formations to meet the O&M requirement of Company.9. Supervision and Maintenance of Imprest of 80 Accounting Units.10. Arrangements of funds from Govt. for Village Electrification through AGPR 11. (Accounting General of Pakistan Revenue)12. To deal with statuary Govt. Internal auditor.13. Correspondence with Head Office, Field formation and Banks.

BUDGET &CORPORATE PLANNING

This section operates two types of budgets:-

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1. OPERATING BUDGET2. CAPITAL BUDGET.

1. OPERATING BUDGET:

Operating budget consist of the following types of budgetI. Operating Expense Budget

II. Operating Revenue Budget.

I. OPERATING EXPENSE BUDGET:

Operating expense budget consist of General establishment Maintenance.

a) GENERAL ESTABLISHMENT:

General establishment consist of the following budgets.i. Salary (pay and allowance)

ii. Free electricity supplyiii. Medical free supplyiv. Office expensev. Telephone bills

vi. Gas bills.vii. Traveling Allowance bills

b) MAINTENANCE BUDGET:

Maintenance consists of the following type of budget.i. Insurance

ii. Vehicle expensesiii. Repair and maintenance of buildingiv. Line Maintenance.

II. OPERATING REVENUE BUDGET: Operating revenue consist of the following budgets

i. Sale of electricityii. Hydel surcharge

iii. Fuel adjustment surchargeiv. Additional surcharge.

2. CAPITAL BUDGET Capital budget consist of the following type of budgets

i. System augmentation programii. Development of power

iii. Energy loss reduction

CAPITAL RECEIPTSecurity submitted for the new connections is treated as capital receipt.

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BUDGET PREPARATIONEstimate of operating budget and system augmentation program are prepared in the budget section. The estimate is send to the Board of Director and then sent to the authority (WAPDA house) for approval. If any objection is there then it is try to remove than sent to MEPCO LTD MULTAN and then budget section distribute the approve budget to the field offices, accordingly.

TAXES SECTION

Tax section has been established to fulfill the requirements of Income Tax Ordinance, 2001 as applicable to corporatized entity anywhere in Pakistan. WAPDA is exempt from the levy of Tax

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but in the current scenario, MEPCO, being Limited Company, is payable to Tax liability as prescribed to corporatized entity and according, even in case of loss MEPCO has to pay Minimum TAX of its Turnover to the Tax Department.

The Federal Board of Revenue (FBR) has recently allotted National Tax Number (NTN) and Sales Tax Registration No. (STRN) to MEPCO.

MEPCO was exempted from any type of tax deduction. Since 24 February 2007 from this date it has been valid. Because MEPCO passing the loss period from 2007 and currently it also generates loss. And now GOVT, give subsidy to MEPCO.

FUNCTIONS OF TAX CELL:

1. Deduction of Tax:Above Rs 300,000 tax exempt 5%.

2. Deposit of Tax:Deducted tax deposit in FBR (Federal Board of Revenue) by its account in NBP. And also interchange Tax deducted copies one another circle.

3. Compilation of All Information: On the behalf of Company MEPCO compile the data under Sec 149, 2010 on eFBR folder present on FBR.gov.pk

TYPES OF TAXES:

1. Income Tax (Services)2. GST General Sales Tax (On Goods)

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INCOME TAX (Sec 165):

Income tax is deducted from the employ’s salaries and submission to the Govt,

1. Salary exemption is started from Rs 300,000/- .2. Free electricity units (500 units).3. Bonuses.

Monthly withholding Tax statement under the Income Tax Ordinance, 2001.Annually withholding Tax statement of MEPCO Income Tax Ordinance.

Replies of Income Tax Notices issued by the Tax Department under section 161/205.

SALES TAX RETURNS:

Sale tax is deducted on goods purchase 15%. This tax only paid by final consumer but Govt. Give subsidy before final consumer between two means of customers. On material supply the supplier purchase 3.5% and services 6%.

Monthly Sales Tax Returns of MEPCO under the Sales Tax Special Procedures Rules, 2007, issued under the Sales Tax Act, 1990.

Claim Refund of the claim of Subsidy of GST from the Ministry of Finance, protected by the Government of Pakistan.

Monthly withholding GST Statement under S.R.O. 660(I)/2007 called as the Sales Tax Special Procedure (Withholding) Rules, 2007.

E-Enrolment and e-filing of Tax ReturnsMEPCO has recently enrolled its name and now all the Tax Returns of MEPCO are being submitted through e-filing to the Tax Department and in this connection MR: Syed Mushtaq Hussain Bokhari (Finance Director) & Mian Answer Mehmood (Manager Corporate Accounts) and has played important role.

If consumer use less than 500 units Govt, gives subsidy and Ministry Finance refund it.But if a consumer

PRE-AUDIT

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As the name indicates it is audit before execution of Transaction and before the Payment is made. This procurement is related to M.M.Distribution & M.M.STG. E.g. New Grid Station, New Heavy Lines, Big Transformers and Bankers Procurement.

