OFFICE OF THE MD (WEST ZONE)

M. P. Paschim Kshetra Vidyut Vitaran Co. Ltd.,

G.P.H. Compound, Pologround, Indore

Tender Specification No.MD/WZ/02/Audit/13-14/TS-02/12713 dated 07.06.2013

Due for opening on: 18.07.2013

Request for Proposal Document (Tender)

June -2013
(This Document contains 01 to 24 Pages)

Tender for The Appointment Of The chartered Accountant Firms as Internal

Auditor for Audit of Corporate Office, MPPKVVCL, Indore For Three Years

Issued by:
Director (F&A)
O/o MD (West Zone),
M. P. Paschim Kshetra Vidyut Vitaran Co. Ltd,
G.P.H. Compound, Pologround, Indore (M.P.)
Ph No.: 0731- 2426247,2426355,2426311,Fax No. 0731-2423300.

Index of Tender Document

SR NO

PARTICULARS

NOTICE INVITING TENDER

INTRODUCTION & BACKGROUND

OBJECTIVE

4
5

QUALIFYING CRITERIA

TERM OF AGREEMENT( CONTRACT PERIOD)

EARNEST MONEY DEPOSIT

CLARIFICATION/FURTHER INFORMATION

PRE-BID CONFERENCE

10

DUE DATES OF OPENING OF THE BID

11

CONSIDERATION OF BID
DUE DATES OF OPENING OF THE BID

12

PAGE NO
02
03

PERIOD OF VALIDITY OF THE BID

1.

04

04-05

13
14

RIGHT OF REJECTION
STRUCTURE OF AUDIT TEAM & ROLES AND
RESPONSIBILITIES

15

SECURITY DEPOSIT

16

INTERNAL AUDIT AUDIT OPINION AND REPORTING

17
18

OFFICE SPACE
TRAVELLING EXPENSES

19

PAYMENT TERMS

20

FORMAT FOR THE FINANCIAL BID

08

21

ANNEXURE 1

09

22

ANNEXURE 2

10

23

ANNEXURE 3

11

24

ANNEXURE 4

12

25

ANNEXURE 5

13

26

ANNEXURE 6

14

27

ANNEXURE 7

15-19

28

05

06-07

07

ANNEXURE 8 (Draft of Agreement)

Page 1

20-24

MD/WZ/02/Audit/13-14/TS-02/12713

date

07.06.2013

NOTICE INVITING TENDER

Sealed tenders are invited from reputed Chartered Accountant Firms :TS. No.
TS-02

Name of Work

Tender fee
(in Rs.)

Tender for The Appointment Of

The chartered Accountant Firms
as Internal Auditor for Audit of
Corporate Office, MPPKVVCL,
Indore For Three Years

1000/-

Amount
of EMD
(in Rs.)

10000/-

Due date for

Opening
18.07.2013
at 11.00 a.m.

Note:- Full details of qualifying criteria, earnest money and terms & conditions of
tender are available on our website www.mppkvvcl.org. The tender documents must
be purchased from the Director (F&A) O/o MD (WZ), MPPKVVCL, Indore, from dtd.
17-06-2013 on payment of non refundable tender fees as specified above (extra Rs.
100/- each by post), between 11.00 Hrs. to 17.00 Hrs. on all working days. Tender
documents down loaded from web site will also be entertained in that case bidder must
submit tender fees in a separate envelope with bid. In case of any ambiguity, the terms
and conditions mentioned in the tender document will be final. The payment of
EMD/Cost of Bidding Document shall be made by crossed Demand Draft in favours of
MPPKVVCL, Indore payable at Indore. Cheque/Cash/Postal orders will not be accepted.
The last date of selling of tender document shall be 17.07.2013 upto 12:00 hours
and last date of submission of Bid shall be 17.07.2013 upto 17:00 hours .
Further details could be obtained from No: Ph No.:0731-2426247, 2426355, 2426311

www.mppkvvcl.org

//Save Electricity//

Page 2

Director (F&A)

TENDER DOCUMENT INCLUDING TERMS OF REFERENCE (ToR) FOR

APPOINTMENT OF THE INTERNAL AUDITOR
1. INTRODUCTION & BACKGROUND
Madhya Pradesh Paschim Khsetra Vidyut Vitran Company Limited, with its Head Office at GPH Campus
Pologround Indore, is a Power Distribution Company incorporated under the provisions of the Companies
Act, 1956 and is a Government of Madhya Pradesh Undertaking, post un-bundling of Madhya Pradesh State
Electricity Board in 2005, as a part of the MP power sector reforms. The scope of work of the company
includes:
i. Distribution of electricity to retail consumers;
ii. Compliance of requirements provided under provisions, regulations, notifications, clarification, etc
issued or notified by Madhya Pradesh Electricity Regulatory Commission (MPERC).
iii. Operation and Maintenance of distribution system;
iv. Billing to retail consumers and collection of revenue from retail consumers;
v. Capital investment for improvement and capacity enhancement of distribution system.
The Company is engaged in the distribution & retail supply of electricity to its consumers through 2
regional offices,14 circles and 51 divisions. There are about 402 Distribution Centres/Zones and 4 No. City
Divisions under the Company in the specified area.
The Management of the Company has decided to appoint Internal Auditors, by engaging the Firms of
Chartered Accountants with a view to bring in a professional approach in the Internal Audit of the Power
Distribution business in Madhya Pradesh. As a part of the implementation of the same, the appointment is
planned to be done on a 2-tier basis:
1. Tier I Audit Firms Internal Audit of all the sections/departments of the Corporate Office
along with managing/verifying the works of the Tier II Audit Firms.
2. Tier II Audit Firms Internal Audit at the Regional/ Division Office(s).
The company desires to engage a reputed Chartered Accountant firm as Internal Auditor for
undertaking the Tier I Audit functions at the Corporate Office to carry out the internal audit on a
quarterly basis of all the sections/departments of the Corporate Office.
2.

OBJECTIVE :The objective of this assignment shall be to:

2.1. Focus on regular internal audit of the office(s) to assess ,review ,recommend and comment in respect
of effectiveness & efficiency of accounting, financing , operation & maintenance functions and
procedural compliance at all the corporate divisions;
2.2. Ensure prevention by early detection of misappropriation, fraud, irregularities, negligence, etc;
2.3. Establish an effective internal audit and control system;
2.4. Achieve the objectives specified in the Corporate and Operational Plans.

3.

QUALIFICATION CRITERIA
(Refer Annexure 1 for Submission of Information for the Qualification Verification)
3.1 The CA Firm must be in operation for at least fifteen (15) years, (with at least one (1) office of
operation located in Indore duly registered with ICAI and at least 1 Partner should sit regularly in
such Office. If the firm does not have its office in Indore at present then the firm shall submit an
Undertaking in the Annexure-6 regarding consent for opening of its Branch office in Indore duly
registered with ICAI within one month of receipt of Letter of Award(LoA). If selected firm after one
month of receipt of Letter of Award (LoA) fails to submit copy of the registration of firm from ICAI
showing Branch office in Indore its contract award shall be cancelled.
3.2 The CA Firm must be empanelled with C&AG for the FY 2013-14, having a minimum of three (3)
Fellow Chartered Accountants (FCA) and at least one (1) DISA/CISA qualified Chartered Accountant;
3.3 The firm must undertake to deploy audit team as per details given in Clause 13 of the tender
document.
3.4 Firm should have served as internal auditors for two (2) years during past four years in any zonal/
regional/ corporate office(s) of a Govt. / Semi Govt. Undertaking which has a turnover of at least Rs.
500 Crores; In case of internal audit has been carried out for the Corporate office of any Govt. / Semi
Govt. Undertaking then the turnover shall be considered for the organisation as a whole. In case of
internal audit has been carried out for the Zonal / Regional office of any Govt. / Semi Govt.
Undertaking then the turnover shall be considered for that particular Zonal/ Regional office(including
offices subordinate to such Zone/Region). As a proof of turnover the bidder firm required to submit a
certificate in this regard from the client.
3.5 The Firm should have turnover of at least Rs. 20 Lacs in any one Financial year, FY 2011-12 or FY
2012-13 ;
3.6 There should be no legal suit / Criminal case pending or contemplated against the CA Firm on the
grounds of moral turpitude or for violation of any of the law in force.

