QUARTERLY REPORT by wanghonghx

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									                                 QUARTERLY REPORT
      Open Joint-Stock Company “Moscow United Electric Grid Company”


                         Issuer‟s code:              6 5 1 1 6 – D


                                 For quarter I, 2010
Issuer‟s location: 115114, Rusia, Moscowregion, Podolsk, Ordjonikidze 27

The information containing in this quarterly report is to be disclosed in accordance with the
Russian Federation law on securities




Director General                                                                        A.P. Konovalov

Date “        14 ”       May         20 10                             (signature)

Chief Accountant of the issuer                                                          L.A. Sklyarova

Date “        14 ”      May          20 10                             (signature)
                                                                            Seal here


                                         Chief of the Securities Division
Contact person:                          Tamara Valentinovna Sobakina

Telephone number:                        (495) 984-5773

Fax number:                              (495) 984-5817
Email:                                   SobakinaTV@moek.ru

                                         www.e-disclosure.ru/portal/company.aspx?id=5563;
                                         www.moesk.ru
Internet website(s) used by the issuer
for the disclosure of the information
containing in this quarterly report




                                                                                                         1
Introduction

I. Brief data on the persons that form part of governance bodies of the issuer, data on
bank accounts, auditor, appraiser and financial adviser of the issuer, and on other
persons who signed the quarterly report
1.1. Persons who that form part of the issuer‟s governance bodies

1.2. Data on the issuer‟s bank accounts

1.3. Data on the issuer‟s auditor(s)

1.4. Data on the issuer‟s appraiser


1.5. Data on the issuer‟s consultants:


1.6. Data on other persons who signed the quarterly report


II. Important data about financial-economic state of the issuer


2.1. Indicators of the issuer‟s financial and economic activities

2.2. Issuer‟s market capitalization


2.3. Issuer‟s liabilities


2.3.1. Accounts payable
2.3.2. Issuer‟s credit history
2.3.3. Liabilities of the issuer from the securing granted to the third parties
2.3.4. Issuer‟s other liabilities
2.4. The purposes of issue and ways of use of the funds received as a result of
placement of
issue securities
2.5. Risks, connected with the acquisition of distributing (distributed) issued papers

2.5.1. Branch risks
2.5.2. Country and regional risks
2.5.3. Financial risks



                                                                                          2
2.5.4. Legal risks
2.5.5. Risks connected with issuer‟s activities

III. Detailed information on the issuer
3.1. Issuer‟s establishment and development history

3.1.1. Data on the issuer‟s name
3.1.2. Data on the state registration of the issuer
3.1.3. Data on the issuer‟s creation and development of the issuer
3.1.4. Contact information
3.1.5. Taxpayer identification number
3.1.6. Branches and representative offices of the issuer
3.2. Issuer‟s main economic activities
3.2.1. Issuer's industry
3.2.2 Issuer‟s main economic activities
3.2.3. Issuer‟s materials, goods (raw material) and suppliers
3.2.4. Issuer‟s production (works, services) market
3.2.5. Information on issuer‟s licenses
3.2.6. Issuer‟s joint activities
3.3. Issuer‟s plans of the future activities
3.4. Issuer‟s participation in industrial, bank and finance groups, holdings, concerns
and associations
3.5. Issuer‟s subsidiaries and dependent economic companies
3.6. Composition, structure and value of the issuer‟s fixed assets, information on
plans for the fixed assets purchase, replacement, retirement, and all facts of the
issuer's fixed assets encumbrance
3.6.1. Fixed assets
IV. Data on the issuer‟s financial and economic activities

4.1. Results of the issuer‟s financial and economic activities
4.1.1. Profit and loss
4.1.2. Factors which influence changing of the amount of proceeds from selling by the
issuer of the issuer‟s goods, products, works, services and profit (loss) from the
primary activities
4.2. Issuer‟s liquidity, sufficiency of the equity and working capital
4.3. Amount and structure of the issuer‟s equity and working capital
4.3.1. Amount and structure of the equity and working capital
4.3.2. Issuer‟s financial investments
4.3.3. Issuer‟s intangible assets


                                                                                         3
4.4. Data on the issuer‟s policy and expenses in the field of scientific and technical
development, licenses and patents, new development and research

4.5. Analysis of development tendencies in the sphere of issuer‟s principal activity

4.5.1. Analysis of tendencies of development in the sphere of the issuer‟s primary
activities
4.5.2. Issuer‟s competitors
V. Detailed data on the persons that form part of the issuer‟s governance bodies,
bodies of the issuer undertaking control over its financial and economic activities, and
brief data on the staff (employees) of the issuer
5.1. Data on structure and competence of the issuer‟s governance bodies
5.2. Information on the persons that form part of the issuer‟s governance bodies

5.2.1. The issue Board of Directors
5.2.2. Information on the issue Sole executive Body
5.2.3. Composition of the issue Collegial Executive Body
5.3. Data on amount of remuneration, privileges and/or indemnification of charges
concerning each governance body of the issuer

5.4. Data on the structure and competence of the issuer‟s bodies for control over
financial and economic activities
5.5. Data on the persons that form part of the issuer‟s bodies for control over financial
and economic activities
5.6. Data on amount of remuneration, privileges and/or indemnification of charges
paid to the issuer‟s financial and economic activities‟ control bodies

5.7. Data on the number and the generalized data on education and structure of the
issuer‟s staff (employees), and also on change of number of the staff (employees) of
the issuer
5.8. Data on any obligations of the issuer to the staff (employees) concerning the
possibility of their participation in the authorized (joint-stock) capital (share fund) of
the issuer
VI. Data on participants (shareholders) of the issuer and on interest-party transactions
completed by the issuer
6.1. Data on total amount of the issuer‟s shareholders
6.2. Data on the issuer‟s participants (shareholders) owning at least 5 percent of its
authorized (joint-stock) capital (share fund) or at least 5 percent of its ordinary stocks,
and data on such persons‟ participants (shareholders) owning at least 20 percent of the
authorized (joint-stock) capital (share fund) or at least 20 percent of their ordinary
stocks
6.3. Data on the market share of the state or municipal formation in the issuer‟s
authorized capital (share) stock (share fund), possession of special right („golden
share‟)
6.4. Data on restrictions on participation in the authorized (joint-stock) capital (share
fund) of the issuer
6.5. Data on changes in the composition and stake of the issuer‟s shareholders
(participants) owning at least 5 percent of its authorized (joint-stock) capital (share
fund) or at least 5 percent of its ordinary shares
6.6. Data on the issuer‟s interested-party transactions


                                                                                              4
6.7. Data on debt receivable amount

VII. Issuer‟s accounting reports and other financial information:
7.1 Annual financial statement of the issuer

7.2. Quarterly accounting reports of the issuer for the previous completed reporting
quarter
7.3. Summary accounting reports of the issuer for the previous completed fiscal year
7.4. Data on the issuer‟s accounting policy
7.5. Data on total amount of export and an export share in the total amount of sales
7.6. Data on the value of the issuer‟s real estate and essential changes which occurred
in the structure of the issuer‟s property after the date of the previous completed fiscal
year
7.7. Data on participation of the issuer in litigations if such participation may have a
material effect on the financial and economic activities
VIII. Additional data on the issuer and on the equity securities floated by it
8.1. Additional data on the issuer
8.1.1. Data on the amount, structure of the authorized (joint-stock) capital (share
fund) of the issuer
8.1.2. Data on the change of the amount of the authorized (joint-stock) capital (share
fund) of the issuer
8.1.3. Data on formation and use of the reserve fund and other funds of the issuer
8.1.4. Data on the procedure of convocation and carrying out the meeting
(conference) of the issuer supreme governance body
8.1.5. Data on the commercial Companies, in which the issuer owns at least 5 percent
of the authorized (joint-stock) capital (share fund) or at least 5 percent of ordinary
stocks
8.1.6. Data on material transactions completed by the issuer
8.1.7. Data on credit ratings of the issuer
8.2. Data on each category (type) of the issuer‟s stocks
8.3. Data on the previous issues of the issuer‟s equity securities except for the issuer‟s
stocks
8.3.1. Data on the issues all the securities of which are repaid (annulled)
8.3.2. Data on the issues, the securities of which are outstanding
8.3.3. Data on the issues, the obligations of the issuer under the securities of
which were not executed (default)
8.4. Data on the person (persons) who provided securing the bonds of the issue
8.5. Terms of execution of the securing under the issuer‟s bonds

8.6. Data on the Companies which carry out registration of the rights to the equity
securities


                                                                                             5
 8.7. Data on the legislative acts regulating issues of import and export of the capital,
 which may influence payment of dividends, interest and other payments to non-
 residents
 8.8. Description of incomes taxation procedure of the issuer‟s floated equity securities
 and equity securities which are in the process of floatation

 8.9. Information on declared (accrued) and paid dividends on the emitter‟s shares and on
 income on the emitter‟s bonds



 8.9.1. Information on declared (accrued) and paid dividends on the emitter‟s shares
 and on income on the emitter‟s bonds
 8.9.2. Issue of bonds on which the income was paid for the last 5 completed financial
 years, proceeding the termination date of last accounting quarter and if the emitter
 carries out the activity less than 5 years - for each completed fiscal year proceeding a
 termination date of last accounting quarter


 8.10. Other data

 8.11. Data on given securities and the emitter of given securities, the property right
 on which is admitted by the Russian Depositary Receipts.




Introduction

 The issuer is obliged to disclose the information in the form of the quarterly report


 Registration of the prospectus is carried out regarding securities of the isuuer




                                                                                            6
This quarterly report contains the issuer authorized governance bodies‟ estimations and forecasting
concerning future events and/or actions, prospects of development of the economy sector, in which the
issuer carries out its primary activities, and results of the issuer‟s activities, including the issuer‟s plans,
probability of occurrence of certain events and fulfillment of certain actions. Investors should not fully
rely on estimations and forecasting provided by the issuer‟s governance bodies as actual results of the
issuer‟s activities in the future may differ from those predicted for many reasons. Purchase of the
issuer‟s securities is connected with the risks described in this quarterly report.




I. Brief data on the persons that form part of governance bodies of the issuer, data on bank
accounts, auditor, appraiser and financial adviser of the issuer, and on other persons who
signed the quarterly report


1.1. Persons who that form part of the issuer‟s governance bodies

Structure of the issuer‟s Board of Directors:




                                                                                                              7
                                   Name, surname   Year of birth

Nikholay Nikholaevich Shvets                          1956

Sergey Nikholaevich Ivanov                            1961

Alexey Feliksovich Bodunkov                           1966

Anatoliy Anatolievich Gavrilenko                      1972

Sergey Valentinovich Grischenko                       1972

Alexey vladimirovich Demidov                          1976

Sergey Mikhaylovich Kerber                            1973

Alexander Albertovich Popov                           1955

Vladimir Nikholaevich Silkin                          1957

Volfgang Skribot                                      1966

Maria Gennadievna Tikhonova                           1980

Yury Ivanovich Trophimov                              1945

Nikolay Grigorievich Shulginov                        1951




The sole executive body of the issuer:


                                   Name, surname   Year of birth

Andrey Pavlovich Konovalov                            1958



  The Issue Collegial Executive Body structure


                                   Name, surname   Year of birth

Andrey Pavlovich Konovalov (Chairman)                 1958

Alexander Mitrophanovich Burmistrov                   1953

Olga Leonidovna Bulanova                              1959

Grigoriy Yakovlevich Volkenshteyn                     1956

Georgiy Nikolaevich Groshev                           1951

Oleg Yurievich Isaev                                  1969

Oleg Anatolievich Kazakov                             1948



                                                                   8
Evgeniy Anatolievich Kopanov                                               1970

Igor Alexeevich Kosolapov                                                  1971

Leonid Vladimirovich Mazo                                                  1977

Andrey Vladimirovich Mayorov                                               1967

Alexander Alexandrovich Mityaev                                            1952

Ludmila Alexeevna Sklyarova                                                1958

Nikolay Mikhaylovich Soldatov                                              1940




1.2. Data on the issuer‟s bank accounts
Data on Loan Company


Full company name: Bank of Foreign Trade (OJSC Vneshtorgbank)
Shorten company name; OJSC VTB bank
Location: 190000, Saint-Petersburg city, Bolshaya Morskaya street, 29
VAT: 7702070139
BIC: 044525187
Account number: 40702810500060021123
Correspondent account number: 30101810700000000187
Type of account: rubles settlement


Data on Loan Company


Full company name: Bank of Foreign Trade (OJSC Vneshtorgbank)
Shorten company name: OJSC VTB bank
Location: 190000, Saint-Petersburg city, Bolshaya Morskaya street, 29
VAT: 7702070139
BIC: 044525187
Account number: 40702810500060021123
Correspondent account number: 30101810700000000187
Type of account: current foreign exchange
Data on Loan Company
Full company name: Open Joint-Stock Company Joint-Stock Commercial Bank “Agroimpuls”
Shorten company name: (OJSC JSCB “Agroimpuls”, “Moskovsky” branch)
Location: 127106, Moscow, Gostinichnaya street, 5, bld. 10
VAT: 3664036384
BIC: 044552444


                                                                                       9
Account number: 40702810300010000082
Correspondent account number: 30101810300000000444
Type of account: rubles settlement


Data on Loan Company
Full company name: Open Joint-Stock Company Joint-Stock Commercial Bank “Agroimpuls”
Shorten company name: (OJSC JSCB “Agroimpuls”, “Moskovsky” branch)
Location: 127106, Moscow, Gostinichnaya street, 5, bld. 10
VAT: 3664036384
BIC: 044552444
Account number: 40702810300010000082
Correspondent account number: 30101810300000000444
  Type of account: Roubles account


Data on Loan Company
Full company name: Open Joint-Stock Company Joint-Stock Commercial Bank “Agroimpuls”
Shorten company name: (OJSC JSCB “Agroimpuls”, “Moskovsky” branch)
Location: 127106, Moscow, Gostinichnaya street, 5, bld. 10
VAT: 3664036384
BIC: 044552444
Account number: 40702810300010000082
Correspondent account number: 30101810300000000444
  Type of account: current foreign exchange


Data on Loan Company
Full company name: Joint-Stock Commercial Bank “Bank of Moscow” ((Open Joint-Stock
Company)
Shorten company name: (OJSC “Bank of Moscow” )
Location: 107996 Russia, Moscow, Rozhdestvenka St, 8/15 bld. 3
VAT: 7702000406
BIC: 044525219
 Account number: 40702810301050000069
 Correspondent account number: 30101810500000000219
  Type of account: Roubles account


Data on Loan Company
Full company name: Open Joint-Stock Company “ALFA-BANK”
Shorten company name: (OJSC “ALFA-BANK”)
Location: 107078, Moscow, Kalanchevskaya street, 27
VAT: 7728168971



                                                                                       10
BIC: 044525593
  Account number: 40702810701300000554
  Correspondent account number: 30101810200000000593
  Type of account: Roubles account


Data on Loan Company
Full company: Gazprombank (Open Joint-Stock Company)
Shorten company name: (OJSC "Gazprombank")
    Location: 117420, Moscow, Nametkina street, 16, bld.1
    VAT: 7744001497
    BIC: 044525823
  Account number: 40702810900000003645
  Correspondent account number: 30101810200000000823
  Type of account: Roubles account


Data on Loan Company
    Full company: Joint Stock Company Commercial Bank of Russian Federation (open joint
    stock company branch – Kievskoye department - № 5278)
    Shorten company name: Sberbank of Russia OJSC
    Location: 117997, Moscow, Vavilova street, 19
    VAT: 7707083893
    BIC: 044525225
  Account number: 40702810838260011503
  Correspondent account number: 30101810400000000225
  Type of account: settlement


1.3. Data on the issuer‟s auditor(s):


  The auditor (auditors), making the independent audit of issuer‟s business accounting and
  financial (book-keeping) accounts, on the ground of the concluded agreement, as well as auditor
  (auditors), confirmed (chosen) for auditing of the issuer‟s annual financial (book-keeping)
  accounts on the balance of the current or completed fiscal year:
  1.The auditor (auditors), making the independent audit of issuer’s business accounting and
  financial (book-keeping) accounts, on the ground of standards of the accounting reports:


  Full company‟s name: Close Joint-Stock Company “HLB Vneshaudit”
  Abbreviated company‟s name: CJSC “HLB Vneshaudit”
  Address: 123610, Moscow, Krasnopresnenskaya st., 12, ent. 3, office 701
  ITN: 7706118254


  Telephone: (495) 967-0495


                                                                                               11
 Fax: (495) 967-0497
 E-mail address: info@vneshaudit.ru


 Information on the license about the auditing business carrying out


   Name of the authority the license issued by: Ministry of Finance of the RF
   Number: No. E 000548
   Date of issue: 25.06.2002
   Valid till: 25.06.2012

 Information on auditor‟s membering in self-regulating audit companies



 Information on auditor‟s membering in boards, associations or other professional unions
 (organizations):

 CJSC “HLB Vneshaudit” is the member of HLB International – the international company of
 professional book-keeper firms and business consultants, providing customers with high-
 quality services in the sphere of audit, financial and business consultation, corporate
 finances, IT and other consulting directions.

 CJSC “HLB Vneshaudit” is the member of self-regulating professional audit union founders
 “The Institute of Professional Auditors” (IPAR) and takes an active part in its work:
 According to the results of examination, made by the IPAR Committee quality inspector,
 CJSC “HLB Vneshaudit” got the Quality Certificate No. 124.

 In 2006 by the decision of President Council of the Institute of Professional Book-keepers and
 Auditors of Russia CJSC “Vneshaudit” was affiliated as the corporate member of the Institute
 of Professional Book-keepers and Auditors of Russia and the territorial institute of
 professional book-keepers.
 The fiscal year (years), the issuer‟s business accounting and financial (book-keeping) accounts of which were
 independently audited by the auditor.




   Year

2005

2006

2007

2008




                                                                                                                 12
    The factors, which can influence on the auditor‟s independence from the issuer, as well as
    the important interests, connecting the auditor (auditor‟s officials) with the issuer (issuer‟s
    officials) are absent.
The procedure on choosing the issuer‟s auditor
The presence of the tender procedure, connected with the choice of auditor, and its basic
conditions:
At present time the tender procedure, connected with the choice of auditor is absent.
According to the decision of the OJSC “MOESK” Board of Directors on December, 13 2006
(Minutes No. 37 dated December, 15th 2006) the Committee to audit the Board of Directors is
established in the Company, which terms of reference cover as well “the question of preparing
recommendations to the Company‟s Board of Directors about candidature of the Company‟s
Auditor, which is chosen from the number of independent auditors, which have high
professional reputation, for the further approval of this candidature by the General Meeting of
the Company‟s Shareholders, working out of recommendations on the conditions of holding the
competitive choice of the Company‟s auditor, participation in holding the competitive choice of
the Company‟s auditor if any are held”.
    The procedure on proposing the auditor‟s candidature to confirm it by the meeting of
    shareholders (participants), as well as the operating control, making such a decision:

    According to the item 10.2 Article 10 of the Issuer‟s Regulations the following question is in
    the competence of the General Meeting of the Issuer‟s Participants:
    “the approval of the Company‟s Auditor”.


  The information on works, carried out by the auditor in the network of the special audit
  programmes:
  The works, carried our by the auditor in the network of the special audit programmes, were
  not held.
  The procedure for determining amount of auditor‟s fee is described, the actual fee rate, payed out
  to the auditor by the issuer on the ground of the results of the each of last five completed fiscal
  years, during which the auditor made independent auditing of the issuer‟s business accounting
  and financial (book-keeping) accounts, is indicated:
  According to item 23.9. Article 23 of the Issuer‟s Regulations, the rate of payment for auditor
  service is established by the Board of Directors.


  The actual rate of auditor‟s fee, payed out by the issuer to the auditor on the grounds of the
  results of each fiscal year, during which the auditor made independent audit of the issuer‟s
  business accounting and financial (book-keeping) accounts:
   for year 2005 – 280 000 roubles without the VAT
  for year 2006 – 280 000 roubles without the VAT
  for year 2007 – 2 100 000 roubles without the VAT
  for year 2008 – 3 500 000 roubles without the VAT


  The information on the presence of deferred and late payments for the rendered auditor services:
  Deferred and late payments for the rendered auditor services are absent




                                                                                                   13
  The auditor, that fulfilled the audit of the financial accounts, years 2005 and 2006, of OJSC
  “MOESK”, made according to the International Standards of Financial accounts:

  Full firm‟s name: “KPMG Limited”
  Abbreviated firm‟s name: “KPMG Limited”
  The auditor company‟s address:
  Moscow office: 119019, Moscow, Gogolevskiy av., 11

  The auditor rendered to the issuer the service of accomplishing the audit of financial
  accounts, years 2005, 2006, of OJSC “Moscow Joint Electric Network Company”
  (“MOESK”), made according to the International Standards of Financial accounts.


  The auditor, that fulfilled the audit of the financial accounts, years 2007 and 2008, of OJSC
  “MOESK”, made according to the International Standards of Financial accounts:



  Full company name: CJSC “KPMG”
  Abbreviated company‟ name: CJSC “KPMG”
  The auditor company‟s address:
  123317. Moscow, Krasnopresnenskaya st., 18


  The auditor rendered to the issuer the service of accomplishing the auditing of financial
  accounts, years 2007 and 2008, of OJSC “Moscow Joint Electric Network Company”
  (“MOESK”), made according to the International Standards of Financial accounts.


1.4. Information on the issuer‟s appraiser (appraisers)


  Surname, given names: Edomskiy Sergey Rudolfovich
  The appraiser works on the ground of the labour contract with the juridical person


  Telephone: 98120 703-4090
  Fax: (812) 703-3008
  E-mail address: edomsky@ipp.spb.ru


  The information on the juridical person, the appraiser concluded the agreement with


    Full firm‟s name: Close Joint-Stock Company “Deloit and Tush SNG”
    Abbreviated firm‟s name: CJSC “Deloit and Tush SNG”
    Address: 125009, Moscow, Vozdvizhenka st., 4/7, building 2, Business Centre “Mokhovaya”
    VAT: 7703097990
    PSRN: 1027700425444


                                                                                                  14
  Information on appraiser‟s membering in self-regulating appraiser organizations
     Full name: All-Russian Fund “The Russian Appraisers‟ Society”
       Address
       107078 Russia, Moscow, 1st Basmanniy st., 2A
     Date of registration of appraiser in self-regulating appraiser organization: 10.01.2008
     Registration number: 002797


  Information on appraisal service, rendered of this appraiser:

  In the first quarter of 2007 the issuer recruited the appraiser to rate the market value of fixed
  assets, concerning which the issuer fulfilled the reappraisal of value, stated in item 3.6.1. of
  quarterly accounts.


  In the first quarter of 2009 the issuer recruited the appraiser to rate the market value of fixed
  assets, concerning which the issuer fulfilled the reappraisal of value, stated in item 3.6.1. of
  quarterly accounts.


1.5. Information on the issuer‟s consultants (


  The information concerning the financial consultant on the equity market, rendering to the issuer
  the corresponding services on the ground of agreement, as well as other persons, rendering to the
  issuer the consulting services, connected with the paper issue, and signed the quarterly accounts
  and the last registered current securities data.


Full firm‟s name: Open Joint-Stock Company “Brokerage house Otkrytie”
Abbreviated firm‟s name: OJSC “Brokerage house Otkrytie”
Address: 129010, Moscow, Protopopovskiy st., 19, building 10
VAT: 7710170659
PSRN: 1027739704772


Telephone: (495) 232-0300
Fax: (495) 956-4700
E-mail address: http://www.bdopen.ru

  The information on the license about the professional activity carrying out on equity market


  The services, rendered (carried out) by the consultant:

  The financial consultant on equity market has signed the securities prospectus (ordinary non-
  documentary shares, state registration number and date of the state registration issued 1-01-
  65116-D-001D of June, 30th 2008)

  The services, rendered by the consultant:
     give assistance to the issuer in preparation and registration of the issuer‟s securities


                                                                                                 15
 prospectus;
  subscription of Securities prospectus and the issuer‟s Accounts of capital issue results;
  consultation of the issuer
  on information disclosure;
  on other questions, connected with the issuer‟s paper issue.


The Open Joint-Stock Company “Brokerage house Otkrytie” was also the financial consultant on
the following issuer‟s paper issue (state registration number 1-01-65116-D dated May, 31st 2005)


1.6. Data on other persons who signed the quarterly report
  Name: Ludmila Alexeevna Sklyarova
  Year of birth: 1958
  Information about the place of work:
  Organization: Moscow United electric Grid Company , JSC
  Position: Chief Accountent




                                                                                               16
II. Important data about financial-economic state of the issuer
2.1. The issuer‟s financial-economic activity showings
  Measure unit: RUR thousand

        Parameter              2005         2006         2007       2008       2009       2010, 3
                                                                                           мес.

Net asset value of the          27 135       30 863       48 930     86 976    122 127     124 285
issuer, RUR                        086          843          597        157        595         494

Relation of the borrowed           19.2         57.2       93.96      148.3      109.4      108.09
funds to the capital and
reserves, %

Relation of the short-term        18.69        25.48       60.88      68.19      78.15       84.99
liabilities amount to the
capital and reserves, %

Cover of payment for debt         43.54        38.17       36.38        14.8     18.33              5
service, %

Level of the debt overdue,         1.64            0            0          0     18,05        6,71
%

Receivables turnover, times        5.51         3.25         2,11       1.04       1.37        0.4

Share of dividend in the           3.86         1.61            0          0          -             -
profit, %

Labour productivity, RUR      1 204.68       2 428.2     3 762.01   5 605.85   5 817.54   1 663.18
„000/person

Depreciation to the amount         8.47         6.96       11.11        9.52     13.96       11.46
of proceeds, %




                                                                                              17
* Parameter «a share of dividends in profit» for 2009 will be calculated after the statement by
annual general meeting of shareholders of the definitive amount of the annual dividend.

The issuer's net assets as of the date of the end of the third quarter 2009 equaled RUR 122 127 595
thousand. The sizable amount of net assets is explained by the issuer's activities peculiarities. The
primary business of OJSC "MOESK" is rendering paid services on transmission and distribution of
electric energy to the city of Moscow and the Moscow region. The primary goal of the Company is
transformation, distribution and supply of the electric power to consumers. The company structure
includes more than 600 high-voltage substations (they belong to the company on the basis of a right of
ownership), over 16 thousand km of overhead and cable high-voltage transmission lines, nearby 60
thousand km of distribution grids. In 2009 input of fix assets was carried out in amount RUR
24 551 billion Total transformer power input in fix assets is 1 595 MWA МВА and 1 433 km of
electric linesof all levels of voltage.
The dynamics for 2005-2009 allows to draw a conclusion on a significant growth of the issuer's
net asset value. The increase in the issuer's net asset value is resulted from putting the fixed
capital in operation and performance of the Company's Investment Program in 2005-2009
aimed to address the need for liquidation of electric capacity deficiency in the Moscow Region.
As at the end of the 1st quarter of 2010, the issuer's net asset value was RUR 124,285,494
thousand.
Starting from the date of the issuer's state registration (1.04.2005) until the date of the end of
the 1st quarter of 2010 the issuer's charter capital changed. Based on the resolution of the
extraordinary General Shareholders Meeting of OJSV "MOESK" dated 18.04.2008 (Minutes
No.6 dated 28.04.2008), the Company was reorganized by way of accession of OJSC "Moscow
City Electric Grid Company" to it. The Shareholders Meeting of OJSC "MOESK" decided to
increase the charter capital of OJSC "MOESK" by placing additional shares by means of
converting the shares of OJSC "MGEsK" into them. As at 31.03.2010 the issuer's charter
capital was RUR 24,353,545,787. The issuer's charter capital has no preferred shares.
The additional capital of OJSC "MOESK" as at the date of the end of 2009 equals RUR 63,720,537
thousand.
The additional capital was generated due to the following sources:
- Reassessment of the fixed production assets;
- Uniting of reorganized entities‟ equities in the process of reorganization in the form of
accession.
As at the date of the end of the 1st quarter of 2010, the additional capital was RUR 63,717,011
thousand.
The issuer uses both own sources and short-term and long-term sources of borrowed financing.
The major part in the issuer's balance sheet structure is represented by the item "Capital and
reserves" consisting, according to the issuer's reporting, of the charter, additional capital and
unallotted profit. The share of "Capital and reserves" in the structure of the balance sheet
equals 47.75%. Long-term loans and credits are 5.57% of the balance sheet total as at the end of
2009.
As at the date of the end of the 1st quarter of 2010, the share of "Capital and reserves" in the
structure of the balance sheet is 48.06%. Long-term loans and credits equal 3.58%.
The indicators of the relation of the borrowed funds amount to the capital and reserves and the
relation of short-term liabilities to the capital and reserves are indicators of financial



                                                                                                         18
dependence. The less these indicators, the less financial lever of the company, which proves a
greater financial independence of the company.
The indicator of the relation of the involved assets amount to the capital and reserves as at the
date of the end of 2009 was 109.40%. A certain reduction in the indicator of the relation of the
borrowed funds amount to the capital and reserves in comparison with the 2008 financial year
indicators is due to optimization by the Company of the credit portfolio and return of a part of
the loans, as well as the growth of the Company's equity.
The indicator of the relation of the borrowed funds amount to the capital and reserves as at the
date of the end of the 1st quarter of 2010 was 108.09%.
The indicator of the relation of the amount of short-term liabilities to the capital and reserves
shows dependence of the Company on short-term borrowed funds.
As at the date of the end of 2008, the indicator of the relation of the amount of short-term
liabilities to the capital and reserves was fixed at the level of 68.19%, and in 2009 it was 78.15
%. The growth of the indicator is due to re-classification of the loan commitment due to the
need for its fast repayment.
As at the date of the end of the 1st quarter of 2010, the indicator of the relation of the amount of
the short-term liabilities to the capital and reserves was fixed at the level of 84.99%.
The indicator of coverage of debt service payment during the considered period is 5%, which
characterizes the issuer's ability to cover the liabilities out of the net profit as follows: 5 rubles
of covering by the net profit of the reporting period and by the depreciation accrued in the
reporting period are approximately per 100 rubles of liabilities (taking into account interest per
liabilities).
In terms of percentage ratio, the amount of the overdue liabilities in relation to the volume of
accounts payable for 2009 was 18.05%, and for the 1st quarter of 2010 it was 6.71%.
The occurrence of the overdue short-term accounts payable as at the date of the end of 2009 and
the 1st quarter of 2010 was caused by the following:
- Untimely provision by the lending customer of required engineering specifications, the
unavailability whereof makes performance of works by the contractor impossible;
- Untimely activation of the performed works by creditors, delay in performance of these
obligations by the creditor;
- Presence of counter overdue accounts receivable under works contracts, accounting to which
the contracting entities are simultaneously creditors and debtors in relation to the issuer.
The positive factor describing the Company financial and economic activities is the increase in labour
productivity in 2005-2009 in comparison with the similar period of previous year.


