Social Responsibility Accounting - A Study With Reference To KREDL

Social Responsibility Accounting A Study With Reference To KREDL
INTRODUCTION
1. SOCIAL RESPONSIBILITY ACCOUNTING
Accounting information is essentially financial information, the concept of money
measurement results in the limitation of recording only those transactions in the
books of accounting that is capable of being measured in terms of money.
Accounting reports are therefore limited to phenomena that can be described in
monetary terms. As a result, many factors important to business organization
which cannot be translated into monetary terms go unrecorded.
A business organization is also a social unit. It uses the societys resources and produces
goods and services for which the society is the ultimate consumer. The business
provides employment for sizeable section of the society makers in various forms.
Thus, it is only in a developed society a business organization would succeed. The
development of the society and business are co-extensive since the business draws
the benefit from the society it has a responsibility towards it.
KARNATAKA STATE OPEN UNIVERSITY, MUKTHA GANGOTHRI, MYSORE

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An increasing awareness in our society in recent times is that business managers are
made increasingly responsible for consequential society and environmental impact.
Changing environments and social parameters have compelled them to revalue their
social as well as economic obligations towards the needs of society since society provides
the requisite working infrastructure and facilities. This has made the enterprise to account
and report also the needs of society. Hence the organization has to present the accounting
statements which will reflect the social and economic benefits created by it as well as the
costs incurred with which to appraise its contribution towards solving the problems of
society.
Social accounting began developing in the U.K. in the early 1970s, when the public
interest Research group established Social Audit Ltd. This organization carried out, and
published, investigations into the operations of large public companies, without
necessarily gaining their permission or cooperation, whilst lending support to consumer
pressure, there is an argument that this had a negative on accountability, as organizations
sought to ensure that sensitive information was hidden from such investigations.
Globalization has brought with it a wide realization that companies do not operate in
isolation, but can have marked impacts on the environment and people at local, national,
and global levels. This has led to an increasing awareness of CSR, and the triple bottomline of business success and measuring the business not only in financial performance,
but by its social and environmental impact as well. Third craft and the new economic
foundation pioneered a form of social accounting in early 1990s that in voluntary in
nature and rooted in engagement with stake holders. This can assist organization, both
commercial and NGOs, in understanding and improving their social impact.

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Technically, the terms social accounting or social audit refer to specific parts of a
process now bestowed with the much more unwieldy title of social and Ethical
Accounting, auditing and Reporting(SEAAR). In practice, the shorter titles tend to be
used interchangeably to refer to the entire process. Whichever title is used, the process
should involve all three steps:
Internal data collection and analysis procedures (accounting)
An independently audit of the results (auditing)
A mechanism for disseminating the outcomes more widely (reporting)
Modern financial tests postulate that the objective of the firm is to maximize its market
value. Acceptance of this single objective should lead managers to maximize the
anticipated level of net operation cash flows and minimize the perceived level of risk
associated with those cash flows.
The value of the firm is its discounted anticipated net operational cash flows. The single
financial objective of maximization of the market value of the firm has not been
universally accepted. Even a cursory glance at the convention profits and loss accounting
suggested the companies responsibilities to various interest groups.
It can be interpreted as suggesting that corporate managers have responsibilities towards
consumers, managers of international payments, suppliers, and employees including
mangers, local communities, and mangers of government finances as well as shareholders
and provides of loan capital.
Social Accounting and its reporting is becoming essential on account of the following:
Increasing awareness of society about the corporate social contribution.

Providing means of identifying and rewarding business for social contribution.
Identifying adverse effects on the environment.
Improving credibility and reputation of business.
Transferring cost of social activities to other segments of society.

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While designing the contents to be included in social accounting, it should be taken care
of to see that it does not conflict with the shareholders interest.
1.1 RESEARCH DESIGN

The first and foremost aspect in carrying research programme is formulation and defining
the problem. Identifying the various alternatives of the courses and action is the next
thing. Analyzing the outcome of each and every alternative on the basis of cost benefit
analysis is the significant part of the research design. Finding solutions to the problem is
the trump card of any research programme; accordingly the study identified the
effectiveness of social accounting and its measurement at KREDL. The methodology of
what, where, when, how and by whom of the problem design are narrated in this chapter.
The details are,
1.2 TITLE OF THE STUDY

Social Responsibility Accounting A Study With Reference To
Karnataka Renewable Energy Development Limited
1.3 STATEMENT OF THE PROBLEM

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In the modern and knowledge era, knowledge workers are to be retained in the
organization; it calls for effective motivation and financial resources. It is true in all types
of companies. The firm draws inputs from the society, earns profit. It is necessary that the
company out of its revenue should spend a part to meet corporate social performance.
Meeting social obligations is the social responsibility of the organization.
What kind of social activities are formulated and implemented towards the
workers, general public, commuters, downtrodden people, environment protection,
achievers in various fields by the KREDL is the focus is the study.
The social activities performed by the corporation should be accounted and measured.
The cost incurred and benefits obtained from these social responsibility activities will be
considered and Net benefits from these activities will be analysed in this study.
1.4 REVIEW OF LITERATURE

1. PAPER TITLE: Corporate social and environmental reporting: a review of the
literature and a longitudinal study of UK disclosure
Authors name: Rob Gray, Reza Kouhy, Simon Lavers(1995).

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Its major theoretical preoccupations and empirical conclusions, attempts to re-examine

the theoretical tensions that exist between classical political economy interpretations of
social disclosure and those from more bourgeois perspectives. Argues that political
economy, legitimacy theory and stakeholder theory need not be competitor theories but
May, if analyzed appropriately, be seen as alternative and mutually enriching theories
from alternative levels of resolution. Offers evidence from 13 years of social disclosure
by UK companies and attempts to interpret this from different levels of resolution. There
is little doubt that social disclosure practice has changed dramatically in the period. The
theoretical perspectives prove to offer different, but mutually enhancing, interpretations
of these phenomena.
2. Paper title: Corporate Social Responsibility and Firm Financial Performance
Authors name: Jean B. McGuire, Alison Sundgren and Thomas Schneeweis
Using Fortune magazine's ratings of corporate reputations, we analyzed the relationships
between perceptions of firms corporate social responsibility and measures of their
financial performance. Results show that a firm's prior performance, assessed by both
stock-market returns and accounting-based measures, is more closely related to corporate
social responsibility than is subsequent performance. Results also show that measures of
risk are more closely associated with social responsibility than previous studies have
suggested.
1.5 SCOPE OF THE STUDY

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This study covers organizations philosophy, policy, vision, and mission statements,
objectives, particularly the social objectives; activities pertaining to social responsibility
within and outside the corporation, the benefits derived by the beneficiaries out of social
programmes, the officers in charge of the Social responsibility activity at KREDL.
1.6 OBJECTIVES OF THE STUDY
To analyze cost benefit factor of social responsibility activities of the
organization.
To identify the different classes of social responsibility activities undertaken
by KREDL.
To consult the concerned authorities and in respect of social responsibility
activities in the corporation and to know about social audit results.

To analyze the environmental protection activities of corporation.
To validate the data and to arrive at constructive suggestions.
BASIC ASSUMPTION
Findings of the study are based on the assumption that company has disclosed
correct information.
1.7 METHODOLOGY OF RESEARCH

The Methodology consists of the following.
Type of research:
This is a social research for education purpose and type of research that is
followed in this study is descriptive research and analytical study.
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Method of research: The method of research, which is undertaken in this study, is

scientific method.
Sample design:
The trading accounts, profit and loss account, Balance sheet, Auditors report cash
flow statement have been collected on a random technique.
Tools for gathering data: In this section, the tool used for gathering data is financial
statement interview schedules.
a.Sources Of Data
Primary data: In case of primary data, the data are collected by interviewing
managers.
Secondary data: In case of secondary data, the data is collected from financial
records of the company, Internet and magazines.
b. Plans Of Analysis
The data has been tabulated. Each data has been analyzed and evaluated. The findings are
recorded and conclusions are given based on findings.
c. Software Used

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Software package i.e., Microsoft excel has been used for tabulating and analysing the
data.
d. Method Of Analysis
The collected data have been analyzed with the help of statistical tools and techniques
like Averages, percentages, Ratio and the like. And wherever necessary tables, charts,
graphs have been used to make the data in a presentable way.
1.8 LIMITATIONS OF THE STUDY

The study is confined to only KREDLtd .Since it cant be generalized for all the
companies.
Due to the limited time, in-depth study could not be made.
1.9 CHAPTER SCHEME

Chapter-1: Inroduction
Introduction: The chapter deals with design of the study. It gives the introduction,
statement of the problem, objectives of the study, methodology of the study and
limitations of the study.
Chapter-2:Industry Profile
It gives the overview of renewable energy plants in India, trends in renewable energy
sector and initiatives.
Chapter-3:Company Profile
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Company profile: This chapter deals with profile of Karnataka Renewable Energy
Development Limited.
Chapter-4:Conceptual Frame Work

Deals with general introduction of social responsibility accounting,
significance, purpose and importance of social responsibility
accounting. Decision making based on social responsibility accounting.
Chapter-5: Data, Analysis and interpretations

The chapter deals with cost benefit analysis of social responsibility in Karnataka
Renewable Energy Development Limited.
Chapter-6:Summary of findings and Conclusion

