We have audited the attached Balance Sheet of CHENNAI METROPOLITAN WATER SUPPLY AND SEWERAGE BOARD  (CMWSS Board) as at 31st March 2010, the Income and Expenditure Account for the year ended on that date and the schedules annexed thereto. These financial statements are the responsibility of the Management of the Board.  Our responsibility is to express an opinion on these financial statements based on our audit.

1. We conducted our audit in accordance with the auditing standards generally accepted in India.  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall presentation of financial statements.  We believe that our audit provides a reasonable basis for our opinion.

Further to our comments referred to in paragraph (1) above we report that :

1. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit.


2. In our opinion, proper books of accounts have been kept by the Board, so far as it appears from our examination of such books.


3. The Balance Sheet and Income and Expenditure Account referred to in this report are in agreement with the books of account.


4. Attention is drawn to :


1. Our inability to express an opinion on capital work in progress of Rs.1249.28 Crores (Previous year Rs.956.30 Crores) appearing in Schedule-F ( Fixed Assets) as reconciliation for capitalized is not completed. The amount to be capatilizied as Fixed Assets out of the Capital Work in Progress and corresponding depreciation chargeable are not ascertainable.


2. Note No.1 (vii) of Schedule Q regarding provision of depreciation at 5% instead of at the applicable rates as decided by the Board. The difference between the amount of depreciation to be provided as per the applicable rates and the amount of depreciation provided in books is not ascertainable.


3. Note No.1 (ix) of Schedule Q regarding taking over the Assets and Liabilities of Soorapet Water Treatment Plant.


4. Non provision of Accrued liability in respect of Pension, Gratuity, Leave Encashment as at the end of the year as referred to Note No.2 of Schedule Q and impact whereof on the Income and Expenditure Account and the Balance Sheet is not ascertainable.


5. The effect of points 1 to 4 of Para (d) is not ascertainable,


5. Subject to the above, in our opinion and to the best of our information and according to the explanation given to us, the said Balance Sheet and Income & Expenditure, read together with the significant accounting policies, give a true and fair, view confirming with the generally accepted accounting principles.


1. in so far as it refers to Balance Sheet, of the state of affairs of the Board as at 31st March 2010


2. in so far as it relates to Income and Expenditure Account, of the deficit for the year ended on that date.

For GANESH VENKAT & CO.,
Chartered Accountants
Firm Regn. No. 005293S

T SANKAR
Partner
M.No. 208539