Page 3

4.

PERIOD OF VALIDITY OF THE BID :The Bid shall remain valid for a period three (3) months from the date of opening of Technical Bid.
MPPKVVCL reserves the right to request extension of the bid validity for an additional period of three (3)
months, if necessary.

5.

TERM OF AGREEMENT (CONTRACT PERIOD)

The Internal Auditor for the Corporate Office would be appointed for an initial period of three (3) years
from the date of letter of award.
MPPKVVCL, Indore reserves the right to terminate the Agreement at any time before the expiry of the
Contract Period.

6.

EARNEST MONEY DEPOSIT

6.1. All interested bidders are expected to submit, along with their Bid, Earnest Money Deposit (EMD) of
Rs. 10,000 /-, in the form of DD / Bankers Cheque, drawn on any scheduled bank in favour of
MPPKVVCL, payable at Indore.
6.2. The EMD of the unsuccessful bidder shall be returned not later than sixty (60) days after the expiry
of the period of Bid validity as specified above.
However, EMD of Successful Bidder shall be returned after the submission of the Security Deposit
and Execution of the work.
6.3. Offers submitted without EMD shall be summarily rejected.

7.

CLARIFICATION/FURTHER INFORMATION
The Bidders may seek clarification on the ToR by making a request in writing, submitted to the person
addressed below, either in person, or through registered post / courier, or through email, in the format
prescribed in Annexure 3 till 08.07.2013 as per the details provided below:
Designation :Director (F&A)
Address
:O/o MD (West Zone),
MPPKVVCL G.P.H. Compound,
Pologround, Indore (M.P.)
Ph No.
:0731-2426247,2426355, 2426311
Fax No.
:0731-2423300
E-mail
:financewz@rediffmail.com

8.

PRE-BID CONFERENCE
Interested Bidders may attend the pre-bid conference on 10.07.2013 at 12.00 Hrs.at the following
address:
Conference Hall O/o MD (West Zone),MPPKVVCL G.P.H. Compound, Pologround, Indore (M.P.)

9.

Due dates
Sl. No.

10.

Activities

Due Dates

Issuance of Tender Document

17th June,2013

Pre bid conference

10th July, 2013 at 12:00 Hrs.

Last date for sale of Tender Document

17th July, 2013 at 12.00 Hrs.

Last date of submission of Bid (Bid Deadline)

17th July, 2013 at 17.00 Hrs.

Opening of Technical Proposal

18th July, 2013 at 11.00 Hrs.

CONSIDERATION OF BID
10.1. The bid must be enveloped and super-scripted as Envelope 1 Earnest Money Deposit and
Tender Document Fees [Bidder to insert if applicable];
10.2. Envelope 2 - Bid for appointment as Internal Auditor- Technical Bid containing all the
information and enclosures as required in Annexure 1 and undertakings as attached in Annexure
-4, Annexure -5 and Annexure-6. The bid which do not contain the requisite information or is not
supported by the supporting documents will be treated as non responsiveness, and his bid will not be
opened.
10.3. Envelope 3 - Bid for appointment as Internal Auditor- Financial Bid must contain the
Quotation for each year of the Contract period for the appointment as Internal Auditor of the
Corporate Office.
10.4. The bids, found eligible after evaluation of the technical bid, will be shortlisted and financial bids of
only such eligible bidders shall be opened.

Page 4

10.5. The financial bid with the lowest Total Quoted Fees will be selected for award subject to condition
that the lowest Total Quoted Fees quoted by the bidder is reasonable and other contractual
formalities are fulfilled.
10.6. The selected bidder shall be issued a Letter of Award (LoA) by MPPKVVCL, Indore.The selected
bidder shall accept the Letter of Award unconditionally, within seven (7) days from the date of
issue of the LoA.
10.7. Upon acceptance of the LoA, the selected bidder shall be required to sign up an agreement
with MPPKVVCL Indore on a non judicial stamp paper of Rs. 250/-, within fifteen (15) days of
acceptance of LoA, containing overall terms and conditions which shall be binding on the firms.
Draft of the Agreement is given as Annexure -8.
10.8. Cost of the stamp and revenue stamp affixed on the agreement shall be borne by the applicant.
MPPKVVCL, Indore shall not reimburse these costs.
10.9. The selected bidder shall commence the work of Internal Audit within 15 days of signing of the
agreement.
10.10. If the selected bidder:
10.10.1.Fails to accept the LoA within the prescribed time;
10.10.2. Fails to complete the contractual formalities within the stipulated time period; or
10.10.3. Fails to commence the work within the stipulated time period.
Then in such cases, MPPKVVCL, Indore reserves the right to cancel the offer made to such firm,
forfeit its EMD and may also blacklist the bidder. In such case the MPPKVVCL may at its discretion
,offer the contract award to L-2 firm at the rates quoted by L-1 Firm .
10.11. The selected bidder shall not sublet the work of Internal Audit to any other party. Any violation of
this provision would make the contract liable for termination
10.12. MPPKVVCL, Indore reserves the right to cancel the tender without assigning any reason thereof.
11. DUE DATES OF OPENING OF THE BID
Bids will be accepted up-to 17.00 hours on 17th July,2013 and will be opened on 18th July,2013 at
11.00 hours in presence of the CA Firms or their authorized representative.
12. RIGHT OF REJECTION
The Company is not bound to accept lowest Total Quoted Fees, nor is it bound to assign any reason
whatsoever for rejecting any or all of the Bids.
13. STRUCTURE OF AUDIT TEAM & ROLES AND RESPONSIBILITIES
13.1.

The selected bidder firm shall be required to depute one audit team for the Internal audit of
the Corporate Office, consisting of one (1) Chartered Accountant and two (2) experienced staff
who should be minimum graduates and not be the article assistant of the firm (each with
minimum 2 years experience) on full time basis in the premises of the Company .
13.2.
In addition to Audit team as mentioned above, the Bidder shall have a Team leader who should
be a Fellow Chartered Accountant (FCA) responsible for the supervision and overall monitoring of
the team. He shall arrange all necessary information for the audit team from time to time,
Effectively supervise and control the audit,.
13.3.
The deployed Audit team, referred to as Auditor hereafter, shall be responsible for Carrying out
the day to day Internal Audit of the Corporate Office as per scope of work defined in Annexure-7
of the tender document.
13.4.
The Internal Audit staff will be authorized to review all areas of the organization and shall have full
and free access to all activities, records, property and personnel of the organization.
13.5.
The Team leader (FCA) deployed shall be responsible for the overall
coordination of the
Internal Audit function. He should ensure the work shall be as per the Scope of Internal Audit
and completion of the Audit as per the schedule.
13.6.
During the course of the audit there shall be regular meetings once in a month between
the management of the Company and the team leader of the audit team to discuss and review
upon the issues. He should also report to the management of the company on need basis .
13.7.
The selected bidder firm shall be required to report the outcome of their activities to the Director
(F&A).
13.8.
The Internal Auditor should be responsible for periodically evaluating the adequacy and
effectiveness of the system of internal control and the quality of performance in carrying out
assigned responsibilities throughout the Company.
13.9.
The Internal Auditor shall be obliged to maintain complete secrecy and not to disclose any matter
which comes to its knowledge while conducting Internal Audit, to any third party, which may
affect the interest of the Company adversely.
13.10. The appointment of the Audit team and the team Leader shall be made on the basis of the
credentials, experience and capability as furnished by the participating firm for the purpose of
evaluation along with the technical proposal.
13.11. The Internal Auditor shall not sublet the work of Internal Audit to any other party.

Page 5

14.

15.