This chapter gives summary and findings, conclusion and recommendations.
Bibliography
Annexure
INDUSTRY PROFILE
2.0 OVERVIEW:

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India has the fifth largest power generation portfolio worldwide. Coal and gas
are the popular source account for 58% and 9% share, respectively. The
country has been rapidly adding capacity over the last few year, with total
installed power capacity growing to 223 GW in FY13 from 98 GW in FY98.
The country transitioned from being the worlds 7 th-largest country energy
consumer in 2000 to the 4th largest one within a decade. Economic growth
and increasing prosperity, coupled with factors such as growing rate of
urbanization, raising per capita energy consumption and widening access to
energy in the country are likely to push energy demand further in the country.
The sector enjoys favourable regulatory policies, especially in the generation
segment. The government has permitted 100% FDI, with no added
requirement of procuring license to set up a power plant. However, demand
continues to outstrip supply, with energy and peak demand shortage over the
last 10 years averaging around 8% and 12% respectively. About 67%of
overall installed capacity in the country is thermal based. Average plant load
factor (PLF)for thermal capacity has considerably declined from 75% in
FY2010-11 to 69.9% in FY2012-13, mainly driven by increasing coal and
gas supply shortage.
India installed generation capacity (GW)

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Source: CEA
2.1 TARGET
The planning Commission of India has set a power capacity addition target of
88.537MW (excluding renewable) for the 12th Five year plan ending March
2017. The target is higher than the 75.785MWcapacity estimated by the
working group on power corresponding to a 9% GDP growth.
2.2 Renewable Energy Scenario In India

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Power generation from renewable source is on the rise in India. With the
share of renewable energy in the countrys total energy mix rising from 7.8%
in FY08 to 12.3% in FY13. India had about 28.1GWof installed renewable
energy capacity as of 31 March 2013. Wind accounts for 68% of the capacity,
with 19.1GW of installed capacity, making India the worlds fifth largest
wind energy producer. Small hydro power(3.6GW), bio-energy (3.6GW) and
solar energy (1.7GW) constitute the remaining capacity. In FY13, wind
capacity additions fell to 1.7GW from almost 3.2GW in FY12 as a result of
withdrawal of accelerated depreciation and Generation Based Incentive
(GBI) benefit. Although the share of renewable energy in the generation mix
as been rising over the years, India still has large untapped renewable energy
potential
Growth of installed capacity of renewable energy in India (GW)

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A global renewable energy company, with a primary focus on solar, had been
building its pipeline of utility-scale projects in the emerging markets of India,
Africa and the Middle East. As they began to execute on projects, they
needed a dynamic communications firm who had a deep understanding of
Indian and global renewable energy technology, markets and policies to
execute media relations and raise their profile in those emerging markets and
in the United States and Europe, as well as provide timely market intelligence
and strategic advice.
RENEWABLE ENERGY IN INDIA

Energy is a basic requirement for economic development. Every sector of
the national economy agriculture, industry, transport, commercial and
domestic needs inputs of energy. The economic development plans
implemented since independence have necessarily required increasing
amounts of energy. As a result, consumption of energy in all forms has been
steadily rising all over the country.
The growing consumption of energy has also resulted in the country
becoming increasingly dependent on fossil fuels such as coal and oil and gas.
Rising prices of oil and gas and potential shortages in future lead to concerns
about the security of energy supply, which is needed to sustain our economic
growth. Increased use of fossil fuels also causes environmental problems both
on local and global scales.
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In this background, there is urgent need for the country to develop a

sustainable path of energy development. Promotion of energy conservation
and increased use of renewable energy sources are the twin planks of
sustainable energy.
The Ministry of New and Renewable Energy(MNRE) has been implementing
comprehensive programmers for the development and utilization of various
renewable energy sources in the country. As a result of efforts made during
the past quarter century, a number of technologies and devices have been
developed and have become commercially available.
As against the estimated 80000 MW renewable energy based grid connected
power generation potential in the country, so far only about 6000 MW
installed capacity has been realized, giving vast opportunity for exploitation
of renewable energy sources for power generation. The renewable energy
based power generation capacity presently constitutes 5% of the total
installed capacity in the country for power generation from all sources. The
country is aiming to achieve upto 10% of additional installed capacity to be
set up till 2012 to come from renewable energy sources.
2.3 Indian Renewable Energy Development Agency Ltd

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IREDA has been awarded Mini Ratna (Category -I) status in

2015 by Ministry of New and Renewable Energy (MNRE).Indian
Renewable Energy Development Agency Limited (IREDA) was established
on 11th March, 1987 as a Public limited Government Company under the
Companies Act, 1956 and it promotes, develops and extends financial
assistance for Renewable Energy and Energy Efficiency/Conservation
Projects.
IREDA has been notified as a Public Financial Institution under
section 4 A of the Companies Act, 1956 and registered as Non-Banking
Financial Company (NFBC) with Reserve Bank of India (RBI).
IREDAs mission is Be a pioneering, participant friendly and
competitive
institution
for
financing
and
promoting
self-sustaining
investment in energy generation from Renewable Sources, Energy Efficiency

and Environmental Technologies for sustainable development.
IREDAs Motto is Energy for Ever.

The main objectives of IREDA are :
1. To give financial support to specific projects and schemes for
generating electricity and / or energy through new and renewable
sources and conserving energy through energy efficiency.

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2. To maintain its position as a leading organization to provide efficient

and effective financing in renewable energy and energy efficiency /
conservation projects.
3. To increase IREDA`s share in the renewable energy sector by way of
innovative financing.
4. Improvement in the efficiency of services provided to customers
through continual improvement of systems, processes and resources.
5. To strive to be competitive institution through customer satisfaction.
2.4QUALITYPOLICY
IREDA is committed to maintain its position as a leading organization to
provide
innovative
financing
in
Renewable
Energy
&
Energy
Efficiency/Conservation and Environmental Technologies through efficient

systems & processes for providing total satisfaction and transparency to its
customers.
IREDA shall strive for continual improvement in the quality of services to its
customers
through
effective
quality
management
system.

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2.5QUALITYOBJECTIVES
1.Drivetowards
total
customer
satisfaction.
2. Continual up gradation of capability and improvement in the professional

skills
of
employees.
3. Improvement in efficiency of services provided to customers.

4.
Continual
improvement
of
systems,
process
and
services.
All concerned shall implement the Quality Policy & Quality Objectives with
full devotion & dedication to achieve IREDAs Mission.
COMPANY PROFILE
BACKGROUNDCOMPANY

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Karnataka is the eighth largest states in India, rich in natural resources. It is bestowed
with high potential of Renewable Energy Resources especially Wind, Small Hydro,
Biomass, Cogeneration and Solar which offer great possibilities of exploiting energy
without polluting the environment and is effectively implemented in all parts of the State,
thereby improving economic condition of the farmers and creating employment
opportunities. Electricity is one of the most vital energy sources for economic
development activities. The economic development of a country by and large depends on
its efficient supply of power which can help in transforming the many people and work.
Karnataka Renewable Energy Development Limited (KREDL) was formed on 8th

March1996&co.no 08/20020 as a nodal agency of the government of Karnataka to
facilitate the development of non-conventional energy sources. It is registered under the
Section 18(1) of companies act 1956 & Registered Office, No.39Shanthi Gruha,
Bharath Scouts Guides Building, Opposite to Chief Post Master General Office, Palace
Road, Bangalore-560091.

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Prior to the creation of KREDL, the Karnataka State Council for Science and
Technology (KSCST) the erstwhile Karnataka Electricity Board (KEB) and Karnataka
Power Corporation Limited (KPCL) were looking after this sector as a subsidiary
function to their main activity.
But each of the above agencies had their own priorities and limitations. While KSCST
had research oriented, the KEBs priority was management of power transmission and
distribution. KPCL was involved in construction of large power projects and could not
focus adequately on small power projects in the non-conventional energy sector.
Therefore promotion of renewable energy projects as a supplement to conventional power
generation to energy where in Karnataka. This persuaded the Government of Karnataka
to set up a separate agency rendering hand holding project of support to renewable energy
project development.
Thus, was born the Karnataka Renewable Energy Development Limited for
Promotion of Renewable Energy and Renewable Energy projects development in
Karnataka.
Today Karnataka has huge potential of renewable energy sources of more than 15000
megawatt primarily in the sectors of wind, small hydro, co-generation and biomass.
During 11th five year plan 1000(MW) within three years-by; an additional 3000MW by
2017 though the mandatory of renewable energy power has been added to the state grid.
To develop energy MINISTRY OF NEW AND RENEWABLE ENERGY (MNRE)

projects to meet the challenges of the raising energy supply and demand in Karnataka.