Pre-Audit is a section of Finance & banking Dept. the function of this to PRE-Audit MEPCO Dept. and also the whole Region as a third party. For procurement all documents are Pre-Audit in this section. The Pre-Audited section deals with the internal audit of the MEPCO. In case when the MEPCO is looking forward at the purchase of any Asset or Machinery for expanding its operation the estimates of the total cost of the project are passed over to the Pre-Audit section. The Pre-Audit section then verifies the available Budget with the estimated cost of the project, hence rejecting and accepting the proposal.

PAYMENT: Payment can be direct or via L.C. it is also Pre-Audited before Payment is made. Payment to Contractors is also audited.

MODES OF PAYMENT: There are two modes of Payment by which the payment is carried out;

1. Cross Cheque.

2. Letter of Credit.

CIVIL WORKS:Measurement Books are Pre-Audited and also Civil Works.

CONTRACT AWARDING:Contract Awarding is also Pre-Audited e.g. Tenders Quotation are also checked.

CLUSTERING AND SHIFTING OF METERS:Clustering and shifting of Electricity meters claims audited.

VEHICLES:Vehicles related activities are Pre-Audited e.g. POL of vehicles and LOG Books of vehicles are checked and audited.

DEPRECIATION:Depreciation is charged on the straight Line Monthly Basis of Fixed Assets as 3.5% per Month.

Fire and Safety, Transport Equipment 10%, Building 2%.

FUNCTION OF PRE-AUDIT CELL:

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1. Work behalf on the Chief related to commercial directorate or also on the Asst. Manager.

2. Behalf of the Chief Executive to pay finance dept. and Pre-Audited the doc. And work manual code.

3. Prepare the Book of Financial powers (What are the Powers Exercise on the team).

4. In case of approved claim Pre-Audit the work and forward to Internal Audit.5. Heavy Volume Procurement made in case of1000 items.6. Supply civil work (Against 1000 vehicles, Contractor ship, Polls, Lines).7. Work in the district through Multan to Sahiwal).8. Pre-audit the various claims of dept. as well as whole region as third party. (All

the Consumer, District, Central, and South Punjab).9. Prepare Documents of Specific Nature by Specific rules & Regulation Procedure.10. Maintenance done by the XEN Dept.

FUNCTION OF AUDIT FOR PROCUREMENT:

Tender Issue. Purchase Order (Terms and Condition apply). Manufacturer supply the Material. MIC (Material Inspection Committee) issue I.C (Inspection committee) Accept acne. Case gives GRN (Goods Receive Note). Approved Claim nessaccary for Procurement Plan. Pass to Pre-Audit Section and pass to Pre-Audit. Payment to Supplier by Check and Balance System. Material Management done Procurement Plan

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DEPOSIT WORK:

Work is done on other behalf. Procurement is the procedure to see the Stock, When the Tender is issued.

On the accepted rate material purchased order is given to the selected co

In case of good inspection Store Authority approved the Order

L.M (Letter of Material) is Approved.

Pre-Audit check payment is done.

Fund demand is approved by D.F (Director Finance).

Payment is transferred through cheque.

INVOLVEMENT:

Junior Clerk. Acceptance/Clerk/Purchase Inspection Order.

(In case of Acceptance pass to Account Asst.)(In case of Rejection return back to Tender Co.)

Account Officer (to maintain Accounts sheets). Pre-Auditor (In case of 50,000 limits). / Deputy Manager (Above 50,000 limit). Demand Preparation. Account Officer. L.D. {Late Delivery Charges, (2% under 5 Months Payment), 10%(After 5

months)}. Supply Bill (Against Deposit/Against Budget). Budget section (To prepare Budget). Asst Manager. Finance Director (Banking Sector).

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ASSET/SALARY SLIP

The things that are in the possession of any company are called its assets. There is no concept of Intangible Assets in MEPCO Every asset is tangible here. This section is established to deal with all the movable and immovable assets of the company. Now, the concerned Divisions monthly submit the Assets Sheets to the Section to calculate the depreciation on Straight Line monthly Basis. Asset section of MEPCO Finance Directorate and Maintains record of various assets held by MEPCO. Company charges depreciation on its asset by using the following rates.

.

TYPES OF ASSET:

1. LAND: Land held by MEPCO is of two types.

a. FREEHOLD LAND:This land has been purchased by MEPCO and in its Property used for various purposes.

b. LEASEHOLD LAND:MEPCO also has acquired Land through Lease Agreement from different organizations.

MEPCO has leased the Land from RAILWAY: P.C. Pool Lodhran Lahore.MILITARY: Garden Town Subdivision Multan, MESCO Power near Aziz Hotel Multan. GOVT OF PUNJAB: D.M Operation Sahiwal

In Addition to these almost 105 Grid Station in MEPCO land.

2. BUILDING:Building of MEPCO include

1. Operation Offices Building (Non Residential).2. S.S&T Buildings.3. Residential Buildings.

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Asset Tile Depreciation Rate

Buildings 2 %

Office Equipment 10 %

Distribution Equipment 3.5 %

Other plant and equipment 10 %

Vehicles 10 %

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3. OFFICE EQUIPMENT:Computer Furniture and all the accessories are including in office equipment.

