financial support by way of approval of tariff increases, operational subsidy and investment in infrastructure to safeguard the going-concern status of the Corporation. 

## 2.3 Working Capital 

The working capital position of the Corporation as at 31 March 2018 showed current assets of P1.80 billion and current liabilities of P3.43 billion which resulted in a net current liabilities position of P1.64 billion. 

Current liabilities included: P1.56 billion Trade and Other Payables, P954.04 million advances on consumer-financed projects and P436.52 million Borrowings of which P434.26 million was from the Industrial and Commercial Bank of China. 

## 3.0 Management Letter 

The following were some of the significant matters raised by the auditors and the management responses thereto: 

## 3.1 Impairment Assessment of Property, Plant and Equipment 

The auditors noted that the Corporation carried a significant fixed asset base in its statement of financial position and that as per International Accounting Standard 36 – Impairment of assets, these assets are subject to impairment assessment should any indicators of impairment exist. These indicators include factors such as physical damage, declining economic performances of the assets, decline in market value, significant changes with adverse effects on expected use of assets, etc. 

The auditors observed that the historical continuing losses incurred by the Corporation, construction and equipment defects in plant for which remedial work was underway and plant not being operated at its optimal capacity indicated a possible impairment of its asset base, particularly the generation plant. Accordingly, management performed an impairment assessment of the Morupule B Power Station with some key assumptions, approach and results. 

The auditors highlighted the following in relation to evaluating management assumptions: 

 Expected units generated – There was inconsistency in this assumption as units generated were forecast to be less after 2021/22. In previous year’s assessments, it was expected that 