SECURITY DEPOSIT
The successful bidder needs to submit a Security Deposit equivalent to five percent (5%) of the Total
Quoted Fees in the form of a DD drawn on a scheduled bank in favour of MPPKVVCL, payable at Indore,
within seven (7) days from the date of acceptance of the LoA by the Successful Bidder. Failure to
commence the audit within one (1) month from the date of acceptance of the LoA shall entail the forfeiture
of security deposit and cancellation of the LoA.
INTERNAL AUDIT AUDIT OPINION AND REPORTING:
Audit Reporting shall be in the following manner:
The Internal Auditor shall have 2 types of reporting, viz., Monthly reporting and Quarterly reporting:
15.1. Monthly report shall cover only the following:
15.1.1. Certificate for Monthly balances of Cash and Bank of all the banks of Corporate Office;
15.1.2. Observations on treatment and accounting of interest charges, Loan repayment and other
charges related to various grants, loans etc;
15.1.3. Certification on working of T& D Loss, Collection efficiency and Statement of Input Energy,
Sales, Demand and Collection.
15.1.4. Any other critical observation which might have significant impact due to non attention.
The monthly report will need to be submitted by the 15 th of the subsequent month.
15.2. Quarterly Report shall cover the detailed scope of audit as per Annexure 7. The Internal Auditor
should ensure the applications of the Standards of Internal Audit (SIA) while performing the function
of Internal Audit. The quarterly report to be submitted by the 15 th of the month following the
quarter.
The internal auditors are required to include following format in their report:
15.2.1. The following records could not been referred by the Auditors (List of records with the
reason e.g. non production / non availability)

15.2.2. Irregularities noticed in all the departments

(Point wise irregularities may be furnished under following broad category)
15.2.2.1.Financial Irregularities:
(a)
(b)
15.2.2.2. Regulatory irregularities:
(a)
(b)
15.2.2.3. Persistent irregularities:
(a)
(b)
15.2.2.4. Procedural Irregularities:
(a)
(b)
15.2.3. In addition to the Audit reports, the Internal Auditor shall prepare the Management Letter,
in which the following shall be included:
15.2.3.1 Comments and observations on the accounting records, financial systems and
internal controls that were examined during the course of the audit.
15.2.3.2 Comments on the deficiencies in the internal controls, procedural compliance in
the various departments of the Corporate Office.
15.2.3.3 Identify specific deficiencies and areas of weakness in systems and internal
controls at all levels in the Corporate Office and make recommendations for
their improvement.
15.2.3.4 Report on the degree of compliance with standards of ethics, plans, policies and
procedures of reporting, laws and regulations and give comments, if any, on
internal and external matters affecting such compliance.
15.2.3.5 Communicate matters that have come to the attention during the audit which
might have a significant impact on the functioning in the company.
15.2.3.6 Bring to the companys attention any other matters that it considers pertinent for
risk mitigation and strengthening the internal controls.
15.2.3.7 Give recommendations for the audit findings.
Each deliverable shall be provided in printed format in triplicate to MPPKVVCL, Indore along with the soft
copy. Further, a summary of each audit report will be submitted to the top management of the company.
The Head of Internal Audit will include the Management's response in the audit report and shall clearly
specify the corrective action taken or to be taken in regard on the specific findings and recommendations.
Management's response should include a timetable for anticipated completion of action to be taken and an

Page 6

explanation for any recommendations not addressed. All significant findings will remain open until cleared
by the Head of Internal Audit.
The Internal Auditor shall work for the achievement of the objectives of Internal Audit and as per the
Standards of Internal Audit prescribed.
However, if the performance of the Internal Auditor is found to be unsatisfactory or not to the standards as
expected by MPPKVVCL, the contract can be terminated even before the expiry of the period of agreement.
Indicative performance parameters are listed in Annexure 2 can be used as the medium for reviewing the
performance of the Internal Auditor.
16. OFFICE SPACE
The Company shall provide all sitting arrangements including furniture free of cost for bona-fide use of
audit staff. Other resources, viz. computers, telephone etc. would have to be arranged by firm.

17. Travelling Expenses

The expenses incurred on travelling of the staff of the Internal Auditor deployed on the project to any
of the Field offices for the purpose of the Audit shall be reimbursed at par, provided the same is with
the consent of the Head of Internal Audit, MPPKVVCL. The TA Bill shall be submitted to Joint
Director (Finance & Accounts ), Indore in the prescribed form of the Company. However, the TA Bill shall
be reimbursed based on the travel slab applicable to the corresponding rank in the Company under the
rules in force from time to time.
18. PAYMENT TERMS
Fees for the Internal Audit Function
18.1.

The Bidder shall quote the lump-sum price for each year of the Contract period, inclusive of all
taxes, duties etc., for carrying out internal audit of MPPKVVCL as per scope of work and the terms
and conditions given in the tender document. The payment terms for each year of the Contract
period will be as follows:6
Sl.
No.

18.2.
18.3.
18.4.
18.5.
18.6.
18.7.

Release of Fees

Percentage (%) of the Annual

Quoted
Fees
(AQF) for the
relevant year

On submission and acceptance of 1st Quarter Report

along with the Management Letter

20%

On submission and acceptance of 2nd Quarter Report

along with the Management Letter

20%

On submission and acceptance of 3rd Quarter Report

along with the Management Letter

20%

On submission and acceptance of 4th Quarter Report

along with the Management Letter

20%

Final payment after one (1) month from the date of

submission of 4th quarter report

20%

In case of delay in submission of the Quarterly Audit Report ( in Hard & Soft copy) within 30 days
of the end of a Quarter, a penalty of 2% of the fees due for the particular quarter will be imposed
for every week delay subject to a maximum of 5% of the fees due for quarters.
Quarterly payment of accepted fees will be made within 45 days or on turn as per queue
whichever is later after satisfactory completion of work as per scope of work mentioned in
Annexure-7 of the tender document.
No interest, claim or penalty etc. would be payable by MPPKVVCL in case of any delay in payment
beyond stipulated time.
No. advance payment shall be made against audit fee.
The bill should be submitted in triplicate to Director (F&A) O/o MD MPPKVVCL, Indore.

After satisfactory completion of the work, the bill will be passed by the Bill section of
Corporate office and shall further be forwarded to the Director (F&A) of Corporate
office MPPKVVCL,Indore for pre-auditing the bill and arranging payment within 45 days
or on turn as per queue whichever is later.

Page 7

FORMAT FOR THE FINANCIAL BID

The following shall be used as a format for the Financial Bid to be submitted in Enevelope-3 of the
Bid.
Annual Quoted Fees (AQF) for the Internal Audit Function
S.
No.
1
2
3

Details
Lumpsum
price
inclusive of all taxes,
duties & all other
expenses
etc.
for
carrying out internal
audit of MPPKVVCL
as per scope of work
and the terms and
conditions given in
the tender document.

Year

Professional Fees
(Amount in Rs.)

Service Tax
(Amount in Rs.)

Total
(Amount in Rs.)

Year 1
Year 2
Year 3

Total
(Rs. In words _________ )
Note:
1. Evaluation will be done on the Total Quoted Fees for three years (including service tax).
2. Any overwriting or erasing in the quotation shall render the same invalid.
3. Where there is any discrepancy between the rates in figures and words, words will govern.
4. Any difference between the original and duplicate copy of the bid, the Original Bid shall govern.