4. OTHER PLANT & EQUIPMENT:T&P (Tools and Plant) which are used by Subdivision e.g. Gloves, Medical Equipment etc.

5. VEHICLES:All vehicles used MEPCO are its asset and record is maintained in asset section.

6. DISTRIBUTION EQUIPMENT: These Equipments can be held by various offices are as follows.

Distribution Plant Assets  Account Title Account Code

132 KV Grid Station Equipment 10601

66 KV Grid Station Equipment 10602

132 KV Distribution Lines 10605

66 KV Distribution Lines 10606

11 KV Distribution Lines 10608

400 V Low Tension Line 10609

Under Ground Conductor and Devices 10612

Distribution Transformers (11 KV/400 V) General 10613

Service Drop General 10614

Meters-General 10615

Distribution Transformers (11 KV/400 V) Industrial (0613) 10616

Service Drop Industrial 10617

Meter-Industrial (010615) 10618

Distribution Transformers (11 KV/400 V) Tube well (01613) 10619

Service Drop-Tube well (010614) 10620

Meter-Tube well (010615) 10621

Service Drop-Renovation (010614) Meter-Renovation (010615) 10623

Meter-Renovation 10624

Street Lighting and Signal System (010616) 10625

High Tension Lines Renovation (010617) 10626

Low Tension Lines Renovation (010618) 10627

High Tension Transformers (11 KV) 10628

Village Electrification (PWP, TWP) (010619) 10629

11 KV Distribution Lines (Deposits) 10630

Village Electrification (Capital) 10631

Punjab Government 10632

Transformers Transferred From Scrap 10634

MISCELLANEOUS EQUIPMENTArm’s Equipment, Rest Houses, Medical Equipments, Construction Equipment, Laboratory Equipment, Work Shop Equipment, Transport Equipment.

SALARY SLIP

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It contains the whole detail of salary of officers. It includes detail of Allowances. It is only made for Officers. Basic Pay Scale of Officers =16.

Divisional Accountants are not gazette but their BPS is 16. Above grade 16 Salary Slip is Issued to Account Asst.or above.

OFFICERS:

The employ that are gazette and declare Officers by authority with Scale of 16 and above are mentioned for Salary Slips. There Service Book is closed or not maintained. Salary Slips is also a document of this file. “Services Statement”. It contains whole information’s of service life (Changed, Transfer, etc)

OFFICIALS:

These employees who are not gazette and declared as officials known as Staff. There will be a service book maintain their service record.

There is no Salary Slips involved for Staff and their pay is prepared by Pay Fixation Cell.

FUNCTION OF SALARY SLIP CELL:

1. Basic Pay Scale/ Scale revised slips maintain with time to time Govt. increments and Allowances all are adding in it.

2. All Allowances given to employ Asst. as 15% ARA (Adhoq Relief Allowance).3. In case of Promotion/Punishment issued Extend/Short slips.4. In case of any change of Post/Position Increment Slips issued to the Officers.5. At annual Increment Revised Salary Slips issued to Officers.6. Transfer Ordering Certificates/Transfer or Posting/Charge Selection/charge

Assuming/Taken over Charge or Charged Received. In all cases Salary slips changed and new salary Slips issued to Officers.

7. House/Convence Allowances, Last Pay Scale revised or changed all are needed for issuing Slips.

REVISED PAY SCALE:

1. 19772. 19813. 19834. 19875. 19916. 1994 7. 20018. 20059. 200710. 2008

Allowances:

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1. 50% Ad-hoc Relief Allowance(Running Basis)2. 20% Special Allowance 1st, July 1999 (On basic Pay Scale)

(Both are freeze in 2001)3. SRA (Special Relief Allowance) 1st July 2003 and Freeze in 2005.4. 1st July 2004 ARA (Adhoq Relief Allowance) 15% and freeze in 2005.5. 15% dearness Allowance 1st July, 2006 and freeze in 2009.6. 50% ARA (Ad-hoc Relief Allowance 2010 on Running Basis and still continues.

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PENSION CELL

This Cell has been established in MEPCO from WAPDA in 1st Nov 2002. It gives Pension to 31 Divisions monthly.

“PPO BOOK” It is stand for “Pension Pay Order Book” it is prepared for retired employee and signed by the D.M (OP) and Accountant.

By Services giving benefits it’s called “PENSION SERVICES” for working more than 10 years at permanent post. Post-Retirement benefits that an employ might receive from some employer. A Pension is essentially compensation received by the employee after he/she has retired.

A pension is a steady income given to a person (usually after retirement). Pension is typically payment made in the form of a gurrented Annuity to retired or disabled employee. Some retirement plan (or Superannuation) designs accumulate a cash balance (through a variety of mechanisms) that a retiree can draw upon at retirement, rather than promising annuity payments. These are often called Pensions. In either case, a pension created by an employer for the benefit of an employee is commonly referred to as an occupational or employer pension. Labor Unions, the government, or other organizations may also fund pensions.