In order to calculate the specified indicators, the method recommended by the Regulations for the
Information Disclosing by Issuers of Equity Securities was used, which was approved by Order of
Federal Financial Markets Service as of 10 October 2006 No. 06-117/pz-n (06-117/пз-н).

Net assets are calculated according to the procedure of estimation of the net asset value of the joint-stock
company approved by Order of the Ministry of Finance of Russia and Federal Commission for the
Securities of Russia No. 10n/03-6/pz (No.10н/03-6/пз) as of 29 January 2003.


The issuer's financial standing in the considered period is steady.



2.2. Issuer‟s market capitalization
Technique of definition of a market price of shares:


                                                                                                         19
As the issuer's shares as of 31 December 2005 on the organized markets were not outstanding, it is not
possible to define market capitalization of the issuer under the method provided in Regulations for the
Information Disclosing by Issuers of Equity Securities approved by Order as of 16 March 2005 No. 05-
5/pz-n (No.05-5/пз-н) (as amended by Order of FFMS of Russia as of 1 November 2005 No. 05-57/pz-n
(No.05-57/пз-н)).
For the purposes of this paragraph, the issuer's market capitalization at 31 December 2005 is defined on
the basis of the net asset value. Calculation of net asset value of OJSC "Moscow United Electric Grid
Company" is made under the method specified in "Procedure of estimation of net asset value of joint-
stock companies" approved by Order of the Ministry of Finance of Russia and Federal Commission for
the Securities of Russia as of 29 January 2003 No. 10n/03-6/pz (10н/03-6/pz).
The issuer's market capitalization as of 31 December 2005 was RUR 27 135 086 thousand.
  The market capitalization is calculated as a product of the number of shares of the
  corresponding category (type) multiplied by the market price of one share, disclosed by the
  organizer of trading on equity market and determined according to the Procedure of
  settlement of market price of issued papers and unit investment trusts‟ investment shares,
  admitted to currency through trading organizer, ratified by the FSC of Russia Decree on
  24.12.2003 No. 03-52/ пс


  Parameter           2005       2006              2007         2008           2009             1 кв. 2010

Market          27 135 086       76 386 268        69 493 424   55 672 205     53 382 972       79 782 215
capitalisation, 000              628               862          669            365              998
RUR




  Information about organizer of trading on the equity market, on the ground of which the
  calculation of market capitalization is made, as well as additional information on public
  circulation of securities at issuer‟s discretion:
  For calculation of Company‟s market circulation the information on the market price of one
  share, disclosed by the Close Joint-Stock Company “MMVB Stock exchange”, is used.


  The company‟s shares (state registration number of the shares issue 1-01-65116-D) are
  recorded in the quoted list “A”, the first level, of the Close Joint-Stock Company “MMVB
  Stock exchange” and in the quoted list “A”, the second level, of the Open Joint-Stock
  Company “Stock Exchange Russian Trade System”.

2.3. The issuer‟s liabilities
2.3.1. Account payable

  The structure of the issuer‟s accounts payable

  For 2009
    Unit measure, RUR thousand

                         Accounts payable name                               Payment deadline
                                                                        Up to one      Over one
                                                                          year           year




                                                                                                     20
Accounts payable to the suppliers and contractors, RUR
                                                                      10 997 114
  including those overdue, RUR
                                                                                         x
Accounts payable to the personnel of the organization, „000 RUR
                                                                           1 621
  including those overdue, RUR
                                                                                         x
Accounts payable to the budget and state non-budgetary funds, „000
                                                                         262 066
RUR
  including those overdue, RUR
                                                                                         x
Credits, RUR
                                                                      20 422 526      9 542 277
  including those overdue, RUR
                                                                                         x
Loans, total, RUR
                                                                       6 375 017      4 419 913
  including those overdue, RUR
                                                                                         x
  including bonded loans, RUR
                                                                          59 251      2 356 507
  including bonded loans overdue, RUR
                                                                                         x
Other accounts payable, RUR
                                                                      53 021 004     21 786 335
  including those overdue, RUR
                                                                      23 633 127         x
Sum total, RUR
                                                                      91 079 348     35 748 525
  including those overdue, RUR
                                                                      23 633 127         x


The reasons of default on obligations, the consequences whereof have been experienced or may be
experienced by the issuer in the future due to the default on the obligations as stated above,
including penalties imposed on the issuer, prospective term of repayment of the overdue accounts
payable:
The issuer‟s overdue accounts payable are resulted from the developed adverse financial and
economic situation that entailed revision and reduction of investment programs, including in
respect of the concluded contracts of engineering connection which provide for advance
payments.
The default on obligations in respect of performance of works within the framework of the
mentioned contracts is resulted from:
- Untimely provision by the lending customer of required engineering specifications, the
unavailability whereof makes performance of works by the contractor impossible;
- Untimely activation of the performed works by creditors, delay in performance of these
obligations by the creditor.
The provided grounds do not indicate a reduction in the issuer‟s solvency, which resulted in the
growth of the delayed accounts payable, but are due, first of all, to peculiarities of realization of
the measures to comply with the contracts for engineering connection to electric grids.
The main consequence of the default on obligations by the Issuer may be requisition by the
creditors of the overdue debts through judicial procedures according to the norms of the current
civil laws of the Russian Federation. However the Company in due time performs the
obligations undertaken with respect to the credit institutions. In order to minimize risks of
claming accounts payable through court, the Company carries out actions on pre-judicial
settlement of disputes and possible re-structuring of the existing debts.


                                                                                                  21
The prospective term of repayment of the overdue accounts payable: they are determined by
administrative documents of OJSC MOESK”.
The creditors which provided at least 10 percent of the total amount of accounts payable: no such
creditors


  For 3 months 2010
    Unit measure, RUR thousand


                      Accounts payable name                              Payment deadline
                                                                      Up to one    Up to one
                                                                        year         year
Accounts payable to the suppliers and contractors, RUR
                                                                       8 718 080
  including those overdue, RUR
                                                                       2 354 312       x
Accounts payable to the personnel of the organization, „000 RUR
                                                                        702 899
  including those overdue, RUR
                                                                                       x
Accounts payable to the budget and state non-budgetary funds, „000
                                                                       1 791 713
RUR
  including those overdue, RUR
                                                                                       x
Credits, RUR
                                                                      24 661 793    4 575 000
  including those overdue, RUR
                                                                                       x
Loans, total, RUR
                                                                       6 292 992    4 497 534
  including those overdue, RUR
                                                                                       x
  including bonded loans, RUR
                                                                         11 436     2 356 507
  including bonded loans overdue, RUR
                                                                                       x
Other accounts payable, RUR
                                                                      58 849 936   17 074 945
  including those overdue, RUR
                                                                       6 477 217       x
Sum total, RUR
                                                                     101 017 413   26 147 479
  including those overdue, RUR
                                                                       8 831 529       x


The reasons of default on obligations, the consequences whereof have been experienced or may be
experienced by the issuer in the future due to the default on the obligations as stated above,
including penalties imposed on the issuer, prospective term of repayment of the overdue accounts
payable:
The issuer‟s overdue accounts payable are resulted from the developed adverse financial and
economic situation that entailed revision and reduction of investment programs, including in
respect of the concluded contracts of engineering connection which provide for advance
payments.



                                                                                                22
The default on obligations in respect of performance of works within the framework of the
mentioned contracts is resulted from:
- Untimely provision by the lending customer of required engineering specifications, the
unavailability whereof makes performance of works by the contractor impossible;
- Untimely activation of the performed works by creditors, delay in performance of these
obligations by the creditor.
The provided grounds do not indicate a reduction in the issuer‟s solvency, which resulted in the
growth of the delayed accounts payable, but are due, first of all, to peculiarities of realization of
the measures to comply with the contracts for engineering connection to electric grids.
The main consequence of the default on obligations by the Issuer may be requisition by the
creditors of the overdue debts through judicial procedures according to the norms of the current
civil laws of the Russian Federation. However the Company in due time performs the
obligations undertaken with respect to the credit institutions. In order to minimize risks of
claming accounts payable through court, the Company carries out actions on pre-judicial
settlement of disputes and possible re-structuring of the existing debts.
The prospective term of repayment of the overdue accounts payable: they are determined by
administrative documents of OJSC MOESK”.
The creditors which provided at least 10 percent of the total amount of accounts payable: no such
creditors
2.3.2. The issuer‟s credit (loan) history


  The issuer‟s fulfilment of liabilities on acting during the last 5 completed fiscal years or for
  every completed fiscal year, if the issuer has been carrying out business less than 5 years, as
  well as acting on the date of completion of financial quarter credit agreements and/or loan
  agreements, according to which the sum of original debt is 5 or more per cent of book value of
  issuer‟s assets on the date of the last completed financial quarter, which proceeds the conclusion
  of certain agreement, as well as other credit agreements and/or loan agreements, which the
  issuer considers to be important. In case, if the issuer has fulfilled bonds issue, there is described
  fulfilment by the issuer of liabilities on every bonds issue, the aggregate nominal value of which
  is 5 or more per cent of book value of issuer‟s assets on the date of the end of the last completed
  financial quarter, which proceeds the state registration of the accounts on bonds issue results,
  and in case if bonds floatation is not completed or due to some other reasons the state
  registration of accounts on the issue results is not carried out,- on the date of end of the last
  completed financial quarter, which proceeds the state registration of bonds issue




  Name of the         Name of the      Original debt Currency Credit (loan)        Availability of
   liability           creditor                                 period /               delay in
                       (loaner)                               maturity date         execution of
                                                                                   liability with
                                                                                      regard to
                                                                                     payment of
                                                                                    original debt
                                                                                    and/or fixed
                                                                                     rate, delay
                                                                                    period, days

Credit line         OPEN JOINT              2 350 000   RUR       12.09.2006      absent
                    STOCK                         000
                    COMPANY
                    "ALFA-


                                                                                                     23
                  BANK"

Credit line       OJSC VTB              3 500 000        RUR   23.06.2008      absent
                  BANK                        000

Credit line       Barclays Bank       370 000 000    $ USD     21.04.2010      absent
                  PLC

Credit line       SBERBANK              9 600 000        RUR   24.06.2011      absent
                  OF RF                       000



In 2006 the issuer has placed non-convertible interest-bearing documentary bonds payable to
bearer series 01 (state registration number 4-01-65116-D dated June, 22nd 2006) with maturity
date on the 1820th day from the date of the beginning of issued bonds placement. The yield of
paper issue at face value of: 6 000 000 000 (six billion) roubles, 17,75 % of book value of
issuer‟s assets valid on 31.03.2006. The date of state registration of the accounts on bonds issue
results: October, 24th 2006.
The amount of the issued bonds: 6 000 000 (six million) items
Face value of each issued bond: 1 000 (one thousand) roubles


  The fulfilment by the issuer of liabilities on bonds issue payable to bearer series 01:




Name of the                  Payment Interest The sum for Total sum              Date of        Information
liability                    period      rate    one bond,      of payments,      liabilities   on liabilities
                                                 RUR            RUR               fulfilment fulfilment
Payment of incomings         12.09.06- 8,05      40,14          240 840 000,00 13.03.07
Liability according to
the 1st coupon               13.03.07                                                           fulfilled


Payment of incomings         13.03.07- 8,05      40,14          240 840 000,00 11.09.07
Liability according to
the 2nd coupon               11.09.07                                                           fulfilled


Payment of incomings         11.09.07 – 8,05     40,14          240 840 000,00 11.03.08
Liability according to
the 3rd coupon               11.03.08                                                           fulfilled


Payment of incomings         11.03.08 – 8,05     40,14          240 840 000,00 09.09.08
Liability according to


                                                                                                   24
the 4th coupon                  09.09.08                                                     fulfilled


Payment of incomings            09.09.08- 8,05   40,14          94 590 190,98     10.03.09
Liability according to
the 5th coupon                  10.03.09                                                     fulfilled


Payment of incomings            10.03.09- 8,05   40,14          94 590 190,98     08.09.09
Liability according to
the 6th coupon                  08.09.09                                                     fulfilled
Payment of incomings            08.09.09 8,05    40,14          94 590 190,98     09.03.10
Liability according to          09.03.10                                                     fulfilled
      th
the 7 coupon



   Redemption of bonds on request of creditors – the bond-holders, made in connection with the Company
  reorganization:

  the sum, transferred to the bond-holders- 3 648 302 410, 76 roubles
  number of requests – 75 items
  number of bought out bonds – 3 643 493 items
  accumulated coupon income – 4 809 410,76 roubles

   The date of liability fulfilment: not late than September, 16th 2008

   The issuer‟s liability on redemption of bonds on request of creditors – the bond-holders, made in
  connection with the Company reorganization, is fulfilled completely.


2.3.3. Liabilities of the issuer from the securing granted to the third parties
  The sspecified liabilities are absent
2.3.4. The other issuer‟s liabilities
  The other liabilities, which are not stated in the balance sheet, and which can fundamentally
  affect the issuer‟s financial state, the issuer‟s liquidity, funding sources and conditions of
  their usage, activity results and expenses, are absent
2.4. The purposes of issue and ways of use of the funds received as a result of placement of
the issue securities


  In the financial quarter the issuer did not distributed security papers by a signed statement.


2.5. Risks connected with purchase of equity securities placed (or being in the process of
placement)



                                                                                                   25
The issuer‟s policy in the sphere of risk management:
The issuer follows the conservative policy in the area of risk management. The issuer in itds
activity uses the policy directed on minimisation of any risks, which can appear at primary
activity realisation.
2.5.1. Branch risks
Influence of possible situation worsening in issuer‟s branch on his activity and fulfilment of
liabilities on securities:
The issuer began the main economical activity in the second quarter of 2005. The company
activity base – transmission of electrical energy to ultimate customer and to adjacent electric
networks of the other owners, as well as electric network operation on the territory of Moscow
and Moscow region.

The most important changes in the power industry for the issuer are:
- Changes in tariff policy of electric power transmission, that can negatively affect the financial-
economic state of the company.
According to the issuer‟s estimation, the worsening of the situation in this branch can be
connected with:
 Operational risks, connected with equipment aging and deterioration of basic assets. The
possible negative changes in branch: the possibility of emergency conditions, power supply
reliability loss, power generation irregularity, power loss of operating stations.
 Issuer‟s actions to decrease such risks:
-- reconstruction of working and building of new transmission facilities, as well as transformer
substation and distribution equipment;
- re-equipment of basic assets.

Besides, the issuer is subject to industrial risks:
- risk to turn to work with forced (emergency possible) overflows;
- risk of one time load excursion above planned, due to the customers‟ demands;
- technical risks, connected with the equipment operation. They are caused by such factors as
equipment operation with extreme deviation from reference requirements; operations staff
mistakes; disruption of operations schedule and discipline.
Issuer‟s actions to decrease such risks:
The issuer carries out analysis of possible risk situations in order to foresee the occurrence of
risks while realization of production programme and taking security measures from their
influence.
The main organization forms to decrease and compensate the amount of damage are:

- insurance – they cover insurance of property, dangerous manufacturing objects, means of
transport, civil liability, personnel insurance against accidents and illnesses, as well as medical
insurance;
- self-insurance – creation of inventory and spare parts, taking actions to improve power system
reliability;
- scenario analysis – forecasting of the possible ways of the present situation development,
planning of actions on localization and liquidation of emergency results;
- control over prompt replacement, reconstruction of worn-out or overloaded equipment, repair
works, functioning of labour protection control system, environment and polluters state.



                                                                                                    26
Risks, connected with the possible changes of prices for raw materials, services, used by the
issuer in its activity (separately on home and foreign market) and their influence on issuer‟s
activity and fulfilment of liabilities on security papers:


Risks, connected with rise in prices for equipment and other material and technical sources,
used by the issuer in its activity.
Issuer‟s actions to decrease such risks:
    -   creation of competitive environment in the sphere of work and service purchasing;
    -   optimization of expenses on repair and operational needs and capital construction;
    -   elimination of cross purchases,


Risks, connected with the possible changes of prices for issuer‟s production and/or services
(separately on home and foreign market) and their influence on issuer‟s activity and fulfilment
of liabilities on security papers:


Risks, connected with state rate regulation of electric power, as a result of which they can be put
lower than the economically-grounded level.
  The possible influence of negative changes: worsening of the issuer‟s financial-economic
  state.
Issuer‟s actions to decrease such risks:


    -   carrying out of work to conclude long-term agreements on electric power transmission;
    -   carrying out of weighted financial policy;
    -   enforcement of work with legislative and executive authorities.


The issuer does not plan to work on the foreign market, in this connection considerable negative
effect on the issuer‟s activity can be given only by the global worsening of situation on the
world fuel and energy market, which can affect Russia as well.


2.5.2. Country and regional risks


Country risks

Negative changes of the situation in Russia which may affect the issuer's economic situation and its
activities are not expected in the near future. But the destabilization of the economic situation in the
country connected with the crisis in the world financial markets or sharp reduction of prices is entirely
possible. Besides, the destabilization of the situation in the country due to occurrence of labour conflicts,
increase of the social tension as a result of unpopular actions of the authorities may take place at
realization of reforms in the economic sector.



Regional risks

The main industrial activities of the issuer are carried out in Moscow and the Moscow region. This is
one of the most developed regions of the country, which rooms a plenty of consumers of the electric



                                                                                                          27
power. Thus, the energy consumption constantly grows. All this allows to speak about the stability of the
issuer and its minor susceptibility to regional risks.
The growth of the gross national product and production growth in the country and, in particular, in the
most densely populated and historically industrial areas of Moscow and the Moscow region gives
grounds for making a positive forecast on the issuer's development. The issuer estimates the political and
economic situation in the region as stable. The further improvement in the economic standing of the
region will certainly render a positive influence on the issuer's activities and will be favorably reflected in
its financial standing. Negative changes of the situation in the region of the issuer's business and in the
Russian Federation as a whole which may affect the issuer's activities and economic standing are not
expected in the near future.


The issuer's assumed actions in the event of negative influence of change of the situation in the country and
region on its activities:
The major part of these risks may not be controlled by the issuer due to their global scale. In case of
destabilization of the situation in Russia or in a separate region which may affect the issuer's activities,
the latter will take a number of measures on anti-recessionary management for the purpose of the
maximal decrease in negative influence of the situation on the issuer.
The risks connected with possible military conflicts, introduction of state of emergency and strikes in the
country (countries) and region, where the issuer is registered as the tax bearer and/or carries out primary
activities:
The risks connected with possible military conflicts, introduction of state of emergency and strikes with
reference to the Russian Federation and the Moscow region are estimated by the issuer as minimal.


The risks connected with geographical features of the country (countries) and region, in which the issuer is
registered as the tax bearer and/or carries out primary activities (including the raised danger of acts of
nature, possible breaks of the transport communication in connection with a remoteness and/or
inaccessibility, etc.):
The issuer carries out the activities in the region with the developed infrastructure and is not subject to
the risks connected with breaks of the transport communication in connection with remoteness and/or
inaccessibility.
Influence of the specified risks on the issuer's activities with reference to the Russian Federation and the
Moscow region is estimated as minimal.
The issuer runs the risks connected with raised danger of acts of nature: breakage of transmission lines
during hurricane, a strong snowfall, ice.
The issuer's actions to decrease the influence of these risks are designing of transmission lines in view of
features of weather in the region, and insurance.
2.5.3. Financial risks


Susceptibility of the issuer to the risks connected with change of interest rates, exchange rate of foreign
currencies, in connection with activities of the issuer or in connection with the hedging which is carried out
by the issuer in order to decrease adverse consequences of influence of the above-stated risks:
Within the limits of planned financial and economic policy, the issuer is going to involve various extra
means and in due time to carry out repayment of obligations. Hence, the issuer is subject to risk of
change of interest rates under interest obligations. This risk is estimated as small.
The primary clients who carry out transportation of the electric power are residents of the Russian
Federation; the prices for transportation of the electric power are also expressed in the currency of the
Russian Federation. In this connection the issuer is poorly subject to risks of change of exchange rates
of foreign currencies.




                                                                                                            28
Susceptibility of the issuer's financial standing (its liquidity, sources of financing, results of activities, etc.)
to the exchange rate change:
The issuer's financial standing, its liquidity, sources of financing, results of activities depend on changes
of the rate of exchange, because the issuer's activities are planned to be carried out so that its assets and
liabilities are expressed in the national currency. Besides, the issuer does not plan to carry out activities
on the foreign market. Therefore, the influence of change of the rate of national currency in relation to
US dollar on the issuer's financial standing is estimated as insignificant.


The issuer's assumed actions in case of negative influence of change of the exchange rate and interest rates
on the issuer's activities:
Susceptibility of the issuer to the risk of change of the exchange rate of foreign currencies is estimated by
the issuer as insignificant, because the issuer's all obligations are expressed in the currency of the
Russian Federation.
The issuer runs the risk of change of interest rates. In case of interest rates increase, the expenses for
servicing extra means will also go up.
The issuer's assumed actions in case of negative influence of the interest rates change on its activities:
     Attraction of long-term credits and loans in order to avoid a negative influence of short-term
        fluctuations of interest rates;
     Decrease in the share of credits and loans in the issuer's current assets.


Influence of inflation:
A negative impact of inflation on the issuer's financial and economic activities may be limited to the
following risks:
- Risk of the losses connected with losses in real value of debt receivable at an essential debt rescheduling
or a delay in payment;
- Risk of increase in interest payable;
- Risk of increase of the production cost of goods, products, works, services due to an increase in the
price for energy, transport charges, wages, etc.
- Risk of reduction of real value of means under the investment program.


The critical value of the inflation, in opinion of the issuer:
The scheduled rates of inflation established by the Government of the Russian Federation among the
purposes of the economic policy, as a whole, are fulfilled and tend to reduction. Nevertheless, at
escalation of inflation, the issuer plans to raise the turnover rate of current assets due to changing
contractual relations with consumers. In view of the fact that there is a restriction on raising of the
issuer's tariffs on electric energy transmission within the limits of no more than 10% a year, and
potential profitability of activities, in opinion of the issuer, the value of inflation which are a matter of
difficulties for the issuer is at least 40% per annum.


The issuer's assumed actions to reduce the risk caused by inflation:
If the value of inflation exceeds the specified critical values, the issuer plans to increase a share of short-
term financial instruments in its assets, and to hold actions to reduce internal costs.


The indicators of the issuer's financial reporting which are most subject to changes as a result of the
specified financial risks' influence:
The main indicator which is most subject to changes connected with financial risks, is the company
profit. Along with a growth of interest rates, the interest payments for using credits of commercial banks
increase and, accordingly, the company profit decreases. Besides, the profit does down at an increase in
the cost price of electric power transportation and fixing of tariffs at the legislative level.


                                                                                                                 29
The risks influencing the specified indicators of the issuer's financial reporting and probability of their
occurrence:
A substantial growth of interest rates and, as a consequence, growth of expenses for service of the
issuer's debts.
The probability of their occurrence is estimated as low.



2.5.4. Legal risks
The legal risks connected with the issuer's activities:
Changes of the currency regulation:
Changes of the currency and customs legislation of the Russian Federation do not influence the
Company activities and, hence, do not entail occurrence of legal risks on them.
Changes of the tax laws:
Now the Government of the Russian Federation pursues a policy of decrease in tax load on the Russian
tax bearers. In this connection, amending the tax laws regarding an increase in tax rates is not expected
in the near future.
This risk is considered as insignificant.


In order to minimize the risk of wrong calculation and/or payment of the taxes caused the varying
treatment of norms of the legislation, the Company holds a permanent work on optimization of tax
schemes of calculation of tax base in strict compliance with the current legislation of the Russian
Federation.
In case of amending the operating procedure and terms of the taxation, the issuer aims to plan the
financial and economic activities taking in account these changes.


Changes of rules of the customs control and duties:
Changes of rules of the customs control and duties which may create legal risks connected with the
issuer's activities are not expected.
Changes of requirements on licensing the issuer's primary activities issuer or licensing rights to use objects,
the availability of which is limited (including natural resources):
Changes of requirements on licensing the Company primary activities may lead to an increase in the
term of preparation of the documents which are necessary for prolongation of the validity of the license,
and necessity of the compliance with the requirements established. However, as a whole, this risk should
be considered insignificant, except for the cases when the requirements will be set which cannot be met
by the Company, or the compliance with which will be connected with excessive expenses for
prolongation of the license or for realization of the activities which are subject to licensing, that may
lead to the termination of this activities line.
In case of change of requirements on licensing the primary activities of the issuer or licensing of rights
to use objects, the availability or circulation of which is limited, the issuer will take necessary measures
to obtain the respective licenses and permits.
Changes of the judiciary practice connected with activities of the issuer (including concerning license
granting):
The probability of change of judiciary practice concerning the items connected with the Company
activities is insignificant. The legal risk management is based on optimization of the process of legal
official registration of papers and support of activities of the Company. For minimization of legal risks,
any Company business processes subject to risks (for example, the completion of contracts), pass
obligatory legal examination.




                                                                                                            30
In case of amending judiciary practice on the issues connected with the issuer's activities, the issuer will
plan the financial and economic activities taking into account these changes.


In connection with the fact that the issuer does not plan to hold activities on foreign markets, the
analysis of influence of the legal risks connected with the issuer's activities on foreign markets is not
provided.


2.5.5. Risks connected with the issuer's activities


The risks which are peculiar exclusively to the issuer:


There is a risk of a delay in reception of the licenses which are necessary for realization of certain kinds
of the company activities in connection with changes of the legislation.
There is a risk of a delay in renewal of licenses, which is connected with the company re-structuring.
The issuer estimates risk of non-prolongation of the effect of the issuer's license for holding a certain
line of activities or for use of objects, the availability of which is limited (including natural resources) as
insignificant.
The possible responsibility of the issuer under debts of the third parties also does not render much
influence on the issuer's financial standing.
The possibility of loss of consumers, the turnover with which is at least 10 percent of the total proceeds
from products (works, services) is regarded by the issuer as insignificant.


The issuer runs the risks connected with a seasonal nature of consumption of electric energy. The peak
of consumption is observed in the autumn and winter period; in connection with this the issuer runs
risks of the grids' overload.
There are no other risks connected with activities of the issuer, which are peculiar exclusively to the
issuer.
This section 2.5 describes only the risks which, in the issuer's opinion, are material. There may be other
risks which were not included in this section. Other risks the issuer is unaware of, or which are now not
material for the issuer, may have a potential negative impact on the issuer's economic activities.


III. Detailed information on the issuer

3.1. Issuer‟s establishment and development history


3.1.1. Data on the issuer‟s name


The issuer‟s full company name:
Open Joint-Stock Company “Moscow United Electric Grid Company”
The issuer‟s shortened company name: OJSC «MOESK»
The current name was put into effect on 14 September 2006.
According to the decision of the annual general shareholders meeting of OJSC "Moscow Regional
Electric Grid Company" as of 26 June 2006 (Minutes No. 3 as of 6 July 2006), changes were made to the
Company Charter which are connected with its company name.


3.1.2. Data on the state registration of the issuer


                                                                                                             31
Primary state registration number of the legal entity (PSRN): 1057746555811
Date of state registration: 1 April 2005
Name of registering body according to the data specified in the certificate on making an entry in the Uniform
State Register of Legal Entities: Interdistrict Inspection of the Federal Tax Service no. 46 in Moscow.