Page 8

ANNEXURE-1
Submission of Information for the Qualification Verification
a) All information submitted shall be sealed and signed by the authorized representative of the firm.
b) A brief Profile of the Firms Practice and experience giving the following details clearly:
1
2
3
4
5
6
7

Name of the Firm

ICAI Registration No.
CAG Empanelment No. for the FY 2013-14
PAN No.
Service Tax Registration No.
Strength of manpower.
Audit and Certification work done in past 2 years (along with details as Name of the
client and the fees charged)
Experience of PSUs other than Bank and Insurance Sector

Along with the Profile above, the firm must submit documentary evidences in support of the
above mentioned details, as given in the table below:
1
2
3
4
5

Photocopy of the certificate of registration of the partnership with ICAI

Photocopy of the latest certificate of Constitution of firm issued by ICAI.
Documentary evidence for the CAG Empanelment No. for the FY 2013-14
Photocopy of PAN Card
Photocopy of Service Tax Registration Certificate / Copy of Service Tax Challan etc clearly
specifying the Name and Registration No. of the CA firm
DISA/CISA certificates of the DISA/CISA qualified CA
Audited copies of P & L A/c, Balance Sheet, and Income Tax Return for last three years of
the CA firm
Breakup of the Professional Fees of 2012-13, clearly segregating the fees from Audit
services during the year (if not already available in the audited accounts), duly attested by
its Auditor

6
7
8

c)

Qualification of the staff

Sl. No.

Qualification

1
2
3
4

No. of CAs
No. of DISA/CISA qualified CA
Postgraduate in Commerce
Graduates in Commerce

d)
1
2
3
4
5
6
e)
f)
g)

No. of Staff on rolls

Details of list of major five clients with data for FY 2012-13 giving the following details
clearly:
Name of organization.
Form of organization (Partnership/ Proprietary/Company).
Turnover.
Fee charged.
Experience/Completion Certificates of Statutory / Internal Audit from at least three clients out of
the Clients as mentioned above.
Audited Financial Statements of the Year 2012-13 of the clients mentioned above.
Documentary evidence in support of the internal audits undertaken for zonal/ regional/corporate
office(s) of a Govt/ Semi-Govt Undertaking (Appointment letter for the appointment as Internal
Auditor of the zonal/regional/ corporate office(s) of a Govt./ Semi-Govt. Undertaking)
Certificate of Turnover of the Govt/ Semi Govt. Undertaking for whom the firm has served as
Internal Auditor.
Audited Financial Statements of the Govt/ Semi-Govt undertaking for the respective year(s) for
which the firm has served as Internal Auditor.

Page 9

Indicative Performance Parameters of the work of Internal Auditor

ANNEXURE- 2

The performance of the Auditor shall be determined based on the following parameters:

Feedback from the Board of Directors of the Company;

Elapsed time for issue of reports completion of audit work to draft report;

Elapsed time for issue of reports draft to final report;

% unsatisfactory audit opinions (not more than 10%);

% of recommendations accepted (not less than 50% - 70%);

Number of repeat audit findings;

Amount of direct savings potential as a result of audits;

Amount of measurable savings achieved as a direct result of audits;

Number of major process improvements implemented as a result of audits;

Extent of reliance External audit can place on Internal Audit;

Extent of advice given; and

Number of best practice ideas shared

In addition to the above list, the Internal Auditor is also expected to follow and meet the minimum
standards for Internal Audit as prescribed from time to time.

Page 10

ANNEXURE- 3
FORMAT FOR CLARIFICATIONS IN THE TENDER DOCUMENT
Sl.
No.

Clause no. and existing

provision

Clarification
required

Page 11

Rationale
clarification

for

the

ANNEXURE -4
UNDERTAKING BY THE BIDDERS
(This undertaking is to be submitted along with the Technical Bid in Envelope -2.)
(This undertaking should be on a non-judicial stamp paper of `100 duly notarized)
To,
Director (F&A),
O/o MD (West Zone),
MPPKVVCL G.P.H. Compound,
Pologround, Indore (M.P.)
Dear Sir,
Sub: Bid for Appointment of Internal Auditors at the Corporate Office, MPPKVVCL, Indore
(Tender Specification No. MD/WZ/02/Audit/13-14/TS-02 /12713
Indore dtd: 07.06.2013 )
This undertaking is submitted in respect of the appointment of Internal Auditors for the Corporate Office of
MPPKVVCL, Indore, in response to the tender document dated 07.06.2013 issued by MPPKVVCL, Indore
and subsequent amendment thereof.
We hereby confirm that:
1. We have never been blacklisted by any Government Department or Public Sector Undertaking of
any State Government in India or the Government of India for practicing in India.
2. We have no pending or contemplated legal suit or criminal cases on grounds of moral turpitude or
for violation of any other law in force.
We understand and agree that if the information mentioned above is found to be incorrect at any stage of
this Bidding Process, our Bid shall be considered as non-responsive and rejected accordingly. If this
undertaking is found to be incorrect post the issue of LoA, then such LoA issued shall be cancelled and the
contract terminated, without any liability to either Party. Under such circumstances, however, we
acknowledge and accept the right of MPPKVVCL to encash our EMD.
We further understand and agree that if the Audit is awarded to us and this undertaking is found to be
incorrect after execution of the work, the order of appointments stands terminated, without any liability to
either Party. Under such circumstances, however, we acknowledge and accept the right of MPPKVVCL to
encash our security deposit.
..
(Signature of authorised signatory of the firm issued along with firm seal)
Name:

Designation:

..

Date:

Place:

...

Page 12

ANNEXURE- 5
UNDERTAKING BY THE BIDDERS
(This undertaking is to be submitted along with the Technical Bid in Envelope -2.)
To,
Director (F&A),
O/o MD (West Zone),
MPPKVVCL G.P.H. Compound,
Pologround, Indore (M.P.)
Dear Sir,
Sub: Bid for Appointment of Internal Auditors at the Corporate Office, MPPKVVCL, (Tender Specification
No. MD/WZ/02/Audit/13-14/TS-02 /12713
Indore dtd: 07.06.2013 )
This undertaking is submitted in respect of the appointment of Internal Auditors for the Corporate Office of
MPPKVVCL, Indore , in response to the tender document dated 07.06.2013 issued by MPPKVVCL, Indore
and subsequent amendment thereof.
We hereby agree that:
a) We shall deploy audit team & team leader as mentioned in Clause- 13 of the tender document on the
assignment who shall be responsible for the Internal Audit of the Corporate Office;
b) The experienced staffs deployed on the assignment are not the articled assistants of the firm.
c) The staff will maintain complete secrecy of the records and will not disclose any matter which comes to
the knowledge during the conduct of internal audit, to the third party, which may affect the interest of the
Company adversely.
..
(Signature of authorised signatory of the firm issued along with firm seal)
Name:
Designation:
Date:
Place:

..

Page 13

ANNEXURE-6
(Format for submission with Technical-Proposal)
(To be kept in envelope 2)
[Shall be detailed out as indicated in the format on the Companys/ Firms Letter Head]
I, the undersigned, being the duly authorized representative, do hereby declared that if the
work of the Appointment Of The chartered Accountant Firms as Internal Auditor for Audit of
Corporate Office, MPPKVVCL, Indore For Three Years allotted to our firm , the firm shall open
its branch office in Indore, within one month of the receipt of the LoA from MPPKVVCL Indore
and a copy of the registration of the firm from ICAI showing its branch office in Indore will be
submitted to the MPPKVVCL Indore failing to which MPPKVVCL Indore shall have the right to
reject our proposal .
The undersigned understands and agrees to the statement made above.