Occupational Pensions are form of deferred compensation, usually advantageous to employee and employer for tax reasons. Many Pensions also contain an insurance aspect, since they often will pay benefits to survivor or disabled beneficiaries, while annuity income insures against the risk of longevity.

CONDITIONS: 1. If service is less than five years than there was nothing too paid.2. If service is less than ten years but more than five years than gratuity will be paid.

(Basic Pay × 1.5×Service Year)3. If service is more than ten years same ratio of pension will be given. GLI (Group Life

Insurance) paid of employee died during service.WWF (WAPDA Welfare Fund) it can be withdrawn in any special case.

TYPES OF PENSIONS:

1. SUPPERANNUATION:This pension has been made for age of 60 years of employee after retirement.

2. RETIRING PENSION:For this type of pension service must be for 25 years.

3. INVALID PENSIONS:In case of disability factor involved.

4. FAMILY PENSION:In case of death of employee.

5. GOVT. RETIREMENT:At age 60 Govt must be retire the employee.

6. COMPULSORY RETIREMENT: In any case of punishment Employee fired from its job.7. COMPENSATION PENSION: In case of ending section, post than offer employee to take another post or retirement.

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CALCULATION FORMULA’s:

1. SELF RETIREMENT PENSION:

Gross Pay:Last drawn × Qualifying Service ÷ 30 × 70/100(If service life is 30 years than multiplied by just 30 than give 70% of basic pay. )Grass Pension divided into two parts.

1. 35% of Grass Pension × 12 × Age Factor it has been retained.2. 65% of Grass Pension × 12 + (Time to time increase).

These all paid on monthly basis.

2. DEATH DURING SERVICE:Basic Pay + (Qualifying Pay) ×70%×30 And 25% of Gratuity Fund paid to Widow.Now rule is revised 1. 75% of monthly Pension if she/he has children less than 18 years.

5% of monthly Pension if she/he has children greater than 18 years.

3. DEATH AFTER RETIREMENT:Commutation has not given to widow. 1. 50% of monthly Pension given to widow.2. It can be paid also to made child till 21 years.3. It can be paid also to female till her marriage.

NOTE: Pension can be getting from any MEPCO office Region in whole Country and bill will be sent to related office of Pension reimbursement.

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COMPILATION CELL

This section deals with the compilation of Company’s Accounts on Monthly basis. This section maintains different books of accounts. The Divisional Accounts Officers (DAO) is the representative of the Finance Department in the Operation Division and deals with the accounts matters in the Field Offices. The DAO submitted the monthly accounts to the compilation section of the Finance Department and this section has to consolidate the Accounts according to the International Accounting Standards (IAS). At the end of each month they prepare Trial Balance, Profit and Loss accounts, Balance Sheet, Cash Flow Statement and detail of accounts of different heads.

In compilation there are 81 account Units and 31 Revenue Offices (RO) include Asst. Manager and Customer Offices and also 31 Operational directors.

FUNCTION OF COMPILATION CELL:

To prepare Trial balance, profit & Loss, and Balance Sheet. Deputy Manager Operations and executive Engineer Sahiwal to Sadiqa Bad 4 Regional

Stores operate. Work between Head Offices, Chief executive, Material Management, Independent units. Correct the Trial balance, receiving them and main.

TRIAL BALANCE:It is main and important result of accounting books. The Trial Balance can be prepared monthly, quarterly and annually. There are two main types of Trial Balance.

1. Cumulative Trial Balance:2. Monthly Trial Balance.

FINANCIAL ACCOUNTS ANALYSIS:The financial accounts analyze the most important and result of accounts work annually.

There is made final accounts statement.1. Profit & loss accounts.2. Cash Flow Statement.3. Balance Sheet.

.

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RECEIVABLE/PAYABLE (IOT)

Debit and credit advices received from other offices as well as issued to other offices are called IOT (Inter Office Transaction) that also named Receivable and Payable cell. It works on office to office and also DISCO’s to DISCO’s level.

It can also be made at the condition of such as one employee working at other place and being get benefits from another place then such transaction have been made by this section known as receivable and Payable.

It may be salaries, advances, free supply, and Pension.

FUNCTION OF IOT:

Inter office Transaction comprises of following major components.

Debit advices received and issued. Credit advices received and issued.S.S.Cheque received and issued. Work with Consignee Stores(D.G.Khan & Sahiwal, Bahawalpur to Multan) Regional Stores to direct Supplier. Disco’s, NTDC exchanges statements on demand. Centralized Payment along GRM (Goods Receive Note) always from Head Office. Late delivery Charges, and Dr. Cr. Statements always issue from IOT (Inter Office

Transaction) that is also deal in Compilation section.

