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TITASGAS

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TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): As per Gazette Notification No. 146/FRC/Admin/Notification/2020/01 dated 02 March 2020 by Financial Reporting Council (FRC), the capital received as share money deposit or whatever the name which is included in the Equity part of any company that cannot be refunded and the said amount shall be converted into share capital within 06 (six) months from the date of such receipt. Further, such share money deposit shall (cont.20)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): information. However, the Company has provided an amount of Tk. 491.05 crore against the above said disputed volume of gas which is 3% above the allowable system loss. g. As per subsidiary loan agreement (SLA) between the Government of the Republic of Bangladesh and Titas Gas Transmission and Distribution Company Limited (TGTDCL), the Company has received Tk. 27.42 crore as equity and recognized it as share money deposit. (cont.19)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): The Committee has, reportedly, been working on the disputed issue and the outcome of the settlement is yet to be known. The value of the said excess gas volume has been estimated at Tk. 2,154.27 crore but the gas supplying companies have not yet raised any invoices except for Tk. 103.33 crore claimed by GTCL. We could not determine the actual volume and value of excess loss of gas by the Company due to lack of reliable (cont.18)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): Being the said excess system loss for the year 2019-20 abnormal the Company has referred this disputed matter to Bangladesh Oil, Gas and Minerals Corporation (Petrobangla), the parent company of TGTDCL and all other gas supplying and transmitting companies, for settlement and as such a committee comprising members from all the supplying and transmitting companies including TGTDCL has been formed by Petrobangla. (cont.17)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): But there are no measurement tools at the supplying and receiving points for gas transmitted by GTCL to TGTDCL. The management of the Company informed that GTCL has calculated the supply volume of gas based on their assumption as they do not have accurate metering system at their transmitting points and they did not consider the loss of gas due to leakage, their own usages, gas purging, etc. at the time of transmitting by them. (cont.16)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): had supplied 2,139,913,063 CM more gas to TGTDCL than the recorded and reported quantities. This difference of gas volume (beyond the allowable system loss) is about 13.88% more than the reported volume of purchase. The actual excess system loss for previous year was 3.72% and the average for last five years was 0.95%. The Company had received around 88.19% of gas it had sold during the year through the pipeline of GTCL. (cont.15)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): from the supplying companies through its own pipelines and 2.25% on the gas volume received via pipelines of Gas Transmission Company Limited) on the volume/quantities of gas sold by the Company to its Customers during the year. Our examination of records, papers and correspondences with the supplying and transmitting companies regarding supply of gas to TGTDCL during the year under audit reveals that the supplying companies (cont.14)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): carrying amount of inventories of the Company as on 30 June 2020 appears to be overstated. f. As disclosed in Note no. 31 to the financial statements, the company has reported cost of sales at Tk. 15,877.46 crore against purchase of 15,416,777,365 CM gas from different gas supplying companies for the year ended 30 June 2020. This purchase volume of gas has been determined by adding allowable system loss (@2% on gas volume received (cont.13)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): adjustment in the accounts for the said items. Further, the Company conducted physical verification of inventories as on 30 June 2019. It identified huge quantities of dead and obsolete items but could not determine the value of such inventories. As a result, the value of inventories as on 30 June 2020 may include huge quantities of dead and obsolete items which could not be quantified thereof due to lack of information. Thus the (cont.12)

TITASGAS 27-Oct-2020

(Continuation news of TITASGAS): state that inventories are valued at cost which is a non-compliance with International Accounting Standard (IAS) 2: Inventories. IAS 2 requires valuation of inventories at the lower of cost and net realizable value. Physical verification of inventories done at 30 June 2013 identified dead stock worth Tk. 10.44 crore and obsolete stock worth Tk. 3.33 crore by the inventory committee at that time. But the Company did not make any (cont.11)

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