3.1.3. Data on the issuer‟s creation and development


  Period of existence of the issuer from the date of its state registration, as well as date, by which
  the issuer will exist, if it is founded for certain period or till achievement of certain goal:


  Period of existence of the issuer from the date of its state registration
  (1.04.2005) -
  4 years and 9 months
  The issuer is founded for uncertain period.
    Brief description of issuer‟s foundation and development. Goals of issuer‟s foundation,
 issuer‟s mission (if any exists), or other information on issuer‟s activity, which is important
                    for decision making about issuer‟s securities acquisition:

Open joint-stock company “Moscow joint electric network company”, altered from OJSC
“Moscow regional electric network company” (minutes of OJSC “Moscow regional electric
network company” annual shareholders meeting No. 3 dated July, 6th 2006), was created as a
result of reorganization of OJSC “Mosenergo” by spinning off (Minutes No. 1 dated June, 29th
2004 of OJSC “Mosenergo” annual shareholders meeting). The Company is assignee in respect of
rights and obligations of OJSC “Mosenergo” according to dividing balance sheet of OJSC
“Mosenergo”, approved by OJSC “Mosenergo” annual shareholders meeting (Minutes No. 1
dated June, 29th 2004)
On OJSC “MOESK” annual shareholders meeting on June, 26th 2006 the decision on change in
company’s name was made.
Because of the fact that Company works not only on the territory of Moscow oblast’ but also in
Moscow, due to the decision of OJSC “Moscow regional electric network company” shareholders
it was altered to OJSC “Moscow joint electric network company”.
 In April 2007 OJSC “MOESK” took up 50% shares of OJSC “Energocenter”, which was
founded according to the initiative of the Government of Moscow oblast‟ in order to develop and
realize investment programs and projects in the sphere of power industry and to cover current
and future demands of all consumer categories.
In 2007 OJSC “MOESK” carried out actions to change the Company’s organizational structure in
order to enlarge subsidiaries.
On December, 29th 2007 the Company founded and registered 3 associated companies with 100%
share of OJSC “MOESK”: OJSC “Moskabelsetmontazh”, OJSC “Electric equipment repair
plant”, OJSC “Moskabelenergoremont”.
According to the decision of the Company special shareholders meeting on 18.04.2008 (Minutes
No. 6 dated 28.04.2008) the Company was reorganized in the form of take-over to it of Open joint-
stock company “Moscow intercity electric network company” (further- OJSC “MGEsK”).
According to the transfer act, approved by OJSC “MGEsK” special shareholders meeting on
18.04.2008 (Munites No. 1 dated 28.04.2008), from the moment of entry into the Unified State



                                                                                                           32
Register of Legal Entities of record on OJSC “MGEsK” activity discharge the Company is
assignee of all rights and obligations of OJSC “MGEsK”
On June, 30th 2008 OJSC “MOESK” was reorganized in the form of take-over to it of OJSC
“MGEsK”, as a result of which on the ground of OJSC “MOESK” inter-regional distributing grid
company of Moscow and Moscow oblast’ was formed.

The goal of issuer’s foundation: according to the issuer’s Regulations (item 3.1. Article 3) the
main goal of the Company’s activity is to get income.
The Company’s main objective is conversion, distribution and supply of electric energy to
consumers.
 According to the issuer’s Regulations (item 3.2. Article 3) the Company activity subjects are the
                                            following:
- service on transmission and distributing of electric power;
- service on connection to electric networks;
- service on gathering, transfer and processing of technological information, including measuring and
recordkeeping data;
- diagnostics, operation, repair of electric networks and other power supply network facilities and
technological control of them;
- diagnostics, operation, repair of technological coupling networks, measuring and recordkeeping
instrumentation, relay protection equipment and emergency control automatics and other
technological equipment, connected with the power supply network functioning, as well as
technological control of them;
- development of long-terms forecasts, long-term and current development plans of electric
network complex, targeted complexed scientific-technical, economical, social programmes,
- development of electric networks and other power supply network facilities including projecting,
engineering survey, building, reconstruction, technical reequipment, assembling and setup;
- development of technological coupling networks, measuring and recordkeeping instrumentation,
relay protection equipment and emergency control automatics and other technological equipment,
connected with the power supply network functioning, including projecting, engineering survey,
building, reconstruction, technical reequipment, assembling and setup;
- operation of highly explosive, chemically active and fire risky functional objects, connected with
the power supply network functioning;
- activity connected with fire control and extinguishing, assembling, repair and operation of fire
safety equipment on buildings and constructions, connected with the power supply network
functioning;
- technological control, examination of industrial security and labour protection on power supply
network facilities;
- storage of oil products, used for technological aims;
- foreign-economic activity, commercial-economic and scientific-technological cooperation with
foreign companies in order to support the Company’s types of activity stated in the Regulations;
- educational activity with a view of personnel training, retraining and education, including
personnel examination concerning technical operation regulations, fire safety regulations, and
other normative documents;
- transportation of goods and passengers by means of motor, railway and air transport for
technological purposes;
- operation, technical maintenance and repair of motor, railway and air transport and hoisting
devices, that used for technological purposes;




                                                                                                        33
- security activity only for the sake of self-safety in the framework of created by the Company
Security Service, which works according to the Law of the RF “On private detective and security
activity in the Russian Federation” and current legislation of the RF;
- organization and carrying out of defensive actions in the point of preparedness activity, civil
defence, emergency situations and protection of data of State secret, according to the current
legislation of the RF;
- accident results elimination on coupling lines, contact and power networks;
- other types of activity, that are not prohibited by the legislation of the Russian Federation;
- organization of around-the-clock dispatch operation by matched electric nets work and other
facilities of power supply network ,prevention and elimination of technological disruptions in
transmission and distributing of electric power.

 The Company can carry out special types of activity, list of which is determined by the federal
laws, only on the ground of special permit (license).

The issuer’s mission: OJSC “Moscow joint electric network company” sees its mission in
providing the reliable power supply for consumers of Moscow region with high-quality power
energy.
Our work is to make world brighter!
(OJSC “Moscow joint electric network company” policy in the sphere of quality, approved by
OJSC “MOESK” Order No. 577 on 10.11.2008)


Other information concerning issuer’s activity, which is important for making decision of issuer’s
securities acquisition: is absent.

3.1.4. Contact information

Location: 142100 Russia, Moscow region, Podolsk city, Ordzhonikidze street 27
Location of Permanent acting Executive Body
  115114 Russia, Moscow, the 2-d Paveletsky passway 3 bld. 2
Addres for mail
  115114 Russia, Moscow, the 2-d Paveletsky passway 3 bld. 2
telephone: (495) 982-38-57
Fax: (495) 585-14-51
E mail: odou@moesk.ru


Information on the issue and on released securities by one is available on the following Internet
page.
www.moesk.ru




3.1.5. Taxpayer identification number

TIN is 5036065113



                                                                                                    34
3.1.6. Branches and representative offices of the issuer:

There were no changes in branches and representative offices structure of the issue in the accounting
quarter
  Name of the representative office according to its charter :
  Full name: Yuzhniye Electric grids
  Location: 142117, Moscow region, Podolsk city, Kirova street, 65
  Date of opening: 01.04.2005

  Director of the branch (representative office)
    Name: Shomesov Vadim Mikhaylovich
    term of a warrant: 31.12.2010


  Full name: Vostochniye Electric Grids
  Location: 142400, Moscow region, Noginsk city, Radchenko street, 13
  Date of opening: 01.04.2005

  Director of the branch (representative office)
    Name: Kuleshov Ivan petrovich
    term of a warrant: 31.12.2010


  Full name: Severniye Electric Grids
  Location: 141070, Moscow regionKorolev city, Gagarina street, 4
  Date of opening: 01.04.2005

  Director of the branch (representative office)
    Name: Shitin Vladimir Alexeevich
    term of a warrant: 31.12.2010


  Full name: Zapadniye Electric Grids
  Location: 121170, Moscow , year of 1812 street, vl.15
  Date of opening: 01.04.2005
  Director of the branch (representative office)
    Name: Yakunin Alexander Igorevich
    term of a warrant: 31.12.2010


  Full name: High-Voltage Cable System
  Location: 107140, Moscow , Nizhnyaya Krasnoselskaya street, 6, bld.1
  Date of opening: 01.04.2005
  Director of the branch (representative office)
    Name: Trakhtenberg gennadiy Emmanuilovich



                                                                                                        35
    term of a warrant: 31.12.2010


  Full name: Central Electric Grids
  Location: 115201, Moscow, Kashirskoye highway, 18
  Date of opening: 01.10.2007
  Director of the branch (representative office)
    Name: Raev Alexander Igorevich
    term of a warrant: 31.12.2010


  Full name: Moscow Cable System
  Location: 115035, Moscow , Sadovnicheskaya street, 36, bld.1
  Date of opening: 22.05.2008

  Director of the branch (representative office)
    Name: Aristov Dmitry Pavlovich
    term of a warrant: 09.09.2010


3.2. Issuer‟s main economic activities


3.2.1. Issuer's industry

 Codes of the main kinds of economic
 activities of the issuer under the All-
   Russian Classifier of Economic
          Activities (OKVED

40.10.2

28.11

31.10.9

31.20

31.20.9

31.62.9

33.20

40.10.3

41.00

45.11

45.2

45.3




                                                                 36
45.4

55.12

55.23

55.51

60.10

63.12

63.21.2

63.40

64.20

70.12

70.20

90.00



3.2.2 Issuer‟s main economic activities


The main lines of economic activities (lines of activities, types of products (works, services)) which
provide at least 10 percent of proceeds (gains) of the issuer.


    Unit measure: RUR thousand


Types of products name (works, services The primary line of economic activities of OJSC "Moscow
United Electric Grid Company” is electric power transmission.



          Parameter            2005       2006        2007        2008       2009       2010, 3
                                                                                        months

Volume     of    proceeds       11 365     22 282     26 209      51 604      74 904      24 555
(gains))  from    electric         550        966        434         266         182         610
power transmission („000
RUR)

Share of the volume of           92.75      87.56          67      81.89       87.88        94.7
proceeds (gains) from
electric power transmission
in the total volume (gains)
of the issuer, %



Change of the amounts of the issuer‟s proceeds (gains) from the main economic activities by 10 and
more percent in comparison with the corresponding reporting period of the previous year and the
reason of such changes:


                                                                                                   37
            Parameter                             in 2009                  in 1 quarter 20010 in
                                                                         comparison with 1 quarter
                                         in comparison with 2008                   2009
  A growth of gains (proceeds)
 from primary economic line of                                                          20,51
                                                   45,15
   activities in relation to the
        previous year, %




       In 2009 growth of the issuer's gains (proceeds) from transmission of the electric power in relation
       to the similar period of the previous year was 45,15%.

       Financial data for 2009 in comparison with 2008 increased because of two reasons.

       1. Since 01.07.2008 the reorganization of the Company was carried out by joining
       Moscow Municipal Electric Grid Company, JSC to MOESk, JSC now it is MKS branch;
       2. The Compane developed anti-recessionary measures on cost savings.

       The growth of the issuer's gains (proceeds) from transmission of the electric power in relation to
       the 1 quarter of 2009 was 20,51 %, that is connected mainly with growth of productive power
       supply          into         network           in         the          accounting            year.


  Seasonal attributes of the main activity of the issuer.
The main economic activities do not possess seasonal attributes.

The electric power is always in demand; however, the amount of demand for the electric power is
exposed to seasonal fluctuations that are connected with Russian climatic conditions. As the issuer
carries out activities on the territory of Moscow and Moscow region, the amount of demand depends on
the season. In spring and summer months, the need for the electric power may decrease that is connected
with the daylight hours duration.
The structure of the cost price of the issuer
                                Parameter                                   2009           2010, 3
                                                                                           months.
Raw and other material, %                                                        1,79            1,02
Purchased complementary parts, semi-finished products, %

Works and services of industrial character which are implemented by            32,00            36,56
external organizations, %

Fuel, %                                                                          0,30            0,23
Energy, %                                                                      15,28            21,95
Expences on labour payment, %                                                  12,78            12,41
Interest per credits, %

Rent payment, %                                                                  4,02            3,49



                                                                                                        38
Assessments to social needs, %                                                   0,51
Amortization of fixed assets, %                                                 15.92          13,65
Taxes included in the production cost, %                                         0,51            0,40
Other costs:                                                                    16,89          10,29
Amortization under intangible assets, %

Remuneration for innovations, %

Obligatory insurance payments, %                                                 5,40            7,11
Representation expenses, %                                                       0,10            0,16
others, %                                                                       11,39            3,02
Total: expenses for production and selling of products (works,                    100            100
services) (production cost), %

For reference: proceeds from sales of products (works, services), % to            123            119
the production cost


New kinds of products offered by the issuer on the market of its primary activities, which have a material
value (works, services), in a degree, in which this corresponds to the popular information on such types
of production (works, services): none.



Standards (rules), according to which the accounting reports are prepared and the calculations are made,
which are reflected in this item of the quarterly report:


The issuer's accounting reports are prepared according to the current laws of the Russian Federation in
the field of book keeping:
Regulations on Book Keeping "Accounting Policy of Organization" RBK 1/98 (ПБУ 1/98)
(approved by Order of the Ministry of Finance of the Russian Federation as of 9 December 1998 No. 60n
(60н), amended as of 30 December 1999).)
Regulations on Book Keeping "Accounting Reports of the Organization" RBK 4/99 (ПБУ 4/99)
(approved by Order of the Ministry of Finance of the Russian Federation as of 6 July 1999 No. 43n
(43н)).
Regulations on Book Keeping "Charges of the Organization" RBK 10/99 (ПБУ 10/99) (approved by
Order of the Ministry of Finance of the Russian Federation as of 6 May 1999 No. 33n (33н), amended by
Order of the Ministry of Finance of the Russian Federation as of 30 December 1999 No. 107n (107н), as
of 30 March 2001 No. 27n (27н)).


Regulations on Book Keeping "Expences of the Organization" RBK 10/99 (ПБУ 10/99) (approved by
Order of the Ministry of Finance of the Russian Federation as of 6 May 1999 No. 33n (32н), amended by
Order of the Ministry of Finance of the Russian Federation as of 30 December 1999 No. 107n (107н), as
of 30 March 2001 No. 27n (27н)).




                                                                                                        39
Regulations on Book Keeping "Incomes of the Organization" RBK 9/99 (ПБУ 9/99) (approved by Order
of the Ministry of Finance of the Russian Federation as of 6 May 1999 No. 32n (32н), amended by Order
of the Ministry of Finance of the Russian Federation as of 30 December 1999 No. 107n (107н), as of 30
March 2001 No. 27n (27н)).


3.2.3. Issuer‟s materials, goods (raw material) and suppliers

  For 2009
    The name and location of the issuer's suppliers that provide at least 10% of all deliveries of raw
    material (other material),
    Full company name: PRISTLY, limited liability company (LLC) (based on agreement
    №11502-409 as of 22.01.2010 delivery of petroleum, oil, lubricants (POL)
    Location: 143900, Moscow region, Balashikha city, Severny passage, 2
    TIN: 5001057930
    PSRN: 1065001028102


    Share in total amount of deliveries, %: 100


    Full company name: TRIVIA limited liability company (LLC) (based on agreement №11502-
    409 as of 22.01.2010 delivery of material and technical resources (MTR) on nomenclature,
    quantity, terms of delivery and prices, defined on the bases of specification, signed by the
    both parties)
    Location: 115114, г.Moscow , the 1-st Derbenevsky lane, д.5
    TIN: 7726576887


    Share in total amount of deliveries, %: 100
The information on an over 10 percent change of prices for the main raw material (other material) during
the respective reporting period in comparison with the respective accounting period of the previous fiscal
year:
There were no change of prices over 10 percent for the main raw material (other material)
during the respective reporting period


The share of the issuer's import in deliveries of for the specified periods:
There is no share of direct import in deliveries.

  For the accounting quarter
    The name and location of the issuer's suppliers that provide not less then 10% of all deliveries of raw
    material (other material)


    Full company name PRISTLY, limited liability company (LLC) (based on agreement
    №11502-409 as of 22.01.2010 delivery of petroleum, oil, lubricants (POL) Location:
    Location: 143900, Moscow region, Balashikha city, Severny passage, 2
    TIN: 5001057930
    PSRN: 1065001028102


    Share in total amount of deliveries, %: 100


                                                                                                              40
    Full company name: TRIVIA limited liability company (LLC) (based on agreement №11502-
    409 as of 22.01.2010 delivery of material and technical resources (MTR) on nomenclature,
    quantity, terms of delivery and prices, defined on the bases of specification, signed by the
    both parties)
    Location: 115114, г.Moscow , the 1-st Derbenevsky lane, д.5
    TIN: 7726576887


    Share in total amount of deliveries, %: 100


The information on an over 10 percent change of prices for the main raw material (other material) during
the respective reporting period in comparison with the respective accounting period of the previous fiscal
year:
  There were no change of prices over 10 percent for the main raw material (other material)
during the respective reporting period
The share of the issuer's import in deliveries of for the specified periods:
There is no share of direct import in deliveries.


3.2.4. Issuer‟s production (works, services) market
  The principal markets, on which the issuer works:


  OJSC “Moscow Joint Electric network Company” (“MOESK”) is one of the largest inter-
  regional switching network companies of the Russian Federation. The main types of activity
  of OJSC “MOESK” are rendering of services of power energy transmission on the territory of
  Moscow and Moscow region, as well as technological connection of the consumers to electric
  networks. The company provides power supply to 1,4 million consumers on the territory of
  Moscow and Moscow region, the area of which is 47 thousand square kilometres. The
  population on the service territory is 17 million people.
  Moscow region, that are Moscow and Moscow oblast‟, is one of the most dynamically
  developing regions of Russia. In spite of the financial-economic crisis, house building on the
  territory of Moscow region continues to be carried out, industrial, transport and social
  infrastructure develops. On the territory of Moscow region the service of power energy
  transmission is rendered by more than 200 compamies, but, in spite of the great number of
  competitors, OJSC “MOESK” confidently takes the leading place in the sphere of power
  energy transmission, serving 98% of consumers in Moscow and 95% of consumers in Moscow
  region.

   OJSC ”MOESK” activity is aimed at improvement of power supply reliability to consumers,
  power lines modernization, power shortage elimination in Moscow region in conditions of
  predicted power consuming growth. In order to fulfil this aim OJSC “MOESK” implements a
  programme of capital construction of new end technical re-equipment, reconstruction and
  repair of existent energy objects.
  In spite of the active realization of investment programme by OJSC “MOESK”, there still
  exist such districts of Moscow region , where is electric power shortage.
   All 39 municipal districts of Moscow oblast‟ and 10 administrative districts of Moscow can
  conditionally be divided into 3 groups: districts with power shortage, districts with balanced
  electric power and districts with power efficiency. To districts which have more power
  shortage can be related: Krasnogorskiy, Leninskiy, Lyuberetskiy, Mytitschinskiy, Podolskiy,


                                                                                                       41
  Solnechnogorskiy, Pushkinskiy municipal districts of Moscow oblast‟, as well as Southern
  administrative district of Moscow. To districts with power efficiency can be related such
  districts as: Dmitrovskiy, Naro-Fominskiy, Sergievo-Posadskiy, Noginskiy and Orekhovo-
  Zuevskiy municipal districts of Moscow oblast‟, as well as Western, Eastern and North-
  Eastern administrative districts of Moscow. The other districts and administrative unions are
  districts with balanced electric power.


Factors, that can negatively influence issuer‟s production (works, services) distribution, and
issuer‟s possible actions to decrease such influence:
The are two main groups of factors, that can negatively influence rendering by OJSC
“MOESC” its services to ultimate customers: technical and financial-economic.
To the 1st group of factors can be related the following:
  - power input lag from the rate of electric power consumption (by power capacity);
  - transmission capacity exhaust of 220 kilovolt-backbone networks and 110 kilovolt-
  distributive networks of Moscow circle, which restricts power receiving to close existent and
  growing                                     power                                     shortage;
  -      reactive     power     shortage        in     the      electric     networks      areas;
  - absence of automatic system of dangerous voltage loss prevention in the networks on 110-
  220                                                                                    kilovolt;
  - lack of modern program operational systems, which allow to estimate and analyse the work
  reliability of Moscow power system by the current function parameters;
  - presence in Moscow region of consumers with particularly dangerous manufactures, not all
  of         which       are      equipped         with       stand-by        power         units;
  - imperfection of software and rated model of Moscow power system to make calculation and
  determine criteria of system reliability in steady state particularly of repair state and post-
  emergency transient state.
  To the second group of factors can be related, first of all, influence of financial-economic
  crisis on company‟s industrial and economic activity, which is showed in:
  - great number of refusals of consumers from the declared connections capacity;
  - considerable uncertainty of territories‟ social-economic development parameters              and
  consumers plans.
  Besides, to the second group of factors can be related the following:
  - administrative barriers, that are expressed in long terms of coordination of reference-license
  documentation on building of network objects, which make it difficult to response operatively
  on consumers‟ demands and satisfaction of requests in the period, fixed in agreements;
  - shortage of free lands to build electric networks, complicacy in co-ordination with owners
  and high price of land taps.




  The following institutional factors also influence OJSC “MOESK” activity:
  - monopolistic type of activity;
  - introduction according to the legislation of “stock” method of tariffing of power
  transmission services. OJSC “MOESK” function as “a stock holder” proposes creation of
  contractual relationships between OJSC “MOESK” and adjacent subordinate electric network
  companies of Moscow and Moscow oblast‟ OJSC “MOESK” appears to have additional
  functions, connected with settlement of payments with subordinate network companies.



                                                                                                  42
  - the planned change of power energy tariff control system to method called RAB (regulation
  of yield standard on laid-down capital).
  - breakage liability of electric network company for level of losses in network, and which
  determines necessity in providing high-quality accounting of electric power and power
  capacity because of network company‟s liability to pay for total loss while tariffing only
  standard losses are taken into consideration.
  In order to decrease the influence of negative factors on issuer‟s activity the main aims are:
  - consolidation in the company of network assets of Moscow region;
  - forward development of electric networks of Moscow region according to economy
  requirements of Moscow and Moscow oblast‟ to satisfy the cumulative demands;
  - creation of effective system of cooperation with outer environment.



3.2.5. Information on issuer‟s licenses
Name of the authority the license issued by: Central Board of State Fire Fighting Service of
EMERCOM of the RF
Number: 1/08123
Name of type (types) of activity: activity on fire prevention and extinguishing
Date of issue: 08.07.2005
Valid till: 08.07.2010


Name of the authority the license issued by: Central Board of State Fire Fighting Service of
EMERCOM of the RF
Number: 2/13373
Name of type (types) of activity: operation on assembling, repair and maintenance of fire safety
supports of buildings and constructions
Date of issue: 08.07.2005
Valid till: 08.07.2010


Name of the authority the license issued by: Central Board of State Fire Fighting Service of
EMERCOM of the RF
Number: 3/01238
Name of type (types) of activity: operation of fire risky manufacture objects
Date of issue: 17.06.2005
Valid till: 17.06.2010



Name of the authority the license issued by: Federal Agency on Technical Regulation and
Metrology
Number: 001162-R
Name of type (types) of activity: repair of measurement instrumentation
Date of issue: 26.07.2005



                                                                                                   43
Valid till: 26.07.2010


Name of the authority the license issued by: Federal Communications Oversight Service
Number: 37600
Name of type (types) of activity: communication service on offer of channels of communication
Date of issue: 23.12.2005
Valid till: 23.12.2010


Name of the authority the license issued by: Federal Communications Oversight Service
Number: 37601
Name of type (types) of activity: services on local telecommunication, excluding services on
local telecommunication with usage of coin-telephones and means of multiple access
Date of issue: 23.12.2005
Valid till: 23.12.2010


Name of the authority the license issued by: Federal Service on Ecological, Technological and
Atomic Supervision
Number: EV-02-000952 (К)
Name of type (types) of activity: operation of highly explosive manufacturing objects, where is
used equipment, working under overpressure more than 0,07 MPa or under water reheat
temperature more than 115 degrees Celsius
Date of issue: 20.10.2006
Valid till: 29.06.2011


Name of the authority the license issued by: Federal Service on Ecological, Technological and
Atomic Supervision
Number: EV-02-001323 (S)
Name of type (types) of activity: operation of highly explosive manufacturing objects, where are
manufactured, used, processed, generated, kept, transported, destroyed the substances, able to
form explosive mixture with air oxygen or with each other (fuel gas, volatile flammable and
combustible liquids, dust formative substances), solid-phase and liquid-phase substances, able to
spontaneous decomposition with explosion.
Date of issue: 12.07.2007
Valid till: 12.07.2012


  Name of the authority the license issued by: Federal Service Administrution for Supervision of
  Consumers Protection and Welfare in Moscow region
  Number: 50.99.08.002L.000252.11.07
  Name of type (types) of activity: Activity in the area of using ionizing radiation sources
  (generating)
  Date of issue: 09.11.2007
  Valid till: 01.11.2012



                                                                                                  44
Name of the authority the license issued by: Federal service for supervision in the sphere of
healthcare and social development
Number: 50-01-001426
Name of type (types) of activity: medical
Date of issue: 27.09.2007
Valid till: 27.09.2012


Name of the authority the license issued by: Federal Service for Ecological, Technological and
Atomic Supervision
Number: ОТ-00-009028 (ОО)
Name of type (types) of activity: Activity on gathering, use, neutralisation, transportation,
placing of a dangerous waste
Date of issue: 15.08.2008
Valid till: 15.08.2012


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262
Name of type (types) of activity: The works connected with data using, making the state secret
to the address: Moscow, the 2nd Paveletsky journey 3, 1
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/1
Name of type (types) of activity: работы, связанные с использованием сведений,
составляющих государственную тайну по адресу: Moscow , Bolshaya Ordinka street,.40,
bld.1
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/2
Name of type (types) of activity: the works connected with data using, making the state secret
for branch of Central Electric Grids
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/3


                                                                                                 45
Name of type (types) of activity: the works connected with data using, making the state secret
for branch of Yuzhniye Electric Grids
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/3
Number: 16262/4
Name of type (types) of activity: the works connected with data using, making the state secret
for branch of Severniye Electric Grids
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/5
Name of type (types) of activity: the works connected with data using, making the state secret
for branch of Vostochniye Electric Grids
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/6
Name of type (types) of activity: the works connected with data using, making the state secret
for branch of Zapadniye Electric Grids
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/7
Name of type (types) of activity: the works connected with data using, making the state secret
for branch High-Voltage Cable lines
Date of issue: 10.02.2010
Valid till: 10.02.2015


Name of the authority the license issued by: The Administration of the Federal Security Service of
the Russian Federation for Moscow and Moscow Region
Number: 16262/8
Name of type (types) of activity the works connected with data using, making the state secret
for branch MKS on the asdress: Moscow , Cadovnicheskaya street, 13, bld.11


                                                                                                 46
  Date of issue: 10.02.2010
  Valid till: 10.02.2015


  Name of the authority the license issued by: The Administration of the Federal Security Service of
  the Russian Federation for Moscow and Moscow Region
  Number: 16262/8
  Name of type (types) of activity: the works connected with data using, making the state secret
  for branch MKS on the asdress: Moscow, the Kremlin
  Date of issue: 10.02.2010
  Valid till: 10.02.2015


  Name of the authority the license issued by: The certificate on permit to works on building, and
  to major repairs is given out reconstruction by self-adjustable organisation Energostriy, Non-
  profit organization
  Number: С-0141-09-0012
  Name of type (types) of activity: Works on building, reconstruction and major repairs,
  influencing safety of objects
  Date of issue: 07.12.2009
  Valid till:
  unlimited
  The issuer plans to obtain a number of additional special permits (licenses) which are necessary for its
normal functioning.

The issuer estimates the risk of non-prolongation of the available special permits (licenses) as minimal.
  The issuer estimates the risk of non-prolongation of available special authorizations (licenses)
  to be minimal.



3.2.6. Issuer‟s joint activities

The issuer is not engaged in the joint activities with other Companies.



3.3. Plans on issuer‟s future activity



 According to the Regulations the principal issuer‟s goal is to get income. On the ground of it
the issuer is planning to continue work in the sphere of its principal activity – transmission of
electric power.
  As required, in case of load and deterioration growth, modernization and reconstruction of
  the fixed assets will be carried out.

   Sources of future income:
  OJSC “Moscow joint electric network company” plans the following sources of income:


                                                                                                        47
  - transmission and distribution of electric power;
  - incomes gained from leasing of buildings and constructions;
  - technological connection to electric networks;
  - other incomes.

  Plans on organization of new manufactures, expansion or shrinkage in capacity, development
  of new types of products, modernization and reconstruction of fixed assets:

  За период с 2010 – 2015 г.г. ОАО «МОЭСК» планирует реализовать инвестиционную
  программу на общую сумму 182,5 млрд. руб., в том числе в Москве 120,2 млрд. руб. и в
  Moscow            region           на           62,3          млрд.             руб.

  Инвестиционная программа ОАО «МОЭСК» на 2010 год сформирована в объеме 22 111
  млн. руб., кроме того лизинг 2 736 млн. руб. При этом инвестиционная программа по
  Москве составляет 12 378 млн. руб., по Moscow region 9 734 млн. руб.
  Основным источниками финансирования инвестиционной программы 2010 года
  является      амортизация     и    плата     за   технологическое  присоединение.


Putting into operation of this cable lines will provide carrying capacity increase of transmission
lines, let increase electric supply reliability and regularity for Moscow region consumers.

 Possible change of principal activity. The issuer‟s activity is connected with electric power
transmission. The issuer does not plan to change principal activity.




3.4. Issuer‟s participation in industrial, bank and finance groups, holdings, concerns and associations


  Name of group, holding, concern or association: OJSC “IDGC Holding”
  Participation start year: 2008


Issuer‟s role (place) and functions in the organization:


The Company is associated company of OJSC “IDGC Holding” (50,9 % of the Company‟s
voting shares are possessed by OJSC “IDGC Holding”). OJSC “IDGC Holding” was founded
on July, 01st 2008 as a result of reorganization of OJSC RAO “UES of Russia” by spinning off.
Issuer‟s place and functions in the organization: being OJSC “IDGC Holding” associated
company the issuer takes the leading role in formation of Moscow regional energy system, and
is oriented at carrying out of the following functions:
- providing reliability of electric power complex functioning;
- carrying out of long-term investment programmes in power industry, etc.