WORKING:Centralized the cash position in DISCO’s and NTDC, and gives SS (Super Subscribe Checque) to control the movement of cash. And surpass the material from one to another store and in emergency situation material taken from any DISCO’s and give SS cheque against payment

PROCEDURE:

Payable and receivable is always co. to co., Head office to head office, DISCO’s to DISCO’s, Quarterly statements of accounts, six months transactions some consumers pay bill in another place of co. Than evident note is issued and above stents also issued by payable and receivable section. Also S.S.Cheques for store material issued.

Units Receivable (MEPCO) Dr.Units Payable (LESCO) Cr.

End of month transaction.Units Payable (LESCO) Dr.Units receivable (MEPCO) Cr.

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AUDIT CELL

The Main purpose of internal audit is to prepare the books of accounts according the requirements of Government Audit Party. Accordingly, this audit is completed before the commencement of Government Audit. The internal audit division conducts the audit of the company’s revenue accounts continuously throughout the year. The audit of the accounts is conducted through three types of audit parties.

1. LOCAL AUDIT PARTIES (LAP):It is also Called Revenue Audit. The local audit parties audit the electricity revenue accounts on annual basis throughout the year in the office of Asst. Manager Customer Services (CS). There are 21 local audit parties to conduct the revenue audit of the revenue offices headed by the assistant audit officer and 4 to 6 Audit assistants, to conduct the audit. These parties are rotated in all the revenue offices of the company. These office parties during the course of audit pointed out the cases of less billing, omission, and commission through audit notes. After discussion with Asst. Manager (CS) and Deputy Manager (Operation) or in some cases with Manager (Operation), the audit notes are accepted and debited the amount of less billing to respective consumer for recovery.

2. INTERNAL AUDIT/PRE-AUDIT(STOCK VERIFICATION BEFORE PAYMENT):The Manager Internal Audit (IA) has maintained its schedule for verification of stocks of Stores on annual bases. The Deputy Manager Audit deputes Stock Verifiers for verification of Stock Material. They physically check and verify the Material and reconcile with stock register of the Store and also submit stock verification report wherein pointed out any shortage and surplus of material in the Stores at sights.

Post Audit by Finance Directorate (After Payment)

The Post Audit Party works under the control of the Finance Director. The main purpose of the audit is to check and verify that all the payment, cash transaction, subsidiary books and cash vouchers etc. are being kept and maintained according to the Rules and regulations as prescribed by the company.

3. EXTERNAL AUDIT(GOVT AUDIT):According to company’s ordinance 1984, a Chartered Accountant must audit the financial statements of a Public Limited Company. For this purpose Board of Directors has appointed the External Audit Party. M/S KPMG Taseer Hadi & COMPANY Chartered Accountants for conducting the statutory or external audit of the company.

STATUARY AUDIT: This audit is taken by audit companies which are the most reliable into top ten chart, Currently TASEER & HADI ( KPMG) CO. is Audited the MEPCO. It has been Prepare final report for Public and performance of working of companies by the Govt Order.

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FUNCTIONS OF AUDIT CELL:

Working with Internal/External/Govt audit under the rules and regulations by competent authority.

Check the responsibilities of work, Approval. Authority who pass the Bill. Whether its ordering co. or not?

On passing Bill check the work competency, powers, delegations of powers, competent authority for approve bill.

Regularize the excess expenditure. Checking payment slips of Banks. Checking Bank accounts of MEPCO payment under the rules and regulations. Checking expenses record general/Ledger books of Payments under the rules and

regulations. Checking the Division office voucher under the rules and regulations. Contractor Pay/Cash Book/Petty Cash/date wise checking after pre-audit. Checking regularity and de-regularity. Checking delegations of financial powers. Checking Bills under rules & regulations. Point out the de-regularity issue in audit report. Taking recoveries from payee’s and in receiving case write off from recovery books.

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ESTABLISHMENT

An establishment is an enterprise engaged in economic activities with the assistant of at least one hired worker on fairly regular basis. Establishments are further classified into Directory establishments (DE) and Non-Directory establishments (NDE) on the basis of number of workers. A directory establishment is one employing or more workers (including household and hired) daily on a fairly regular basis.

VOUCHERS:

This document is support of each transaction is called as voucher. Each activity / transaction are to be recorded on the voucher. There are four types of vouchers...

CASH VOUCHERS: All the vouchers pertaining to case are called cash vouchers. The vouchers regarding cash receipt are called cash receipt vouchers while the vouchers regarding cash payments are called cash payment vouchers.

BANK VOUCHERS:All the transaction relating to Banks is recorded on the vouchers called as Bank Vouchers. The voucher regarding the receipt through Banks are called Bank Receipt vouchers and the vouchers regarding the payments through Banks is also called Bank Payment Vouchers.

JOURNAL VOUCHER:All their transaction are recorded on “Journal Vouchers” e.g. regarding rectifications of errors, miscellaneous classification, depreciation of fixed assets, provision of bad debts.

It also deals with throughout payment of an employee e.g. salary, medical allowance, TADA bills, house rent, marriage fund and other benefits etc by establishments.

SALARY:It includes basic pay according to pay scale chart +House Rent allowance in cities Multan, Lahore, and Bahawalpur 45% and other cities 30%.