________________________________
(Signed by an authorized Officer of the Firm, along-with seal of firm)
Title of Officer Name of FirmDate
Place-

Page 14

ANNEXURE -7
Broad Scope of Internal Audit at the Corporate Office Level
Internal auditing is an independent, objective assurance and consulting activity designed to add value and
improve an organization's operations. It helps an organization accomplish its objectives by bringing a
systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control,
and governance processes.
The Internal Audit firm appointed shall be responsible to carry out internal audit function, and submit
reports as per the reporting requirements on Audit observations a initial period of three (3) years.
(A)

SCOPE OF INTERNAL AUDIT AT CORPORATE OFFICE

Scope of Work should include the verification of internal controls and process at all the
sections/departments of the Corporate Office It includes internal controls in all the departments / sections
of the corporate office In particular , the internal auditor shall be required to comment on following aspects
of working of different department of the Corporate office.
1. C.E.(Purchase)
1.1. Checking of administrative & financial approval and payment against tenders above Rs. 50 lacs.
1.2.
To verify the progress of all the turnkey contracts awarded and ensure the same comply with
the contract conditions.
1.3.
Checking of the cost data and estimates of the turnkey projects
1.4. Refund status of EMD/ SD
1.5. Release of BG where the contracts are concluded.
1.6. Check to ensure that tender procedures viz, payment of earnest money ,receipt of tender,
opening of tender, attestation of tender by Finance Representative etc. are complied with.
1.7. Check to ensure that tenders from black listed parties are dealt with as per orders/instructions
on the subject.
1.8. Check to ensure that ordered quantity is delivered within the due date as per delivery schedule;
in case of extension, it may be seen that the extensions are approved by the competent
Authority.
1.9. Check to ensure that in case of cancellations that these are made with the approvals of the
Competent Authoritys terms of purchase order.
1.10. Check to ensure that Purchase Order /agreement
incorporates a suitable compensation
Clause in case of delay in execution or non execution of Purchase/ various orders .
1.11. Check to ensure that in the respect of Purchase Orders placed against ex-post-facto approval of
Chairman/Board ,that such ex-post-facto approval are in fact obtained.
1.12. To check whether a proper system exists to check the approval of the competent authority
before any action is initiated by the purchase department.
1.13. To determine whether purchase order are placed promptly after receipt of requisitions .
1.14. To make sure that bids are properly analysed in accordance with the procedure laid down
1.15. Whether an award is made other than to the lowest bidder,Find out why it was done and
whether approval was secured and reasons for accepting a bidder other than lowest are
properly recorded .
1.16. To see that the procedure for registration of suppliers are followed as per rules.
1.17. To verify whether tenders received against different enquiries are kept under safe custody and
opened on due date.
1.18. To verify whether tender opening register is maintained properly.
1.19. To examine whether sales tax and all other taxes applicable as well as percentage there of
mentioned on all purchase orders.
1.20. Proper action is being taken against the (i) Firm who has failed to supply the material /failed to
carry out the work as per order (ii) Firm who has not supplied material in time, in required
quantity and as per specification of the supply order or firm who has not carried out the work in
time and as per specification of the work order.
1.21. To check :- (a) whether nomenclature of specifications given in the tender/enquiry/Tender
Notice tally with the Quotations/Tenders received. If not, note the differences. (b) Whether
rebates offered by the tenders for payment terms or quantity are brought out in the
comparative statement and duly availed of. (c) Whether one supplier is quoting in different
names so as to fulfil the requirement of minimum three quotations. (d) whether there is any
attempt to split the purchases.
1.22. To see that the adjustments for the short supply or the reject material and credit received from
the suppliers are handled correctly and promptly.
1.23. To see that concessional rate of Central and Commercial Tax is availed wherever applicable in
purchasing goods/ materials.

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1.24. Purchase has been made

after call of comparative tenders by giving wide publicity where
required and rates are reasonable as per prevailing market trend.

2. Human Resources and Administration Section

The following records are generally required to be kept which require checking by auditor :(a) Attendance register (b) Service books (c) Personal files (d) Medical claims register (e) Advance (HBA,
Conveyance advance ,festival advance etc.) register (f) Telephone Register (g) Register of repairs and
replacement (h) Purchase order (i) Stock register (j) Dead Stock Register (k) T.A. Register (l) C.L.
Register(m) Postage stamp account register.
2.1 Administration Department
2.1.1 To test check the indents, purchase orders, requisitions and stock register for stationery and
printing material.
2.2 Personnel Department
2.2.1 Expenditure on establishment and other than establishment and their comparison with the proposed
budgets.
2.2.2 Looking to the present working staff, recruitment of staff of all cadres being made by the Company is
necessary, Justified and Proper procedure is being followed in recruitment.
2.2.3 To check the strength of staff with original sanctions of competent authorities with the staff in
position.
2.2.4 To scrutinise the leave records of employees and test check the calculations of Earned & Sick
leave as per rules and note the postings of actual leave taken into service records /books with
sanctioned applications. Regularisation of cases where the employees availed leave in excess
of prescribed days, cases of non debiting of CL or any other kinds of leave, non deduction of
salary against cross marking in the attendance register, deduction of salary of the employee
towards LWP and other kinds of irregularities.
2.2.5 To check the re-fixation of pay of employees as a result of promotion or an agreement with
union or as per decision of Board/Company taken from time to time.
2.2.6 To see the proper records of each employee is maintained in the personal history sheet
/service books.In case of new appointments it may be ensured that police verification reports
have been obtained.
2.2.7 Test check whether all formalities are observed as per existing rules for the recruitments of employees in
different posts .
2.2.8 To check the leaves other than earned and sick leaves are granted as per existing procedure
of the Board/Company and properly noted in the personnel records/service books.
2.2.9 Proper action is taken in cases of suspension/ termination/demotion/dismissal/compulsory retirement cases
of the employee.
2.2.10 Proper and timely action is taken in all the court cases by the Company.
2.2.11 Maintenance of service book of the employee as per Boards/Companys rule.
2.2.12 Purchases of furniture and fixtures, purchase of computers, disposal of old furniture and computers.
2.3 Pay Rolls /Salary & Wages Payments
2.3.1 To check the each name in salary/wages sheet with attendance records received from the
establishment sanction and other sections/departments concerned.
2.3.2 To check the D.A., C.C.A., H.R.A., other allowances are allowed as per rules.
2.4 Medical Claims
2.4.1 To see that a proper register of medical claims is maintained as prescribed and is kept upto
date.
2.5 Provident Funds Account
2.5.1 Examine that an employee is made a member of P.F. in accordance with the rules and
regulations of the Provident Fund Act Boards /Companys Provident fund Scheme.
2.6 Travelling Expenses
2.6.1 T.A. Bills
2.6.1.1
To verify that the TA bills are correctly passed as per the Travelling Allowances Rules of the
Board/Company.
2.6.1.2
To verify that the journey was actually performed and it was authorised by a competent
authority.
2.6.2 T.A. Advance
2.6.2.1
To see that all advance payment for TA are made on the sanction of competent authority and
individual accounts of such advances are duly posted in the TA advance register.
2.6.3 Transfer Advance
2.6.3.1
To verify the transfer TA bill with reference to relevant advice/order .
2.6.4 Telephone register
2.6.4.1
To test check the bills of telephone etc. as passed by Administrations.
2.6.5
Misc. Bills Register.
2.6.6
Dead stock Register.
2.6.7
Cash Book, R-11 Book, CAC, CRA.

Page 16

3. Works and Planning Department

3.1.
3.2.

Verify that administrative approval and technical sanction for various works is granted as per DoP
and in accordance with norms /procedure.
Verify that funds are received for execution of deposit/Contributory works prior to commencement
of such works.

4. Commercial Department
4.1.
4.2.
4.3.
4.4.
4.5.
4.6.
4.7.

5.

Verification of Power Purchase bills, Transmission charges bills and SLDC charges bills.
Verification of HT Cases of Corporate Office CE(IR) Indore & CE(UR) Ujjain Office.Verify that
proposals for sanction of new HT service connection /enhancement of load etc. are processed
expeditiously and delays are avoided.
Verify that various sanctions are granted after competent approval as per DoP.
Audit of Franchisee Accounting.
Audit of wind energy Account.
Audit of open access consumer HT bill.
To verify and certify that the Billing software is updated from the effective date for the Tariff Rates
consumer category wise as approved by MPERC.

Finance Department
5.1.

Books of Accounts
5.1.1.
Ensure that the books of accounts like Loan registers, grant registers, shareholders
registers and all the other books of accounts required to be maintained as per CAG or
any other Statute are maintained and duly updated.
5.1.2.
Verify that the financial transactions have to be thoroughly checked for their
accounting.
5.1.3.
Scrutiny of trial balances of all accounting units and head office, and reporting of the
observations on the same.
5.1.4.
To verify accounting and treatment of the interest charges, bank charges, guarantee
and other charges on funding by various funding agencies.
5.1.5.
Checking of capitalization and depreciation calculations .
5.1.6.
Proper Accounting of Grants.