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Apart from KSCST, KEB, KPCL AND MNRE other agencies joining hands to give more
power to Karnataka includes IREDA, KERC and KPTCL, along with departments of
Government of Karnataka such as Irrigation, Finance, Revenue, Forest and Environment.
PSUs like BESCOM, MESCOM, HESCOM, GESCOM.
Others in this line are Karnataka Solar Manufactures and consultants, wind Biomass and
co-generation developers and consultants etc.
3.3 VISION
To develop R&D Institute to carry out state-of-the-art research and developmental
activities in the area of renewable energy in general and bio-energy in particular.
To develop new and renewable energy technologies, processes, materials,
components, sub-systems, products & services at par with international specifications,
standards and performance parameters in order to make the state net earner in the sector
and deploy such indigenously developed and/or manufactured products and services in
furtherance of the national goal of energy security.
3.2 MISSION
To create an enabling police frame work for the development of 20000(MW) of
solar power by 2022.
To promote of off-grid applications, reaching 1000(MW) by 2017 and 2000(MW)
BY 2022.
Increase in the share of clean power: Renewable (bio, wind, hydro, solar,
geothermal & tidal) electricity to supplement fossil fuel based electricity
generation;

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Energy Availability and Access: Supplement energy needs of cooking, heating,

motive power and captive generation in rural, urban, industrial and commercial
sectors;
Energy Affordability: Cost-competitive, convenient, safe, and reliable new and
renewable energy supply options; and
Energy Equity: Per-capita energy consumption at par with the global average level
by 2050, through a sustainable and diverse fuel- mix.
3.3 GOALS & OBJECTIVES OF THE COMPANY

To survey investigate, construct, execute and carry out schemes and work of all
kinds for exploitation of Non-Conventional Energy including all power vacation
lines for the agricultural, industry and society.
Working as an interface between the government and its various agencies and the
community of developers.
Investigation of potential renewable energy sources.
Inviting applications from private sector developers for development of proven
potential, advising the government on policies to obtain speedy development of
projects in the sector.
Scrutiny of applications and identification of suitable developers for allocation of
capacity, assisting the developers, wherever such assistance is sought. To prepare a
detailed project report.
Assisting the developers in obtaining statutory clearances. To carry on business
investment in securities and particularly by purchase of receivable in the form of
lease rentals relating to real property, securitization of receivables and the like.
To conduct research and arrange or establish facilities for research, servicing or
testing of the good, material and this is in which company is authorized to deal.

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PRODUCT PROFILE
1. WIND ENERGY
From the ages wind has been used for several applications of mankind in the world. Wind
energy does have the Potential Energy and Kinetic Energy, this form of energy can either
be harnessed through Mechanical application
A wind energy system transforms the kinetic energy of the wind into mechanical or
electrical energy that can be harnessed for practical use. Mechanical energy is most
commonly used for pumping water in rural or remote locations- the "farm windmill" still
seen in many rural areas of the U.S. is a mechanical wind pumper - but it can also be used
for many other purposes (grinding grain, sawing, pushing a sailboat, etc.). Wind electric
turbines generate electricity for homes and businesses and for sale to utilities.

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There are two basic designs of wind electric turbines: vertical-axis, or "egg-beater" style,
and horizontal-axis (propeller-style) machines. Horizontal-axis wind turbines are most
common today, constituting nearly all of the "utility-scale" (100 kilowatts, kW, capacity
and larger) turbines in the global market.
Turbine subsystems include:
A rotor, or blades, which convert the wind's energy into rotational shaft energy;
A nacelle (enclosure) containing a drive train, usually including a gearbox* and a

generator;
A tower, to support the rotor and drive train; and
Electronic equipment such as controls, electrical cables, ground support

equipment, and interconnection equipment.

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WIND POWER PROJECT DEVELOPMENT (KREDL) IN

KARNATAKA:The Ministry of New & Renewable Energy (MNRE) has installed the wind
assessment program through its subsidiary centre for energy technology
(C-
WET).C-WET has assessed the wind potential at 50M height to be of the order of
about 13236 MW considering 2% of geographical area of the state. This continued
program including state government funded project,77 wind monitoring station are
established include in the state. Currently the wind measurement studies are in
progress.
Karnataka is best owed with good wind energy potential in the country of the
energy potentials on date about 9235MW of wind capacity has been allotted. 661
projects have been commissioned so for with a total installed capacity of 1536MW
till the end of March 2010. KREDL and has set up demonstration wind project of
2MW capacity at Mavinahonda, Belgaum district in august 2003. Another
demonstration project 2.5MW capacity has been set up at sogi, Bellary district in
August 2004.

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TABLE3.1
SL
Financial
Capacity
NO
year
allotment
(MW)`s
to 179.638
Capacity
in commissioned
in (MW)`s
37.225
Up
2000
2000-01
256.500
3.75
2001-02
441.200
28.8
2002-03
741.428
55.46
2003-04
394.050
83.17
2004-05
603.850
204.55
2005-06
1689.450
174.63
2006-07
2521.500
264.45
2007-08
1188.600
192.8
10
2008-09
136.200
321.35
11
2009-10
1076.500
170
Total
9234.920
1536.185

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2. SMALL HYDRO ENERGY
Hydrogen energy based power generating unit Hydrogen fuelled threewheeler

In India there are many rivers. In river, water flows from high points to low points
because of the force of gravity. Inflows of water, some of the energy is captured and
convert it into electric power. The power available in a flow of water of over a given
interval depends on two factors:

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The vertical distance the water falls over the interval measured in feet or meters, and
the volume of the flow of water, measured in cubic feet or cubic meters per second. Small
Hydro Hydro-electric power stations capture the energy in flowing water to produce
electricity. Small hydro-electric generating systems provide clean, cheap electricity for
local applications.
Small Hydro Division in KREDL:1. Statistics: No of projects as on date 2063.350MWcapacity
No of projects commissioned as on date (IPP) 45nos. 506.27MW
Expected projects to be commissioned by 2014another 200MW
KREDL has the pride of bagging prize for development of small hydro
projects consecutive 4th time.
2. Based on capacity:
Large Hydropower plants >25MW
Small Hydropower plants 3MW to 25MW.
Mini Hydropower plants 1 MW to 3 MW
Micro Hydro 10 KW to 1 MW
3. Based on Head: Low Head Plant (< 15 m)

Medium Head Plant(15m<H<50m)
High head Plant (H>50m)

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TABLE3.2
SL
Financial
Capacity
Capacity
NO
year
allotment in
commissioned in
Up to
(MW)`s
420.550
(MW)`s
103.2
2000
2000-01
105.000
12
2001-02
72.100
36.5
2002-03
249.200
13.25
2003-04
245.575
34.5
2004-05
206.275
33.15
2005-06
263.650
76.55
2006-07
314.000
13.12
2007-08
103.000
90
10
2008-09
11.500
10
11
2009-10
Total
72.500
2063.350
138
560.27

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3. BIO MASS AND CO-GENERATION ENERGY
A. BIO MASS:Bio mass is a renewable energy resource derived from carbonaceous waste of various
human and natural activities. It is derived from numerous sources, including by the
products from the timber industry. Agricultural crops, raw-materials from the forest,
major ports of household waste and wood.
Biomass fuels used in India account for about one third (1/3) of the total fuel used in the
country , being the most important fuel used in over 90% of the rural householders and
about 15% of the urban households.

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TABLE2.3
SL
Financial
Capacity
Capacity
year
allotment
in commissione
No
(MW)`s
Up to 2000
d in (MW)`s
4.50
0.00
2000-01
30.50
0.00
2001-02
193.70
4.5
2002-03
215.00
0.00
2003-04
7.50
35.5
2004-05
21.00
6.00
2005-06
0.00
27
2006-07
0.00
8.00
2007-08
6.00
0.00
10
2008-09
0.00
0.00
11
2009-10
0.00
6.00
Total
498.20
87

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4.SOLAR POWER ENERGY
The solar energy produced by the sun and largely untapped resources. Solar energy can
be used to produce electricity to heat domestic hot water and offset a buildings space
heating needs solar energy is pollution free India is potentially the largest single market
for renewable energy in the world over 17% of the people on earth line in India, and
approximately 60% of the Indian population lacks electricity, India has plentiful solar
energy.
1. HOW THE SUN PRODUCES ENERGY?

The sun is a sphere of high temperature gases about 1.4 million kilometres in diameter
(About 870000 Miles). The temperature of the interior of the sun is 15 million degrees
Kelvin (About 27 million degrees F) this high temperature combined with a pressure that
is 70 billion times higher than atmosphere Pressure on earth creates ideal conditions for
fusion reactions. Fusion reactions come about by the union of light atomic nuclear to
form heavier nuclear, releasing a large amount of energy in the process.
2. SOLAR PHOTOVOLTAIC (SPV):KARNATAKA STATE OPEN UNIVERSITY, MUKTHA GANGOTHRI, MYSORE

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Photovoltaic refers to the creation of voltage from light. SPV (solar photovoltaic) systems
directly convert sun light into useful electricity. This process is called the photo electrics
effect.
The word photovoltaic comes from two roots. Are photo means light and voltaic means
voltage producing. When the sun rays fall on a photovoltaic cell it increases the energy
stored in the atoms of the thin waters of silicon. These cells when connected in tries and
parallel constitute a solar panel.
Solar Photovoltaic Programs:1. Solar home lightings systems.
2. Solar street lightings systems.
3. Solar power plant.
4. Solar pump sets.
3. SOLAR THERMAL ENERGY PROGRAMME:The main objectives of the schemes are market development, commercialization and
utilization of solar thermal systems for the fulfilment of heat energy requirements of
different application in domestic, institutional and industrial sector.
The scheme has all components.
1. Thermal research and development
2. Solar water heater
3. Solar cooker programme
3. Adithya solar shops