TRAVELLING AND DAILY ALLOWANCE:Special daily allowance will be paid in big cities such as given below. Ordinary daily paid except big cities and other places.

Special Daily1 to 4 2005 to 10 220

11 to 16 365 17 to 18 640 19 to 20 825

Ordinary daily 1 to 4 125

5 to 10 15511 to 16 28017 to 18 50019 to 20 625

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CONVEYANCE ALLOWANCE:Conveyance allowance paid only in big cities for example Multan, Bahawalpur, and Dera Ghazi Khan.

But special daily Allowance is not paid in D.G.Khan.1 to 4 Rs 2405 to 10 Rs 46011 to 15 Rs 680 16 to above Rs 1240

MEDICAL ALLOWANCE: This allowance is in two types

i. Medical FacilityIn medical facilities and green book has been made.

ii. Cash medical Allowance In cash allowance get cash and white book has been made, and medical facility get in emergency, officers are exempt this allowance.

MARRIAGE ALLOWANCE:Employee personal marriage amount is fixed as 20,000 only. Employee can get this allowance for his daughter marriage, and employee widow get allowance for two daughter’s marriage.

SCHOLARSHIP:It has been given to the brilliant child of employee who top in school, college, university, on different rates.

PURCHASE OF USUAL ASSECCORIES:Establishment also sanctions, quotations, goods are being cheeked and passed by it according to rules. Purchase made from GST shape.

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ADMIN CELL

This section controls or look after all kinds of documents, files and proposed letter issued. Receiving posts and note it on a separated date this is called as dairy and this posts check by administrator and distributor to relative offices.

DISPATCHING: Dispatching of notes also noted on register as same receiving posts procedure.

All services books and personal files are also watch over and handle by ADMIN.

MEPCO GENERAL RULES:

It is different rule of leave, medical and travelling etc described according to acts and law.

Leave has been also mentioned and sanctioned by admin according to rule of 1982 under the Act of 1958.

DOUBLE ENTRY BOOK KEEPING SYSTEM:

The double entry book keeping system is based on the principle of duality, which means that all events of economic importance have two aspects (i.e. effort and reward, sacrifice and benefits, source and uses) that offset or balance each other. In double entry system each transaction must be recorded twice in such a way that the total amounts of debits and credits must be equalizes each other. All accounting systems, no matter how sophisticated, are based on the principle of duality.

ACCOUNTING SYSTEM OF ORGANIZATION:

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In MEPCO there are two accounting system.1. Divisional Level Accounting system 2. Head Office Accounting System

1. DIVISIONAL LEVEL ACCOUNTING SYSTEMIn Divisional Offices, the Divisional Accounts Officer (DAO) works for preparation of Accounts. At Division level there are three accounts which DAO prepared.

i. Journal Voucherii. Ledger Statement

iii. Trail BalanceAll the voucher are prepared at the sub-division level then lager and trail balance are maintained by the DAO.

2. HEAD OFFICE ACCOUNTING SYSTEM Following are the main statements prepared in the Head Office.

i. Trail Balance ii. Balance Sheet

iii. Profit & Loss Accountiv. Statement of Owner Equityv. Cash flow Statement.

All these statements and accounts are prepared under the separate control in the Finance Department. After the consolidations of Accounts these statements are checked by the Finance Director and sent to WAPDA House, Lahore for information and critical review of the financial position of the Company.

FINANCE SYSTEM OF THE ORGANIZATIONThere are three sources through which the finance is collected.

A. Revenue CollectionB. Security CollectionC. Capital Collection.

A. REVENUE COLLECTIONThe collection which is made through the electricity bills is called Revenue Collection. All the Banks branches and Post Offices under the jurisdiction of the Company are allowed to collect the Electricity Bills. A separate Bank Account and Cash Book is maintained for the purpose and Divisional Offices are not allowed to withdraw any amount from the Electricity Collection Accounts, if they need any funds for payment of cash they are required to prepare and submit the fund demands to the Finance Directorate along with the relevant payments Vouchers.

B. SECURITY ACCOUNTThe amount of Security which is paid by the consumer for the new connections is transfer in the name of security account.

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C. CAPITAL CONTRIBUTIONThe amount deposited by the consumer for the new connections or the cost of capital good like poles, meters and cables for the meters is called Capital Contribution Accounts and the amount is transferred to the main accounts of the Company and the fund of this account is utilized only for “purchase of Material under Capital Contribution” Head of Accounts and the process of issuance of fund to the relevant Account is strictly watched by the Finance Director and Budget Section of the Company.