3.5. Issuer‟s subsidiaries and dependent economic companies


                                                                                                     48
  Full company name: Open Joint Stock Company «Energocenter»
  Shorten Company name: OJSC «Energocenter»
  Address
    142117 Russia, Moscow region, Podolsk city, Kirova street, 65
  VAT: 5036072424
  PSRN: 1065074061579

  Affiliated company: No
  Dependent company: Yes


  The bases to recognize the Company affiliated or dependent in relation to the issuer: Open Joint
  Stock Company «Moscow United Electric Grid Company» owns more than 20 % of voting
  stocks of OJSC "Energocenter"
  Share of participation in the issuer‟s authorized capital stock, %: 50
  Share of possessed issuer‟s equities, %: 50
  Share of participation in the issuer‟s authorized capital stock, %: 0
  Share of participation in the issuer‟s authorized capital stock, %: 0
The description of a principal view of the Company core assets. The description of the Company
value for the issue activity:
Company core assets are investment activity enforcement, services providing in area of
connecting to electric networks, development of electric networks and other objects of an electric
network economy, including designing, engineering researches, building, reconstruction,
technical modernization, installation and commissioning
Value Estimation of such company for the emitter activity: development of Moscow region
electric grids.

The Company Board of directors structure

                           Name                              Year of   Share of      Share of
                                                              birth  participatio    ordinary
                                                                       n in the       stocks,
                                                                        issue       possessed
                                                                     authorized       by the
                                                                      capital, %     issue, %

Roman Vladimirovich Voynov                                    1971              0            0

Boris Anatolievich Lipkin                                     1966              0            0

Alexander georgievich Erlikhman                               1978              0            0

Evgeniy Anatolievich Kopanov                                  1970              0            0

Sergey Suleymanovich Mamedov                                  1968              0            0



  The Company Individual Executive Body




                                                                                                 49
                             Name                              Year of   Share of      Share of
                                                                birth  participatio    ordinary
                                                                         n in the       stocks,
                                                                          issue       possessed
                                                                       authorized       by the
                                                                        capital, %     issue, %

Alexey Viktorovich Fortov                                       1966              0            0


    The Company Collective executive body
    Collective executive body is   not provided


  Full Company name: Open Joint Stock Company «Moscablesetmontazh»
  Shorten Company name: OJSC «MCSM»
  Location
    107140 Russia, Moscow, Nizhnyaya Krasnoselskaya 6 bld. 1
  VAT: 7708659347
  PSRN: 1077764814632

  Affiliated Company: Yes
  Dependent company: No
  The bases of the Company recognition affiliated or dependent in relation to the issue: Open
  Joint Stock Company «Moscow United Electric Grid Company» owing to prevailing
  participation in its authorised capital stock has possibility to define the decisions accepted by
  Open Joint Stock Company «Moscabelsetmontazh»


  Share of the issue in the authorized capital stock, %: 100
  Share of possessed issuer‟s ordinary shares, %: 100
  Share of participation in the issuer‟s authorized capital stock, %: 0
 The description of a principal view of the Company core assets. The description of the Company
 value for the issue activity:
Company core assets are building and installation works (including works on the arrangement
of external engineering networks and the equipment, electrical supply cabling of 1-10, 20, 35,
110,220 and 500 kV; building site preparation and excavations; erection of bearing and
protecting designs; arrangement of internal engineering networks; works on protection of
designs and the equipment; starting-up and commissioning works).
 Value Estimation of such company for the emitter activity: installation and construction
 works, jointing of cable lines of electrosupply.
  The Company Board of Directors Structure


                             Name                              Year of  Share of       Share of
                                                                birth  participatio    ordinary
                                                                         n in the       stocks,
                                                                          issue       possessed


                                                                                                   50
                                                                         authorized    by the
                                                                         capital, %   issue, %

Andrey Borisovich Miridonov                                    1958               0              0

Vladimir Sergeevich Artamonov                                  1949               0              0

Olga stanislavovna Zotova                                      1966               0              0

Sayan Balzhinimaevich Tsirindashiev                            1979               0              0

Alexey Sergeevich Kravchenko                                   1981               0              0



 The Company Individual Executive Body




                           Name                               Year of   Share of       Share of
                                                               birth  participatio     ordinary
                                                                        n in the        stocks,
                                                                         issue        possessed
                                                                      authorized        by the
                                                                       capital, %      issue, %

Artur Surenovich Bagdasarov                                    1962               0              0


   Collective executive body
   Collective executive body is not provided


 Full company name: Open Joint Stock Company «Moscabelenergoremont»
 Shorten Company name: OJSC «MKER»
 Location
   115569 Russia, Moscow, Shipilovskaya street 13bld. 2
 VAT: 7737527095
 PSRN: 1077764814907

 Affiliated Company: Yes
 Dependent Company: No
 The bases of the Company recognition affiliated or dependent in relation to the issue: Open
 Joint Stock Company «Moscow United Electric Grid Company» owing to prevailing
 participation in its authorized capital stock has possibility to define the decisions accepted by
 Open Joint Stock Company "Moscabelenergoremont"
 Share of the issue in the authorized capital stock, %: 100
 Share of ordinary stocks, possessed by the issue, %: 100
 Share of participation in the issuer‟s authorized capital stock, %: 0
 Share of ordinary stocks, possessed by the issue, %: 0



                                                                                                     51
The description of a principal view of the Company core assets. The description of the Company
value for the issue activity:
Company core assets are installation, commissioning and maintenance of power objects, the
electric power, heat and power equipment and power stations of consumers; repair,
reconstruction and technical modernization of cable lines and the equipment, and also technical
modernization and reconstruction of power objects; maintenance of power supply of the
consumers connected to networks; maintenance of operation of the power equipment,
engineering systems and constructions according to actual regulatory requirements
  Value Estimation of such company for the emitter activity: Монтаж, наладка и ремонт
  электрооборудования.




  The Company Board of directors structure


                             Name                        Year of   Share of      Share of
                                                          birth  participatio    ordinary
                                                                   n in the       stocks,
                                                                    issue       possessed
                                                                 authorized       by the
                                                                  capital, %     issue, %

Jury Valerievich Nepomnyashiy                             1950      0.000194     0.000194

Sergey Aleksandrovich Panin                               1954      0.000943     0.000943

Andrey Igorevich Zhuromsky                                1979              0            0

Natalia Ilinichna Erpsher                                 1969              0            0

Vladimir Viktorovich Brylkov                              1970              0            0



  The Company Individual Executive Body




                             Name                        Year of   Share of      Share of
                                                          birth  participatio    ordinary
                                                                   n in the       stocks,
                                                                    issue       possessed
                                                                 authorized       by the
                                                                  capital, %     issue, %

Sergey Aleksandrovich Panin                               1954      0.000943     0.000943




    Collective executive body structure
    Collective executive body is not provided




                                                                                             52
  Full Company: Open Joint Stock Company «Plant on repair of the electrotechnical
  equipment»


  Shorten Company name: ОOJSC « Plant RETO»

  Location
    152201 Russia, Moscow, Starokashirskoye highway 4а.
  VAT: 7724646338
  PSRN: 1077764814324

  Affiliated Company: Yes
  Dependent Company: No


  The bases of the Company recognition affiliated or dependent in relation to the issue: Open
  Joint Stock Company «Moscow United Electric Grid Company» owing to prevailing
  participation in its authorized capital stock has possibility to define the decisions accepted by
  Open Joint Stock Company «Factory on repair of the electrotechnical equipment»


  Share of the issue in the authorized capital stock, %: 100
  Share of ordinary stocks, possessed by the issue, %: 100
  Share of participation in the issuer‟s authorized capital stock, %: 0
  Share of ordinary stocks, possessed by the issue, %: 0


  The description of a principal view of the Company core assets. The description of the Company
  value for the issue activity:

Company core assets are installation, commissioning and maintenance of power objects, the
electric power, heat and power equipment and power stations of consumers; works on capital
and to operating repair of the power electro technical equipment in power electric networks,
thermal power station, a state district power station and other objects; works on liquidation of
consequences of failures in power electric networks, thermal power station, a state district power
station and other objects on a city territory of Moscow and Moscow Region and in other regions.
  Value Estimation of such company for the emitter activity: Ремонтное обслуживание
  электрооборудования.




  The Company Board of directors structure


                            Name                               Year of   Share of      Share of
                                                                birth  participatio    ordinary
                                                                         n in the       stocks,
                                                                          issue       possessed
                                                                       authorized       by the
                                                                        capital, %     issue, %



                                                                                                  53
Vladimir Vladimirovich Kovyrkin                               1949                0             0

Jury Olegovich Burakov                                        1962                0             0

Alexander Petrovich Vasilev                                   1944       0.001245      0.001245

Anna Jurevna Katina                                           1982                0             0

Valentina Aleksandrovna Dyomina                               1977                0             0




    The Company Individual Executive Body


                               Name                          Year of   Share of        Share of
                                                              birth  participatio      ordinary
                                                                       n in the         stocks,
                                                                        issue         possessed
                                                                     authorized         by the
                                                                      capital, %       issue, %

Vyacheslav Alexandrovich Chucharin                            1958                0    0.001245


      Collective executive body structure
      Collective executive body is not provided
.

3.6. Composition, structure and value of the issuer‟s fixed assets, information on plans for the fixed
assets purchase, replacement, retirement, and all facts of the issuer's fixed assets encumbrance


3.6.1. Fixed assets




    For 2009
      Unit measure: RUR thousand

                Name of the group of fixed asset objects                 Initial Amount of
                                                                      (recovery) the accrued
                                                                     value, RUR depreciation,
                                                                                    RUR

Buildings                                                             11 466 570         979 706

Structures and transfer mechanisms                                    52 759 395       5 107 106

Machines and equipment                                               110 392 604      35 787 162

Vehicles                                                                  517 139        194 027



                                                                                                    54
Other types of fixed assets                                                   172 329             63 065

Total, fixed assets                                                      175 308 037      42 131 066


    Data on ways of charge of depreciation charges on groups of the fixed assets objects:

    Definition of full recovery value of the fixed assets under the direct recalculation method
Amortization under the fixed asset objects is made by linear way, proceeding from the terms of efficient
application of these objects.


    Reporting date: 31.12.2009

  For the termination date of the accounting period
    Unit measure: RUR thousand

              Name of the group of fixed asset objects                       Initial Amount of
                                                                          (recovery) the accrued
                                                                         value, RUR depreciation,
                                                                                        RUR

Buildings                                                                  11 464 182         1 088 032

Structures and transfer mechanisms                                         53 331 240         5 718 636

Machines and equipment                                                   111 015 335      38 005 846

Vehicles                                                                      547 041          214 322

Other types of fixed assets                                                   183 019             69 307

Total, fixed assets                                                      176 540 817      45 096 143


    Data on ways of charge of depreciation charges on groups of the fixed assets objects:

Definition of full recovery value of the fixed assets under the direct recalculation method
Amortization under the fixed asset objects is made by linear way, proceeding from the terms of efficient
application of these objects.


    Reporting date: 31.03.2010
  Results of last revaluation of the fixed assets and long-term rented fixed assets, carried out for 5
  complete financial years previous the accounting quarter, or for each complete fiscal year
  previous the accounting quarter if the issue carries out the activity less than 5 years, and for
  accounting quarter
    Unit measure: RUR thousand

Name of the group of           Total cost depreciable    Date of          Total cost     depreciable
 fixed asset objects            before    value before revaluation          after        value after
                              revaluation revaluation                    revaluation     revaluation


                                                                                                           55
Buildings                 4 987 335    4 812 753     01.01.2007     4 987 335     4 812 753

Structures and transfer   15 951 955   14 801 547    01.01.2007     15 951 955    14 801 547
mechanisms

Machines and              11 287 640   9 902 353     01.01.2007     29 390 726    23 249 062
equipment

Vehicles                  105 904      13 363        01.01.2007     105 904       13 363
Other types of fixed      274 471      238 453       01.01.2007     274 471       238 453
assets

Total, fixed assets       32 607 305   29 768 469                   50 710 391    43 115 178

Buildings                 10 074 945   9 489 309     01.01.2009     10 087 861    9 500 792

Structures and transfer   39 882 678   36 688 708    01.01.2009     39 871 258    36 676 292
mechanisms

Machines and              59 483 568   45 748 733    01.01.2009     100 456 856 73 262 354
equipment

Vehicles                  585 409      453 549       01.01.2009     585 409       453 549
Other types of fixed      209 456      139 964       01.01.2009     236 186       159 562
assets

Total, fixed assets       110 236 056 92 520 263                    151 237 570 120 052 549


  The way of carrying out reevaluation of fixed assets is described (using the indices of the State
  Statistics Committee of the Russian Federation, the market value of the respective fixed assets
  confirmed by documents or experts‟ opinions. If the experts‟ opinion is indicated, the method of
  evaluation should be stated):


  Determination of the full replacement value of fixed assets using a direct recalculation
  method.
  Depreciation of fixed asset facilities is performed by linear way, based on the useful life of
  these facilities.
  Description of the information on the plans concerning purchase, replacement, retirement of the
  fixed assets, the value whereof equals or exceeds 10 percent of the issuer‟s fixed assets value and
  other fixed assets at the issuer‟s discretion; information on all facts of encumbrance of the
  issuer‟s fixed assets (including information in respect of the nature of the encumbrance, the
  moment of the encumbrance occurrence, its effective period and other conditions at the issuer‟s
  discretion), existing as at the date of the end of the last completed reporting period:
  For the period from 2010 to 2015, OJSC “MOESK” plans to implement the investment
  program for a total of RUR 182.5 billion, including in Moscow – RUR 120.2 billion and in the
  Moscow Region – RUR 62.3 billion.
  The 2010 OJSC “MOESK” investment program has been generated in the amount of RUR
  22,111 million and leasing in the amount of RUR 2,736 million. Thus, the investment
  program across Moscow is RUR 12,378 million; in the Moscow Region it is RUR 9,734
  million.




                                                                                                   56
  The core financing sources of the 2010 investment program is depreciation and payment for
  engineering connection.




IV. Data on the issuer‟s financial and economic activities:


4.1. Results of the issuer‟s financial and economic activities


4.1.1. Profit and loss


    Unit measure: RUR thousand

                                2005        2006        2007      2008     2009     2010, 3
         Indicator
                                                                                    months

                                12 254       25 447      38 681   63 015   85 232    25 925
      Proceeds), RUR               106          566         052      362      848       639

                                  2 140       6 216       9 091    6 420   15 851 4 162 031
    Gross profit, RUR
                                    538         655         433      147      043


                                                                                              57
Net profit (unappropriated
                                 1 293       3 735       4 747      2 303       6 318 2 118 776
 profit (uncovered loss)),
            RUR
                                   798         595         588        146         508

   Return on equity, %            4.77        12.1         9.7        2.65        5.17        1.71

   Return on assets, %            4.01        7.72        5.02        1.08        2.52        0.84

   Net returns ratio, %          10.56       14.68       12.27        3.65        7.41        8.17
   Product profitability
                                 17.47       24.43        23.5      10.18         18.6       16.05
   (return on products
        (sales)), %

     capital turnover             0.45        0.63         0.6        0.41        0.54        0.17
Amount of uncovered loss
                                     0           0           0      1 156            0           0
 as of the reporting date,
        RUR “000
                                                                      024
Relation of uncovered loss
                                     0           0           0      0.005            0           0
as of the reporting date to
 the balance sheet assets

The economic analysis of the issuer‟s profitability/ running at a loss based on the dynamics of the
indicators referred herein, including information on the reasons which, in opinion of the issuer‟s
governance bodies, led to the issuer‟s losses /profit reflected in the accounting reports as at the end
of the reporting quarter in comparison with the similar period of the preceding year (preceding
years):
The earnings of the issuer as at the date of the 2009 end were RUR 85,232,848 thousand that is
by 35.25% more than in the similar period of the last year.
The main factor which influenced the growth of the sales earnings in 2009 as compared to the
similar period of the last year:
1. From 1.07.2008 the company was reorganized by way of accession of OJSC "Moscow City
Electric Grid Company" to OJSC "MOESK"; now it is the branch called MCN;
2. The Company has developed anti-recessionary measures to decrease costs.
As at the date of the end of the 1st quarter of 2010 the issuer‟s earnings were RUR 25,925,639
thousand.
The issuer's plans include connection of new consumers. Connection of new consumers means
engineering connection of power-receiving devices to electric grids. This will allow the issuer to
raise reliability and quality of power supply due to installation of the highly technological
equipment and simultaneously to expand the client base.
The increase in the consumers number is expected to lead to a growth of the issuer's earnings.
The modern equipment will allow to reduce operational costs that will also positively influence
the issuer's financial performance.
The profitability indicators representing the results of the relation of profit (net revenue) to the
means of its receipt describe an overall performance of the enterprise - productivity or return of
the issuer's financial resources.
The return on assets which is calculated as a relation of net profit to assets, shows a part of
assets per a unit of net profit, in other words, how much assets in money terms are involved per
1 ruble of net profit. Thus, the indicator enables to estimate the efficiency of assets for the
purpose of profit generation.
The return on assets as at 31.12.2009 was 2.52%, while the return on equity was 5.17%. The
economic interpretation of the return indicators is as follows: they show how much rubles is per



                                                                                                     58
one ruble of the equity. Thus, 5.17 rubles of net profit of the reporting year is per 100 rubles of
equity.
The return on assets as at the end of the 1st quarter of 2010 was 0.84 %, while the return on
equity was 1.71%.
The capital turnover indicator, which is calculated as a relation of the earnings to the amount of
equity and long-term liabilities, shows a part of long-term financial sources covered by
earnings. The equity turnover as at the date of the end of the 2009 financial year was 0.54.
The capital turnover indicator, first of all, characterizes the volume of sold products per 1 ruble
of the assets invested in the enterprise's activities. Thus, this indicator for the issuer equals 0.54
ruble per 1 ruble of the cumulative indicator of equity and proceeds in long-term use. The equity
turnover as at the date of the end of the 1st quarter of the 2010 was 0.17.
The method of calculation recommended by the Federal Financial Markets Service provides for
calculation of the net profitability indicator as the relation of net profit of the reporting period to
the earnings for the similar period. Thus, the issuer's net profitability indicator as at the date of
the end of the financial year 2009 (7.41%) proves that every 100 rubles of earnings bring 7.41
rubles of net profit.
As at the date of the end of the 1st quarter of 2010, the net profitability indicator was 8.17%.
The uncovered loss at the date of the end of the 2009 financial year and the 1 st quarter of 2010:
none.
Opinions of the issuer's governance bodies concerning the information presented in this clause
coincide.


Economic analysis of liquidity and solvency of the issuer based on the economic analysis of the
dynamics of the specified indicators:
Own working capital is the share of own capital aimed to finance the issuer's current assets.
This indicator is negative for the issuer and as at the date of the end of the 2009 year is RUR
51,996,533 thousand. The indicator increase in resulted from the increase in the share of own
capital.
As at the date of the end of the 1st quarter of 2010 the own working capital is negative and is
RUR 48,290,708 thousand.

The net asset index describing the issuer‟s share of non-current assets and long-term debt
receivable in the sources of own means as at the date of the end of the 2009 financial year was
1.66. A reduction in the indicator for 2009 in comparison with 2008 was caused by a significant
growth of non-current assets and reduction in long-term accounts receivable and increase in the
share of equity.
As at the end of the 1st quarter of 2010 the net asset index was 1.63.
The current liquidity indicator shows, whether the enterprise has enough means which may be
used for repayment of short-term liabilities (in particular, accounts payable). The current
liquidity indicator as at 31.12.2009 was 0.51. The reduction in the indicator in 2009 as
compared to 2008 was due to the vigorous activity of the company in respect of the engineering
connection of consumers to electric grids, since essential advance payments are stipulated by
contracts of connection.
As at the end of the 1st quarter of 2010 the current liquidity indicator was 0.5.
The acid test ratio shows the relation of the most liquid assets of the company and accounts
receivable to current short-term obligations (net of incomes of the future periods). This
indicator reflects payment opportunities of the enterprise for duly and fast repayment of debts.
This indicator for the issuer as at 31.12.2009 was 0.45. A reduction in the indicator for 2009 in
comparison with 2008 was caused by was due to the vigorous activity of the company in respect


                                                                                                    59
of the engineering connection of consumers to electric grids, since essential advance payments
are stipulated by contracts of connection.
As at the end of the 1st quarter of 2010 the acid test ratio was 0.44.
The equity asset ratio characterizes dependence of the enterprise on external sources of
financing. The higher its value, the more the issuer's financial independence. The value of the
equity asset ratio at the date of the end of 2009 was 0.49. A reduction in the equity asset ratio in
2009 as compared to 2008 was due to the increase in the share of equity.
As at the end of the 1st quarter of 2010 the equity asset ratio was 0.49.
The opinions of the issuer‟s governance bodies concerning the information presented in this
clause coincide.
4.1.2. Factors which influence changing of the amount of proceeds from selling by the issuer of the
issuer‟s goods, products, works, services and profit (loss) from the primary activities.


                                                                            2009 г./ 2008 г., %
        Indicator                  2008 г.                2009 г.

Proceeds from sales,                                                              135,26
                                63 015 362              85 232 848
RUR
Net profit                                                                        274,34
(unappropriated balance)         2 303 146               6 318 508
(uncovered loss),RUR




                                                                             1 quarter. 2010
        Indicator           1 quarter         2009    1 quarter   2010
                                                                             г./1 qt. 2009 , %
Proceeds from sales,                         22 482
                                                        25 925 639                115,31
RUR „ 000                              566
Net profit
(unappropriated balance)         3 324 502                2 118 776               63,73
(uncovered loss),RUR
„000



The proceeds from sales in 2009 equaled RUR 85 232 848 thousand that 35,26 % exceeds the
similar period of the previous year.
The net profit for 2009 was RUR 6 318 508 thousand that 174,34 % exceeds the similar period of
the previous year.


Financial parameters for 2009 in comparison with 2008 have grown for two reasons:

1. Since 01.07.2008 reorganisation of the company was taken place by joining of Moscow
Municipal Electric grid Company, JSC to MOESk, JSC, now it is MKS branch;
2. The company developed anti-recessionary measures on cost decrease .

The gain from realisation in 1 quarter 2010 equeled RUR 25 925 639, that 15,31 % exceeds the
similar period of the previous year.
The net profit in 1 quarter 2010 has made 2 118 776 thousand rbl., that 36,27 % less, than the
similar period of the previous year.



                                                                                                  60
  The major factor which influenced the growth of the amount of proceeds from sales in 1 quarter 2010
  in comparison with the similar period of the previous year was increase of productive power supplyto
  the network in the accounting period

The issuer governance bodies' opinions concerning the information presented by this item coincide.


                  4.2. Issuer‟s liquidity, sufficiency of the equity and working capital
    Unit measure: RUR thousand

                                 2005         2006        2007         2008         2009       2010, 3
         Indicator                                                                             months
Working capital, RUR „000       -644 962 -5 327 571        -19 043     -53 139      -51 996      -48 290
                                                               203         063          533          708
Net fixed assets index               1.02        1.17         1.39         1.96        1.66          1.63
Current liquidity ratio               0.9        1.57          0.9         0.75        0.51           0.5
Acid test ratio                      0.49        1.27         0.77         0.63        0.45          0.44
Equity asset ratio                   0.84        0.64         0.52         0.41        0.49          0.49


Economic analysis of liquidity and solvency of the issuer based on the economic analysis of the
dynamics of the specified indicators:
Own working capital is the share of own capital aimed to finance the issuer's current assets.
This indicator is negative for the issuer and as at the date of the end of the 2009 year is RUR
51,996,533 thousand. The indicator increase in resulted from the increase in the share of own
capital.
As at the date of the end of the 1st quarter of 2010 the own working capital is negative and is
RUR 48,290,708 thousand.

The net asset index describing the issuer‟s share of non-current assets and long-term debt
receivable in the sources of own means as at the date of the end of the 2009 financial year was
1.66. A reduction in the indicator for 2009 in comparison with 2008 was caused by a significant
growth of non-current assets and reduction in long-term accounts receivable and increase in the
share of equity.
As at the end of the 1st quarter of 2010 the net asset index was 1.63.
The current liquidity indicator shows, whether the enterprise has enough means which may be
used for repayment of short-term liabilities (in particular, accounts payable). The current
liquidity indicator as at 31.12.2009 was 0.51. The reduction in the indicator in 2009 as
compared to 2008 was due to the vigorous activity of the company in respect of the engineering
connection of consumers to electric grids, since essential advance payments are stipulated by
contracts of connection.
As at the end of the 1st quarter of 2010 the current liquidity indicator was 0.5.
The acid test ratio shows the relation of the most liquid assets of the company and accounts
receivable to current short-term obligations (net of incomes of the future periods). This
indicator reflects payment opportunities of the enterprise for duly and fast repayment of debts.

                                                                                                     61
This indicator for the issuer as at 31.12.2009 was 0.45. A reduction in the indicator for 2009 in
comparison with 2008 was caused by was due to the vigorous activity of the company in respect
of the engineering connection of consumers to electric grids, since essential advance payments
are stipulated by contracts of connection.
As at the end of the 1st quarter of 2010 the acid test ratio was 0.44.
The equity asset ratio characterizes dependence of the enterprise on external sources of
financing. The higher its value, the more the issuer's financial independence. The value of the
equity asset ratio at the date of the end of 2009 was 0.49. A reduction in the equity asset ratio in
2009 as compared to 2008 was due to the increase in the share of equity.
As at the end of the 1st quarter of 2010 the equity asset ratio was 0.49.
The opinions of the issuer‟s governance bodies concerning the information presented in this
clause coincide.

4.3. Amount and structure of the issuer‟s equity and working capital


4.3.1. Amount and structure of the equity and working capital


    Unit measure: RUR thousand

                                 2005         2006          2007          2008           2009        2010, 3
Indicator
                                                                                                     months

                                  14 124        14 124       14 124        24 353         24 353          24 353
Authorized capital amount
                                     680           680          680           546            546             546
Compliance of the
                                                                             -3 798              0               0
authorized capital with the
documents of incorporation
Total value of shares which
                                                                             0.016               0               0
are repurchased by the
issuer for the subsequent re-
selling
Reserve capital amount                          64 690      251 470       695 356        810 513      810 513

                                9 119 676   9 118 789        23 401        36 243         63 720          63 717
Additional capital amount
                                                                503           169            537             011

Undistributed net profit        3 857 756   7 463 361        11 004        24 400         30 792          32 914
amount                                                          062           180            331             634

Total amount of the issuer‟s      27 102        30 771       48 781        85 688        119 676      121 796
equity                               112           520          715           453            927          704


  Amount of the issuer‟s current assets in accordance with the issuer‟s accounting reports


        Parameter                2005        2006        2007         2008        2009          2010, 3
                                                                                                months

Current asset total               4 524      12 181       26 641      72 654          76 509     80 863



                                                                                                            62
                                     649          184          225          628          532          668

Stocks                            900 522       1 485        2 641        6 538        6 191 6 149 327
                                                  059          327          472          284

Value added tax on                  1 160    847 845         1 197     277 787      307 796      164 428
acquired assets                       807                      441

Accounts receivable                  897          140        1 636       30 002       29 159       30 242
(payments on which are                                                      022          381          674
expected more than in 12
months after accounting
date)

Accounts receivable                 2 224       7 826       18 371       30 636       33 037       34 323
(Payments on which are                431         215          038          466          744          036
expected during 12
months after accounting
date)

Short-term financial                                                                   2 968 3 171 184
investments                                                                              747

Money assets                      237 992       2 021        4 429        5 197        4 844 6 812 929
                                                  925          783          786          580

Other current asset                                                       2 095                         90

       OJSC "Moscow United Electric Grid Company" uses both own sources of financing of current
assets, and extra sources. The own sources are enough for realization of the current financial and
economic activities; however, the company also uses extra sources in order to provide an effective
realization of the investment program. The current assets financing policy is based on principles of
minimization of loans value, availability of credit resources, maximization of the company profit, etc.
Formation of the delayed debt (i.e. breaking the terms of the contracts concluded by the issuer regarding
the terms of transfer of money resources) is not allowed.
      The issuer does not project an occurrence of factors which may entail changes in the policy of
financing of the current assets.




4.3.2. Issuer‟s financial investments


  For 2009
The list of the issuer's financial investments which are at least 10 percent of its all financial investments at
the date of the end of the third quarter of the current fiscal year.
Investments in issue securities
The type of securities: shares
The full company name: Open Joint-Stock Company "Energocenter"
The shortened company name: OJSC "Energocenter"
The location: 142117, Moscow region, Podolsk city, Kirova street, 65




                                                                                                             63
  The date of the       The state registration                    The registering agency
 state registration            number
  number of the
    share issue

   31.08.2006         1-01-55217-Е               The Federal Financial Markets Service



The number of the securities owned by the issuer: 20 000 pieces
The total par value of the securities owned by the issuer: RUR 1,000,000,000.
Exchange: RUR
The total balance sheet value of the securities holding: RUR 760 109 000
       dividend was not paid per ordinary shares


The type of securities: shares
The full company name: Open Joint-Stock Company "Moskabelsetmontazh"
The shortened company name: OJSC "MKSM"
The location: 107140, Moscow, Nizhnyaya Krasnoselskaya street 6, bld. 1.