Page 33
4. SOLAR WATER PUMPING SYSTEM:Subsidy of Rs.30/- per peak watt of PV array subject to maximum of Rs. 50,000/- per
pump set available for solar water pumping system through the state Nodal Agency and
soft loan facility at the rate of 5% is also available up to 90% of the unsubsidized portion
of pump set through IREDA.
COMPETITORS
1)Suzlon Energy
2)Moser Baer
3)Tata Power / Tata BP Solar
4)Orient Green Power
5)Greenko
6)NTPC
7)Kenersys

Page 34
OVERALL ORGANISATION CHART OF KREDL

Chairman
Managing Director
General Manager 1
Deputy General
Manager 2
Asst. General
Manager 6
Project Officer
(Energy
Conservation) 4
Technical Officer
6
Asst. Tech
Officer 12
Project
Engineers
(4)
Project Inspectors
(16)
Project
Officer
(CDM) 4
Inspecting
Project
Officers
Engineers
(4) (4)
Inspecting
Officers
(4)
Project
Inspectors (16)

Page 35
System
System
Analys
t Analys
t
Mechani
c Mechani
c
Asst
Asst
Forest
Forest
Affairs
Affairs
Junior
Junior
Enginee
r Enginee
r
Electricia
n Electricia
n
Managing Director
Company
Secretary
Admn.
Officer
Chief
Controlle
r of
of
Finance
Finance
Steno
Data
Entry
Operator /
Typist (3)
Drivers
(6)
Cleaner
(2)
First Div
Assistant
(4)
Second
Div
Assistant
(3)
AsstAdmn Assistant
Officer 2 General
Manager
Accounts
Accounts
Officer
Asst.
Accounts
Officer 2
Sales
Assistant
Public
Relations
Officer
Asst Public
Relations Off
Public
Relations Assistant
Marketi
ng
Executiv
e
Marketi
ng
Assistant

Page 36
FUNCTIONAL DEPARTMENTS:
ADMINISTRATION
SECTIONS
FINANCE
IT
HR
WIND
ENERGY
SMALL
HYDRO
ENERGY
BIO-MASS
ENERGY
SOLAR
ENERGY

Page 37
3.3 SECTIONS:
Wind Energy Division in KREDL:A wind energy system transforms the kinetic energy of the wind into
mechanical or electrical energy that can be harnessed for practical use.
Mechanical energy is most commonly used for pumping water in rural or
remote locations- the "farm windmill" still seen in many rural areas of the
U.S. is a mechanical wind pumper - but it can also be used for many other
purposes (grinding grain, sawing, pushing a sailboat, etc.). Wind electric
turbines generate electricity for homes and businesses and for sale to utilities.
There are two basic designs of wind electric turbines: vertical-axis, or
"egg-beater"
style,
and
horizontal-axis
(propeller-style)
machines.
Horizontal-axis wind turbines are most common today, constituting nearly all
of the "utility-scale" (100 kilowatts, kW, capacity and larger) turbines in the
global market.
It includes:

Page 38
A rotor, or blades, which convert the wind's energy into rotational shaft
energy;
A nacelle (enclosure) containing a drive train, usually including a

gearbox and a generator;
A tower, to support the rotor and drive train; and
Electronic equipment such as controls, electrical cables, ground support

equipment, and interconnection equipment.
Small Hydro Division in KREDL:Small Hydro Hydro-electric power stations capture the energy in flowing
water to produce electricity. Small hydro-electric generating systems provide
clean, cheap electricity for local applications.
1. Statistics: No of projects as on date 2063.350MWcapacity
No of projects commissioned as on date (IPP) 45nos. 506.27MW
Expected projects to be commissioned by 2014another 200MW
KREDL has the pride of bagging prize for development of small
hydro projects consecutive 4yh time.

Page 39
2. Based on capacity:
Large Hydropower plants >25MW
Small Hydropower plants 3MW to 25MW.
Mini Hydropower plants 1 MW to 3 MW
Micro Hydro 10 KW to 1 MW
Bio Mass Division in KREDL:Biomass gets converted into gas with a calorific value of 1000-1300
kcal per Nm3, which would have the following.
Composition-co-15-20%
H2-15-20%,
CH4-1-45
CO2-8-5%
N2-45-55%
ENERGY FROM WASTES:1. Quantity of wastes/ annum from class 1 cities 27 million tones,
4400 million CU.M of sewage in addition to industrial waste.
2. These estimates translate to a potential of 1200 MW from urban
waste and 800 MW from industrial waste till 26 MW achieved
and 50WM under implementation.

Page 40
As on the date total potential 1000MW but biomass allotted

478.20MW&Commissined 87MW
Biomass/Biogas targeted from 2009to2014 300MW
Solar Energy:The main objectives of the schemes are market development,
commercialization and utilization of solar thermal systems for the fulfilment
of heat energy requirements of different application in domestic, institutional
and industrial sector.
The scheme has all components.
1. Thermal research and development
2. Solar water heater
3. Solar cooker programme
Subsidy of Rs.30/- per peak watt of PV array subject to maximum of Rs.
50,000/- per pump set available for solar water pumping system through the
state Nodal Agency and soft loan facility at the rate of 5% is also available up
to 90% of the unsubsidized portion of pump set through IRED

Page 41
CONCEPTUAL FRAMEWORK
4.0 HISTORY OF ACCOUNTING
Accounting records dating back more than 7,000 years have been found
in Mesopotamia, and documents from ancient Mesopotamia show lists
of expenditures,
and goods received
and
traded. The
development
of
accounting, along with that of money and numbers, may be related to the
taxation and trading activities of temples.
4.1. MEANING OF ACCOUNTING

Accounting is a systematic process of Identifying, measuring,
recording,
classifying,
summarising,
analysing,
interpreting
and
communicating of financial informations.

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Accounting is one of the key functions for almost any business; it may
be handled by a bookkeeper and accountant at small firms or by sizable
finance departments with dozens of employees at larger companies.
4.2. BRANCHES OF ACCOUNTING

Financial Accounting
Cost Accounting
Management Accounting

Page 43
4.2.1. FINANCIAL ACCOUNTING

The process of recording, summarizing and reporting the myriad of
transactions from a business, so as to provide an accurate picture of its
financial position and performance. The primary objective of financial
accounting is the preparation of financial statements - including the

balance sheet, income statement and cash flow statement - that encapsulates
the company's operating performance over a particular period, and financial
position at a specific point in time. These statements - which are generally
prepared quarterly and annually, and in accordance with Generally Accepted
Accounting Principles (GAAP) - are aimed at external parties including
investors, creditors, regulators and tax authorities.
4.2.2. COST ACCOUNTING

Cost accounting is a type of accounting process that aims to capture a
companys costs of production by assessing the input costs of each step of
production as well as fixed costs such as depreciation of capital equipment.
Cost accounting will first measure and record these costs individually, then
compare input results to output or actual results to aid company management
in measuring financial performance.

Page 44
TYPES OF COST
Fixed Cost
Variable Cost
Semi-variable Cost

Page 45
4.2.3. MANAGEMENT ACCOUNTING

Management accounting is a process of preparing management reports
and accounts that provide accurate and timely financial and statistical
information required by managers to make day-to-day and short term
decisions. Unlike financial accounting, which produces annual reports mainly
for external stakeholders, management accounting generates monthly or
weekly reports for an organizations internal audiences such as department
managers and the chief executive officer. These reports typically show the
amount of available cash, sales revenue generated, amount of orders in hand,
state of accounts payable and accounts receivable, outstanding debts, raw
material and inventory, and may also include trend charts, variance analysis,
and other statistic
Emerging areas in accounting

Fund accounting
Hedge accounting
Bank account
Forensic accounting
Management accounting
Tax accounting
Social accounting

Page 46
SOCIAL RESPONSIBILITY ACCOUNTING
4.3 INTRODUCTION
Accounting information is essentially financial information, the concept of money
measurement results in the limitation of recording only those transactions in the
books of accounting that is capable of being measured in terms of money.
Accounting reports are therefore limited to phenomena that can be described in
monetary terms. As a result, many factors important to business organization
which cannot be translated into monetary terms go unrecorded.
A business organization is also a social unit. It uses the societys resources and produces
goods and services for which the society is the ultimate consumer. The business
provides employment for sizeable section of the society makers in various forms.
Thus, it is only in a developed society a business organization would succeed. The
development of the society and business are co-extensive since the business draws
the benefit from the society it has a responsibility towards it.

Page 47
An increasing awareness in our society in recent times is that business managers are
made increasingly responsible for consequential society and environmental impact.
Changing environments and social parameters have compelled them to revalue their
social as well as economic obligations towards the needs of society since society provides
the requisite working infrastructure and facilities. This has made the enterprise to account
and report also the needs of society. Hence the organization has to present the accounting
statements which will reflect the social and economic benefits created by it as well as the
costs incurred with which to appraise its contribution towards solving the problems of
society.
Social accounting began developing in the U.K. in the early 1970s, when the public
interest Research group established Social Audit Ltd. This organization carried out, and
published, investigations into the operations of large public companies, without
necessarily gaining their permission or cooperation, whilst lending support to consumer
pressure, there is an argument that this had a negative on accountability, as organizations
sought to ensure that sensitive information was hidden from such investigations.
Globalization has brought with it a wide realization that companies do not operate in
isolation, but can have marked impacts on the environment and people at local, national,
and global levels. This has led to an increasing awareness of CSR, and the triple bottomline of business success and measuring the business not only in financial performance,
but by its social and environmental impact as well. Third craft and the new economic
foundation pioneered a form of social accounting in early 1990s that in voluntary in
nature and rooted in engagement with stake holders. This can assist organization, both
commercial and NGOs, in understanding and improving their social impact.