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FINANCIAL ANALYSIS OF MEPCO

FINANCIAL OVERVIEW OF MEPCOFINANCIAL RESULTS DURING 2008-2009Revenue (Rs. in Millions)Sale of Electricity  62,745.023Rental & Service Income  182.537Amortization of Deferred Credit  1,009.089Other Income  1,592.379Total Revenue  65,529.028

 

EXPENSESCost of Electricity  61,886.892Operating Expenses ( depreciation)  6,637.902Financial Charges  304.739Tax  -Total Expenses 68,829.533Loss for the year (3,300.505)

 FINANCIAL POSITION AS ON 30.06.2009ASSETS (Rs. in Millions)Tangible Fixed Assets  39,704.222Long Term Advances / deposits  23.281Current Assts  26,123.094Total Assets  65,850.597

 Equities & Liabilities  

Share Capital & Reserves  4,779.078

Long Term liabilities  16,220.889Current Liabilities  44,850.630Total Expenses  65,850.597

 

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EXISTING STRENGTH UP TO 01/2011

S.# Category Distribution GSO Total01 Officers Gr-18 & above 164 10 17402 Assist: Managers 263 31 29403 Assist: Managers (C.S) 27 0 27

Total 454 41 49504 LS-I 487 23 51005 LS-II 408 5 41306 SSO-I 1 112 11307 SSO-II 2 212 21408 Foreman 3 21 2409 LFM-I (Foreman) 31 0 3110 LFM-II (Foreman) 46 1 4711 Commercial Assistant 620 0 62012 LM-I (Lineman) 1556 62 161813 LM-II (Lineman) 1542 78 162014 ALM (Asstt: Lineman) 4165 53 421815 Meter Reader 1665 0 166516 Bill Distributor 403 0 40317 Chowkidar / NQ 888 43 93118 Clerks all types 955 25 98019 Other Staff 2072 1345 3417

Total 14844 1980 16824Grand Total 15298 2021 17319

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CATEGORY WISE NUMBER OF CONSUMERS AS ON  12/2010

       Tariff Pvt. Govt. Total

Domestic A-1 3603505 19247 3622752

Domestic Temp E1 (1) 752 5 757

Total 3604257 19252 3623509

Commercial A-2 394168 1241 395409

Commercial Temp E1(2) 914 15 929

Total 395082 1256 396338

Industrial B-1 25233 690 25923

Industrial B-1 TOD 27 0 27

Industrial B-2 4871 269 5140

Industrial B-2 TOD 14507 875 15382

Industrial B-3 26 3 29

Industrial B-3 TOD 204 10 214

Industrial B-4 0 0 0

Industrial B-4 TOD 6 1 7

Total 44874 1848 46722

Bulk C-1 (A) 29 68 97

Bulk C-1 (B) 115 153 268

Bulk C-2 (A) 6 15 21

Bulk C-2 (C) 0 0 0

Bulk C-3 0 1 1

Total 150 237 387

Scarp D-1 970 15 985

Agri: D-2 32541 2238 34779

Agri: D-2 TOD 31010 167 31177

Total 64521 2420 66941

Public Light 471 1134 1605

Residential CLY 106 8 114

Railway Traction 0 5 5

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Co-Generation 3 0 3

TOTAL 4109464 26160 4135624

Cash Collection Branches  Select a division to see the cash collection branches

 MULTAN CANTT

 MUMTAZABAD

 CITY

 KHANEWAL

 MIAN CHUNNU

 D.G KHAN

 RAJANPUR

 VEHARI

 BUREWALA

 MAILSI

 BAHAWALPUR

 LODHRAN

 AHMAD PUR

 SAHIWAL

 PAKPATTAN

 CHICHAWATTNI

MEPCO ONLINE CONSUMER BILLINNG:

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VILLAGE ELECTRIFICATION PROGRESS:

2010-11 (UPTO 12-2010)

SR. NO.

ON-GOING PROJECTS TOTAL SCHEMES

COMPLETED ENDING

12/2010

BALANCE / LEFT

OVER

1 PWP - I (M.N.A / SENATOR) 491 145 346

2 PWP - II (P.M.D) 3228 1296 1932

3 KPP- I (M.N.A / SENATOR) 13 13 0

4 KPP- II (P.M.D) 242 24 218

5 KPP (MPA) 4 0 4

6 KHUSHHAL PAKISTAN PROG. (DISTRICT NAZIM)

423 286 137

7 CHOLISTAN DEVELOPMENT AUTHORITY 11 11 0

8 D.O.P ELECTRIFICATION) 2 1 1

9 IN-COMPLETE SCHEMES (P-II) 7 0 7

  G: TOTAL :- 4421 1776 2645

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DOP / ELR WORKS COMPLETED:

(WAPDA OWN SOURCE)

Sr. No.

YEAR Works Completed Expenditure Incurred

1 2010-2011

Up to

12-2010

HT Feeders 9 104.561 (M)

2 LT Proposals 87 52.517 (M)

Total 96 157.078 (M)(Tentative

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General Manager (Training) office is functioning at WAPDA House, Lahore and controls various

training centers detailed below: -

a. WAPDA Staff College, Islamabad.

b. WAPDA Engineering Academy (Water & Power), Faisalabad

c. Thermal Generation Training Center, Guddu

d. Hydel Training Center, Mangla

e. Technical Services Group, Lahore

f. 8 Regional Training Centers (RTCs), one at each DISCO

Address: MEPCO, Khanewal Road,

Multan.