5.2.

Bank Transactions
5.2.1.
Reporting of the Status of the bank reconciliation statement of the bank account at
the Corporate Office and passing of adjustment entries.
5.2.2.
Report on the settlement of all old items reflected in the BRS.
5.2.3.
Report on the status FDRs and Investments indicating interest earned/ accrued
during the quarter vis--vis reinvestment of the amount.
5.2.4.
Surprise verifications.
5.2.5.
Review of the Bank Accounts and suggestions for the closure of unnecessary Bank
accounts and discontinuance of the same.
5.2.6.
Reconciliation of TDS deducted by the Bank on investments
5.3. Debt Servicing
5.3.1.
Verification of repayment of principal of various loans as per the payment schedule.
5.3.2.
Interest payments on various loans.
5.3.3.
Preparation of JVs month wise and proper accounting entries of the same.
5.3.4.
Review of the terms and conditions and benefits accrued as per the loan agreements.
5.4. CBP Cell
5.4.1. Sample checking of invoices of vendors which have been admitted for payment to
verify that the invoice is in conformity with the contract terms and conditions and
deduction of taxes, penalty etc. has been done properly.
5.4.2. To verify that the vouchers for payment of taxes /statutory liabilities are prepared
and submitted to payment section for timely remittance of taxes.
5.4.3. To verify that uniform and consistent approach is adopted while pre audit of
bills/invoices of various vendors.
5.4.4. To verify that all invoices are processed within a reasonable time-limit and delays are
not occurring.
6. Company Secretary

Page 17

This shall include checking of following:6.1 All statutory requirements as per Companys Act 1956 are complied.
7. S.E. (Stores)
This shall include checking of following:7.1. Timely receipt of various materials as per terms ,conditions and as per specification of the order. Timely entry
of materials in the Bin Card.
7.2. Timely testing of materials as per conditions of supply order and proper receipt of test report.
7.3. Timely lifting, repairing and return of material failed within Guarantee period by the supplier/repairing firms as
per condition of order like Meter, Power Transformer, Distribution Transformer etc. Timely action taken towards
recovery of penalty from the supplier/repairing firms for cases like non lifting of materials in time ,Material not
returned in time ,material not returned , timely raising liability ,recovery of liability etc. as per terms &
conditions of the order .
7.4. Timely issue of various materials to the field offices in order to reduce the inventory of the material.
7.5. Proper maintenance of records of receipt/ issue of material as per procedure of the Board/Company.
7.6. Timely auction for disposal of scrap material. Proper up-keeping and safety of the materials available in store.
7.7. Check to ensure that in case defects are noticed within the warranty period, whenever a warranty exists ,due
claims are made on the vender/supplier.
7.8. Ensure reconciliation and neutralization of difference as per accounts and as per the physical
verification of inventory is done.
7.9. Reporting on the status of the physical verification of inventory.
7.10. Check to ensure that the quantity delivered against the order is within the +/-tolerance limits
stipulated in the Purchase Order.
8. Project Department
In addition to above, the scope of auditor also includes verification of internal controls and process in
all the following departments / sections of the corporate office.
8.1. Project Department Feeder Separation.
8.2. Project Department RGGVY.
8.3. Project Department R-APDRP.
8.4. Project Department ADB.
8.5. Project Department Works section.
8.6. To verify the progress of all the turnkey contracts awarded and ensure the same comply with the
contract conditions.
8.7. Checking of the cost data and estimates of the turnkey projects.
9. Regulatory and Statutory Compliance
9.1.
9.2.
9.3.
9.4.
9.5.
9.6.
(B)

Checking of fee & fines realized by Commission as per relevant Regulation.

Violation of TDS.
Compliance of MPERC regulations.
To ensure adequate internal control procedures commensurate with the nature & size of the
business in compliance to C&AG Report for the year 2008-09,2009-10 & 2010-11.
Non compliance of payments of the Statutory Dues along with the reasons for the same
should be reported on a quarterly basis.
Checking of the pending cases with the courts vis-a-vis occurring of contingent liability.

SCOPE OF INTERNAL AUDIT TO VERIFY THE WORK OF THE TIER II AUDITORS:

1.

Ensuring timely submission of Internal Audit reports by Tier II Firms, who are carrying out internal
audit of various offices at different circle levels under MPPKVVCL Indore for the different financial
year as per LoA issued by this office. Scrutiny of the Test Audit Report (TAR) & Test Audit Note
(TAN) submitted by the Tier II Firms for the following :1.1 The report is prepared as per standard format decided by the Company & Report file
containing all necessary annexure ,half margins etc. complete .
1.2 The audit recovery pointed out by the auditor is correct as per rules & regulations/circulars
and according to the applicable tariff for the year & calculations are correctly made .
1.3 All pages should be numbered serially.
Preparation of draft of covering letter informing to the auditee office as well as its next superior
office about the TAR/TAN already submitted by the TierII auditor firm to their office, and
requesting them to send the compliance of the various audit observation within one month as per
circular . The draft letter shall be put up to the Assistant Engineer (Audit) /Executive Engineer
(Audit)/ Joint Director (F&A) for the signatures.
To prepare the U.O. Note on the basis of scrutiny of paragraph-wise compliance and offer
comments in respect of final settlement of paragraphs in TAR/TAN for their disposal, dropping or
rejoinder, as the case may be. The draft U.O. Note /letter shall be put up to the Assistant Engineer
(Audit) /Executive Engineer (Audit)/ Joint Director (F&A) for the final consideration.

Page 18

After approval of U.O. Note by the Joint Director (F&A) Preparation of covering letter informing to
the auditee office as well as its next superior office about the settlement of various audit paras of
TAR/TAN submitted by the auditee office and requesting for early submission of compliance of
balance audit para .The letter shall be put up for signatures to Assistant Engineer (Audit)
/Executive Engineer (Audit)/ Joint Director (F&A).
In cases where compliance report of TAR/TAN is not received within one month, make contact
telephonically /writing letter to the auditee office for early submission of the compliance report to
the Corporate office for early settlement of the audit pars & closing the file of the cases in which
compliance of all the audit para have been made.
In case of L.T. Revenue Audit of Distribution Centres, verify the incentive amount claimed by the
Tier II auditor firm for the realised audit recovery as per clause of the tender document of the
Tier-II firm and if the incentive claim found correct then put up the case through Assistant Engineer
(Audit)/Executive Engineer (Audit)/ Joint Director (F&A) for the final consideration.

It is however emphasized that the coverage in the scope of services as mentioned above is indicative and
not exhaustive. Director (F&A) may include more area of audit as per need. Apart from the audit
observations, auditor will be required to indicate discrepancies / inadequacies in the system or
procedures so as to initiate steps for improving the system and making it more efficient. The audit team
will also be required to educate the dealing staff so as to avoid repetition of routine procedural / technical
errors.
Further, all other incidental/ necessary activities for the completion of audit & resolution of matters
arising during the audit ,shall be deemed to be included in the scope of services. In case of judicial
proceeding(s) initiated by MPPKVVCL, Indore, pursuant to the audit for the period, the auditor shall
reasonably assist MPPKVVCL, Indore office by acting as a witness and providing evidences required as
related thereto.

Page 19

ANNEXURE-8
(DRAFT)
OVERALL AGREEMENT TERMS AND CONDITIONS
THIS AGREEMENT is made on _________
BETWEEN:
(1)

MP Paschim Kshetra Vidyut Vitaran Company Limited (referred as MPPKVVCL or

Company hereinafter) having its Head Office at Indore; and

(2)

M/s______________________, Chartered Accountants/Cost Accountants (referred as the

Vendor or Firm hereinafter) having its Head Office/Branch Office at Indore.
INTRODUCTION:

A.