Page 48
Social accounting is a way of demonstrating the extent to which an organization is

meeting its stated social or ethical goals. Whilst independently verified, the organization
itself owns the process of data collection and analysis and the process is driven by
indicators the organization sets in consultation with stakeholders, as opposed to being on
standards or criteria determined extremely. This is balanced by the principle of
benchmarking, which whilst still developing, should enable organizational comparisons
where possible.
Technically, the terms social accounting or social audit refer to specific parts of a
process now bestowed with the much more unwieldy title of social and Ethical
Accounting, auditing and Reporting(SEAAR). In practice, the shorter titles tend to be
used interchangeably to refer to the entire process. Whichever title is used, the process
should involve all three steps:
Internal data collection and analysis procedures (accounting)
An independently audit of the results (auditing)
A mechanism for disseminating the outcomes more widely (reporting) Social

Accounting and its reporting is becoming essential on account of the following:
Increasing awareness of society about the corporate social contribution.
Providing means of identifying and rewarding business for social contribution.
Identifying adverse effects on the environment.
Improving credibility and reputation of business.
Transferring cost of social activities to other segments of society.

Page 49
While designing the contents to be included in social accounting, it should be taken care
of to see that it does not conflict with the shareholders interest.
The business enterprise is an integral part of the functioning of our nation. As such, in
return for the privileges and rights granted to it by the state, increasingly the enterprise is
being expected to assume responsibility towards the society in which operates. Business
firms themselves have changed, and at the same time have become so massive that they
exercise important influences on the communities in which they exist, often they exercise
strongly influence the laws to which they are required to conform. The entire private
sector has become all mixed up with the public sector. There is ample evidence that
corporate managements are recognizing the importance of their actions on the social
wellbeing and increasingly are reporting this aspect of their operations in annual reports.
4.4 NATURE OF SOCIAL ACCOUNTING

Social accounting:
Social accounting is also called by other names such as social responsibilityaccounting,
social audit, socioeconomic accounting, and social reporting Social accounting tries to
measure the effect of welfare activities on the society and the enterprise itself for
qualitative as well as quantitative terms.
Social accounting is defined by Richard Dobbins and David Fanning a The Measuring
and reporting of information concerning the impact of entity and its activities and
society.

Page 50
Social Cost:
Social Cost is a sacrifice or detriment to society. Whether economic, internal or
external, social cost are sacrifices of the society for which the business firm is responsible
like air pollution, water pollution, deficiency due to bankruptcy, depletion and destruction
of animals resources, soil erosion, deforestation, impairment of human factor of
production, monopoly and social losses, production of dangerous products and
explosives, deterioration in the law and order conditions in the industrial estates etc.
Social Benefit:
Social benefit is a compensation made to the society in the form of increase in per
capita income, employment opportunities, etc.
Social Value:
Social Value denotes quantified social worth or utility. The value of any resource
depends on the existence of some social welfare function quantifiable as a worth is a
social value.
Social profit:
Social profit may be defined as the excess of social benefits received by the society
from a business firm over the social costs borne by the society attributable to the same
firm.
Social reporting:
Social reporting encompasses reporting on those activities of the organization that have
an impact on the society at large but are not necessarily represented by its traditional
financial report.

Page 51
Social Audit:
The concept of Social Audit is a new dimension in auditing.
According to Kohlers Dictionary for Accountants, social audit is an examination of
business performance and consequences of its super legal public interest, non-profit
activities. Such activities have been held to include financial contributors and personnel
loans to public enterprise, creation of scholarships, technical training programmes
shared with non-employees, memberships on civic committees and boards and
participations in affairs devoted to public interest.
A review of the social responsibilities of these enterprises and also costs and benefits
caused to the public is called social Audit. The social audit is a systematic evaluation of
an organizations social performance as distinguished from its economic performance.To
implement a social programme successfully, a company must be organizationally geared
to the effort. It must arrange to set into motion corporate machinery to:
Evaluate, quantitatively where possible, the social improvement in which it functions.
Establish and improve social objectives
Make resource allocation in response to identified social benefits.

Page 52
4.5 OBJECTIVES OF SOCIAL ACCOUNTING

The main objectives of social accounting are to help society by providing different
facilities by enterprise and to record them. They are:
Effective utilization of natural resources: Main objectives of making social
accounting is to determine whether company is properly utilize their natural
resources or not.
Help to employees: Company can help employees by providing the facility of
education to children of employees, providing transport free of cost and also
providing good working environment conditions.
Help to society: Because companies' factories spread the pollution in natural society
which is very harmful for society. So, enterprise can help to society by planting the
trees, establishing new parks near factory area. And also opening new hospitals
Help to customers: In social accounting this is the part of benefits given by
company to society, if company provides goods to customers at lower rate and with
high quality.
Help to investors:
Company can help to investors by providing transparent
accounting information to investors.

Page 53
4.6 IMPORTANCE & SIGNIFICANT FEATURES OF SOCIAL

ACCOUNTING
1. Social accounting is not impact assessment
Social accounting, thought the AA1000 process standards, provides a comprehensive and
systematic framework for accounting, auditing, and reporting against an organizations
social objectives. The discipline of social accounting encourages any organization to take
impact assessment more seriously. It encourages management information systems to be
developed and embedded in the organization to provide ongoing monitoring and learning
from programme activities.
2. Social Accounting uses participatory methods
Social accounting provides an ideal way to combine participatory methods of indicator
setting with ongoing qualitative data collection. The emphasis on identifying and
engaging with key stakeholders lends itself well to the use of impact assessment
methodologies such as Participatory Rural Appraisal(PRA) and Participatory Learning
and Action(PLA). If a SEAAR mythology is to be employed as a framework for impact
assessment, then it becomes incumbent on those designing an intervention to do so in the
light of stakeholder dialogue, so that the criteria for assessment are set through
stakeholder consultation, rather than being donor driven.
3.Social Accounting seeks to embed M&E
Development of social accounting processes within an organization involves commitment
to ongoing stakeholder dialogue, and the development of a management information
system based on indicators of social impact. Impact assessment of enterprise
development projects often bemoan the lack of a systematic embedded M&E system,
which hampers efforts to provide and use meaningful impact assessment information.
The AA1000 focus on embedding systems is therefore useful (especially with the
addition of a full module on this topic to be added in the newAA1000 Series).
Page 54
The experience of Tradecraft is that iterations of the social audit process have led to a
shift in focus from a need to prove our achievements, towards a desire to improve them,
using learning gaining from the exercise as a key driver.
4. Scope of engagement
It is important to note that social accounting has an organizational, rather than project
level scope. Thus stakeholders judge an organization on their overall perception rather
than a narrow view of project success or failure. However, one of the levels at which
stakeholder dialogue can be carried out by the organization. Enterprise development
activities typically involve chains of interrelated interventions. It is unreasonable to
expect parties that do not have a direct relationship with the organization to be involved
in making a regular assessment of how it has performed against social indicators.
5. Transparency
Fundamental to social accounting is the concept of accountability, aided through
increased transparency. Few of the established methods of evaluating project or
programme success include transparency of results as a primary concern; social
accounting adds a level of accountability to what are sometimes perceived as
unaccountable NGOs. They are those who now suggest that social accounting offers an
interesting way of bringing wider accountability to donor funded or NGO led projects in
the enterprise sector.
6. Compliance or improvement
One of the most positive features of social accounting is that it encourages change within
the organization. Earlier concepts of social audit involved an external organization
making an assessment of social performance and providing a report on the company. This
method did not tend to change the way businesses operated in the way that self-directed
assessments are carried out in the same way imposed externally lending to limited
ownership of the results by the organization assessed. Social accounting tends to foster an
improvement rather than a compliance-based mentality to impact assessment and so
should lead to ownership and ongoing improvement in the organization.
Page 55
4.7 BENEFITS OF SOCIAL ACCOUNTING AND REPORTING

Several benefits of social accounting and reporting by an organization are as follows:
Presentation of a complete picture to the society and the management to enable
everybody to form correct opinions
Assist management in formulating appropriate policies and priorities
Avoidance of adverse publicity.
Improvement of image leading to greater support from Govt. and public.
Help in marketing and greater support
Evidence of social commitment.
Improved employee motivation.
Better business with all concerned e.g., banks, Insurance and Government etc.
Resolution of social problems can assist in long-term growth of the organization.
Attracting and retaining high quality of staff
Obtaining feedback from the public as to the changes required in the focus.
Improved confidence of shareholders or members.
Meeting information needs of consumer and society.
Several companies are realizing that being a socially responsible organization can be
good for productivity, morale, and loyalty amongst employees. In addition to the benefits
derived by the individual organization, various other interested parties like Govt.
agencies, consumer councils, Shareholders associations, Trade associations, News media,
etc., also benefit because of the ready availability of the information.
4.8 MAJOR AREAS OF SOCIAL PERFORMANCE

The Canadian National Association of Accountants has advanced the most useful
categorization of the variable present in social accounting measurement. Societal
concerns are divided into the following four major components.
Community involvement
Human resource stewardship
Physical resources and environmental stewardship
Product or service contribution

Page 56
Community involvement includes those socially oriented activities, which tend

primarily to the general public, e.g. philanthropic programs, community
involvement by employees, corporate community services.
Human resource stewardship covers activities directed to the wellbeing of
employees, e.g., hiring practices, pension and retirement benefits, working
conditions, training and promotion policies, job enrichment and satisfaction.
Physical resources and Environment stewardship includes protection of the
environment.

