Feb 25, 2013, 01.20 PM IST
Reliance Industries has provided half of the documents sought by CAG and promised to give most of the remaining when the auditor returns to audit its spending on the flagging KG-D6 fields.
RIL provided half of the documents to the team of the Comptroller and Auditor General (CAG) during their three-week stay at the company's office at Mumbai beginning January 9 and wrote to it that the rest, barring a small 10 per cent, would be given when the auditor promised to return on February 11.
Sources privy to the development said CAG, however, wrote back saying it will not be coming as promised on February 11.
In the meantime, CAG Vinod Rai wrote to Oil Minister M Veerappa Moily that RIL is not cooperating with the audit.
The documents that RIL has declined to provide relate to its legal case against the Oil Ministry decision to decline USD 1 billion of cost recovery as punishment for gas output from the main gas fields in KG-D6 block not matching the target.
RIL reasoned that such documents are no way related to audit of spending and revealing its strategy to counter the Ministry will compromise its legal case, sources said.
Also, RIL has refused to provide any documents relating to selection of technology as it felt the auditor cannot sit on judgement using hindsight to question decisions taken 6-7 years ago.
Sources said the firm feels the auditor's job is to verify expenditure and not question technology selection, which can be done only in a propriety audit and such an audit was beyond the scope provided in the Production Sharing Contract (PSC) for KG-D6.
RIL, they said, has kept the Oil Ministry, on whose written assurance that CAG would follow the audit process set out in the PSC, posted of the developments through weekly updates.
RIL on January 29 wrote to the Ministry that CAG was seeking voluminous documents of years not related to the period under audit (2008-09 to 2011-12).
CAG is demanding documents of previous years even though it had taken copies of documents in the first round of audit.
Reliance stock price
On December 11, 2013, Reliance Industries closed at Rs 881.00, down Rs 2.55, or 0.29 percent. The 52-week high of the share was Rs 954.80 and the 52-week low was Rs 765.00.
The company's trailing 12-month (TTM) EPS was at Rs 67.88 per share as per the quarter ended September 2013. The stock's price-to-earnings (P/E) ratio was 12.98. The latest book value of the company is Rs 557.05 per share. At current value, the price-to-book value of the company is 1.58.
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