Whereas the MPPKVVCL wants the Vendor to provide certain Appointment Of The chartered
Accountant Firms as Internal Auditor for Audit of Corporate Office, MPPKVVCL, Indore For
Three Years related services (as outlined under the heading Scope of work in the Tender
document, or mentioned herein under) and the Vendor is willing to provide such services all on the
terms and conditions set out in this Agreement.

B.

And, whereas the Vendor has knowledge and experience in the provision of services in the area of
The
chartered Accountant Firms as Internal Auditor for Audit of Corporate Office,
MPPKVVCL, Indore For Three Years of companies of the size and type of MPPKVVCL, Indore. The
Vendor acknowledges that MPPKVVCL has relied on such knowledge and experience in selecting the
Vendor to provide such services.
And therefore, IT IS AGREED as follows:

1. DEFINITIONS AND INTERPRETATION

1.1. In this agreement unless otherwise specified or the context otherwise requires:
1.1.1. where reference is made to a statutory provision this includes all subsequent enactments,
amendments and modifications relating to that provision and any subordinate legislation
made from time to time under it;
1.1.2. a law includes common or customary law and any bye-law, regulation, legislation, decree,
judgment, order, ordinance, statute, treaty or other legislative measure in any jurisdiction
or any present or future directive, regulation, request, requirement or guideline (the
compliance with which is in accordance with the general practice of persons to whom the
directive, regulation, request, requirement or guideline is addressed);
1.1.3. a document in an agreed form is a reference to a document in a form approved by both
parties and for the purposes of identification signed by the relevant Authorised
Representatives on behalf of each party; and
1.1.4. reference to the parties or to a party will be to MPPKVVCL and/or the Vendor unless
otherwise expressly provided and shall include that partys assignees;
2. TERM
2.1.This Agreement will come into force on the Signature Date and will, subject to the terms of this
Agreement, continue for a period till satisfactory completion of work Tender for The Appointment
Of The chartered Accountant Firms as Internal Auditor for Audit of Corporate Office, MPPKVVCL,
Indore For Three Yearsfrom the Signature Date.
2.2.MPPKVVCL reserves the right to extend the term of agreement for a further period of one year, at
the same terms & conditions.
2.3.At any time during the Term, the parties may (in their absolute discretion) by mutual agreement,
extend the Term by such additional period as they see fit and on terms and conditions substantially
similar to those included herein.
3. SERVICES
3.1.From the Service Start Date the Vendor shall provide the Services in accordance with the terms of
this Agreement and Award(Work Order) and will ensure that with effect from the Service Start

Page 20

Date, a team of persons is available to provide the Services. This team will as of the Service Start
Date include the employees of the Vendor.
3.2.The Vendor agrees that it will follow and comply with any reasonable instructions, directions or
requests given or issued which are consistent with the terms of this Agreement by MPPKVVCL's
relevant Authorised Representative in writing or, where it was reasonably impracticable to do so in
writing, given orally and subsequently confirmed in writing by such Authorised Representative in
connection with the performance of the Services.
3.3.The Vendor shall as soon as reasonably practicable notify MPPKVVCL whenever the vendor
becomes aware of and has reasonable grounds to believe that any failure on the part of MPPKVVCL
to carry out its obligations and responsibilities under this Agreement will have a detrimental effect
on the performance or quality of the Services or cost (to MPPKVVCL). The same shall apply to the
vendor also.
4. MPPKVVCL RESPONSIBILITIES
4.1. MPPKVVCL shall:
4.1.1. Use all reasonable endeavours to make available such staff of MPPKVVCL as are reasonably
required on a timely basis to liaise with the Vendor in relation to the provision of the
Services;
4.1.2. Provide to the Vendor on a timely basis such information and documentation as the Vendor
may reasonably require to provide the Services;
4.1.3. Provide the Vendor on a timely basis, taking into account MPPKVVCL 's standard policies
and procedures, with such access to the information as is reasonably required to provide
the Services;
4.1.4. Provide answers on a timely basis to queries, consents and approvals requested by the
Vendor to enable the Vendor to provide the Services.
5. SERVICE LEVELS
5.1. The Vendor shall perform the Services in accordance with the Service Levels listed as part of the
scope of services in the main letter.
5.2. If the Vendor fails to meet the Service Levels as per the scope of services, the Vendor shall as
soon as reasonably practicable:
5.2.1. identify the cause of such failure;
5.2.2. take such action as is reasonably required to minimise the impact of the failure and to
prevent it from recurring;
5.2.3. where possible, correct the failure; and
5.2.4. Advice MPPKVVCL, of the status of the remedial efforts being undertaken for meeting the
service levels as per scope of work.
6. CHARGES
In consideration for the provision of the Services, MPPKVVCL shall pay to the Vendor the Charges
as detailed in the Letter of Award.
7. INVOICING AND PAYMENT
7.1. The Vendor shall invoice MPPKVVCL for the Charges as laid out in the Letter of award (LoA) /work
order which shall be issued to the successful bidder firm.
7.2. The total fees payable for the assignment shall as per Clause-18 of the tender document.
7.3. If MPPKVVCL receives an invoice which, acting in good faith, it reasonably believes is not correct,
valid and/or properly due or where MPPKVVCL, acting in good faith, otherwise disputes the
appropriateness of such invoice, MPPKVVCL shall pay that part of the invoice which is not in
dispute in accordance and shall be entitled to withhold the balance pending resolution of the
dispute and shall notify the Vendor in writing.
7.4. Notwithstanding anything contained in clause 7.1 to 7.3 above, whenever MPPKVVCL acting in
good faith, reasonably believes that the services provided by the vendor were not satisfactory, the
MPPKVVCL shall have the right to wholly or partly withhold the payment or make appropriate
deductions from the invoice of the vendor.
7.5. In case of dispute on any invoice, the dispute resolution procedure, as outlined below, shall apply.

Page 21

7.6. For avoidance of any doubt, it is herein specifically agreed that the Vendor's obligations to provide
the Services shall in no way be affected by any dispute in relation to the Charges or payment
thereof.
7.7. Whenever under this Agreement any sum of money shall be recoverable from or payable by the
Vendor to MPPKVVCL, this may be deducted from any sum then due, or which at any time may
become due, to the Vendor under this Agreement.
8. REGULATORY REQUESTS
8.1. If the Vendor receives requests for information from Regulatory Authorities which relate to the
Services or any other obligation of the Vendor under this Agreement, it shall inform MPPKVVCLs
Authorised Representative promptly in writing and shall provide reasonable assistance to
MPPKVVCL in dealing with the requests.
8.2. The Vendor will only release such information to the Regulatory Authority after:
8.2.1. providing a copy of the information to MPPKVVCL; and
8.2.2. receiving MPPKVVCLs written consent to the release,
8.3. Except that the Vendor shall not be obliged to obtain MPPKVVCLs prior consent or provide a copy
of the information in advance where it is prevented from doing so by law or the relevant
Regulatory Authority.
9.

FORCE MAJEURE
9.1. Force Majeure Event means any event beyond the reasonable control of the affected party.
Force Majeure Event includes, but is not limited to, acts of God, expropriation or confiscation of
facilities, any form of government intervention, war, hostilities, rebellion, terrorist activity, local or
national emergency (including an emergency service to a hospital), sabotage or riots, and floods,
fires, explosions or other catastrophes. Force Majeure does not include:
9.1.1. Strikes or other industrial action by employees of MPPKVVCL or the Vendor; or
9.1.2. Any act or omission of either party's employees, agents, or subcontractors (except to the
extent that person is affected by a Force Majeure Event).
9.2. Neither party shall be responsible for failure to, or delay in, carrying out any of its duties under
this Agreement to the extent to which this is caused by a Force Majeure Event (as defined in
Clause 9.1).
9.3. Should a Force Majeure Event occur, the affected party shall:
9.3.1. Take all reasonable steps to overcome and mitigate the effects of the Force Majeure Event
as soon as reasonably practicable, including actively managing any problems caused or
contributed to by third parties and liaising with them;
9.3.2. On becoming aware of the Force Majeure event promptly inform the other in writing of the
details and provides information of the Force Majeure Event and information about which
Services have been affected to the extent that such information is known, together with, if
practicable, an estimate of the period during which the Force Majeure Event will continue;
and
9.3.3. Notify the other as soon as it becomes aware that the Force Majeure Event has stopped.
9.4. If the Force Majeure Event continues for more than 15 calendar days, the unaffected party may
terminate this Agreement by giving 15 calendar days written notice without cost or liability to the
other party (except in respect of antecedent breaches).
9.5. Nothing in this Clause-9 shall suspend MPPKVVCLs obligation to pay the Charges in accordance
with this Agreement in respect of any portion of the Services provided by the Vendor to
MPPKVVCL not affected by a Force Majeure Event.