  The date of the       The state registration                    The registering agency
 state registration            number
  number of the
    share issue

   27.03.2008         1-01-55338-Е               The Federal Financial Markets Service



The number of the securities owned by the issuer: 3 359 709 830 pieces
The total par value of the securities owned by the issuer: RUR 1 679 854 915
Exchange: RUR
The total balance sheet value of the securities holding: RUR 1 793 454 251
       dividend was not paid per ordinary shares


The type of securities: shares
The full company name: Open Joint-Stock Company "Electric Grid Equipment Repairing Plant"
The reduced company name: OJSC “Zavod RETO”
The location: 152201, Moscow, Starokashirskoe highway, 4а

  The date of the       The state registration                    The registering agency
 state registration            number
  number of the
    share issue

   28.07.2009         1-01-12871-А               Regional branch of Federal Service for Financial
                                                 Markets in Central Federal District


The number of the securities owned by the issuer: 1 223 215 466 pieces


                                                                                                    64
The total par value of the securities owned by the issuer: RUR 611 607 733.
Exchange: RUR
The total balance sheet value of the securities holding: RUR 661 954 811
       dividend was not paid per ordinary shares


The total balance sheet value of the securities holding: RUR
  The date of the        The state registration                   The registering agency
 state registration             number
  number of the
    share issue

   28.07.2009         1-01-12847-А                Regional branch of Federal Service for Financial
                                                  Markets in Central Federal District


The number of the securities owned by the issuer: 998 880 622 pieces
The total par value of the securities owned by the issuer: RUR 499 440 311
Exchange: RUR
The total balance sheet value of the securities holding:RUR 470 179 511
       dividend was not paid per ordinary shares

    Investments in non-equity securities
The type of securities: bill of exchange
The full company name: “OTKRITIE Financial Corporation”, Limited Liability Company
The shortened company name: OTKRITIE FC
The location: 129090, Moscow, Kalanchevskaya street, 49
The number of the securities owned by the issuer: 1 piece
The total par value of the securities owned by the issuer: RUR 2 968 747 000
Exchange: RUR
Repayment date: June 30, 2010
The total balance sheet value of the securities holding: 2 968 747 000


    Other investments
       There are no other financial investments equal 10 and more percent of all financial
       investments

    The issuer creates a reserve under investment depreciation in securities:
    The reserve amount under depreciation of securities for 01.01.2009 - is not present
    Reserve amount under depreciation of securities for 31.12.2009 - RUr 286 395 thousand
The information on amount of the potential losses connected with bankruptcy of the organisations
(enterprises) in which investments were made, by each kind of the specified investments:
The issuer has no funds on depositary or other accounts in banks and other credit organizations, the
licenses of which were suspended or withdrawn, and in banks and other credit organizations, with regard
to which the decision on reorganization, liquidation, the beginning of the bankruptcy procedure or on
recognition to be insolvent (a bankrupt) was taken.




                                                                                                     65
Standards (rules) of the accounting reporting according to which the issuer made the calculations
reflected      in       the      present       point      of      the       quarterly     report:
The registration of the issuer's financial investments is performed according to the Russian Book
Keeping Rules stated in the Order of the Ministry of Finance of the Russian Federation as of 10
December 2002 No. 126n (126н) "On approval of the Regulations for Book Keeping "Registration of
Financial Investments" RBK 19/02" (ПБУ 19/02).


  For the end of 1 quarter 2010
The list of the issuer's financial investments which are at least 10 percent of its all financial investments at
the date of the end of the third quarter of the current fiscal year.
Investments in issue securities
The type of securities: shares
The full company name: Open Joint-Stock Company "Energocenter"
The shortened company name: OJSC "Energocenter"
The location: 142117, Moscow region, Podolsk city, Kirova street, 65


  The date of the         The state registration                   The registering agency
 state registration              number
  number of the
    share issue

   31.08.2006          1-01-55217-Е                The Federal Financial Markets Service



The number of the securities owned by the issuer: 20 000 pieces
The total par value of the securities owned by the issuer: RUR 1,000,000,000.
Exchange: RUR
The total balance sheet value of the securities holding: RUR 760 109 000
       dividend was not paid per ordinary shares


The type of securities: shares
The full company name: Open Joint-Stock Company "Moskabelsetmontazh"
The shortened company name: OJSC "MKSM"
The location: 107140, Moscow, Nizhnyaya Krasnoselskaya street 6, bld. 1.


  The date of the         The state registration                   The registering agency
 state registration              number
  number of the
    share issue

   27.03.2008          1-01-55338-Е                The Federal Financial Markets Service



The number of the securities owned by the issuer: 3 359 709 830 pieces
The total par value of the securities owned by the issuer: RUR 1 679 854 915



                                                                                                             66
Exchange: RUR
The total balance sheet value of the securities holding: RUR 1 793 454 251
dividend was not paid per ordinary shares


The type of securities: shares
The type of securities: shares
The full company name: Open Joint-Stock Company "Electric Grid Equipment Repairing Plant"
The reduced company name: OJSC “Zavod RETO”
The location: 152201, Moscow, Starokashirskoe highway, 4а

  The date of the        The state registration                 The registering agency
 state registration             number
  number of the
    share issue

   28.07.2009         1-01-12871-А                Regional branch of Federal Service for Financial
                                                  Markets in Central Federal District


The number of the securities owned by the issuer: 1 223 215 466 pieces
The total par value of the securities owned by the issuer: RUR 611 607 733
Exchange: RUR
The total balance sheet value of the securities holding: RUR 661 954 811
       dividend was not paid per ordinary shares


The type of securities: shares
       The full company name: Open Joint-Stock Company "Moscabelenergoremont"
       The reduced company name: MKER, JSC
       The location: 115569, Moscow , Shipilovskaya street, 13, bld.2


  The date of the        The state registration                 The registering agency
 state registration             number
  number of the
    share issue

   28.07.2009         1-01-12847-А                Regional branch of Federal Service for Financial
                                                  Markets in Central Federal District


The number of the securities owned by the issuer: 998 880 622 pieces
The total par value of the securities owned by the issuer: RUR 499 440 311
Exchange: RUR
The total balance sheet value of the securities holding: RUR 470 179 511
       dividend was not paid per ordinary shares

    Investments in non-equity securities
The type of securities: bill of exchange


                                                                                                     67
The full company name: “OTKRITIE Financial Corporation”, Limited Liability Company
The shortened company name: OTKRITIE FC
The location: 129090, Moscow, Kalanchevskaya street, 49
The number of the securities owned by the issuer: 1 piece
The total par value of the securities owned by the issuer: RUR 2 968 747 000
Exchange: RUR
Repayment date: June 30, 2010
The total balance sheet value of the securities holding: 2 968 747 000


         There are no other financial investments equal 10 and more percent of all financial
         investments

       The issuer creates a reserve under investment depreciation in securities:
       The reserve amount under depreciation of securities for 01.01.2009 - is not present
       Reserve amount under depreciation of securities for 31.12.2009 - RUr 286 395 thousand
The information on amount of the potential losses connected with bankruptcy of the organisations
(enterprises) in which investments were made, by each kind of the specified investments:
The issuer has no funds on depositary or other accounts in banks and other credit organizations, the
licenses of which were suspended or withdrawn, and in banks and other credit organizations, with regard
to which the decision on reorganization, liquidation, the beginning of the bankruptcy procedure or on
recognition to be insolvent (a bankrupt) was taken.
The registration of the issuer's financial investments is performed according to the Russian Book
Keeping Rules stated in the Order of the Ministry of Finance of the Russian Federation as of 10
December 2002 No. 126n (126н) "On approval of the Regulations for Book Keeping "Registration of
Financial Investments" RBK 19/02" (ПБУ 19/02).


       4.3.3. Issuer‟s intangible assets

  For 2009
       The issuer doesn‟t possess no non-materials assets
  For the end of the accounting period
       The issuer doesn‟t possess no non-materials assets


4.4.      Data on the issuer‟s policy and expenses in the field of scientific and technical development,
          licenses and patents, new development and research.


There is no policy of the issuer in the sphere of the research and development and costs for the
implementation of the research and development from own funds for the period since the date of the
state registration of the issuer till the moment of the forth quarter end of 2009.


The issuer neither created nor got the legal protection of the main objects of the intellectual property in
the 1-th quarter of 2010.


There were no risk factors connected with the possibility of the validity expiration of the basic patents
and licenses for trade marks use.


4.5.      Analysis of development tendencies in the sphere of issuer‟s principal activity


                                                                                                            68
 Russian power industry is one of the largest in the world due to its installed capacity,
production and sales of electrical energy.


For the 1st half of the year 2010, 289.6 billion kWh of electricity were generated (this is 105.8%
to the similar period of the year 2009), including in March – 94.2 billion kWh (104.2%).
Growth of electric power production in comparison with the previous year is caused not only by
an increase in rates of growth of production in a number of activities characterized by electric
intensity, but also developed cold weather conditions in the heating season.
Electric power production in the 1st quarter of 2010 decreased (by 8.2%) at hydroelectric power
stations and increased at thermal and nuclear power stations (accordingly by 8% and 9.9%) in
comparison with the respective period of 2009.
A significant reduction in electric power production at hydroelectric power stations in
comparison with the respective period of the last year is due not only to the accident at Sayano-
Shushenskaya Hydroelectric Power Station, but also to adverse hydrological conditions at a
number of the rivers of the European part of Russia.
In such a way, in the 1st quarter of 2010 electric power production at Volzhsko-Kamskiy
Cascade in comparison with the 1st quarter of 2009 decreased by 1.91 billion kWh (by 18.9%), at
Angaro-Yeniseiskaya Cascade - by 2.34 billion kWh (by 11 percent).
The share of the electric power produced by thermal power stations increased in the total
electric power production from 69.5 % in the 1st quarter of 2009 to 71.0% in the 1st quarter of
2010, as to atomic power stations – accordingly from 15.1% to 15.6%, and as to hydroelectric
power stations - decreased accordingly from 15.4% to 13.3 percent.
Electricity consumption in the 1st quarter of 2010 was 285.2 billion kWh which is by 6.0% more
than in the respective period of 2009, including 92.7 billion kWh was produced in March which
is by 4.5% more than in the respective period of the last year.
The net power flow of export and import deliveries of electric power for the 1st quarter of 2010 is
estimated in the amount of 4.4 billion kWh (by 6,8 % below the level of the corresponding period
of 2009) which is due to the reduction of export to the Baltic states.
Putting into operation new capacity in the 1st quarter of 2010 (based on JSC “UES SO‟s”
information) equaled 128 MW, putting out of operation equaled 139 MW. Besides, in March
2010 the fifth hydraulic unit was engaged with the industrial load at Sayano-Shushenskaya
Hydroelectric Power Station (after the accident in 2009).


(Source: the Economic Development Ministry of the Russian Federation)

 Already in 1980s signs of stagnation in country‟s power industry became to appear: production
capacities renewed notably slower than power consumption grew.
In 1990s, in the period of economic crisis in Russia, the amount of electric power consumption
has notably decreased, at the same time the process of power capacity renewal has practically
stopped.
The general situation in the branch was characterized by the following showings:
      According to technological showings (fuel discharge intensity, equipment average
performance factor, stations work capacity and others) Russian energy companies stood behind
their analogues in developed countries.
      There were no incentives to effectiveness increase, rational planning of production
procedure and power consumption, energy-saving.


                                                                                                  69
      In certain regions irregularity in energy transmission occurred, energy crisis was
observed, there was a high possibility of large accidents.
      Payment discipline was absent, non-payments were spread.
      The companies in this branch were informationally and financially “non-transparent”.
      Market access to new, independent players was closed.
All that made it necessary to reorganize power industry, that could create incentives to
effectiveness increase of energy companies and let notably increase the number of investments
in this industry. Otherwise, during the following expansion of foreign-economic co-operation,
Russian companies could lose in economic competition not only on foreign markets, but also on
the home market of the country.


(Source: OJSC “IDGC Holding”)


The main aim of power industry reformation in Russia – increase of effectiveness of companies
in the industry, creation of conditions for its development on the basis of investment stimulation,
providing reliable and regular energy supply to consumers.
In this connection radical changes in power industry of Russia take place: system of industry
state regulation changes, competitive market of electric power is forming, new companies are
created.
In the course of reform the industry structure has changed: natural-monopolistic (electric
power transmission, dispatch operation) and potentially competitive (production and sale of
electric power, repair and service) functions divided, and instead of former vertically-
integrated companies, which acted so, the structures, specializing on certain types of activity,
were created. Formed during the reform companies are enterprises, specializing on certain types
of activity (production, transmission of electric power and others) and controlling the
corresponding profile assets. By the scale of profile activity the created companies exceed
former monopolies of regional level: new companies consolidate profile enterprises of several
regions, or are all-russian.
Thus, the conditions for development of competitive power market are being created, the prices
of which are not regulated by the state, but are formed on the ground of demand and supply,
and its participants compete, by decreasing their expenses.
Aims and objectives of the reform are stated in the Government Decree dated July, 11th 2001 No.
526 “On reformation of power industry of the Russian Federation”.
Taking into consideration the following changes in reference-legal base aims and objectives of
reformation were concretely defined in “Strategy Conception of OJSC “RAO UES of Russia”
for 2005-2008s “5+5”.

 Bulk power supply networks were taken under control by Federal network company,
distributive networks were integrated into inter-regional high voltage grid companies (MRSK),
functions and assets of supervisory controls were given to all-russian System operator.
Generation assets were also consolidated into inter-regional companies of two types: generating
companies of wholesale market (wholesale generating companies – WGC) and territorial
generating companies (TGC). WGCs consolidate electric power stations, specialized on
production of almost electric power. TGCs mainly consolidate heat and power plants (HPP),
which product both electric and heat power. Six of seven WGCs are formed on the base of
thermoelectric power stations, and one (“RusHydro”) – on the base of hydrogenerating assets.
Heat WGCs are built under exterritorial principle, while TGCs consolidate stations of nearby
regions.



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In December 2007 – January 2008 the formation of target structure of all heat WGCs and TGCs
were finished, the first stage of OJSC “RusHydro” consolidation was finished.
The process of spinning off of electric network companies was finished. On the base of
reorganized JSC-energo 56 bulk power supply companies were created.
On June, 30th 2008 the process of reorganization of OJSC “ RAO UES of Russia” was
completed. As a result of reorganization of OJSC “ RAO UES of Russia” by means of spinning
off there was created OJSC “Holding MRSK”. The aim of OJSC “Holding MRSK” creation,
stated in the“Strategy Conception of OJSC “ RAO UES of Russia” “5+5”, accepted by OJSC “
RAO UES of Russia” Board of Directors on May, 29th 2003, was to isolate during OJSC “ RAO
UES of Russia” reorganization the company, which was handed the shares, belonged to OJSC
“ RAO UES of Russia”, of all inter-regional distributing network companies.

Main factors, which influence the industry state:
For the latest 5 years the following tendencies, typical for industry in the whole can be
distinguished:
   -   significant growth of energy consumption from the late 90s, correspondently growth of
       heat and electric power output;
   -   increase of payment discipline of heat and electric power consumers;
   -   improvement of financial results of energy companies activity;
   -   improvement of balance structure of regional energy systems;
   -   reduction of cross financing;
   -   aging of main equipment (electric power stations, electric and heat networks) of energy
       companies, lack of investment to support generating supplies.
General assessment of results of issuer‟s activity in this branch, conformance evaluation of
results of issuer‟s activity and branch development tendencies and causes proving the obtained
results of the activity:
Stable positive development of the issuer should be noted. The issuer takes the leading position
on the market of electric power transmission not only in the Moscow region but also in the
country. OJSC “MOESK” – is the largest inter-regional distributing network company in
Russia, is a member of three leading energy companies of the country and of 30 main largest
enterprises of the Russian Federation. OJSC “MOESK” supplies 98% of consumers in Moscow
and 95 % of consumers on the territory of Moscow oblast‟.
During the first years of company‟s existence (from 2005 till 2008) there were invested into
development of electric network service of Moscow and Moscow oblast‟ more than 91 billion
roubles, that allowed to increase significantly reliability of power supply of region‟s consumers
and created possibility of consumers‟ connection to electric networks. Investment programme of
OJSC “MOESK” has been worked out taking into consideration the development rate of
metropolitan region. Agreement between OJSC “RAO UES of Russia” and the Government of
Moscow and Moscow oblast‟, “General spacing chart of power industry objects by year 2020”,
approved by the Government of the RF were taken into consideration. Owing to realization of
investment programme of the Company, in 2005-2008s there were put into operation more than
9112 MVA of power capacity, approximately 3 000 km of power lines, and also the possibility of
consumers‟ connection to electric networks of Moscow region for the total capacity of more
than 906 MVA appeared. Realization of unique investment programme of OJSC “MOESC”
allowed to increase significantly reliability of electric power supply to the consumers of Moscow
region.


The opinions of issuer‟s authorities on the presented information concur.




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4.5.1. Analysis of tendencies of development in the sphere of the issuer‟s primary activities


Factors and conditions influencing the issuer‟s activity and the forecast concerning their duration:


Factors and conditions influencing the issuer‟s activity comprise the following:
    -   considerable amount of the state regulation of the branch, concerning the tariffs regulation for
        heat and electric power;
    -   the growth of power consumption in the place of the issuer‟s location;
    -   increase of payment discipline of heat and electricity power consumers;
    -   decrease of cross-subsidization level;
    -   ageing of the issuer‟s basic equipment lack of the investment resources for the generating
        capacities support;
    -   the given factors will influence the activity of the issuer during near several years.


Activities taken by the issuer and activities the issuer is planning to take in future for the productive use of
the given factors and conditions:
    -   to carry out the fixed assets modernization;
    -   to provide the constant growth of all industrial chain constituents efficiency of the issuer;
    -   implementation of the improved procedures of the financial planning;
    -   efforts concentration for the provision of the timely acquisition of the money means concerning
        the current and overdue accounts receivable;
    -   restructuring of the obligations directed to their extinction during the longer period of time.


Methods used by the issuer and methods the issuer plans to use in future to decrease the negative effect of
factors and conditions influencing the issuer‟s activity:
    -   development of the modern system of transmission and distribution of the electric power;
    -   decrease of losses of power;
    -   increase of the financial control and implementation of the program directed to the decrease of
        costs;
    -   risks management connected with the basic activity of the issuer;
    -   insurance of the property risks and civil responsibility risks and etc.


Considerable events/factors which can negatively influence the possibility of the issuer‟s acquisition of
higher results are as follows:
    -   deterioration in business, political and social environment in the country;
    -   raw materials and equipment cost growth.


The probability of the abovementioned factors is considered by the issuer as not high due to the current
forecasts of the stable and successful development of the economic, political and social situation in the
country in general.


Considerable conditions/factors which can improve the results of the issuer‟s activity and the possibility of
their occurrence and the duration of their action:
There are no considerable factors that can improve the basic activity of the issuer – electric power
transmission.


4.5.2. Issuer‟s competitors


Information on the general and supposed competitors of the issuer concerning the basic types of the
activity:


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The activity of the issuer is the natural-monopolistic one.

List and factors of the issuer‟s competitive ability with the description of their influence, according to the
issuer on the competitive ability of the produced goods (works and services):
It is not possible to evaluate the factors of the issuer‟s competitive ability as far as the issuer‟s activity is
natural-monopolistic.




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V. Detailed data on the persons that form part of the issuer‟s governance bodies,
bodies of the issuer undertaking control over its financial and economic
activities, and brief data on the staff (employees) of the issuer

5.1. Data on structure and competence of the issuer‟s governance bodies


A comprehensive description of the issuer‟s governance bodies in accordance with the issuer‟s Charter
(documents of incorporation):


The governance bodies of the issuer, in accordance with its Charter, are:
       1) General Shareholders Meeting;
       2) Board of Directors;;
       3) General Director.



General Shareholders Meeting is the highest governance body of the issuer.


The competence of the issuer‟s General Shareholders Meeting in accordance with its Charter.


The issues which fall within the competence of the General Shareholders Meeting shall not be delegated for
decision to the Company Board of Directors or General Director (item 10.3., Article 10, the issuer’s
Charter).


In accordance with item 10.2 of the issuer’s Charter, the competence of the issuer’s General Shareholders
Meeting includes the following issues:


1) amending of the Charter and approval of the revised Charter;
2) restructuring of the Company;
3) liquidation of the Company; appointment of the liquidation commission and the approval of the
interim and final liquidation balances;
4) determination of the quantity, par value, category (type) of the declared stocks and the rights
provided by these stocks;
5) increase of the authorized capital by an increase of the par value of stocks or by a placement of
additional stocks;
6) reduction of the Company authorized capital by a reduction of the par value of the stocks,
through the acquisition by the Company of a part of stocks in order to reduce their total amount,
or by repayment of the stocks redeemed or acquired by the Company;
7) fractioning and consolidation of the Company stocks;
8) making the decision on the placement by the Company of bonds converted into stocks and other
equity securities convertible into stocks;
9) election of the members of the Board of Directors and the early termination of their powers;
10) election of the members of the Auditing Committee of the Company and the early termination
of their powers;
11) approval of the Company Auditor;
12) making the decision on the transfer of powers of the Company sole executive body to the
managing Company (managing director) and on the early termination of his/her powers;
13) approval of annual reports, annual accounting reports, including the Company income
statements, and distribution of its profit (including payment (declaring) of dividends, except for the
profit distributed as a dividend following the results of the first quarter, half a year, nine months of
the financial year) and the Company loss following the results of the financial year;


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14) payment (declaring) of dividends following the results of the first quarter, half a year, nine
months of the financial year;
15) determination of the procedure for holding the Company General Shareholder Meeting;
16) making the decision on the approval of transactions in cases envisaged by Article 83 of the
Federal Law “On Joint Stock Companies”;
17) making the decision on the approval of large transactions in cases envisaged by Article 79 of
the Federal Law “On Joint Stock Companies”;
18) making the decision on the participation in financial and industrial groups, associations and
other unions of for-profit Companies;
19) approval of the internal documents regulating the activities of the Company bodies;
20) making the decision on payment remuneration and/or compensation to the members of the
Company Auditing Committee;
21) making the decision on payment of remuneration and/or compensation to the members of the
Company Board of Directors;
22) solution of other issues envisaged by the Federal Law “On Joint Stock Companies”.

The competence of the issuer‟s Board of Directors in accordance with its Charter.

In accordance with item 15.1 of the issuer’s Charter, the Company Board of Directors carries out general
management of the Company activities, except for the decision of issues which are referred by the Federal
Law “On Joint Stock Companies” and the Charter to the competence of the General Shareholders Meeting.

The Company Board of Directors’ competence includes the following issues:

1) setting the priority directions of the Company activities;
2) convocation of the Company annual and extraordinary general shareholder meetings, except
for the cases stipulated by item 14.8 of Article 14 of this Charter;
3) Approval of the Company general shareholder meeting agenda;
4) election of the secretary of the Company general shareholder meeting;
5) determining of the date of drawing up the list of persons entitled to participate in the Company
general shareholder meeting, and solution of other issues connected with preparation and
carrying out of the Company general shareholder meeting;
6) submission for the decision of the Company general shareholder meeting of issues envisaged by
subparagraphs 2,5,7,8,12-20 of Item 10.2 of Article 10 of this Charter, as well as on the reduction
of the Company authorized capital through the reduction of the par value of the stocks;
7) placement by the Company of bonds and other equity securities except for the cases stipulated
by the legislation of the Russian Federation and this Charter;
8) approval of the resolution authorizing issuance of securities, prospectus for securities, and
report on the results of the securities issuance, approval of the reports on the results of the stocks
acquisition from the Company shareholders, reports on the redemption of stocks, reports on the
results of presentation the demands by the Company shareholders on the redemption of the stocks
owned by them;
9) determining the price (monetary value) of the property, the price of the placement and
redemption of equity securities in cases envisaged by the Federal Law “On Joint Stock
Companies” as well as while solving issues stipulated in subitems 11, 20, 21, and 38 of Item 15.1.
of Article 15 of this Charter;
10) acquisition of the stocks, bonds and other securities placed by the Company in cases envisaged
by the Federal Law “On Joint Stock Companies”;
11) carve-out (selling) of the Company stocks which are placed at the disposal of the Company as
a result of their acquisition or redemption from the Company shareholders, as well as in other
cases envisaged by the Federal Law “On Joint Stock Companies”;
12) election of the Company General Director and early termination of his/her powers including
taking the decision on early termination of the labor contract with him/her;



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13) recommendations to the Company general shareholder meeting on the amount of
remunerations and compensations paid to the members of the Auditing Committee and fixing the
amount of remuneration of the Auditor’s services;
14) recommendations on the amount of the dividend per stocks and the procedure for its payment;
15) approval of the Company internal documents determining the procedure for the formation and
use of the Company funds;
16) decision-making on the use of the Company funds; approval of the cost estimates for the use of
special-purpose funds and consideration of the results of the implementation of cost estimates for
the use of special-purpose funds;
17) approval of the Company internal documents except for internal documents, the approval of
which is referred to the competence of the Company general shareholder meeting and other
Company internal documents, the approval of which is referred to the competence of the Company
executive bodies;
18) approval of the business plan (revised business plan) and the report on the results of its
implementation, as well as approval (revising) of the list and values of the Company cash flow
benchmarks;
19) foundation of the Company branches and opening of the Company representative offices, their
liquidation, as well as amending the Company Charter in connection with the foundation of the
Company branches and opening of the Company representative offices (including changing of the
information on the names and locations of the Company branches and representative offices) and
their liquidation;
20) participation of the Company in other Companies (including coordination of constituent
documents and candidates for the governance bodies of newly founded Companies, and in view of
provision 21, item 15.1., Article 15 of this Charter) and change of the stake (number of stocks,
amount of contributions, equities), carve-out of stocks (equities) and termination of the Company’s
participation in other Companies;
21) making the decision on one or several associated transactions of the Company on the carve-
out, pledging or other encumbrance of stocks and stakes of SDE (subsidiaries and dependent
entities) which are not engaged in production, transmission, dispatching, distribution and selling
of electric and thermal energy in case if the market value of stocks or stakes being the subjects of
the deal determined according to the report of the independent appraiser exceeds 30 million rubles
and in other cases (amount) determined by the separate decisions of the Company Board of
Directors;
22) determination of the Company credit policy as to provision by the Company of loans, making
credit contracts and loan contracts, issuing of guarantees, acquisition of liabilities on bills
(issuing of ordinary and transfer bill), pledging of property and making the decision on the above
mentioned transactions of the Company in cases when the procedure for the decision-making of
them is not determined by the Company credit policy as well as decision-making in accordance
with the order envisaged by the Company credit policy on bringing the debt situation of the
Company within the limits determined by the Company credit policy;
23) decision-making on completion of the transactions, the subject of which is the property, works
and services, the value of which is from 5 to 25 per cent of the Company balance sheet assets
which is defined at the date of decision-making on completion of the transaction, except for the
transactions completed in the process of the Company ordinary economic activities;
24) approval of the large transactions in cases envisaged by Chapter X of the Federal Law “On
Joint Stock Companies”;
25) approval of transactions in cases envisaged by Chapter XI of the Federal Law “On Joint
Stock Companies”;
26) approval of the Company Registrar, terms of the contract concluded with it and termination of
the contract concluded with it; approval of an estimate of expenses for carrying out the
Company General Shareholder Meeting;
27) election of the Company Board of Directors Chairperson and the early termination of his/her
powers;



                                                                                                 76
28) election of the Company Board of Directors Deputy Chairperson and the early termination of
his/her powers;
29) election of the Company Board of Directors Secretary and the early termination of his/her
powers;
30) tentative approval of decisions on the Company transactions connected with the gratuitous
transfer of the Company property or property rights (demands) to itself or the third party;
transactions connected with the liberation from property liabilities to itself or the third party;
transactions connected with the gratuitous provision of services by the Company (carrying out of
works) to the third parties, in cases (amount) determined by separate decisions of the Company
Board of Directors, and decision-making on these transactions by the Company in cases when the
above-mentioned cases (amount) are not determined;
31) decision-making on suspending of the powers of the managing Company (managing director);
32) decision-making on the appointment of the Acting General Director of the Company and
his/her calling to an account;
33) calling to an account of the Company General Director and his/her remuneration in
accordance with the labor legislation of the Russian Federation;
34) consideration of the General Director’s reports on the Company activities (including the
report on exercising his/her functions, on the implementation of the decisions of the Company
General Meeting and its Board of Directors);
35) approval of the procedure of the Company’s interaction with the Companys, in which the
Company participates;
36) Definition of the Company’s position (Company’s representatives), including the assignment to
take or not to take part in voting on the agenda items, to vote under draft decisions "for", "against"
or "abstained", on the following items of the agenda of general shareholder (participant) meetings of
subsidiaries and dependent entities (further on called SDE) (except for the cases when the functions
of the SDE general shareholder meetings are exercised by the Company Board of Directors), and
meetings of the SDE boards of directors (except for an item on approval of the agenda of the SDE
general shareholder meetings when functions of the SDE general shareholder meeting are carried
out by the Company Board of Directors):
i) on the determination of the agenda of the general shareholder meeting (participants) of SDE;
ii) on the reCompany and liquidation of SDE;
iii) on the determination of the quantitative structure of the SDE Board of Directors, nomination
and election of its members and the early termination of their powers;
iv) on the determination of the number, par value, category (type) of the SDE declared stocks and
the rights granted by these stocks;
v) on the increase of the SDE authorized capital through the increase of the par value of stocks or
through the placement of additional stocks;
vi) on the placement of the SDE securities convertible into ordinary stocks;
vii) on the fractioning and consolidation of the SDE stocks;
viii) on the approval of large transactions made by the SDE;
ix) on the participation of SDE in other Companys (on entering the existing Company or on the
foundation of the new one), as well as on the acquisition, carve-out, encumbrance of stocks and
stakes in the authorized capitals of the Companys, in which SDE participates, changes of the stake
in the authorized capital of the respective Company;
x) on the transactions made by SDE (including several associated transactions) connected with the
carve-out or the possibility of carve-out of property, representing fixed assets, intangible assets,
objects of incomplete construction, the purpose of the use of which is production, transmission,
dispatching, distribution of electric and thermal energy in cases (amount) defined by the
procedure of interrelation of the Company with Companys in which the Company participates,
approved by the Company Board of Directors;
xi) on amending the SDE constituent documents;
xii) on the determination of the procedure of remuneration payment to the members of the SDE
Board of Directors and Auditing Committee;


