20. The other information

20.1. The information on the received provisions of the Company’s obligations and payments.

The information on the received provisions of obligations of IDGC of Centre is included in the notes to the accounting balance-sheet and in the profit and loss statement in table 5.8.

20.2. The information on planned development of the company:

One of the indicators of the company’s financial standing is its solvency and liquidity, i. e. its ability to pay back its obligations.

Current ratio as of 31.12.2010 took a value of 1.25. As of 31.12.2011 the value of this ratio did not change significantly and was 1.24.

Quick ratio reflects the company’s ability to pay back its current obligations in the shortest period of time. The normal value of the ratio is more than 0.8. Following the results of 2011 this ratio is 1.08.

Liquidity ratios are within normal values, indicating the ability of the company to pay back its current liabilities from current assets and a stable, from a financial point of view, situation in the Company.

Equity-assets ratio determines the stare of the company’s assets financed by equity. The higher the ratio is, the more financially stable and independent from external creditors the enterprise is. The generally accepted standard value for this indicator is 0.6. Following the results of financial and economic activity of IDGC of Centre for 2011 the equity-assets ratio is in the range of normative values.

Overall, following the results of 2011 a significant increase in profitability and financial performance of the company is observed, which is associated with the restoration of the economy of the regions where IDGC of Centre operates. The increase marked at the end of the reporting period will occur in subsequent years.

20.3. Policy concerning borrowed funds, managements of risks.

In case of appearance of one or several of the above mentioned risks IDGC of Centre will take all possible measures on minimisation of negative consequences. Possible events for Company actions are developed for neutralisation of a part of risks when this or that risk occurs. However, it is necessary to note that preliminary development of measures adequate to corresponding events is complicated by uncertainty of development of a situation, and parametres of conducted events will depend in a greater degree on features of the created situation in each specific case. IDGC of Centre cannot warrant that the actions directed on overcoming of arisen negative changes, can lead to the situation correction as the described factors are out of the Company’s control.

• The risks connected with change of currency exchange rates.

The companies conducting foreign trade activities are subject to the given risk. It is shown in shortfall of the provided income as a result of direct influence of change of an exchange rate of the foreign exchange used in the external economic transactions, on expectational monetary flows from these transactions.

The company provides services at the domestic market of the Russian Federation with settlements in rubles (currency of the Russian Federation) and in this connection it is not subject to risks of change of currency exchange rates. Thus it is necessary to note that the Company, performing the investment program, can buy goods from foreign suppliers which cost of services depends on rate fluctuation of currencies. In this connection it is possible to tell that the currency risk for the Company is minimum.

• The risks connected with change of interest rates.

Taking into account the situation stabilisation on financial markets, the risk of change of rates is estimated by the Company as average.

The Company with a view of levelling the risk of loan interest rates increase interacts with the credit companies working with budgetary funds (state, regions of the Russian Federation, municipal).

Thus the Company, being a natural monopoly, performs selection of the financial companies for rendering financial services by carrying out tender procedures established by the legislation of the Russian Federation (Federal law #135-FZ from 26.07.2006 “About competition protection”, Federal law #94-FZ from 21.07.2005 “About order placement on delivery of products, accomplishment of works, rendering services for the state and municipal needs”). According to part 4.1 of article 9 of the Law on order placement, the price of the state order or municipal contract is firm and cannot change during its execution. Thus, the risk of change of interest rates under acting credit contracts decreases.

The policy of the Company concerning external loans is regulated by the Regulation on credit policy of IDGC of Centre, confirmed by the decision of the Board of directors of the Company (Minutes # 06/08 from March 28, 2008). This Regulation determines the order of estimation of financial stability and credit quality of the Company and is the instrument of calculation of value limit of a debt position of the Company and estimation of possibility of attraction of investment credits and loans within the limits of business planning.

The Company plans to perform all credit obligations according to conditions of contracts.

20.4. The information about accounts receivable and payable

For the date of the statement approval reconciliation statements of accounts with counterparts were not returned in full.

The account receivable structure is included in the notes to the accounting balance-sheet and in the profit and loss statement in table 5.6.1.

The accounts payable structure is included in the notes to the accounting balance-sheet and in the profit and loss statement in table 5.6.5.

By results of an inventory the doubtful debt receivable in the amount of 1,788,543 thousand rubles, was revealed on which the reserve on doubtful debts was created. The remainder of not used reserve on the doubtful debts, created as of 31.12.2011, in the amount of 1,066,061 thousand rubles was recovered.

20.5. Information disclosure according to Federal law #261 from 23.11.09 “About energy saving and increase of energy efficiency and modification of some legislative acts of the Russian Federation”.

In the course of economic activities IDGC of Centre consumes for its economic activities electric power and heat energy. In 2011 it consumed electric power for the sum of 418,754 thousand rubles, heat energy for the sum of 56,667 thousand rubles for its own needs.

20.6. Information disclosure on the environmental activities of the Company

The costs of environmental protection of IDGC of Centre for 2011 were 15,314 thousand rubles. The fee for a negative impact on the environment in 2011 was 7,458 thousand rubles.

In 2011, in order to reduce negative impact on the environment and compliance with SanPiN 2.1.7.1322-03 “Hygienic requirements for the placement and disposal of production and consumption waste” in all branches of IDGC of Centre specialized containers for waste collection were purchased, the arrangement of sites for temporary storage (stockpiling) of waste and improvement of surrounding area was performed. IDGC of Centre — Lipetskenergo performed repair and reconstruction of sites for oil-filled equipment, waste oil, scrap metal and wood poles.

Based on SanPiN 2.2.1/2.1.1.1200-03 “Sanitary protection zones and sanitary classification of enterprises, buildings and other facilities” an instrumental control of emissions at the boundary of the sanitary-protection zones was performed. Based on the studies of air at the boundary of the sanitary-protection zones no excess of allowable concentration levels was detected.

Pursuant to Federal Law # 7-FZ of 10.01.2002 instrumental monitoring of compliance with established standards of maximum permissible emissions was arranged.

To comply with Federal Law # 89-FZ of 24.06.1998 “On the Production and Consumption Waste” and creating an analytical framework based on instrumental measurements and laboratory studies for monitoring of compliance with established MPE, MPD and monitoring in temporary storage (accumulation) waste was organized and performed within:

• air control of working zone in the temporary storage of waste;
• monitoring the state of soil contamination;
• laboratory analysis of microbiological, radiological and chemical parameters of groundwater and effluent.

In 2011 IDGC of Centre — Belgorodenergo purchased software packages for MPE project design documentation and performed development of project documentation by experts of the branch.

A key event in IDGC of Centre — Tambovenergo in 2011 is the disposal of equipment containing PCDs.

Return to Explanatory Note for Financial Statements for 2011