Page 57
TABLE-1.1VARIOUSCHECKLIST
ITEMS
OF
SOCIAL
REPORTING
Community Involvement
1.General philanthropy
Human Resource Stewardship

1.Employment practices
2.Transportation
2.Training programmers
3.Health service
3.Promotion policies
4.Aid
in
personal
and
business 4.Employment conditions
problems
5.Remuneration and recruitment benefits
5.community planning & improvement 6. Working conditions

6.Volunteer community activities
7.Health and safety
7.Housing
8.Job satisfaction
8.Specialised
food
and
welfare 9.Communications and participation
programmers
9.Education
Physical Resources and Stewardship
Product
1.Air
contributions
1.Labeling and packaging
2.Water
2.Marketing representations and product
3.Sound
claims
4.Waste
creation
and
or
Service
Environmental
disposal 3.Guarantee and warranty positions
conservation
4.Consumer education
5.Scarce resource usage
5.Product safety
6.Aesthetic consideration of presence
6.Constructive research and development

7.Advertisement and promotion

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4.10 MAJOR SOCIO-ECONOMIC PROBLEMS

The following heads are identified considering the major socio economic problems for
social reporting purpose.
1 .Energy conservation
2 .Industrial safety
3. Quality assurance
4. Consumer protection
5. Welfare work of weaker sections of the society
6. Information regarding imports and exports
7. Import substitution
8. Improvement of productivity
9. Research and development
10. Employment of minorities
11. Contribution to government exchequer
12. Environmental control
13. Social projects
14. Foreign exchange transactions
15. Employment opportunities
16. National interest donations
17. Employees participants in management and welfare measures
18. Family planning and welfare programmes
19. Development of ancillary and small scale industries
4.11 SOCIAL REPORTING STATEMENTS

The below mentioned table shows the format and constituents of a simple Social
accounting statement, based on the conventional profit and loss or income statement.
TABLE-1.2TABLE SHOWING SOCIAL REPORTING FORMAT

Page 59
PARTICULARS
Social benefits
Products and services provided
payment to other elements of society:
Wages and salaries
Payment to suppliers
Taxes and rates, etc.,
Dividend and interest
Additional employee benefits
Donations to the community
Environmental improvements
Ancillary benefits
Total social benefits
(a)
Social costs:
Goods and materials acquired
Fixed asset purchase
Labour and service used
Public service and facilities use
Payment from other elements of society
Customers
Investors
Lenders
Work-relate injuries or illnesses
Discrimination and disadvantage
Environmental damage
Other costs
Total social costs
(b)
AMOUNT
AMOUNT
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
XXX
Categories of social benefits

Taking the services provided (the present value of the entitys output together with the
value of facilities or services provided to other elements of the society.
Payments to other elements of society.
Donations to the community(both money sums, whether by direct gifts or sponsorship,
and gifts in kind)

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Environmental improvements (landscaping gravel pit, or providing a company bus
services).
Ancillary benefits(factory crches or public education programmes)
Categories of social cost
Goods and material s acquired
Fixed assets purchases
Labour and services used
Public service and facilities used (the entity`s share of the cost of the police and fire
services, of the use of roads, parks, sewers and so on

Payment from other elements of the society(customers,investors,lenders)
Work-related injuries and illness(the present value of lost income)
Discrimination and disadvantages
Environmental damage
Other costs(product short coming or undesirable attitude formation)
4.12 LIMITATIONS OF SOCIAL REPORTING

Social responsibility accounting has been developed in response to the government and
public's pressure on large corporations to be more transparent and conscious about the
impact of their activities on the environment and society. As this is not a traditional
accounting system, the implementation process can be quite difficult and cumbersome for
some organizations.
Cost and Workload: The implementation cost of social responsibility

accounting is high. It requires a high labour workload, especially at the initial
stage of its implementation. Early planning and troubleshooting strategies have to
be organized, which could incur massive time and cost to the business. The
management has to implement long-term, strategic planning so that the accounting
system meets the organization's profitability objectives while also minimizing the

Page 61
social impact of its activities. Risk awareness as a result of the implementation has
to be taken into consideration and monitored.
Business Objective: In contrast to public services which operate to serve the

public needs, most private businesses aim to maximize profit and shareholders'
wealth. The nature of their activities may make it difficult to implement the social
responsibility accounting system. For example, although a company's policy and
procedures on disposal of chemical waste is in accordance to the rules and
regulation, it may not be sufficient to achieve the target of accommodating
environmental and social needs.
Staff Morale: The implementation process, which requires heavy workload,

may deteriorate the staff morale. Having to work extra hours and additional
workload at the same pay rate can cause employees to seek employment
somewhere else. As a result, the business will incur high labor turnover and more
cost by needing to recruit and possibly train new staff.

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DATA,ANALYSIS AND
INTERPRETATION

Page 63
5.1. Sources Of Data

Primary data: In case of primary data, the data are collected by
interviewing managers.
Secondary data: In case of secondary data, the data is collected from
financial records of the company, Internet and magazines.
5.1.1. Plans Of Analysis

The data has been tabulated. Each data has been analyzed and evaluated. The
findings are recorded and conclusions are given based on findings.
5.1.2. Software Used

Software package i.e., Microsoft excel has been used for tabulating and
analysing the data.
5.1.3. Method Of Analysis

The collected data have been analyzed with the help of statistical tools and
techniques like Averages, percentages, Ratio and the like. And wherever
necessary tables, charts, graphs have been used to make the data in a
presentable way.
5.2
COST
&
BENEFIT
ANALYSIS
ON
SOCIAL
RESPONSIBILITY
Page 64
Cost and benefit analysis on Social Responsibility is done by using various

techniques like averages, percentages, ratio etc., from the following
parameters:
1. Benefits to Employees
2. Benefits to Employees in Training, Provident Fund, Leave Encashment,
Rewards and Other Benefits
3. Benefits to Community
4. Good Corporate Citizenship Activities
5. Benefits to Outsiders
6. Accident Relief Fund
7. Environmental Initiatives
8. Job Opportunities to SC/ST and Downtrodden people of the Society
9. Employment Opportunities to Women Workforce
10.
Training Programmes
5.3 BENEFITS TO EMPLOYEES

The KREDL renders various benefit programmes to its employees and to
the children of its employees. Canteen, Medical & hospital, and Housing
Facilities are provided to the employees to increase productivity, loyalty,
inspiration, and by way of social responsibility. The amount incurred on
each of these facilities is shown at Table 4.1 and Chart-4.1

Page 65

Page 66
TABLE-5.1
BENEFITS TO EMPLOYEES
(Rs in 000)
EMPLOYEES BENEFITS
Particulars
Medical &
Hospital
Facilities
201112
2012-13 201314
Growth in Percentage
2012-13
2013-14
626.52 685.464 651.63 109.41

5
6
95.06
394.65 799.397 939.65 202.55

8
2
117.54
Housing
&township
Facilities
180
172.258 15.000 95.70
8.70
Water
charges
188.83 152.818 10.972 80.93

7
7.17
19.08
48
Canteen
Facilities
Labour Fund
39.286
18.887 205.90
ANALYSIS

Page 67
It is observed from the Table No.4.1 that the Amount spent on medical and
hospital facilities was ,626.525which increased to 651.636 thousands by the
end of 2013-14 In terms of percentage during 2012-13 it was109.41%,which
decreased to 95.06% during the year 2013-14. Amount spent on canteen
facilities was 394.Lakhs during the year 2011-12, which increased to 939.652
thousands by the end of 2013-14. In terms of percentage during 2012-13 it
was 202.5%,which reduced to 117.54% during the year 2013-14 Amount
spent on Housing & township facilities was 180 thousand during the year
2011-12,which decreased 15.00 thousands by the end of 2013-14. In terms of
percentage during 2012-13 it was95.70%, which reduced to 8.70% during the
year 2013-14. Amount spent on Water charges was 10.972 thousand during
the year 2013-14. In terms of percentage during 2013-14 it was 7.17%.
Amount contributed towards Labour Fund was 19.08 thousand during the
year 2011-12, which decreased to 18.887 thousands by the end of 2013-14. In
terms of percentage during 2012-13 it was 205.90%, which decreased to 48%
during the year 2013-14.
CHART-5.1