                                                                                                   77
37) determination of the position of the Company (representatives of the Company) on the
following items of the agenda of the SDE board of directors’ meetings (including the assignment to
participate or not to participate in voting on the items of the agenda, to vote on draft decisions
“for” or “against”, or “abstain”:
i) on the determination of the SDE representatives’ position on the items of the agenda of the
general meetings of shareholders (participants) and the meetings of the Board of Directors of the
subsidiaries and dependent entities in respect of SDE, concerning the completion (approval) of
transactions (including several associated transactions) connected with carve-out or a possibility
of carve-out of the property representing fixed assets, intangible assets, objects of incomplete
construction, the purpose of the use of which is production, transmission, dispatching, distribution
of electric and thermal energy in cases (amount) determined by the procedure of interrelations of
the Company with Companys in which the Company participates, approved by the Company
Board of Directors;
ii) on the determination of the SDE representatives’ position on the items of the agenda of the
general meetings of shareholders (participants) and the meetings of the Board of Directors of the
subsidiaries and dependent entities in respect of SDE, participating in production, transmission,
dispatching, distribution of electric and thermal energy, on reCompany, liquidation, increase of
the authorized capital of these entities through the increase of the par value of stocks or through
the placement of additional stocks, securities convertible into ordinary stocks;
38) tentative approval of the decisions on the completion by the Company:
i) of transactions, the subject of which shall be the Company non-current assets in the amount
exceeding 10 percent of the balance sheet value of these assets as of the date of decision-making
on the completion of this transaction;
ii) of transactions (including several associated transactions) connected with carve-out or an
opportunity of carve-out of the property forming the fixed assets, intangible assets, objects of
incomplete construction, the purpose of use of which is production, transmission, dispatching,
distribution of electric and thermal energy in the cases (amount) determined by separate decisions of
the Company Board of Directors;
iii) of transactions (including several associated transactions) connected with carve-out or an
opportunity of carve-out of the property forming the fixed assets, intangible assets, objects of
incomplete construction, the purpose of use of which is not production, transmission, dispatching,
distribution of electric and thermal energy in the cases (amount) determined by separate decisions of
the Company Board of Directors;
39) nomination by the Company of persons for the election to the position of the sole executive
body, to other management bodies, bodies of control, and candidates for the Auditor of the
Companies, in which the Company participates, which carry out production, transmission,
dispatching, distribution and selling of electric and thermal energy, as well as repair and
maintenance activities;
40) determination of the Company’s insurance assurance directions, including approval of the
Company’s Insurer;
41) approval of independent appraiser (appraisers) candidature to fix the Company’s shares,
property and other assets value in cases, provided by the Federal law “On joint-stock companies”,
Articles of Association, as well as the Company’s Board of Directors individual solutions;
43) prior approval of collective agreements, contracts, that are concluded by the Company in the
frame of social-labour relations management;
43) approval of financial consultant candidature, recruited according to the Federal law “On
Equity market”, as well as candidature of equity issue organizer and transaction advisers, who are
directly connected with fund obtaining in the form of public loans;
44) working out of recommendations on Auditor choice, who carries out audit of the Company’s
financial accounts, prepared according to the International standards of financial accounts ,
approval of agreement conditions with him, as well as monitoring of the Company’s financial
accounts audit carrying out, prepared according to the International standards of financial
accounts;


                                                                                                  78
45) approval of the document, determining rules and approaches of the Company’s data
disclosure; the document usage of data on the Company’s activity, the Company’s securities and
transactions with them, which is not opened to general use and disclosure of which will
significantly affect the market price of the Company’s securities; the document determining
procedures of administrative control over the Company’s financial-economical activity;
46) approval of perspective (up to 5 years), annual and quarter plans of capital construction;
goods and services purchasing plans; new construction projects; technical reequipment and
construction and reports on fulfillment results;
47) prior approval of transactions, which can entail rise of liabilities, that are expressed in
foreign currency (or liabilities, the value of which is bound with foreign currency), in cases and
amounts determined by the Company’s Board of directors individual solutions, and also, if
mentioned cases (amounts) are not determined by the Board of Directors;
48) determination of purchasing policy in the Company, including approval of the Regulations on
the procedure of regulated purchase holding of goods, works, services, approval of the head of the
Company’s Central purchasing authority and its members, as well as approval of annual complex
purchasing program and making other decisions according to the approved by the Company
documents, that regulate the Company’s purchasing activity;
49) making decision of the Company’s General Director recommendation for State decorations;
50) approval of goal values (corrected values) of the Company’s key performance indicators (KPI)
and reports on their fulfillment;
51) determination of the Company’s housing policy concerning pledging to the Company’s
personnel corporate support in housing conditions improvement in the form of subsidy, costs
offsetting, interest-free loans and making a decision on pledging by the Company mentioned
support in case if the procedure of its pledging is not determined by the Company’s housing policy;
52) determination of quantitative representation of the Company’s Management Board, election of
the Company’s Management Board members; early powers elimination, including making a
decision on early termination of labour contracts with them;
53) determination of the Company’s policy concerning distributing electric network complex and
other electric network facilities reliability increase, including approval of the Company’s strategic
programmers on electric network complex reliability, electric network complex development and its
security;
54) other issues related to the competence of the Board of Directors by the Federal law “On joint-
stock companies” and by the Company’s Regulations.




The competence of the issuer‟s Management Board in accordance with its Charter.


In accordance with item 20.1, Article 20 of the issuer’s Charter, the Company’s current activities
management shall be carried out by the sole executive body – General Director, and the collegial executive
body – the Company Management Board.


The collegial executive body shall be accountable to the General Shareholder Meeting and the Company
Board of Directors.


1) development and granting for consideration of the Board of Directors of long-term plans on realization
of the Company main business lines;




                                                                                                       79
2) approval (revising) of target values of key performance indicators (KPI) for divisions (officials) of the
Company;
3) preparation of the business plan (revised business plan) and the report on results of its implementation;
approval and revising of the cash flow according to the list and values of the Company cash flow
benchmarks approved by the Company Board of Directors (with an obligatory subsequent submission to the
Company Board of Directors);
4) preparation of the investment program and the report to the Company Board of Directors on the results
of its implementation;
5) consideration of the Company certain investment projects for the amount exceeding 2 (two) million
rubles and approval of reports of the Company officials and divisions on the efficiency of their realization;
6) preparation of the program of the Company re-equipment, reconstruction and development;
7) approval of the quarter budget of the Company cash flow, and the report on its execution;
8) preparation of the annual program on the Company purchasing activities, approval of quarter purchases
programs within the limits of the annual programs, and preparation of reports on implementation of the
Company annual and quarter purchases programs;
9) preparation of the report on the Company financial and economic activities, on implementation by the
Management Board of the decisions of the Company General Shareholders Meeting and Board of
Directors;
10) decision-making on completion of transactions, the subject of which is the property, works and/or
services, the value of which is more than 1 percent of the Company balance sheet assets defined at the date
of decision-making on the completion of the transaction, except for the transactions completed during the
Company usual economic activities; and the transactions, the decision on fulfilment of which according to
the Company Charter falls within to the competence of the Company Board of Directors;
11) preliminary consideration and delivery to the Company Board of Directors of the recommendations on
the issues submitted for consideration of the Company Board of Directors in accordance with the
procedure specified in the Company internal documents which regulate the procedure of the Company
Management Board activities;
12) decision-making on the issues which fall within the competence of the supreme management bodies of
the economic entities, 100 (one hundred) percent of the authorized capital, or all voting stocks of which
belong to the Company (taking into account subitem 36 of item 15.1 of the Company Charter);
13) consideration of reports of the Company Deputies General Director and heads of the Company
structural divisions on the results of implementation of the approved plans, programs, instructions,
consideration of reports, documents and other information on the Company and its subsidiaries and
dependent entities' activities;
14) involvement in other issues of management by the Company current activities according to the
decisions of General Shareholders Meeting, Company Board of Directors, and the issues submitted for
consideration of the Management Board by the Company General Director.



The competence of the issuer‟s sole executive body in accordance with its Charter.


According to item 20.1., Article 20 of the issuer’s Charter, the management by the Company
current activities shall be performed by the sole executive body – General Director, and by the
collegial executive body – Management Board of the Company.
According to item 20.2., Article 20 of the issuer’s Charter, the Company General Director and the
Company Management Board shall be liable to the General Shareholders Meeting and the
Company Board of Directors.
According to item 22.2., Article 22 of the issuer’s Charter, the competence of the General Director
shall include all the issues of the Company current activities management, except for the issues
referred to the competence of the General Shareholder Meeting, the Board of Directors, and the
Management Board of the Company.


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The Company General Director shall act without a power of attorney on behalf of the Company
taking into account the limitations envisaged by the legislation of the Russian Federation, this
Charter and the decisions of the Company Board of Directors. The Company General Director
shall
1) ensure the fulfillment of the Company activity plans which are necessary for the solution of
his/her tasks;
2) develop and submit for approval of the Company Management Board the target values of key
performance indicators (KPI) for the Company divisions (officials) and bear liability for their
implementation;
3) organize bookkeeping and accounting in the Company;
4) dispose of the Company property, complete transactions on behalf of the Company, issue
powers of attorney, opens settlement and other accounts of the Company in banks, other credit
Companys (and in cases specified in the law – in Companys which are professional participants of
the securities market);
5) issue orders, approve (accept) instructions, local normative enactments and other internal
documents of the Company on the issues of his/her competence, give instructions necessary for the
execution by all employees of the Company;
6) approve the Company Companyal structure, staff list and official salaries of the Company
employees;
7) approve Regulations on branches and representative offices of the Company;
8) exercise in respect of the Company’s employees the rights and obligations of the employer,
envisaged by the labor law;
9) exercise functions of the Chairperson of the Company Management Board;
10) distribute obligations among the Deputies of the Director General;
11) submit for the consideration of the Board of Directors the reports on financial and economic
activities of subsidiaries and dependent companies, the stocks (stakes) of which are owned by the
Company, as well as the information on other Companys, in which the Company participates;
12) not later than 45 (forty five) days prior to the holding of the Company annual General
Shareholder Meeting, submit for the consideration of the Company Board of Directors the annual
report, accounting balance sheet, the income statement of the Company and distribution of profit
and loss of the Company;
13) solve other issues of the Company current activities, except for the issues referred to the
competence of the Company General Shareholder Meeting, the Company Board of Directors, and
the Company Management Board.


The Board of Directors of OJSC "Moscow United Electric Grid Company" as of 8 November 2006
(Minutes No. 35 as of 10 November 2006) approved The Corporate Conduct Code of OJSC "Moscow
United Electric Grid Company".
The Internet website containing the Corporate Conduct Code of OJSC "Moscow United Electric Grid
Company": www.moesk.ru.
  The issue approved Corporate Code of Conduct or the other similar
  OJSC «Moscow United Electric Grid» Board of directors approved the Corporate Conduct Code
  of OJSC «Moscow United Electric Grid» as of November, 08 2006 (Minutes № 35 as of
  November 10, 2006 г.).
  Internet page address, where the full text is available for free:
  www.e-disclosure.ru/portal/company.aspx?id=5563;
  www.moesk.ru



  Internet page address is available for free, where the full text of acting redaction of the issue
  charter and internal documents, regulating the issue bodies activity.

                                                                                                      81
  www.e-disclosure.ru/portal/company.aspx?id=5563;
  www.moesk.ru


5.2. Information on the persons that form part of the issuer‟s governance bodies

5.2.1. The board of directors of the issuer


  Name: Shvets Nikolai Nikolaevich
  (chairman)
  Year of birth: 1956

  Education:
  higher
  All positions, held by the person in the issuer and other organizations over the past 5 years and
  now, including part-time

          Period                  Name of the organization                      Position
   From            To
2001           2007        Federal State Unitary Enterprise          Managing, the assistant to the
                           “Rosoboronexport”                         first deputy of the general
                                                                     director
2007           2008        The Government of Amur Region             The first vice-president of the
                                                                     government
2008           2009        Far East state agrarian university        The professor of chair
                                                                     "Management, marketing and
                                                                     the right"
2008           2009        The House of Assembly of the Amur         The chairman
                           Region
2009           now         OJSC "Holding IDGC”                       The general director, the
                                                                     Chairman of Board , member of
                                                                     Board of directors
2007           now         Union of machinists of Russia, All-       Member of Central Board,
                           Russian Social Organization               member of office of Central
                                                                     Board
2007                       Union of machinists of Russia, All-       Vice-President
               now
                           Russian Branch Association of
                           employers.
2008                       Scientific and Technical council of  Member of Supervisory board
               now
                           unified electric power system, Non-
                           profit organization
2009           now         IDGC of Centre and Volga region, JSC Chairman of Board of directors
2009           now         IDGC of North-West, JSC                   Chairman of Board of directors

2009           now         Lenenergo, JSC                            Chairman of Board of directors

2009           now         IDGC of Ural, JSC                         Chairman of Board of directors

2009           now         Tumenenergo, JSC                          Chairman of Board of directors

2009           now         Yantarenergo, JSC                         Chairman of Board of directors



                                                                                                       82
2009           now             MOESK, JSC                                          Chairman of Board of directors




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions



 Name: Ivanov Sergei Nikolaevich
 Year of birth: 1961

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                        Name of the organization                               Position
   From            To
2002           2006            Federal State Unitary Enterprise                    The deputy of the General
                               "Koncern Rosenergoatom"                             director on economy and the
                                                                                   finance - the Chief executive,
                                                                                   the deputy of the General
                                                                                   director - the director for
                                                                                   reforming and a corporate
                                                                                   governance
2007           2008            CSJC "Inter-RAO UES"                                The deputy of the general
                                                                                   director on strategy and



                                                                                                                       83
                                                                                   investments
2008           now             OJSC "Federal Grid Company of                       The first vice-president of
                               Unified Energy System"                              Board

2009           now             Lenenergo, JSC                                      the member of Board of
                                                                                   directors
2009           now             IDGC of Volga region, JSC                           the member of Board of
                                                                                   directors
2009           now             IDGC of North-West, JSC                             the member of Board of
                                                                                   directors
2009           now             IDGC of Ural, JSC                                   the member of Board of
                                                                                   directors
2009           now             IDGC of Siberia, JSC                                the member of Board of
                                                                                   directors
2009           now             IDGC of Centre and Volga region, JSC the member of Board of
                                                                                   directors
1994           now             ERCO, JSC                                           the member of Board of
                                                                                   directors
2007           now             Malaya Energetica, JSC                              the member of Board of
                                                                                   directors
2009           now             Index of Power of FGC UES, LTD                      the member of Board of
                                                                                   directors
2009           now             CIUS UES, JSC                                       the member of Board of
                                                                                   directors
2009           now             Energostroysnabcomplekt, JSC                        the member of Board of
                                                                                   directors
2009           now             Agency on balance broadcast in power                the member of Board of
                               supply, CJSC                                        directors
2009                           National Institute of Power Security,               The Chairman of presidium –
               now                                                                 the President of the Institute
                               Autonomus Non-Profit Organization
                               (ANO)
2009                           MOSK, OJSC                                          The Deputy Chairman of Board
               now                                                                 of directors




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:




                                                                                                                       84
   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Bodunkov Alexei Feliksovich
 Year of birth: 1966

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                        Name of the organization                               Position
   From              To
2002           now             The Ministry of property relations of               The minister of property
                               the Moscow Area                                     relations of the Government of
                                                                                   the Moscow area
2009           now             OJSC “Moscow United Electric Grid                   Board of Directors
                               Company”                                            member



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.




                                                                                                                       85
   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Gavrilenko Anatolij Anatlievich
 Year of birth: 1972

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                        Name of the organization                               Position
   From              To
2004           now             CJSC "Lider" (Company on pension                    The general director, member
                               fund assets management)                             of Board of directors

2005           now             OJSC "Mosenergo"                                    the member of Board of
                                                                                   directors
2008           now             "Gazprombank" (Open joint-stock                     the member of Board of
                               company)                                            directors
2008           now             Open joint-stock company "SIBUR                     the member of Board of
                               holding"                                            directors
2008           now             Open joint-stock company                            the member of Board of
                               “Salavatnefteorgsitez”                              directors
2008           now             Open joint-stock company "Second                    the member of Board of
                               generating company of the electric                  directors
                               power wholesale market”
2008           now             Open joit-stock company "Sixth                      the member of Board of
                               generating company of the electric                  directors
                               power wholesale market”
2005           now             OJSC “Moscow United Electric Grid                   the member of Board of
                               Company”                                            directors




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares



                                                                                                                       86
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

 28.02.2005 – 2006 Board of Directors Member OJC «Upravliaushchaia energeticheskaia
 kompania»


 Name: Grishchenko Sergei Valentinovich
 Year of birth: 1972

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                  Name of the organization                     Position
   From           To
2004          2006        LTD “Bazovyi element” company              The director of
                                                                     Department of corporate
                                                                     relations
2006          now         "Gazprombank" (Open joint-stock            The deputy chief of
                          company)                                   Department of direct
                                                                     investments
2006          now          Open joint-stock company "OMZ"            the member of Board of
                                                                     directors
2007          now         CJSC MK "Uralmash"                         the member of Board of
                                                                     directors
2007          now         OJSC "SIBUR Holding"                       the member of Board of
                                                                     directors
2007          now         LTD "Status"                               the member of Board of
                                                                     directors
2008          now         Group Khimmash, CJSC                       the member of Board of
                                                                     directors
2008          now         OJSC "Machine works "ZiO-Podolsk"          the member of Board of


                                                                                                   87
                                                                                   directors

2008           now             Ural Plant of Chemical Engineering,                 the member of Board of
                               JSC                                                 directors

2009           now             Uralmash- Engineering, LTD                          the member of Board of
                                                                                   directors
2008           now             OJSC “Moscow United Electric Grid                   the member of Board of
                               Company”                                            directors



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Demidov Alexey Vladimirovich
 Year of birth: 1976

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                        Name of the organization                               Position
   From            To
2003           2006            CJSC "Sevmorneftegaz"                               The first deputy of the


                                                                                                                       88
                                                                                   General director
2006           2006            OJSC "Gazprom"                                      The adviser of the vice-
                                                                                   president of Board
2006           2009            OJSC NK "Rosneft”                                   The first deputy of the
                                                                                   financial director
2009           now             OJSC "Holding IDGC"                                 The deputy of the general
                                                                                   director on economy and
                                                                                   the finance, the member of
                                                                                   the board
2009           now             Tumenenergo, JSC                                    the member of Board of
                                                                                   directors

2009           now             IDGC of Ural, JSC                                   the member of Board of
                                                                                   directors

2009           now             IDGC of Seberia, JSC                                the member of Board of
                                                                                   directors

2009           now             IDGC of North Caucoasus, JSC                        the member of Board of
                                                                                   directors

2009           now             Lenenergo, JSC                                      the member of Board of
                                                                                   directors

2009           now             IDGC of Centre and Volga region, JSC the member of Board of
                                                                    directors
2009           now             OJSC “Moscow United Electric Grid                   Board of Directors
                               Company”                                            member



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy


                                                                                                                       89
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Kerber Sergei Mihaolovich
 Year of birth: 1973

 Education:
 higher
 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                        Name of the organization                               Position
   From            To
2005           2006            Federal State Unitary Enterprise                    The Director for economy
                               “Goskorporacia” on ATM
2007           now             CJSC "Lider" (Company on pension                    The Director for
                               fund assets management)                             investments
2008           now             OJSC "Uralsviazinform"                              the member of Board of
                                                                                   directors
2008           now             OJSC "SIBUR-Minudobrenia"                           the member of Board of
                                                                                   directors
2008           now             OJSC "Mosteplosetenergoremont"                      The Chairman of Board of
                                                                                   directors
2008           now             OJSC “Moscow United Electric Grid                   the member of Board of
                               Company”                                            directors



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.




                                                                                                                       90
   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions
 Name: Popov Alexandr Albertovich
 Year of birth: 1955

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time



          Period                Name of the organization                    Position
   From           To
1972          2007       Armed Forces and Federal Security         Service on various posions
                         service of the Russian Federation
2007          2007       LTD "GRUPPA AVTOVAZ"                    Main experton DAY
                                                                 service of the Vice-
                                                                 president - directors for
                                                                 safety
2007          2007       Representation of the administration of The chief of
                         the Amur region at the RF President     organizational-personnel
                         and the Government of the Russian       department
                         Federation
2007          2008       The government of the Amur Region       The chief of the
                                                                 Department of the
                                                                 Governor of area and the
                                                                 area Government
2008          2009       Representation of the administration of The Chief
                         the Amur region at the RF President
                         and the Government of the Russian
                         Federation
2009          now        OJSC "Holding IDGC"                     The deputy of the General
                                                                 director - the chief of the
                                                                 Department
2009          now        OJSC "North-Western IDGC"               the member of Board of
                                                                 directors
2009          now        OJSC "Siberian IDGC"                      the member of Board of
                                                                   directors
2009          now        OJSC “IDGC of Center and Privozjie"       the member of Board of
                                                                   directors


                                                                                                 91
2009            now             OJSC “Moscow United Electric Grid                   the member of Board of
                                Company”                                            directors



  Has no shares/ordinary shares in the authorized capital of the issuer

  Amount of shares of the issuer of each type which may be acquired by a person as a result of
  rights on the issuer options belonging to him: the issuer has not issued stock options

  Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
  the issuer:
    The person has no listed shares
  Information about the nature of any family ties with other persons belonging to the governing
  bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
  issuer:

    The person has no listed family ties
  Information on bringing person to the administrative responsibility for violations in the areas of
  finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
  economic sphere or for crimes against the state.

    The person has not been drawn to these types of liability
  Information on the positions, occupied by person in the administration of commercial
  organizations during the period, in the time when these organizations were filed for bankruptcy
  and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
  were provided. :

    The person did not occupy the listed positions


  Name: Silkin Vladimir Nikolaevich
  Date of birth: 1957

  Education:
  higher


  All positions, held by the person in the issuer and other organizations over the past 5 years
  and now, including part-time




          Period                         Name of the organization                               Position
   From             To
2004            2007            The government of Moscow,                           The minister of the Government
                                Department of property of Moscow                    of Moscow, the chief of
                                                                                    Department
2007            now             The government of Moscow,                           The deputy of the Mayor of
                                                                                    Moscow in the Government of


                                                                                                                        92
                                Department of property of Moscow                    Moscow, the chief of the
                                                                                    Complex of orivate land
                                                                                    relations of a city of Moscow,
                                                                                    the chief of Department of
                                                                                    property of a city of Moscow
2008            now             Mosenergo, OJSC                                     the member of Board of
                                                                                    directors
2008            now             Moscow Heat Grid Company, OJSC                      the member of Board of
                                                                                    directors
2008            now             OJSC "TV centr"                                     the member of Board of
                                                                                    directors
2008            now             OJSC "KB"Moscow hypothecary                         the member of Board of
                                agency"                                             directors
2006            now             OJSC “Moscow United Electric Grid                   the member of Board of
                                Company”                                            directors



  Has no shares/ordinary shares in the authorized capital of the issuer

  Amount of shares of the issuer of each type which may be acquired by a person as a result of
  rights on the issuer options belonging to him: the issuer has not issued stock options

  Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
  the issuer:
    The person has no listed shares
  Information about the nature of any family ties with other persons belonging to the governing
  bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
  issuer:

    The person has no listed family ties
  Information on bringing person to the administrative responsibility for violations in the areas of
  finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
  economic sphere or for crimes against the state.

    The person has not been drawn to these types of liability
  Information on the positions, occupied by person in the administration of commercial
  organizations during the period, in the time when these organizations were filed for bankruptcy
  and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
  were provided. :

    The person did not occupy the listed positions


  Name: Skribot Volfgang
  Year of birth: 1966




                                                                                                                        93
 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From              To
2004           now             "Gazprombank" (Open joint-stock                     The Operating Director of
                               company)                                            department of direct
                                                                                   investments
2008           now             EKSMO, JSC                                          the member of Board of
                                                                                   directors
2008           now             Mosenergosbyt, JSC                                  the member of Board of
                                                                                   directors

2009           now             IDGC Holding, JSC                                   the member of Committee
                                                                                   on strategy and
                                                                                   investments

2009           now             RAO ES of the East, JSC                             the member of Committee
                                                                                   on strategy and
                                                                                   investments

2009           now             Rus Hydro, JSC                                      the member of Committee
                                                                                   on investments under the
                                                                                   Board of directors

2009           now             INTER RAO                                           the member of Committee
                                                                                   on strategy and
                                                                                   investments
2007           now             OJSC “Moscow United Electric Grid                   the member of Board of
                               Company”                                            directors



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties


                                                                                                                       94
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions
 Name: Tikhonova Maria Gennadievna
 Year of birth: 1980

 Education:
 higher


 All positions, held by the person in the issuer and other organisations over the past 5 years
 and now, including part-time



           Период               Наименование организации                     Должность

       с            по

2005          2008         Federal agency on power supply             Заместитель начальника
                                                                      отдела- Управления
                                                                      правового обеспечения
                                                                      и имущественных
                                                                      отношений в ТЭК

2008          now          Ministry of Energy of the Russian          И.о. директора
                           Federation                                 Департамента
                                                                      экономического
                                                                      регулирования и
                                                                      имущественных
                                                                      отношений в ТЭК

2009          now          Kamchatskenergo, JSC                       Member of Board of
                                                                      directors

2009          now          DEK, JSC                                   Member of Board of
                                                                      directors

2009          now          Bashkirenergo, JSC                         Member of Board of
                                                                      directors

2009          now          Mobile Gas-Turbine Thermal Power           Member of Board of
                           Plant, JSC                                 directors

2009          now          Electrosetservice UNEN, JSC                Member of Board of



                                                                                                   95
                                                   directors

2009   now   IDGC of Volga region, JSC             Member of Board of
                                                   directors

2009   now   IDGC of Centre, JSC                   Member of Board of
                                                   directors

2009   now   Lenenergo, JSC                        Member of Board of
                                                   directors

2009   now   OGK-5, JSC                            Member of Board of
                                                   directors

2009   now   OGK-6, JSC                            Member of Board of
                                                   directors

2009   now   TGC-5, JSC                            Member of Board of
                                                   directors

2009   now   TGC-11, JSC                           Member of Board of
                                                   directors

2009   now   TGC-7, JSC                            Member of Board of
                                                   directors

2009   now   TGC-12, JSC                           Member of Board of
                                                   directors

2009   now   TGC-6, JSC                            Member of Board of
                                                   directors

2009   now   KrasnyYakor, JSC                      Member of Board of
                                                   directors

2009   now   Research Studies Institute heat and   Member of Board of
             power instrumentation, JSC            directors

2009   now   AMIGE, JSC                            Member of Board of
                                                   directors

2009   now   Dalmornephtegeophisica, JSC           Member of Board of
                                                   directors

2009   now   Soyuzmorgeo, JSC                      Member of Board of
                                                   directors

2009   now   Nizhegorodoblgaz, JSC                 Member of Board of
                                                   directors

2009   now   Kurskgaz, JSC                         Member of Board of
                                                   directors

2009   now   Krasnodarkraygaz, JSC                 Member of Board of
                                                   directors

2009   now   Lenoblgaz, JSC                        Member of Board of
                                                   directors


                                                                        96
2009           now              MGPZ, JSC                                          Member of Board of
                                                                                   directors

2009           now              Dalenergomontazh, JSC                              Member of Board of
                                                                                   directors

2009           now              Vostokenergomontazh, JSC                           Member of Board of
                                                                                   directors

2009           now              Mosenergoremont, JSC                               Member of Board of
                                                                                   directors

2009           now              Sevzapelectrosetstroy, JSC                         Member of Board of
                                                                                   directors

2009           now              Trest Hydromontazh, JSC                            Member of Board of
                                                                                   directors

2009           now              Elektrozhit, the plant of Samara, JSC              Member of Board of
                                                                                   directors

2009           now              Gazprom, JSC                                       Member of Checkup
                                                                                   committee

2009           now              SO UES, JSC                                        Member of Checkup
                                                                                   committee

2009           now              MOESK, OJSC                                        Member of Board of
                                                                                   directors



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),


                                                                                                                       97
 were provided. :

   The person did not occupy the listed positions


 Name: Trofimov Juryi Ivanovich
 Year of birth: 1945

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
1999           2005            Orenburgenergo, JSC                                 The general director
2005           2005            Main Grid Company, JSC                              Fulfilling responsibilities
                                                                                   of the General director
2005           2009            Moscow United Electric Grid                         General director
                               Company, OJSC
2007           2008            Moscow United Electric Grid                         General Director
                               Company, OJSC
2007           2009            Moscow United Electric Grid                         The chairman of Board
                               Company, OJSC
2006           now             Moscow United Electric Grid                         Board of Directors
                               Company, OJSC                                       member




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the



                                                                                                                       98
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

 The person did not occupy the listed positions


 Name: Shulginov Nikolai Grigorievich
 Year of birth: 1951

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From              To
2002           now             SO UES, OJSC                                        The first vice-president of
                                                                                   Board Chairman
2008           now             Mosenergo, OJSC                                     Member of Board of
                                                                                   directors
2008           now             OGK-1, OJSC                                         Member of Board of
                                                                                   directors
2009           now             Lenenergo, JSC                                      Member of Board of
                                                                                   directors
2008           now             Moscow United Electric Grid                         Member of Board of
                               Company, OJSC                                       directors



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:



                                                                                                                       99
       The person has no listed family ties
   Information on bringing person to the administrative responsibility for violations in the areas of
   finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
   economic sphere or for crimes against the state.