10. EMPLOYEES of the VENDOR

10.1. The vendor would deploy persons for provision of the Services to MPPKVVCL ensuring that they
are suitably qualified, skilled and experienced in the work which they are to perform;
10.2. The Vendor will obtain the written approval of MPPKVVCL prior to appointing any replacement for
any Employee of the Vendor (such approval not to be unreasonably withheld or unduly delayed
by MPPKVVCL), except that the Vendor shall be able to replace any Employee without
MPPKVVCLs prior written approval where a Employee leaves the employment of the Vendor, is
prevented from fulfilling his duties due to sickness or will no longer be involved in the Services

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due to natural career progression. Save as otherwise agreed with the MPPKVVCL in writing, the
Vendor will, at its own cost and expense, use all reasonable endeavours to ensure that, where
possible, the Employee who is being replaced imparts appropriate knowledge and experience
concerning the Services to the replacement for the Employee.
10.3. Without prejudice to the provisions of Clause 10.2, before appointing a replacement for any
Employee, the Vendor shall:
10.4. notify MPPKVVCL of the proposed appointment;
10.5. introduce the individual to appropriate representatives of MPPKVVCL (and, if reasonably
requested provide an opportunity for MPPKVVCLs Authorised Representative for Services to
interview the individual); and
10.6. provide MPPKVVCL s Authorised Representative for Services with a resume and other information
about the individual reasonably requested by MPPKVVCL (including, without limitation, a
summary of such persons expertise and previous experience);
AND the Vendor shall provide such replacement for any Employee as soon as reasonably
practicable.
10.7. The Vendor shall:
10.7.1. ensure that its persons engaged in the provision of the Services to MPPKVVCL are suitably
qualified, skilled and experienced in the work which they are to perform;
10.7.2. ensure that while any of its Employees are on MPPKVVCLs premises they will conform to
MPPKVVCLs standard codes of conduct (including policies regarding occupational health and
safety requirements, building access, physical security and dress codes) or procedures as
have been communicated in advance to the Vendor in writing but only to the extent that
such compliance does not place the Vendor in breach of any other provision of this
Agreement.
10.8. MPPKVVCL may, for reasons of incompetence, poor performance or misbehaviour or any such
reason (MPPKVVCL at all times acting reasonably), request the replacement of any Employee of the
vendor. MPPKVVCL shall notify the Vendor giving written reasons as why it is requesting a
replacement to be made. MPPKVVCL and the Vendor shall promptly discuss any such request and, if
the Vendor is unable to satisfy MPPKVVCLs concerns within a time period of three days, the Vendor
shall replace that Employee as soon as reasonably practicable, but not later than seven calendar
days in any case. The Vendor shall use reasonable endeavours to ensure that the Employee who is
being replaced imparts appropriate knowledge and experience concerning the Services to the
replacement Employee. The Vendor shall not be excused from performance of its obligations under
this Agreement as a result of the replacement of any Employee.
10.9. The vendor is expected to provide services of the employees as mentioned in the para 7.1 of the
RFP documents (Tender) on continuous basis on all working days. However, if any employee remains
on leave the vendor must informs of such leaves in advance to the Director (F&A) or any officer
nominated by him, and alternate arrangement shall be made by the vendor.
11. CONFIDENTIALITY
11.1. Each party undertakes to treat all Confidential Information as confidential and to use such
Confidential Information solely for the purposes of this Agreement. Each party shall not, without
the prior written consent of the other, divulge such Confidential Information to any person.
11.2. Each party undertakes to effect and maintain the same adequate security measures to safeguard
the Confidential Information from unauthorised access, use and misappropriation as it maintains
with its own similar information that it does not wish publicly to disclose, publish or disseminate.
11.3. Each party undertakes to notify the other promptly of any unauthorised use, copying or disclosure
of Confidential Information and to provide all reasonable assistance required to terminate such
unauthorised use or disclosure (or both).
11.4. Neither party shall make any announcement about nor disclose the existence or any terms of this
Agreement without the prior written consent of the other. Notwithstanding the foregoing, either
party may advertise or otherwise make known that the Vendor provides services to MPPKVVCL
pursuant to this Agreement without the prior written consent of the other party.
11.5. The foregoing obligations as to confidentiality shall remain in full force and effect notwithstanding
any termination or expiry of this Agreement.
12. DISPUTES

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12.1. This Clause does not prevent either party commencing or pursuing court proceedings to protect
the rights of confidentiality and in respect of the Confidential Information of that party and is
without prejudice to either party's right to terminate this Agreement.
12.2. The Dispute will be dealt with by the parties pursuant to the following escalation procedures (the
Escalation Procedures):
12.2.1. In the first instance, the Dispute will be referred to the Director (Finance & Accounts) for
resolution;
12.2.2. If the Director (Finance & Accounts) cannot resolve the Dispute within 15 Business Days
(or such other period as may be agreed between the parties), the Dispute will then be
escalated to the MD (MPPKVVCL);
12.3. The parties acknowledge and agree that all disputes arising out of or in connection with this
Agreement (the Dispute) shall be dealt with in accordance with the procedure set out in the
Clause 11.2. For the avoidance of doubt, any communications between the parties arising out of
or in connection with Clause 11.2 will be without prejudice and will be treated as confidential.
13. TERMINATION
13.1. MPPKVVCL may terminate this Agreement in its entirety or as it relates to one or more discrete
parts of the Services on written notice with effect from the date specified in the notice if the
Vendor commits any material breach of this Agreement which in the case of a breach capable of
remedy has not been remedied within seven calendar days of service upon the Vendor of a
written notice specifying the breach and requiring it to be remedied. For the purposes of this
Clause, breach shall be capable of remedy if the Vendor can or will be able within the prescribed
period of time to comply with the provisions in question in all material respects other than as to
the time of performance.
13.2. In addition to any other rights it has under this Agreement, MPPKVVCL may terminate this
Agreement in its entirety, or as it relates to one or more discrete parts of the Services, at will,
at any time after the expiry of the one month from the Signature Date, on giving the Vendor not
less than one months written notice.
14. CONSEQUENCES OF TERMINATION
14.1. The Vendor acknowledges that it is critical for MPPKVVCL to have continuity of the Services. To
ensure the orderly transfer of the Services either back in house to MPPKVVCL or to a Replacement
Service Provider, MPPKVVCL relies significantly on the Vendor fulfilling its obligations under this
Agreement.
14.2. The Vendor is an independent contractor and nothing in this Agreement shall be deemed to
constitute a partnership or any employment relationship between the parties nor shall anything in
this Agreement be deemed to constitute one party the agent of the other for any purpose.
Other Terms
& conditions as stipulated in Tender documents of Tender Specification No.
MD/WZ/02/Audit/13-14/TS-02 /12713 Indore dtd: 07.06.2013 shall prevail.
IN WITNESS WHEREOF each of the parties has duly executed this Agreement as of the date first written
above.

Witness
SIGNED by

duly authorised for and

1.)__________________________
2.)_________________________

on behalf of MPPKVVCL
SIGNED by

duly authorised for and

1.)_________________________
2.)__________________________

on behalf of the Vendor

Date:

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