Page 68
CHART SHOWING BENEFITS TO EMPLOYEE

Page 69
CHART 5.1.1 SHOWING BENEFITS TO EMPLOYEE IN

PERCENTAGE
INTERPRETATION

Page 70
From the chart it is clear that Medical & Hospital facilities, Canteen facilities
and Contribution towards Labour Fund has been increasing but Housing and
township facilities and Water charges provided has been decreasing during
the year 2013-14
5.2 SPECIAL BENEFITS TO EMPLOYEES:

KREDL also renders various special benefit programmes to the employees,
provident fund, gratuity, bonus, insurance benefits, leave encashment and
leave travel benefits, provided to their employees so that it leads to the better
performance of the employees by way of social responsibility. The amount
incurred in each of these facilities is shown at Table 5.2 and Chart 5.2 &Chart
5.2.1

Page 71
TABLE.5.2 SPECIAL BENEFITS TO EMPLOYEES
(Rs in
000)

Page 72
SPECIAL BENEFITS TO EMPLOYEES

Particulars
2011-12
2012-13
2013-14
Growth in
Percentage
2012- 2013-14
13
Training
967.854
133.500
13
Provident
fund,
2521.35
2901.78
7644.73
115.0
gratuity,
encashment 1415.05
1969.14
5654.40
139.1
and
263.4
bonus,
insurance
benefits
Leave
leave 1
287.1
travel
benefits
Other
20722.5
24051.6
47834.9
116.0
benefits
49
89
13
198.8
(source: Annual Reports)

Page 73
ANALYSIS
It is observed from the Table No.5.2 that the Amount spent on training was
967.854thousandsduringyear 2012-13.
Decreased to133.500 in 2013/14
.Amount spent on provident fund, pension fund and bonus was

2521.359thousand during the year 2011-12, which increased to 7644.734
thousands by the end of 2013-14. In terms of percentage during 2012-13 it
was 115.09%, which increased to 263.4% during the year 2013-14. Amount
spent on leave encashment &leave travel benefits was 1415.051thousand
during the year 2011-12, which increased 5654.407 thousands by the end of
2013-14. In terms of percentage during 2012-13 it was 139.16%, which
increased to 287.1% during the year 2013-14. Amount contributed towards
other benefits was 20722.549thousand during the year 2011-12, which
increased to 47834.913 thousands by the end of 2013-14. In terms of
percentage during 2012-13 it was 116.07%, which increased 198.8% during
the year 2013-14.

Page 74
CHART 5.2 SPECIAL BENEFITS TO EMPLOYEES

Page 75
CHART 5.2.1 SPECIAL BENEFITS TO EMPLOYEES IN

PERCENTAGE
INFERENCE

Page 76
From the chart it is clear that Training benefits to Employees has been
increasing from the past three years, benefits such as provident fund, gratuity,
Bonus, Other Special benefits has been increasing and Leave encashment and
leave travel benefits has been fluctuating from year to year.
5.3 BENEFITS TO COMMUNITY

KREDL renders various environmental improvement initiatives for the
benefit of the community. Mavinhunda & Sogi Wind Demo Project and its
maintenance is one of the major steps taken by the organization for the
benefit of the community. The amount incurred on each of these facilities is
shown in Table 5.3 and Chart 5.3

Page 77
TABLE 5.3
TABLE SHOWING BENEFITS TO COMMUNITY
(Rs in 000)
BENEFITS TO COMMUNITY
PARTICULA
2011-12
2012-13
2013-14
RS
Labour
Growth
in
Percentage
2012-
2013-
13
14
3571.209 9427.296
7360.563
263.98 78.07
8513.561 5264.261
6945.313
61.83
131.9
charges
Maintenance
charges
Misc.
expenses
Total
12084.77 14691.557
14305.876 121.57 97.37

Page 78
(Source: Annual Reports)
CHART 5.3
CHART SHOWING BENEFITS TO COMMUNITY

Page 79
CHART 5.3.1
SPECIAL BENEFITS TO EMPLOYEES IN PERCENTAGE
INFERENCE
Page 80
From the above chart it is clear that total benefits to community are
increasing from year to year. This clearly shows that the corporation is very
keen on cutting down on cost but at the same time take initiatives for a better
environment.
5.4 GOOD CORPORATE CITIZENSHIP ACTIVITIES

KREDL renders various corporate citizenship activities. The prompt payment
of taxes, duties by the corporation to the central and state government shows
its concern for the general public. The amount incurred on each of these
duties is shown in Table 5.4 and Chart 5.4.

Page 81
TABLE 5.4 CORPORATE CITIZENSHIP ACTIVITIES (Rs in 000)

Page 82
GOOD CORPORATE CITIZENSHIP ACTIVITIES

Particulars
2011-12 2012-13
2013-14
Growth in Percentage
2012-13 2013-14
Taxes,Duties,
95000.
52500.
94500.
55.26
180
47.806
31.215
72.022
65.30
230.72
etc., paid to the

Central Govt.
Taxes,
Duties,
etc., paid to the

State Govt.
State
services
consumedelectricity
&
273.359 8277.26
9104.726 3027.98 3037.98
water services
Central
863.442 1052.285 1157.5
121.87
131.87
services-postal
& telegrams
Total
96184.6 61860.76 104833.5 64.31
169.4
07

Page 83
(Source: Annual Reports)
ANALYSIS
It is observed from the Table No.5.4 that the Amount spent on Taxes, Duties,
etc., paid to central Government was 95000.thousands during the year 201112, which decreased to 52500.thousands by the end of 2012-13. In terms of
percentage during 2012-13 it was 55.26%, which increased to 180% during
the year 2013-14.Amount spent on Taxes, Duties, etc., paid to State
Government was 48.807 thousand during the year 2011-12, which decreased
to 31.215 thousands by the end of 2012-13. Interims of percentage during
2012-13 it were 65.30%, which increased to 230.72% during the year 201314. Amount paid to State services consumed was 273.359thousand during
the year 2011-12, which increased to 8277.26 thousands by the end of 201213. In terms of percentage during 2012-13 it was 3027.98%, which increased
to3037.98% during the year 2013-14. Amount paid to Central services
consumed was 863.442thousand in the year 2011-12, which increased to
1052.285 thousands by the end of 2012-13. In terms of percentage during
2012-13.It was 121.87%, which increased to 131.87% during the year 201314.

Page 84
CHART 4.4
CHART
SHOWING
GOOD
CORPORATE
CITIZENSHIP
ACTIVITIES
INFERENCE

Page 85
The Total Taxes paid to Central and State Government and also towards
Central and State consumed services has been fluctuating from year to year.
This shows their fair & Honesty, Duty towards the government and good
corporation citizenship.
5.5 BENEFITS TO OUTSIDERS

As a part of its social obligations, KREDL has taken up many projects
relating to energy conservation and energy efficiency keeping the overall
interest of the society in view. The other consideration is their present or past
contribution/role for the Society, Nation, and State etc. The following Table
5.5 shows the benefits to different classes of Society.

Page 86
TABLE 5.5
TABLE SHOWING BENEFITS TO OUTSIDERS

Page 87
Sl.
No
.
Name of the project
Approximat
e cost (in
Rs.)
Location/place
Rs.6.75 lakh
Rs.25 lakh
1.
2.
3.
4.
Replacement of the
existing
HPSVL/MVL/MHL/FTL
street
lights by 80W LEDs.
Replacement of the
existing
HPSVL/MVL/MHL/FTL
street
lights by 80W LEDs.
Implementation of
Energy Audit Measures at
government
buildings.
Energy Auditing of
Government
Buildings.
Rs. 46 lakh
Rs.
Rs.
Rs.
Rs.
8 lakh
40 lakh
49 lakh
40 lakh
Rs. 40 lakh
Rs. 100 lakh

Rs. 2 lakh
Rs. 8 lakh
Udupi Town
Magadi Town &Puttur
Town
ESI Hospital Rajajinagar,
Bangalore
Vanivilas Hospital, KR
Market.
Minto Hospital, KR
Market.
Victoria Hospital, KR
Market.
KC General Hospital,
Malleshwaram.
Kalghatagi&Alnawar
Towns
pavagada Town
Kanakapura Town
BasawanaBagewadi Town
AnnegeriHobli
DCs Office building,
Chamarajnagar.
DCs Office building,
Tumkur.
Karnataka State Prisons
Head Office building,
Bangalore.
Regional
Commissioners Office
building, Mysore.
Gulbarga Region- mini
vidhansoudha, Aiwan- EShahi Guest House,
Police Bhavan building,
DC Office complex,
koppal.
Mysore RegionKR Hospital, DC Office

Page 88
(CADA), Mysore Medical

College, Text Book
Printing Press,
Kalamandira, Regional
Commissioner office,
P.K.T.B &CDHospital,
cheluvambha hospital.