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TRAINING:

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s

Strength and weakness are basically occurring in the internal environments of the organization.

It provides the information that in which area we are strong and weak and it provides the

solution how we can overcome the weakness and utilize the strength in a right direction. The

SWOT analysis is a comprehensive and critical overview of the operations, procedures, rules

and regulations, services and other related activities, the analysis include the analysis of MEPCO

in the light of the specific variables which directly or indirectly affect the operations of the

MEPCO. The tool selected for the analysis of organization is SWOT analysis.

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SWOT Analysis:

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It is the moral and professional duty of the directors, managers and executives to overcome the

weakness and convert them into strengths, and get maximum benefits and opportunity from the

prevailing resources.

STRENGTHS:

The MEPCO top management is the combination of both experience and young energetic

professionals which are proving to be the real strength of MEPCO.

MEPCO website provides every information about MEPCO to the customers and

investors.

MEPCO has equipped with the latest technology.

MEPCO has good relation with different departments.

The MEPCO employees are locally so, the turnover rate is low.

The MEPCO has efficient internal audit department, which keep check and balance.

The MEPCO has experienced of strategic apex and managerial skilled staff.

Full support from Federal Government

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WEAKNESSES:

The administrative cost of the company is very high due to which the profitability of the

company decreases.

There is still improvement of technology in the MEPCO like in computers.

There customer service are not up to mark they have to improve the customer services

to satisfy the customers

There divisions are not well furnished they have the need to improve them.

Telecom and Media revolution

Dependency on suppliers of power generation equipment.

Loss is occurred last 3 years in MEPCO but there is no control over expenses and

wastage.

OPPURTUNITIES:

The MEPCO is situated in the region where the customers are large in quantity and other

necessary related product is easily available in the market.

There is no competitor in the local market, there is a big opportunity to get more share.

Buyers of MEPCO services are easily available in the local market.

The extension plan of divisions by the MEPCO is very good to capture the market.

The MEPCO has maintained better relationship in the market which helps the MEPCO to

increase the customers.

The strategies of MEPCO are very strong which help them to get advantages over the

competitors.

Research and development in power generation equipment

Natural resources to increase water resources and cheaper power

There are rapid changes in technology of power generation and to coup with it ministry

will have to be planning for the future plans keeping in mind the changes

New power projects have the bargaining power for higher prices keeping in view the

high demand and supply gap in power sector.

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THREATS:

One major threat to the MEPCO is increasing number of customers day by day.

Due to fluctuation occur in the supply is permanent threat to the MEPCO.

There is always a threat the government may impose some duties on the MEPCO.

Another threat to the MEPCO is change in day by day technology.

Withdrawal of support from suppliers.

Curtailment of budget.

Obsolescence of strategic equipment

There is not a long list of suppliers in power sector and the suppliers enjoy

monopoly to some extent and they can charge higher and delay supplies as there is

long waiting lists for equipment supplies

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L I M I T A T I O N S

No proper arrangement for electricity they have dames and generators but they are not

work according to the requirement of the MEPCO.

Sometime MEPCO employee create tens environment in the MEPCO due to their non

cooperative behavior.

They have provided me knowledge about MEPCO but not according to the requirement

of internship due to much work load on the employees.

Expensive Furnance Oil is major cause of Expensive Electricity.

O B S E RV A T I O NS

I have observers that there is need of improvement in the MEPCO Departments working

who still use manual systems.

Some time the employee doesn’t cooperate with customer they must have needed to

cooperate with customers to create good relationship with them.

I have also observe that there is no proper dress court of employee in the divisions so,

they have need to follow proper dress court

I have observed that there is need of safety department or some safety precaution for

employees of MEPCO.

I also observed one thing that Departments and sections not obey the Audit Committees

that cause the negligence of Misuse data.

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S U GG E S T I O N

The following are some suggestions about the MEPCO.

Management should try creating more understanding between different departments to

increase their productivity.

The top management should give the authority and flexibility to every manager to make

decisions according to the situation at any time and in the absence of the top manager.

A proper training should be given to the employees and the workers to enhance their

skills to increase their productivity and utility of the MEPCO.

All the duties and responsibilities of the employees and the workers should be clearly

defined.

The computer technology should also be used in decision making as well as in storing

and feeding the data. There should be decentralization in decision making.

The management should recruit right person for right job.

The management should here multi skilled workers to get economy of scales.

C O N C L U S I O N

I got a lot of experience in MEPCO. During my internship I come to know that the different

units are working under one umbrella. I have noticed that they are getting the benefits by

minimizing different costs which earlier they were paying due to lack of technology of

computer.

The MEPCO has latest technology for its services and they are serving the local market very

well. MEPCO has open door policy for all tackle all problems upfront. And May be The

Import Electricity Ships decrease load shedding. If Govt. examines the Audit committees

then wastage should be decrease. Merit, justice, fair play be the hallmark Transparency in all

fields Accountability of everyone.

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