The financial reports of a power company : Part 3 Date : 10 January 2026 ## 5. Financial assets, fair value measurement and investment returns - Balances of financial assets and investments (debt and equity instruments, short‑term placements) fluctuate over 2022–2024, but interest income and fair value gains/losses do not fully align with the strong upward shift in market interest rates during this period. - This raises questions about the appropriateness of fair value measurement, classification (e.g. amortised cost vs FVOCI vs FVTPL) and timing of recognition of unrealised losses. **Audit concerns** - Whether fair value hierarchies, valuation techniques, and inputs are properly applied and disclosed. - Whether any losses have been deferred through classification choices or reliance on internal valuation models rather than observable market data. *** ## 6. Derivative instruments and hedge accounting - A company uses certain derivative instruments for risk management, yet the profit and loss effects of derivatives do not consistently track underlying risk factors (interest rates, FX) in some periods. - Disclosures on hedge relationships (hedged items, hedging instruments, hedge ratios, and effectiveness testing) are not sufficiently detailed to allow independent assessment of hedge effectiveness. **Audit concerns** - Whether the designation and documentation requirements for hedge accounting have been fully met, and whether any instruments are in substance speculative rather than hedging. - Whether hedge ineffectiveness is properly measured and recognised in profit or loss. To be continued——————————————————————————————————————— #FinancialAudit #PowerCompany #Thaitimes #ManagerOnline #News1

The financial reports of a power company : Part 2 Date : 9 January 2026 ## 3. Capital projects that do not yet generate commensurate benefits - Several major infrastructure and system projects recognised as assets in 2022–2023 do not appear to yield clearly observable incremental revenues or cost savings in the 2023–2024 results. - These assets continue to be carried at cost without impairment charges, despite technology changes and regulatory developments that could affect expected cash flows and utilisation. **Audit concerns** - Whether management has performed robust impairment testing (under TFRS) for projects with delays, cost overruns, or under‑utilisation. - Whether the business cases, IRR/NPV assumptions and demand forecasts used to justify capitalisation remain valid under current economic and policy conditions. *** ## 4. Trade receivables and allowance for doubtful accounts / ECL - Trade and other receivables remain high and increase in some years, while the allowance for doubtful accounts and expected credit loss (ECL) does not increase in proportion to the exposure and macro‑economic conditions. - Disclosures on aging profiles, major customers, and high‑risk groups are limited, making it difficult to assess the true credit quality of the receivables portfolio. **Audit concerns** - Whether the ECL model parameters (PD, LGD, forward‑looking overlays) are sufficiently conservative and reflect the impact of customer support schemes, payment moratoriums, or economic slowdown. - Whether management judgement has been used to keep impairment charges low in order to support reported profit. To be continued————————————————————————————————————————————————— #FinancialAudit #PowerCompany #Thaitimes #ManagerOnline #News1

The financial reports of a power company : Part 1 Date : 8 January 2026 ## 1. Revenue and profit trends versus cost environment - Company ’s core operating revenues show only modest growth over 2022–2024, while gross profit and operating profit do not decrease in line with the sharp increase and subsequent volatility in fuel and power purchase costs during the same period. - This pattern suggests that profit figures may appear “smoother” than would be expected given the external cost pressures, raising concerns about possible use of classification, timing, or presentation of income and expenses to stabilise reported earnings. **Audit concerns** - Whether revenue recognition and expense classification policies have been applied consistently, or selectively adjusted to maintain stable profit margins. - Whether there are any year‑end manual adjustments or reclassifications (e.g. moving items to “other income”) that significantly affect operating profit. *** ## 2. Property, plant and equipment and construction in progress - The carrying amounts of property, plant and equipment (PPE) and construction in progress (CIP) increase significantly over 2022–2024, reflecting large capital expenditures in network and system projects. - However, depreciation expense does not rise proportionately with the growth in PPE balances, especially in 2023–2024, which may indicate extensions of useful lives, changes in residual values, or delayed capitalisation/commissioning decisions that reduce current‑period expenses. **Audit concerns** - Whether useful lives, residual values and depreciation methods have been revised in a manner that is adequately supported and disclosed, or primarily to reduce depreciation expense. - Whether CIP projects are tested for impairment or re‑assessed for capitalisation criteria when there are delays, scope changes, or lower‑than‑expected economic benefits. To be continued————————————————————————————————————————————— #FinancialAudit #PowerCompany #Thaitimes #ManagerOnline #News1