       The person has not been drawn to these types of liability
   Information on the positions, occupied by person in the administration of commercial
   organizations during the period, in the time when these organizations were filed for bankruptcy
   and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
   were provided. :

       The person did not occupy the listed positions




 5.2.2. Information on the sole executive body of the issuer


   Name: Konovalov Andrey Pavlovich
   Year of birth: 1958

   Education:
   higher


   All positions, held by the person in the issuer and other organizations over the past 5 years
   and now, including part-time


           Period                         Name of the organization                               Position
   From                To
1998             2008            Krasnoyarskaya Hydro Electric Power                 First Deputy General
                                 Plant, JSC                                          director, Director on
                                                                                     economic and finance

2008             2009            Irkutskenergo, JSC                                  General director

2009             now             RusHydro, JSC                                       Member of the Board

2010             now             Moscow United Electric Grid                         General director,
                                 Company, OJSC                                       Chairman of the Board

   Has no shares/ordinary shares in the authorized capital of the issuer

   Amount of shares of the issuer of each type which may be acquired by a person as a result of
   rights on the issuer options belonging to him: the issuer has not issued stock options

   Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
   the issuer:
       The person has no listed shares



                                                                                                                       100
   Information about the nature of any family ties with other persons belonging to the governing
   bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
   issuer:

       The person has no listed family ties
   Information on bringing person to the administrative responsibility for violations in the areas of
   finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
   economic sphere or for crimes against the state.

       The person has not been drawn to these types of liability
   Information on the positions, occupied by person in the administration of commercial
   organizations during the period, in the time when these organizations were filed for bankruptcy
   and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
   were provided. :


   The person did not occupy the listed positions

 5.2.3. Composition of the collegial executive body of the issuer


   Name: Konovalov Andrey Pavlovich (Chairman)
   Year of birth: 1958

   Education:
   higher


   All positions, held by the person in the issuer and other organizations over the past 5 years
   and now, including part-time


           Period                       Name of the organization                 Position
   From               To
1998            2008            Krasnoyarskaya Hydro Electric Power     First Deputy General
                                Plant, JSC                              director, Director on
                                                                        economic and finance

2008            2009            Irkutskenergo, JSC                      General director

2009            now             RusHydro, JSC                           Member of the Board

2010            now             Moscow United Electric Grid             General director,
                                Company, OJSC                           Chairman of the Board



   Has no shares/ordinary shares in the authorized capital of the issuer

   Amount of shares of the issuer of each type which may be acquired by a person as a result of
   rights on the issuer options belonging to him: the issuer has not issued stock options


                                                                                                    101
 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :


 The person did not occupy the listed positions


 Name: Burmistrov Alexander Mitrofanovich
 Year of birth: 1953

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                         Name of the organization                              Position

  From               To

1998           2005             Yukos-РМ, CJSC                                     Department Chief, Chief
                                                                                   of transport department,
                                                                                   director of management
                                                                                   of wholesale and retail
                                                                                   sales, general director of
                                                                                   trading house, Executive
                                                                                   Vice President - Head of
                                                                                   Department of regional
                                                                                   policy

2009           2009             Moscow United Electric Grid                        Advisor of General
                                Company, OJSC                                      Director

2009           now              Moscow United Electric Grid                        Заместитель
                                Company, OJSC                                      генерального директора
                                                                                   по управлению


                                                                                                                     102
                                                                                    персоналом, член
                                                                                    Правления



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized (reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Bulanova Olga Leonidovna
 Year of birth: 1959

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time

          Period                         Name of the organization                              Position

  From               To

2000           2009             INOPROM, group of the companies                     Financial director

2009           now              Moscow United Electric Grid                         Deputy General Director
                                Company, OJSC                                       on finance, Deputy
                                                                                    General director on
                                                                                    economic and finance,


                                                                                                                      103
                                                                                    member of Board



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized (reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions




 Name: Volkenstein Grigoryi Jakovlevich
 Year of birth: 1956

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                         Name of the organization                              Position
   From            To
2001           2008             LTD "Prominvestkompleks"                            General director
2008           2009             OJSC "Korporacia ROEL"                              General director



                                                                                                                      104
2009           now             Moscow United Electric Grid                         Deputy General director on
                               Company, OJSC                                       capital construction, member of
                                                                                   the Board




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Groshev Georgyi Nikolaevich
 Year of birth: 1951

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2005           2007            Moscow United Electric Grid                         Director for marketing and
                               Company, OJSC                                       sales

2007           now             OJSC “Moscow United Electric Grid                   Deputy General director on
                               Company”                                            work with clients and
                                                                                   technological joinings, Deputy
                                                                                   General director on electric



                                                                                                                     105
                                                                                   power transport, member of the
                                                                                   board




 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability (criminal record) for crimes in
 the economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Isaev Oleg Jurievich
 Year of birth: 1969

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                         Name of the organization                              Position
   From            To
2005           2007            The Municipal Department of Internal Service
                               affairs of the Moscow Area
2007           2007            GU NIIST NGO "Special engineering        Deputy chief
                               and communication" of the Ministry of
                               Internak Affairs of Russia
2007           2007            VNII of the Ministry of Internal Affairs Ph. D,


                                                                                                                     106
                                of Russian Federation
2007           2008             Prominvest, LLC                                     Deputy General Director
2008           2009             RT-Logistical systems, LLC                          First Deputy General
                                                                                    Director
2009           now              Moscow United Electric Grid                         Deputy General Director
                                Company, OJSC                                       on the control and safety,
                                                                                    member of the board



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized (reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Kazakov Oleg Anatolievich
 Year of birth: 1948

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                         Name of the organization                              Position
   From            To
2005           2006             Moscow United Electric Grid                         Director for capital


                                                                                                                      107
                               Company, OJSC                                       construction
2006           2007            Moscow United Electric Grid                         Deputy General Director-
                               Company, OJSC                                       Director for investments
                                                                                   and capital construction
2007           2009            Moscow United Electric Grid                         Deputy General Director
                               Company, OJSC                                       on capital construction

2007           now             Moscow United Electric Grid                         member of the Board
                               Company, OJSC



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Kopanov Evgenyi Anatolievich
 Year of birth: 1970

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


         Period                         Name of the organization                               Position


                                                                                                                     108
   From            To
2005           2007            Moscow United Electric Grid                         Deputy General Director
                               Company, OJSC                                       on a corporate governance

2007           now             Moscow United Electric Grid                         Director of department of
                               Company, OJSC                                       a corporate policy and
                                                                                   legal maintenance, the
                                                                                   director of Department of
                                                                                   legal maintenance
2007           now             Energocentr, OJSC                                   General Director
2007           now             Moscow United Electric Grid                         member of the Board
                               Company, OJSC



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Kosolapov Igor Alekseevich
 Year of birth: 1971

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time



                                                                                                                     109
          Period                        Name of the organization                               Position
   From            To
2003           2006            SAK –Energogarant, OJSC                             Deputy General Director-
                                                                                   Director on development
                                                                                   of regional business
                                                                                   Deputy General Director-
                                                                                   Director on economy and
                                                                                   the finance, the first
                                                                                   deputy of the general
                                                                                   director
2006           2008            Moscow United Electric Grid                         Chief of corporate policy
                               Company, OJSC                                       management

2008           now             Moscow United Electric Grid                         Director of Department of
                               Company, OJSC                                       a corporate policy and
                                                                                   property management, the
                                                                                   deputy of the general
                                                                                   director for corporate
                                                                                   functions, the member of
                                                                                   the board



 Has no shares/oedinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions




                                                                                                                     110
 Name: Mazo Leonid Vladimirovich
 Year of birth: 1977

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2003           2005            The Government of Moscow Area                       Managing secretary of the
                                                                                   minister of the
                                                                                   Government of the
                                                                                   Moscow area-chief of
                                                                                   governmental body of the
                                                                                   Moscow area
2003           2008            The Government of Moscow Area                       Managing secretary of the
                                                                                   first vice-president of the
                                                                                   Government of the
                                                                                   Moscow area; the state
                                                                                   counsellor of the Moscow
                                                                                   area of I class
2008           2008            Ekspostroi, LLC                                     The deputy of the general
                                                                                   director
2008           2008            Planstroiekspo, LLC                                 The deputy of the general
                                                                                   director
2008           2008            Energocentr, OJSC                                   The first deputy of the
                                                                                   general director
2009           2009            Moscow United Electric Grid                         The deputy of the general
                               Company, OJSC                                       director on strategy and
                                                                                   business development
2009           now             Moscow United Electric Grid                         The deputy of the general
                               Company, OJSC                                       director on development
                                                                                   and realisation of services,
                                                                                   the member of the board



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares




                                                                                                                     111
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Maiorov Andrei Vladimirovich
 Year of birth: 1967

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                  Name of the organization                      Position
   From           To
2005          2007        Moscow United Electric Grid                 The First Deputy General
                          Company, OJSC                               Director on the
                                                                      production, the First
                                                                      deputy of the general
                                                                      director on production-
                                                                      chief engineer
2007          now         Moscow United Electric Grid                 Deputy General Director-
                          Company, OJSC                               chief engineer

2007          2009        Moscow United Electric Grid                 member of the Board
                          Company, OJSC
2009          now         Moscow United Electric Grid                 Chairman of the Board
                          Company, OJSC
2009          now         Moscow United Electric Grid                 Fulfilling responsibilities
                          Company, OJSC                               of the general director




                                                                                                    112
 The contribution of a person in the authorized capital of the issuer, %: 0.00034
 The share of ordinary shares of the issuer owned by a person, %: 0.00034


 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions
 Name: Mitiaev Alexandr Alexandrovich
 Year of birth: 1952

 Education:
 higher


 All positions, held by the person in the issuer and other organisations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2005           2007                                                                The deputy of the general
                               Moscow United Electric Grid                         director
                               Company, OJSC
2007           now                                                                 The member of the board, the
                               Moscow United Electric Grid                         director of Department of
                               Company, OJSC                                       perspective development




 The contribution of a person in the authorized capital of the issuer, %: 0.0029
 The share of ordinary shares of the issuer owned by a person, %: 0.0029


                                                                                                                     113
 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Skliarova Liudmila Alexeevna
 Year of birth: 1958

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From              To
2005           now             Moscow United Electric Grid                         The First Deputy Chief
                               Company, OJSC                                       accountant, the chief
                                                                                   accountant
2007           now             Moscow United Electric Grid                         member of the board
                               Company, OJSC



 Has no shares/ordinary shares in the authorized capital of the issuer




                                                                                                                     114
 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Soldatov Nikolai Mihailovich
 Year of birth: 1940

 Education:
 higher


 All positions, held by the person in the issuer and other organisations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2005           2007            Moscow United Electric Grid                         The First Deputy General
                               Company, OJSC                                       Director on economy and
                                                                                   the finance
2007           2008            Moscow United Electric Grid                         The Deputy General
                               Company, OJSC                                       Director under the finance

2008           2009            Moscow United Electric Grid                         Director of department of
                               Company, OJSC                                       internal audit and the
                                                                                   financial control
2007           now             Moscow United Electric Grid                         member of the Board
                               Company, OJSC




                                                                                                                     115
  Has no shares/ordinary shares in the authorized capital of the issuer

  Amount of shares of the issuer of each type which may be acquired by a person as a result of
  rights on the issuer options belonging to him: the issuer has not issued stock options

  Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
  the issuer:
    The person has no listed shares
  Information about the nature of any family ties with other persons belonging to the governing
  bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
  issuer:

    The person has no listed family ties
  Information on bringing person to the administrative responsibility for violations in the areas of
  finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
  economic sphere or for crimes against the state.

    The person has not been drawn to these types of liability
  Information on the positions, occupied by person in the administration of commercial
  organizations during the period, in the time when these organizations were filed for bankruptcy
  and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
  were provided. :

    The person did not occupy the listed positions


5.3. Information about remuneration, benefits and/or reimbursement of expenses for each of
the management bodies of the issuer
  Information on remuneration of each management body (with the exception of person, executing
  functions of sole executive management body of the issuer). Identifies all types of remuneration,
  including salary, bonuses, commissions, benefits and (or) compensation costs, as well as other
  economic submissions that were paid by the issuer for the last completed financial year:
  The Board of Directors

Reward, RUR                                                                                                    12 646 674.61
Wages, RUR                                                                                                                 0
Prizes, RUR                                                                                                                  0
Fees RUR                                                                                                                     0
Benefits RUR                                                                                                                 0
Compensation costs, RUR                                                                                                      0
Other property submissions, RUR.                                                                                             0
Other, RUR                                                                                                                   0
TOTAL, RUR                                                                                                     12 646 674.61




                                                                                                                      116
    Data on the existing agreements concerning such payments in the current fiscal year:
    Amount and order of payment of remuneration and compensation for members of the
    Board of Directors is being established by “The Clause on payment remuneration and
    compensation to the members of the Board of Directors”, approved by the Annual General
    Meeting           of          Shareholders           May             28,         2008.

    The remuneration for the mentioned body according to the work that was completed in the las
    fiscal year, that was identified (approved) by the authorized governing body of the issuer but at
    the end of the reported period was njt actually paid


    No facts were mentioned
  Collegial executive body
Reward, RUR                                                                                             0
Wages, RUR                                                                                              0
Prizes, RUR                                                                                             0
Fees RUR                                                                                                0
Benefits RUR                                                                                            0
Compensation costs, RUR                                                                                 0
Other property submissions, RUR.                                                                        0
Other, RUR                                                                                              0
TOTAL, RUR                                                                                              0




    Information on the existing agreements concerning such payments in the current fiscal year:
    In accordance with clauses 2.4 of the Clause on the Management Board, approved by the
    General Meeting of Shareholders on June 15, 2007 (report of June 21,2007 number 4), the
    establishment of paying compensation and reimbursement to the members of the
    Management Board is being done by the Board of Directors


    In 2009 no decisions on paying Management Board were made by the Board of Directors




    Material incentives of employees of the Company that are members of the Board is being
    done in accordance with the Regulations of the material stimulating top managers of OJSC
    “MOESK”, approved by the decision of the Board of Directors of OJSC “MOESK”(report
    of July 17, 2007 number 46)




                                                                                                 117
    The remuneration for the mentioned body according to the work that was completed in the las
    fiscal year, that was identified (approved) by the authorized governing body of the issuer but at
    the end of the reported period was njt actually paid
      No facts were mentioned

 5.4. Data on the structure and competence of the issuer‟s bodies for control over financial and
economic activities


The comprehensive description of the structure of the bodies for control over the issuer's financial and
economic activities and their competence according to the issuer's Charter (constituent documents):

According to Article 23 of the issuer‟s Charter:




23.1. In order to ensure control over the Company financial and economic activities, the General
Shareholder Meeting shall elect the Checkup Committee of the Company for the period till the next
annual General Shareholder Meeting.
Should the Checkup Committee of the Company be elected at the extraordinary meeting of
shareholders, the members of the Checkup Committee shall be considered elected for the period
till the date of the holding of the Company annual General Shareholder Meeting.
The quantitative structure of the Checkup Committee shall be 5 (five) people.
23.2. By the decision of the Company General Shareholder Meeting, the powers of all or separate
members of the Company Checkup Committee may be terminated early.
23.3. The competence of the Company Checkup Committee shall include the following:
      confirmation of the correctness of the information contained in the annual report,
         accounting balance sheet, income statement of the Company;
      analysis of the Company financial standing, revealing of the reserves for the improvement
         of the financial situation in the Company and working out of recommendations for the
         Company management bodies;
      organization and carrying out of an examination (audit) of the Company financial and
         economic activities, in particular:
      examination (audit) of the financial, accounting, settlement and other documentation of the
         Company which is connected with carrying out by the Company of financial and economic
         activities in order to ensure its compliance with the Russian Federation laws, the Charter,
         internal and other documents of the Company;
      control over safe keeping and use of fixed capital;
      control over the adherence to the order of writing off the insolvent debtors’ debt to the
         Company losses;
      control over cash spending of the Company in accordance with the approved business plan
         and budget of the Company;
      control over the building up and use of the reserve and other specialized funds of the
         Company;
      examination of correctness and timely attributing and payment of dividends per the
         Company shares, interest per bonds and earnings per other securities;
      examination of the regulations issued earlier on the correction of violations and shortages
         revealed by the previous examinations (audits);
      carrying out of other actions (measures) connected with the examination of the Company
         financial and economic activities.
23.4. All decisions on the issues referred to the competence of the Checkup Committee shall be
made by the simple majority of the votes from the total number of its members.



                                                                                                    118
23.5. The Checkup Committee shall be entitled and, in case of the revealed serious violations of
the Company financial and economic activities, obliged to demand the convening of the Company
extraordinary general shareholder meeting.
23.6. The procedure of the Company Checkup Committee’s activities shall be determined by the
internal document of the Company approved by the Company General Shareholder Meeting.
The Checkup Committee in accordance with the decision on carrying out an examination (audit) in
order to carry out the given examination (audit), shall be entitled to involve specialists in the
respective field of law, economy, finance, accounting, management, economic security and other
organizations, including the specialized ones.
23.7. The examination (audit) of the Company financial and economic activities may be carried
out at any time at the initiative of the Company Checkup Committee, by the decision of the
Company General Shareholder Meeting, the Company Board of Directors or upon the demand of
the Company shareholder (shareholders) possessing in total at least 10 percent of the Company
voting shares.
23.8. For the examination and approval of the Company annual financial reports, the Company
General Shareholder Meeting shall annually approve the Company Auditor.
23.9. The amount of the remuneration of the services of the Auditor shall be determined by the
Company Board of Directors.
23.10. The Company Auditor shall carry out the examination of the Company financial and
economic activities in accordance with the requirements of the Russian Federation laws and on
the grounds of the Contract signed with him/her.
23.11. Following the results of the examination of the Company financial and economic activities,
the Company Checkup Committee, the Company Auditor shall compile a report, which shall
contain:
       confirmation of the correctness of the information contained in the Company reports and
other financial documents;
       information on the facts of violation by the Company of the accounting procedures and
submission of financial reports envisaged by legal regulations of the Russian Federation, as well
as normative enactments of the Russian Federation while carrying out by the Company of
financial and economic activities.
The procedure and the period for compiling the report on the results of the examination of the
Company financial and economic activities shall be determined by the normative enactments of the
Russian Federation and the Company internal documents.


The emitter has created service of internal audit
Internal audit / the internal control service work period and its key employees:
The structural subdivision which is carrying out procedures of the internal control over financial
and economic activity – Management of the internal control and financial audit is created In the
Company.
Key employees: Posessor Georgy Yefremovitch.
The internal audit service basic functions; the internal audit service accountability, interaction with
the emitter management executive powers and the emitter directors board (supervisory board):
The internal control and financial audit Management basic functions – the emitter its branches,
structural divisions financial and economic activity control.
The MOESK, OJSC directors Board decision (minutes №52 from November, 28th, 2007)
confirms regulation about the OJSC "MOESK" internal control.
(Minutes №37 from December, 15th, 2006) MOESK, OJSC directors Board Committee on audit is
created by the MOESK, OJSC directors Board decision, regulation about Committee on audit is
confirmed. The Committee on audit goal is development and representation of recommendations
(conclusions) to MOESK, OJSC directors Board concerning the Committee competence on audit.



                                                                                                   119
Committee on audit creation is directed on MOESK, OJSC activity transparency increasing and
MOESK, OJSC corporate management system improvement.
Internal audit service and the emitter external auditor interaction


The internal document establishing rules on the office (insider) information use prevention is
confirmed by the emitter
The emitter internal document establishing rules on the office (insider) information use prevention:
«Regulation on the insider information of Moscow United Electric Grid Company, OJSC


The page address in the Internet where its full text is placed in free access:
  www.e-disclosure.ru/portal/company.aspx?id=5563;
  www.moesk.ru




5.5. Data on the persons that form part of the issuer‟s bodies for control over financial and economic
activities
  Name of the authority of control over financial and economic activities of the issuer :Audit
  Commission


  Name: Kormushkina Liudmila Dmitrievna
  Year of birth: 1956

  Education:
  higher


  All positions, held by the person in the issuer and other organizations over the past 5 years
  and now, including part-time


          Period                    Name of the organization                      Position
   From            To
2004           2008         RAO UES Russia, OJSC                        Leading expert of CC of
                                                                        Department of internal
                                                                        audit
2008           now          IDGC Holding, OJSC                          Chief of department on the
                                                                        organization and
                                                                        realisation of audit of
                                                                        Department of internal
                                                                        audit
2009           now          Moscow United Electric Grid                 Member of the auditing
                            Company, OJSC                               committee



  Has no shares/ordinary share in the authorized capital of the issuer



                                                                                                     120
 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Matiunina Liudmila Romanovna
 Year of birth: 1950

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2004           2008            RAO UES Russia, OJSC                                The First Deputy Chief of
                                                                                   Department of internal
                                                                                   audit of the Corporate
                                                                                   Center
2008           2009            IDGC Holding, OJSC                                  The First Deputy Chief of
                                                                                   Department of internal
                                                                                   audit
2005           now             Moscow United Electric Grid                         Member of the auditing
                               Company, OJSC                                       committee



 Has no shares/ordinary shares in the authorized capital of the issuer


                                                                                                                     121
 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability(criminal record) for crimes in the
 economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Mihno Irina Vasilievna
 Year of birth: 1957

 Education:
 higher


 All positions, held by the person in the issuer and other organisations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2004           2008            RAO UES Russia, OJSC                                Deputy Chief of
                                                                                   Department - Chief of
                                                                                   Department of Department
                                                                                   of internal audit
2008           2009            IDGC Holding, OJSC                                  Deputy chief of
                                                                                   Department - the chief of
                                                                                   part of Department of
                                                                                   internal audit
2009           now             Moscow United Electric Grid                         member of an auditing
                               Company, OJSC                                       committee




                                                                                                                     122
 Has no shares/oedinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability (criminal record) for crimes in
 the economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Pukov Juryi Mihailovich
 Year of birth: 1946

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2005           2007            Moscow United Electric Grid                         The main expert of group
                               Company, OJSC                                       of internal audit

2007           2008            Moscow United Electric Grid                         The chief of department of
                               Company, OJSC                                       the economic and
                                                                                   financial control
2008           now             Moscow United Electric Grid                         The chief of department of
                               Company, OJSC                                       internal audit and the
                                                                                   financial control
2009           now             Moscow United Electric Grid                         member of an auditing
                                                                                   committee


                                                                                                                     123
                               Company, OJSC



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability (criminal record) for crimes in
 the economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions


 Name: Sauh Maxim Mihailovich
 Year of birth: 1979

 Education:
 higher


 All positions, held by the person in the issuer and other organizations over the past 5 years
 and now, including part-time


          Period                        Name of the organization                               Position
   From            To
2004           2008            RAO UES Russia, OJSC                                The leading expert, the
                                                                                   examiner - in - chief, the
                                                                                   chief of part of
                                                                                   Department of a corporate
                                                                                   governance and
                                                                                   interaction with
                                                                                   shareholders



                                                                                                                     124
2008           2008            IDGC Holding, OJSC                                  The senior design
                                                                                   manager of Group on
                                                                                   maintenance of
                                                                                   observance of the rights of
                                                                                   shareholders of the Design
                                                                                   centre on end of
                                                                                   reorganisation of Open
                                                                                   Society of the Russian
                                                                                   Open Society "United
                                                                                   Power Systems"
2008           now             IDGC Holding, OJSC                                  The First Deputy Chief of
                                                                                   Department of a corporate
                                                                                   governance and
                                                                                   interaction with
                                                                                   shareholders, the Deputy
                                                                                   chief of Department of a
                                                                                   corporate governance and
                                                                                   interaction with
                                                                                   shareholders
2009           now             Moscow United Electric Grid                         member of an auditing
                               Company, OJSC                                       committee



 Has no shares/ordinary shares in the authorized capital of the issuer

 Amount of shares of the issuer of each type which may be acquired by a person as a result of
 rights on the issuer options belonging to him: the issuer has not issued stock options

 Shares of the individual participation in the authorized(reserve) capital (share fund) of subsidiaries and affiliates of
 the issuer:
   The person has no listed shares
 Information about the nature of any family ties with other persons belonging to the governing
 bodies of the issuer and/or regulatory authorities for financial and and economic activities of the
 issuer:

   The person has no listed family ties
 Information on bringing person to the administrative responsibility for violations in the areas of
 finance, taxes and levies, securities market or criminal liability (criminal record) for crimes in
 the economic sphere or for crimes against the state.

   The person has not been drawn to these types of liability
 Information on the positions, occupied by person in the administration of commercial
 organizations during the period, in the time when these organizations were filed for bankruptcy
 and/or one of the bankruptcy procedures, provided by RF legislation on insolvency (bankruptcy),
 were provided. :

   The person did not occupy the listed positions




                                                                                                                     125
5.6. Data on the amount of fee, benefits and/or refund of charges on the issuer‟s financial-economic
activity control authority
 Data on the amount of fee for every of the issuer‟s financial-economic activity controlling
 authority. All types of fee are stated, including salary, bonuses, brokerage, benefits and/or refund
 of charges, as well as other material presentations, which were paid out by the issuer for the last
 completed fiscal year.
 Name of the issuer‟s financial-economic activity controlling authority: Audit committee




Fee, RUR                                                                                         1 105 800

Salary, RUR                                                                                              0

Bonuses, RUR                                                                                             0

Brokerage, RUR                                                                                           0

Benefits, RUR                                                                                            0

Refund of charges, RUR                                                                                   0

Other material presentations, RUR                                                                        0

Other, RUR                                                                                               0

TOTAL, RUR                                                                                       1 105 800



  Data on existing agreements on such payments in the current fiscal year:
  Amount and procedure of fee and refund payments to the members of Audit committee is
  determined by “Regulations on fee and refund payments to the members of Auditing
  commission”, approved by the general shareholders meeting of OJSC “MOESK” on March,
  28th 2006.
  From September, 01st 2008 amount and procedure of fee and refund payments to the members
  of Audit committee is determined by “Regulations on fee and refund payments to the members
  of Audit committee” new edition, approved by the Company annual shareholders meeting on
  May, 28th 2008.

 Amount of fee on this authority according to the results of work during the last completed fiscal
 year, which was determined (approved) by the issuer‟s authorized managing body, but actually
 was not paid out by the end of accounting period:
    The mentioned facts were not observed




5.7. Data on the number and the generalized data on education and structure of the issuer‟s staff
(employees), and also on change of number of the staff (employees) of the issuer


  Unit measure: RUR thousand




                                                                                                   126
                             Parameter                                    2009        1 quarter
                                                                                        2010
Average number of employees, people                                         14 651         15 588
Amount of share of the issuers employees, having higher                          34            34
education, %
Volume of money for salary                                              7 515 443       2 290 915
vVolume of money for human services                                     1 357 480          33 755
Gross volume of means spent                                             8 872 923       2 324 670



Average number of people equals составила 14 651 persons in the accounting year, that is
more                            then                     in                       2008.
Number growth is caused by hireing more than 1200 persons in 2009 from the Company
Energobalance, JSC with a view of realisation of functions on making of volumes of the
rendered services in electric power transfer.



According to Moscow United Electric Grid Company, JSC

   1. Konovalov Andrey Pavlovich – the General director is the employeer, who touches upon
      the finance-economic activity of the issuer more then the others.

       On the October 27 2005 the primary trade-union organisation of Moscow regional
       committee "Electrotrade union" was created at the enterprise. The Trade-union
       committee equels 11 persons, elected for 5 years. The Audit committee of the trade-
       union organisation consists of 3 persons.


 5.8. Data on any obligations of the issuer to the staff (employees) concerning the possibility of
their participation in the authorized (joint-stock) capital (share fund) of the issuer


The issuer has no agreements and obligations concerning an opportunity of participation of the issuer's
employees (staff) in its authorized capital.




                                                                                                    127
VI. Data on participants (shareholders) of the issuer and on interest-party
transactions completed by the issuer.

6.1. Data on the total amount of the issuer‟s shareholders (participants)


Total amount of persons recorded in the shareholders‟ register of the issuer for the date of the accounting
period end – 17 201
Including
Total amount of the issuer‟s nominee shareholders – 19
6.2. Data on issuer‟s members (shareholders), owning not less than 5 per cent of its authorized capital
(share) stock (unit trust) or not less than 5 per cent of its equities, as well as data on members
(shareholders) of such persons, owning not less than 20 per cent of authorized capital (share) stock
(share fund) or not less than 20 per cent of their ordinary shares


  Issuer‟s members (shareholders), owning not less than 5 per cent of its authorized capital (share)
  stock (unit trust) or not less than 5 per cent of its equities
  Shares are registered in the issuer‟s shareholders list under nominee‟s name
  Data on nominee:
  Full company‟s name: Limited liability company “Depositary and corporate technologies”
  Abbreviated company‟s name: “DKT” Ltd. Co.