Page 89
Replacement of the
existing
T-12/T-10/T-8 FTL with
Copper
Chokes by T-5 Lamp with
5.
electronic ballasts
LED Village Campaignreplacement of the
existing
incandescent lamp/FTL
by LEDs
(Home Lighting)
Replacement of the
existing
HPSVL/FTL by LEDs
6. (Street Lights).
Providing Smart Energy
Saver
Units for the Street Light
Circuitsin the Bangalore
7. & Mysore Cities.
Installation of LED
moving video display
boards at public
8. placesacross the state.
Replacement of the
existing low efficient
water pumps by
EnergyEfficient Star
Rated pumps at selected
Government Hospitals
9. across the state.
Energy Conservation
Building
10. Code (ECBC).
Rs. 4 lakh
Hubli Region- 15
buildings have been
taken up for auditing.
Rs. 100 lakh
About 500 Police

stations in the Bangalore
city.
Rs.20 lakh
Belagumba&Byadarahalli
villages in
BelagumbaPanchayat,
KasbaHobli, MagadiTaluk,
Ramanagar District.
Bangalore City: Rs. 100

Lakh
Rs. 150 lakh Mysore city: Rs. 50 Lakh
DCs Offices, ZP Offices,
Bus Stands,
Rs. 100 lakh Taluk Offices etc.
Government Hospitals
Rs. 100 lakh across the state.

Page 90
ANALYSIS
The above Table shows that corporation is keen in doing responsibility
activities. This shows their Social Obligation towards the Citizens of the
country.
5.6 BENEFITS FROM GOVERNMENT OF KARNATAKA

The corporation received state financial assistance from Government of
Karnataka for providing BelakuYojane and Solar Roof-Top Yojane to
different classes of the society. The Table 4.5.b shows State financial
assistance received from GOK towards various projects.

Page 91
TABLE 5.5 STATE FINANCIAL ASSISTANCE RECEIVED

FROM GOK
(Rs in Crores)

Page 92
STATE FINANCIAL ASSISTANCE FROM GOK

Growth
Particulars
2012-13 2013-14
in
Percentage
201112
SFA for BelakuYojane
2012-13
10
10
100
Yojane
100
SFA for BelakuYojane
10
Solar roof 2013-14
10
Intrestreciveed from gok
SFA for Solar Roof-Top

Page 93
(source: Annual Reports)
ANALYSIS
It is observed from the Table No.5.5.b that the Amount received from GOK
as state financial assistance towards SFA for BelakuYojane and SFA for Solar
Roof-Top Yojane was 33 Crores during the year 2013-14

Page 94
CHART 5.5
CHART
SHOWING
STATE
FINANCIAL
ASSISTANCE
RECEIVED FROM GOK
INFERENCE
From the above chart it is clear that State financial assistance received from
Government of Karnataka for providing BelakuYojane and solar roof-top
Yojane to various citizens of the society has been given in one year.

Page 95
5.6 JOB OPPORTUNITIES TO SC/ST AND DOWNTRODDEN

PEOPLE OF THE SOCIETY
KREDL also gives enormous number of job opportunities to the SC/ST and
downtrodden people of the society. It is categorized into 2. They are Class I
& II officials and Class III &IV officials. The second category is further subdivided into, Mechanical and Administration & others. The detail information
is neatly presented in a Table 5.6

Page 96
TABLE 5.6
TABLE SHOWING JOB OPPORTUNITIES TO DOWNTODDEN
PEOPLE
Category
Employees
SC
ST
Class I & II officials
36
1) Drivers
2) Cleaner
3) Peon/attendant/maid
4) Mechanic
5) Electrician
c)Administration& others
26
Total
80
10
Class II & III officials

Page 97
ANALYSIS
There were 10 employees belonging to Scheduled Castes and6 employees
belonging to Scheduled Tribes as against 80 employees. The percentage of
Scheduled Castes employees to the total employees on roll is 12.5% and the
percentage of Scheduled Tribe employees to the total employees is
7.5%......

Page 98
CHART 4.6 JOB OPPORTUNITIES TO DOWNTRODDEN

PEOPLE
INFERENCE
From the above chart it is clear that the corporation has shown interest in
providing employment opportunities to downtrodden people of the society.

Page 99
5.7 EMPLOYMENT OPPORTUNITIES TO WOMEN WORKFORCE

The corporation is a good employer of women. They have recruited Women
peons/attendant/maid, apart from Administration Staff. The Details are as
follows:

Page 100
TABLE
5.7
EMPLOYMENT
WORKFORCE
OPPORTUNITIES
TO
WOMEN
(Amt in Rs.)

Page 101
No. of Women Employee

Sl.no. Designation
Employees
Assistant
Benefits
technical
officer(AE Grade)
1367508
First Division Assistant
252924
Public relation Assistant
Stenographer
Second Division Assistant
226032
Typist
226032
Receptionist
226032
Peon/attendant/Maid
397116
252924
226032
226032
Hybrid Systems
252924
Total
15
4159404
Assistant
9
252924
252924
Energy
Conservation
Second Division Assistant -
10
Energy Conservation
project assistant - clean
11
development mechanism
Assistant
12
Wind
Solar

Page 102
ANALYSIS
Women Employees: There are 15 women employees. The total employee
benefit given to these women employees are 4159404 as against total
employee benefit of corporation are 20704128 in terms of percentage 20.09%
of total employee benefit.
FINDINGS, SUGGESTIONS AND

CONCLUSIONS
Page 103
FINDINGS
After in-depth study on the data available through analyzing and
interpreting the same, the major findings are listed below:
The KREDL has a variety of Social Responsibility activity to the
needs of different segments like Employees, Community, General
public, Environment, Downtrodden people, Women, and Others.
1)
Benefits to Employees :
In 2011-12 the expenses incurred on all these facilities was about

1409.1 lakhs, which increased to 1636.147lakhs in the financial year
2013-14. Thus, the KREDL is positive enough in spending amounts
to the benefits of employees that forms a major Social Responsibility
activity. If we look into individual benefits Medical, canteen & Labour
fund has been increasing but Housing and township facilities and
Water charges benefits is decreasing. This shows lack of awareness
among employees & Management negligence.
2)Other benefits to Employees:

Page 104

24658.959 lakhs, which increased to 61267.0557lakhs in the
financial year 2013-14. We can conclude that the organization is
pragmatic in respect of social responsibility towards its employees. If
we look into individual benefits, training expenses has been
increasing due to increasing in the number of trained employees.
Other special benefits such as leave encashment & rewards has
been fluctuating from year to year.
3)
Benefits to Community:

14691.55 lakhs, which decreased to 14305.876lakhs in the financial
year 2013-14. The cost incurred on community benefits has been
reduced. This is due to corporation has cut down the maintenance
expenses of tree saplings but the corporation has to take initiatives
for better environment.
4)
Good corporate citizenship activities:
The KREDL is prompt and regular in making payment to the

government by way of taxes, duties to the central and state
government, electricity board, telephone authority, banks and
others. These are accounted appropriately. The aggregate amount
paid to all these authorities was96184.607 lakhs for the year 201112 and it has gone up to 104833.5lakhs for the year 2013-14

Page 105
5)
Benefits to Outsiders:
The KREDL has replaced many street lights into LED lights in various
towns and even many places in Bangalore. The Corporation has
received state financial assistance from Government of Karnataka
towards BelakuYojane and Solar Roof-Top Yojane which inturn saves
energy. In 2013-14 the subsidies received on all these facilities was
about 33 crores. The KREDL by way of social obligations provides
facilities to all people.
6)
Job opportunities to SC/ST & Women Workforce:
The corporation has complied with constitutional guarantee of

providing employment to Scheduled caste, Scheduled tribe, women
work force and other weaker sections of the society.The corporation
recruited 10 employees belonging to Scheduled Castes and 6
employees belonging to Scheduled Tribes. Besides it also recruiting
15 women employees. This amply and clearly shows that the
corporation great concern for downtrodden and weaker section of
the society especially the women work force. We can conclude that
KREDL is a best employer for Social Accounting.

Page 106
SUGGESTIONS
1.
The corporation can invest further more funds in respect of
social responsibility activities since it is on the profit mode.

2.
The corporation is just saying how many beneficiaries are
benefited but not how effectively they are benefited. Therefore it is

suggested to measure the benefits on the basis of cost benefits
analysis ratio.
3.
The corporation can provide education facilities to employees
childrens and conduct recreation, sports and cultural activities in

order to influence an employee to work efficiently.
4.
It is suggested to plant more number of plants and include this
as their social responsibility activity.

5.
The welfare activities given to the employees are not
adequate, further facilities need to be given both monetary and nonmonetary so that the recipients will be happy and work better.
6.
The greatest social responsibility of the corporation is not hike
the fares steeply. It affects commuters rather go in for avoiding

unproductive and wasteful expenditures.
7.
The working conditions for the employees are in good
condition. The tidiness and improvised infrastructure in the working

conditions can influence an employee to work efficiently.
Page 107
8.
The corporation should conduct more and more training
activities in turn training increases efficiency and productivity,

reduces wastage and ensures better industrial relations.

Page 108
CONCLUSION
The Karnataka Renewable Energy Development Limited is a pioneer
public renewable energy development organization in Karnataka
doing service to the Customers in particular and the society as
whole. In respect of providing social responsibility activities, it
covers a wide spectrum of programs catering to the different
interest groups.
The budget on the social is increasing year after year and it
indicates the concern for the society. Overall we can conclude that
the KREDL with the limited resources is doing excellent Social
Responsibility activities.

Page 109

Social Responsibility Accounting - A Study With Reference To KREDL

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Social Responsibility Accounting A Study With Reference To KREDL

KARNATAKA STATE OPEN UNIVERSITY, MUKTHA GANGOTHRI, MYSORE