  Address:
    119607 Russia, Moscow, Ramenki st., 17/1
  ITN: 7729520219
  PSRN: 1057746181272
  Telephone: (495) 641-3031
  Fax: (495) 641-3031
  E-mail address: Dkt@depotech.ru


  Data on license of professional equity market participant
    Number: 177-11151-000100
    Date of issue: 03.04.2008
    Valid till:
      Perpetual
    Name of the authority the license issued by: FSC (FFMS) of Russia
      Amount of the issuer‟s equities, registered in the issuer‟s shareholders list under nominee‟s
      name:
      24 794 187 558 items



  Shares are registered in the issuer‟s shareholders list under nominee‟s name
  Data on nominee:


                                                                                                       128
Full company‟s name: Close Joint-Stock Company “ National depositary center”
Abbreviated company‟s name: CJSC “NDC”
Address
  125009 Russia, Moscow, Sredniy Kislovskiy st., 1/13 building 4
ITN: 7703394070
PSRN: 1097799013256
Telephone: (495) 956-2659
Fax: (495) 956-0938
E-mail address: info@ndc.ru


Data on license of professional equity market participant
  Number: 177-03431-000100
  Date of issue: 04.12.2000
  Valid till:
    Perpetual
 Name of the authority the license issued by: FSC (FFMS) of Russia
Amount of the issuer‟s equities, registered in the issuer‟s shareholders list under nominee‟s
name:
    16 139 959 785 items



Shares are registered in the issuer‟s shareholders list under nominee‟s name


Data on nominee:
Full company‟s name: Close Joint-Stock Company “ Depositary-Clearing Company”
Abbreviated company‟s name: CJSC “DCC”


Address
  115162 Russia, Moscow, Shabolovka 31 building B
VAT: 7710021150
PSRN: 1027739143497
Telephone: (495) 956-0999
Fax: (495) 232-6804
E-mail address: dcc@dcc.ru


Data on license of professional equity market participant
  Number: 177-06236-000100
  Date of issue: 09.10.2002
  Valid till:



                                                                                                129
       Perpetual
    Name of the authority the license issued by: FSC (FFMS) of Russia
  Amount of the issuer‟s equities, registered in the issuer‟s shareholders list under nominee‟s
  name:
       5 525 623 225 items

6.3. Data on the market share of the state or municipal formation in the issuer‟s authorized capital
(share) stock (share fund), possession of special right („golden share‟)


  Amount of share of the issuer‟s authorized capital (share) stock (unit trust), which is in federal
  possession
    The mentioned share is absent
  Amount of share of the issuer‟s authorized capital (share) stock (unit trust), possessed by the territorial subjects of
  the Russian Federation
    0.000036


    Person, controlling the block of shares
       Full company‟s name: Ministry of Property Relations of Moscow oblast‟
  Amount of share of the issuer‟s authorized capital (share) stock (unit trust), which is in municipal possession
    The mentioned share is absent
  The presence of special right on participance of the Russian Federation, the territorial subjects of
  the Russian Federation, municipal formations in management of the issuer – joint-stock company
  („golden share‟), period of validity of special right („golden share‟)
    The mentioned right is not provided.

6.4. Data on restrictions on participation in the authorized (joint-stock) capital (share fund) of the
issuer переведено)


The limiting of shares amount belonging to one shareholders and/or their total nominal value, and/or
maximum amount of votes presented to one shareholder: no


Limitation for the share of the foreign persons‟ participation in the authorized capital of the issuer: no


6.5. Data on changes in the composition and stake of the issuer‟s shareholders (participants) owning at
least 5 percent of its authorized (joint-stock) capital (share fund) or at least 5 percent of its ordinary
shares


Membership of the issuer‟s shareholders (members), owning not less than 5 per cent of authorized
capital (share) stock, and for the issuers, which are joint-stock companies,- also not less than 5 per
cent of the issuer‟s equities, determined on the date of list of persons, possessing the right to
participate in every issuer‟s shareholders meeting, held for the last 5 completed fiscal years,
preceding the date of the end of financial quarter, or for every completed fiscal year, preceding the
date of the end of financial quarter, if the issuer have been carrying out its activity for not less than
5 years, as well as for the last quarter according to the list of persons, possessing the right to
participate in every of such meetings.


                                                                                                                       130
  Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
  (members) meeting: 12.02.2006
  List of shareholders (members)


    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9


    Full company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Abbreviated company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Share of participation in the issuer‟s authorized capital stock, %: 18.4
    Share of possessed issuer‟s equities, %: 18.4


    Full company‟s name: Solidene Inc.
    Abbreviated company‟s name: Solidene Inc.
    Share of participation in the issuer‟s authorized capital stock, %: 6
    Share of possessed issuer‟s equities, %: 6




    Full company‟s name: WELLSTONE TRADING LIMITED
    Abbreviated company‟s name: WELLSTONE TRADING LIMITED
    Share of participation in the issuer‟s authorized capital stock, %: 6.63
    Share of possessed issuer‟s equities, %: 6.63



Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
(members) meeting: 12.05.2006

  List of shareholders (members)



    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9



                                                                                                   131
    Full company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Abbreviated company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Share of participation in the issuer‟s authorized capital stock, %: 18.4
    Share of possessed issuer‟s equities, %: 18.4


    Full company‟s name: Solidene Inc.
    Abbreviated company‟s name: Solidene Inc.
    Share of participation in the issuer‟s authorized capital stock, %: 6
    Share of possessed issuer‟s equities, %: 6


    Full company‟s name: WELLSTONE TRADING LIMITED
    Abbreviated company‟s name: WELLSTONE TRADING LIMITED
    Share of participation in the issuer‟s authorized capital stock, %: 6.63
    Share of possessed issuer‟s equities, %: 6.63


Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
(members) meeting: 11.05.2007

  List of shareholders (members)



    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9


    Full company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Abbreviated company‟s name: Close joint-stock company “Leader” (Company managing the
    pension fund‟s assets) T.M. NPF “Gasfund”
    Share of participation in the issuer‟s authorized capital stock, %: 15.79
    Share of possessed issuer‟s equities, %: 15.79


  Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
  (members) meeting: 13.08.2007

List of shareholders (members)



    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”


                                                                                                   132
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9


    Full company‟s name: Limited liability company “Managing company “AGANA” T.M. Close
    unit investment trust of mixed investments “Strategic assets” under the management of
    “Managing company “AGANA” Ltd. Co.
    Abbreviated company‟ name: Limited liability company “Managing company “AGANA”
    T.M. Close unit investment trust of mixed investments “Strategic assets” under the
    management of “Managing company “AGANA” Ltd. Co.
    Share of participation in the issuer‟s authorized capital stock, %: 18.42
    Share of possessed issuer‟s equities, %: 18.42


  Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
  (members) meeting: 06.03.2008

  List of shareholders (members)



    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9


    Full company‟s name: Limited liability company “Managing company “AGANA” T.M.
    Close unit investment trust of mixed investments “Strategic assets” under the management
    of “Managing company “AGANA” Ltd. Co.
    Abbreviated company‟ name: Limited liability company “Managing company “AGANA”
    T.M. Close unit investment trust of mixed investments “Strategic assets” under the
    management of “Managing company “AGANA” Ltd. Co.
    Share of participation in the issuer‟s authorized capital stock, %: 18.42
    Share of possessed issuer‟s equities, %: 18.42


Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
(members) meeting: 16.04.2008
List of shareholders (members)



    Full company‟s name: Russian open joint-stock company of energy and electrification of
    Russia “UES of Russia”
    Abbreviated company‟s name: OJSC RAO “UES of Russia”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9



                                                                                                   133
    Full company‟s name: Limited liability company “Managing company “AGANA” T.M.
    Close unit investment trust of mixed investments “Strategic assets” under the management
    of “Managing company “AGANA” Ltd. Co.
    Abbreviated company‟ name: Limited liability company “Managing company “AGANA”
    T.M. Close unit investment trust of mixed investments “Strategic assets” under the
    management of “Managing company “AGANA” Ltd. Co.
    Share of participation in the issuer‟s authorized capital stock, %: 18.42
    Share of possessed issuer‟s equities, %: 18.42


Date of forming the list of persons, possessing the right to participate in the issuer‟s shareholders
(members) meeting: 30.04.2009

List of shareholders (members)



    Full company’s name: Open joint-stock company “Holding of Inter-regional distributing
    network companies”
    Abbreviated company‟s name: OJSC “Holding MRSK”
    Share of participation in the issuer‟s authorized capital stock, %: 50.9
    Share of possessed issuer‟s equities, %: 50.9


    Full company‟s name: (TM) “M.C. “AGANA” Ltd. Co. T.M. Close unit investment trust of
    mixed investments “Strategic assets” under the management of “Managing company” Ltd.
    Co.
    Abbreviated company‟ name: (TM) “M.C. “AGANA” Ltd. Co. T.M. Close unit investment
    trust of mixed investments “Strategic assets” under the management of “Managing
    company” Ltd. Co.
    Share of participation in the issuer‟s authorized capital stock, %: 10.97
    Share of possessed issuer‟s equities, %: 10.97


    Full company‟s name: SIRITIA VENTURES LIMITED (LIMITED LIABILITY
    COPMPANY)
    Abbreviated company‟s name: SIRITIA VENTURES LIMITED (LIMITED LIABILITY
    COPMPANY)
    Share of participation in the issuer‟s authorized capital stock, %: 9.62
    Share of possessed issuer‟s equities, %: 9.62



    Full company‟s name: (TM) CJSC “LEADER” C.M. NPF “Gasfund”
    Abbreviated company‟s name: (TM) CJSC “LEADER” C.M. NPF “Gasfund”
    Share of participation in the issuer‟s authorized capital stock, %: 6.84
    Share of possessed issuer‟s equities, %: 6.84


    Full company‟s name: Open joint-stock company “OEK-Finance”



                                                                                                   134
    Abbreviated company‟s name: OJSC “OEK-Finance”
    Share of participation in the issuer‟s authorized capital stock, %: 5.05
    Share of possessed issuer‟s equities, %: 5.05


6.6. Data on the issuer‟s interested-party transactions


  Data on number and amount in money terms of bargains affected by the issuer, considered
  according to the legislation of the Russian federation to be the bargains, in making which the
  interest was possessed, which demanded the approval of the issuer‟s authorized management
  body, according to the results of the last financial quarter



                 Name of showing                       Total number     Total amount in money
                                                                             means, RUR

  Bargains effected by the issuer during the                        0                           0
  accounting period, in making which the interest
  was possessed and which demanded the approval
  of the issuer‟s authorized management body

Bargains effected by the issuer during the                          0                           0
accounting period, in making which the interest
was possessed and which were approved by the
issuer‟s shareholders (members) meeting

Bargains effected by the issuer during the                          0                           0
accounting period, in making which the interest
was possessed and which were approved by the
issuer‟s Board of Directors (Issuer‟s Supervisory
Board)

Bargains effected by the issuer during the                          0                           0
accounting period, in making which the interest
was possessed and which demanded the approval,
but were not approved by the issuer‟s authorized
management body


  Bargains (groups of related bargains), the price of which is 5 or more per cent of book value of
  issuer‟s assets, fixed according to the data of book-keeping accounts on the last accounting date
  before effecting the bargain, made by the issuer for the last financial quarter
   The mentioned bargains were not effected
 The total amount in money means of the bargains, in effecting which the interest was possessed,
 made by the issuer for the last financial quarter, RUR:


 Bargains (groups of related bargains), in effecting which the interest was possessed and decision
 of approval of which by the issuer‟s Board of Directors (Supervisory Board) or by the
 shareholders (members) meeting was not made in cases, when such approval is obligatory
 according to the legislation of the Russian Federation



                                                                                                    135
   The mentioned bargains were not effected




6.7. Data on debt receivable amount


  For 2009
    Unit measure: RUR thousand

                             Debt receivable                                           Termof payment

                                                                                   to 1 year      More then 1
                                                                                                     year

Debt receivable of buyers and orderes                                               6 573 051

including past-due payment                                                                               x

Debt receivable on bills receivable

including past-due payment                                                                               x

Debt receivable of participators (founders) on payments in the
authorized capital

including past-due payment                                                                               x

Debt receivable on advances made                                                    5 011 194       29 159 381

including past-due payment                                                                               x

Other debt receivable                                                             21 453 499

including past-due payment                                                                               x

Total                                                                             33 037 744        29 159 381

including past-due payment                                                                               x



    Debtors, which possess less then 10 per cent of the total sum of debt receivable for the specified accounting
    period



        Full company‟s name: Barclays Bank PLC
        Abbreviated company‟s name: Barclays Bank PLC
        Location: 4 North Colonnade Canary Wharf London E14 4BB
        Sum of debt receivable, RUR.: 11 059 903 670.71
        Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
        no
        Debtor is affiliated person of the issuer: No


                                                                                                                    136
        Full company‟s name: Energokomplex, JSC
        Abbreviated company‟s name: Energokomplex, JSC
        Location: 115035, Moscow, Kosmodamianskaya quay, 4/22. bld.B
        Sum of debt receivable, RUR.: 9 839 735 550,60
        Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
        no
        Debtor is affiliated person of the issuer: No


        Full company‟s name: BUSINESS ALIANCE, JSC
        Abbreviated company‟s name: BUSINESS ALIANCE, JSC
        Location: 109004, Moscow, Nikoloyamskaya, 44/18
        Sum of debt receivable, RUR.: 8 339 044 857,98
        Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
        no
        Debtor is affiliated person of the issuer: No


  For the end of the accounting year
    Unit measure: RUR thousand

                             Debt receivable                                Termof payment

                                                                         to 1 year   More then 1
                                                                                        year

Debt receivable of buyers and orderes                                    8 877 888

including past-due payment                                               1 645 703         x

Debt receivable on bills receivable

including past-due payment                                                                 x

Debt receivable of participators (founders) on payments in the
authorized capital

including past-due payment                                                                 x

Debt receivable on advances made                                         4 033 217     30 242 674

including past-due payment                                               2 535 241         x

Other debt receivable                                                   21 411 931

including past-due payment                                                 121 223         x

Total                                                                   34 323 036     30 242 674

including past-due payment                                               4 302 167         x



                                                                                                    137
Debtors, which possess not less then 10 per cent of the total sum of debt receivable for the specified accounting
period
  Full company‟s name: Barclays Bank PLC
  Abbreviated company‟s name: Barclays Bank PLC
  Location: 4 North Colonnade Canary Wharf London E14 4BB
  Sum of debt receivable, RUR.: 10 735 766 223,65
  Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
  no
  Debtor is affiliated person of the issuer: No


  Full company‟s name: Energokomplex, JSC
  Abbreviated company‟s name: Energokomplex, JSC
  Location: 115035, Moscow, Kosmodamianskaya quay, 4/22. bld.B
  Sum of debt receivable, RUR.: 10 112 245 406,66
  Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
  no
  Debtor is affiliated person of the issuer: No


  Full company‟s name: BUSINESS ALIANCE, JSC
  Abbreviated company‟s name: BUSINESS ALIANCE, JSC
  Location: 109004, Moscow, Nikoloyamskaya, 44/18
  Sum of debt receivable, RUR.: 9 008 489 888,37
  Amount and condition of past-due debt receivable (rate of interest, penalties, fines):
  no
  Debtor is affiliated person of the issuer: No




                                                                                                               138
VII. Issuer‟s accounting reports and other financial information:

7.1. Annual financial statement of the issuer:


2009
                                            Balance sheet

                                       for December 31, 2009

                                                                             Codes

             Form No. 1 under OKUD (All-Russian Classifier of Management    0710001
                                                          Documentation)

                                                                   Date    31.12.2009


                                                                                        139
organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN       5036065113

Activity type                                                           under                40.10.2
                                                                    OKVED (All-
                                                                  Russian Classifier of
                                                                  Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                 under
open joint-stock companies                                         OKOPF/OKF
                                                                      S(All-Russia
                                                                  Classifier of Forms of
                                                                             Ownership)

Unit of measurement: RUR thousand                                    under OKEI               384
                                                                  (All-Russia Classifier
                                                                       of Measurement
                                                                                 Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                          ASSET                         line          at the    at the end of
                                                        code      beginning of the reporting
                                                                  the reporting     period
                                                                     period
                           1                                 2             3                   4

I. NON-CURRENT ASSETS

Fixed assets                                                120      120 052 548           133 176 971

Construction in process                                     130        40 288 263           36 678 074

Long-term financial investment                              140         6 940 839             3 685 697

Deferred tax assets                                         145            301 714             583 386

TOTAL under section I                                       190      167 583 364           174 124 128

                II. CURRENT ASSETS

Stocks                                                      210         6 538 472             6 191 284

Raw materials, other materials and other similar            211         2 422 102             2 416 466
values

Ready product and goods held for re-sale                    214                1 753               2 640

Reserves for future expenses                                216         4 114 617             3 772 178

Value added tax under the purchased values                  220            277 787             307 796

Debt receivable (with a maturity over 12 months after       230        30 002 022           29 159 381



                                                                                                           140
the reporting date)

Debt receivable (with a maturity during 12 months   240      30 636 466       33 037 744
after the reporting date)

including buyers and customers (62, 76, 82)         241       3 986 070        6 573 051

Short-term financial investment (56,58,82)          250                        2 968 747

Monetary assets                                     260       5 197 786        4 844 580

Other current assets                                270             2 095

TOTAL under section II                              290      72 654 628       76 509 532

BALANCE                                             300     240 237 992      250 633 660




                      LIABILITIES                   line       at the    at the end of
                                                    code   beginning of the reporting
                                                           the reporting     period
                                                              period
                              1                      2          3               4

          III. CAPITAL AND RESERVES

Share capital                                       410      24 353 546       24 353 546

Own shares redeemed from shareholders               411             -3 798

Additional capital                                  420      63 775 454       63 720 537

Reserve capital                                     430         695 356         810 513

Reserves formed in accordance with laws             431         695 356         810 513

Retained earnings (uncovered loss)                  470      24 534 063       30 792 331

TOTAL under section III                             490     113 354 621      119 676 927

IV. LONG-TERM LIABILITIES

Loans and credits                                   510      41 304 911       13 962 190

Deferred tax liabilities                            515         971 129        1 675 709

Other long-term liabilities                         520      26 180 131       21 786 335

TOTAL under section IV                              590      68 456 171       37 424 234

V. SHORT-TERM LIABILITIES

Loans and credits                                   610       3 672 283       26 797 543

Accounts payable                                    620      53 462 855       64 281 805

Suppliers and contractors                           621      16 282 953       10 997 114


                                                                                           141
Debt to the personnel of the organization           622                            1 621

Debt to State non-budgetary funds                   623              771            115

Debt under taxes and tax collections                624         437 082        261 951

Other creditors                                     625      36 742 049      53 021 004

Debt to participants (founders) under earnings      630             4 358          2 483
payment

Reserves for future expenses                        640       1 287 704       2 450 668

TOTAL under section V                               690      58 427 200      93 532 499

BALANCE                                             700     240 237 992     250 633 660




    INFORMATION ON PRESENCE OF THE VALUES REGISTERED ON THE OFF-
                     BALANCE SHEET ACCOUNTS

                       Parameter                    line       at the    at the end of
                                                    code   beginning of the reporting
                                                           the reporting     period
                                                              period
                           1                         2          3              4

Rented fixed assets                                 910      57 317 938      66 330 563

Including under leasing                             911      34 452 626      39 135 192

Inventory holdings accepted for custody             920             4 020

Writing-off of insolvent debtors‟ debts             940             9 686       25 552

Securities received from obligations and payment,   950          10 727            5 355
issued

Deterioration of housing facilities                 970              508            529




                                                                                           142
                                    INCOME STATEMENT
                                             for 2009

                                                                                              Codes

            Form No. 1 under OKUD (All-Russian Classifier of Management                      0710002
                                                         Documentation)

                                                                                Date        31.12.2009

organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN       5036065113

Activity type                                                           under                 40.10.2
                                                                    OKVED (All-
                                                                  Russian Classifier of
                                                                  Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                 under
open joint-stock companies                                         OKOPF/OKF
                                                                      S(All-Russia
                                                                  Classifier of Forms of
                                                                             Ownership)

Unit of measurement: RUR thousand                                    under OKEI                384
                                                                  (All-Russia Classifier
                                                                       of Measurement
                                                                                 Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                       Parameter                        line          For the                 For the
                                                        code         reporting                similar
                                                                      period               period of the
                                                                                           previous year
                          1                                  2             3                    4

Income and expenditure from common activities

Receipts (net) from sale of goods, products, services       010        85 232 848             63 015 362
net of VAT, excise and similar obligatory payments)

Profit from power energy transportation                     011        74 904 182             51 604 266

Profit from grid connection                                 012         9 469 407              8 405 307

Services on functioning and development of UES of           018
Russia

Power for sales companies                                   013



                                                                                                           143
Profit from participation in other organizations           014

Profit from leasing                                        015       67 600

The other goods, production, works, services of            016      791 659     3 005 789
industrial character

The other goods, production, works, services of            017
nonindustrial character
Cost value of goods, products, work, services sold         020   -69 381 805   -56 595 215
Including sold:

electric power transmission                                021   -63 178 423   -49 535 837
technical connection                                       022    -5 586 778    -4 221 503

Services on functioning and development of UES of          028
Russia
electric energy by retail companies                        023
Expense from participation in other organisations          024
Expense from leasing                                       025      -37 335
of other industrial goods, products, works, services       026     -579 269     -2 837 875
of other non-industrial goods, products, works, services   027
Gross profit                                               029   15 851 043     6 420 147
Selling expenses                                           030
General and administrative expenses                        040
Sales profit (loss)                                        050   15 851 043     6 420 147
Other income and expenses

Interest receivable                                        060      339 078       255 579
Interest payable                                           070    -3 663 643    -2 637 512
Revenues from participation in other organizations         080
Other income                                               090   11 151 999     9 480 387
Other expenses                                             100   -13 584 886    -9 454 327
  Profit (loss) before tax                                 140   10 093 591     4 064 274
Deferred tax assets                                        141      281 672       267 290
Deferred tax liabilities                                   142     -704 580      -555 175
Current profit tax                                         143    -3 338 810    -1 478 627



                                                                                             144
Other similar obligatory payments                                 144           -13 365              5 384
Profit tax and other similar obligatory payments                  150         -3 775 083         -1 761 128
Profit (loss) from usual activity                                 160         6 318 508          2 303 146
Net profit (undistributed profit (loss) of the accounting         190         6 318 508          2 303 146
period

FOR REFERENCE

Permanent tax liabilities (assets)                                200         1 742 999            791 086
Basic profit (loss) per share                                     201             0.126                  0.05
Diluted profit (loss) per share                                   202




                  Parameter                      line       For the reporting        For the similar
                                                 code            period               period of the
                                                                                     previous year
                                                            Profit      Loss        Profit          Loss

                      1                            2          3           4            5             6
Penalty duties, interest, fees accepted or       210         16 803      10 620            636       2 551
imposed by court (arbitration court)

Profit/loss of previous years                    220         30 208     150 906     274 882         49 343
Indemnity for losses arising from non-           230         74 059       2 659     230 394              294
performance or improper performance of
obligations

Exchange rate differences arising from           240          5 815       5 819        2 393 2 287 573
foreign exchange operations                                     116         910          305
Provision for valuation allowances               250                    286 395
Written-off accounts receivable and              260          6 895      15 866            241           222
accounts payable due to expired limitation
period




                                                                                                                145
                               STATEMENT OF CHANGES IN EQUITY
                                                 for 2009


                                                                                             Codes

             Form No. 3 under OKUD (All-Russian Classifier of Management                    0710003
                                                          Documentation)

                                                                                Date       31.12.2009

organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN       5036065113

Activity type                                                            under               40.10.2
                                                                     OKVED (All-
                                                                 Russian Classifier of
                                                                 Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                  under
open joint-stock companies                                          OKOPF/OKF
                                                                       S(All-Russia
                                                                 Classifier of Forms of
                                                                            Ownership)

Unit of measurement: RUR thousand                                    under OKEI               384
                                                                 (All-Russia Classifier
                                                                      of Measurement
                                                                                Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                                       I. Changes in equity
        Indicator             Code   Authorise   Increment    Reserve        Retained          Total
                                     d Capital       al       capital          Profit
                                                   Capital                  (Uncovere
                                                                                d
                                                                                Loss)

            1                  2        3             4         5                  6             7
Balance as of Dec. 31,        010       14 124       23 401    251 470            11 004 48 781 715
2007                                       680          503                          062

2008 (previous year)
Changes in accounting         011
policy

Revaluation of fixed assets   012



                                                                                                        146
Reorganisation                 013
Balance as of Jan. 1, of the   020   14 124   23 401   251 470     11 004 48 781 715
previous year                           680      503                  062
Foreign currency               023
translation result

Net profit                     025                               2 303 146    2 303 146
Dividends                      026
Provisions for reserve         030                     237 379   -237 379
fund

Increase of capital value      040   10 228   12 850   206 507     11 330 34 616 715
by means of                             866      991                  351
Additional share issue         041
increase of shares par         042
value

corporate restructuring        043   10 228                        11 321 21 549 892
                                        866                           026
others                         044            12 850   206 507      9 325 13 066 823
                                                 991
Reduction of capital value     050   -3 798   -9 325                            -13 123
by means of reduction of
share par value

Reduction in the number        051
of shares

corporate restructuring        052
other                          053
corporate restructuring        054   -3 798   -9 325                            -13 123
Balance as of 31 december      060   24 349   36 243   695 356     24 400 85 688 453
of the previous year                    748      169                  180

2009 год (accounting
year)
Changes in accounting          061
policy

Revaluation of fixed assets    062            27 532                         27 532 285
                                                 285
Reorganisation                 063                                133 883      133 883
Balance as of Jan. 1 of the    100   24 349   63 775   695 356     24 534      113 354
accounting year                         748      454                  063          621




                                                                                          147
Foreign currency             103                           0
translation result

Net profit                   105                                         6 318 508   6 318 508
Dividends                    106
Provisions for reserve       110                               115 157   -115 157
fund

Increase of capital value    120
by means of

Additional share issue       121
increase of shares par       122
value

corporate restructuring      123
others                       124
Reduction of capital value   130         3 798    -54 917                  54 917       3 798
by means of

reduction of shares par      131
value

Reduction of shares          132
number

corporate restructuring      133
others                       134         3 798    -54 917                  54 917       3 798
Balance as of Dec. 31 of     140        24 353    63 720       810 513     30 792     119 676
the accounting year                        546       537                      331         927




                                         II. RESERVES

                Indicator                Code    Balance       Inflow    Outflow     Balance

                     1                     2       3             4          5           6
 Statutory reserves, according to the
              legislation

Previous year data                       150      251 470      443 886                695 356
Accounting year data                     151      695 356      115 157                810 513

Reserves formed in accordance with
constitutive documents

Previous year data                       152
Accounting year data                     153



                                                                                                 148
          Valuation reserves

Reserve for bad debts

Previous year data                       160
Accounting year data                     161
Reserve for devaluation of investments

Previous year data                       162
Accounting year data                     163   286 395   286 395
Reserve for liabilities due to
recognition of operation as
discontinuing

Previous year data                       164
Accounting year data                     165
Reserves formed in accordance with
contingency consequences

Previous year data                       166
Accounting year data                     167
Reserve for tangible assets
depreciation

Previous year data                       168
Accounting year data                     169
others

Previous year data                       170
Accounting year data                     171
reserves for future expenses:
reserve for payment of remuneration
at the year-end

Previous year data                       180
Accounting year data                     181
reserve for vacation pay (including
charges)

Previous year data                       182
Accounting year data                     183
reserve for annual long-service award
payment




                                                                   149
Previous year data                          184
Accounting year data                        185
reserve for repairs of fixed assets

Previous year data                          186
Accounting year data                        187
others

Previous year data                          188
Accounting year data                        189




                                                 enquiries
                  Indicator                 Code       Opening balance           Closing balance

                     1                       2                   3                            4

1) Net assets                               200                  114 642 325                  122 127 595
                                                             From budget           From non-budgetary
                                                                                         funds

                                                    Accounting       Previous    Accounting       Previous
                                                     year data       year data    year data       year data

                                                         3              4            5               6

2) received for
expenses from ordinary activities – total   210
Including:

payments for Chernobyl cleanup              211
veterans

                                            212
Capital investments in fixed assets         220
Including:

                                            221

                                            222




                                                                                                              150
                                      CASH FLOW STATEMENT
                                                for 2009

                                                                                               Codes

             Form No. 4 under OKUD (All-Russian Classifier of Management                     0710004
                                                          Documentation)

                                                                                Date        31.12.2009

organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN        5036065113

Activity type                                                           under                 40.10.2
                                                                    OKVED (All-
                                                                  Russian Classifier of
                                                                  Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                 under
open joint-stock companies                                         OKOPF/OKF
                                                                      S(All-Russia
                                                                  Classifier of Forms of
                                                                             Ownership)

Unit of measurement: RUR thousand                                    under OKEI                 384
                                                                  (All-Russia Classifier
                                                                       of Measurement
                                                                                 Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                                                           Item     Accounting             Same Period of
                       Parameter
                                                           code       Period               Previous Year

                            1                                2             3                     4
Cash balance at the beginning of accounting period          010         5 195 924              4 429 713
Cash flow from operating activity:

cash received from buyers and customers                     020        99 593 053             88 964 771
Inflow of acquired foreign currency                         030                2 255                 1 968
Other income (proceeds)                                     050         6 509 828             57 256 268
Cash outflow:

payments for goods, work, services, materials and other     150      -47 907 680             -46 616 905
current assets purchased

labour expenses                                             160        -7 172 504             -4 890 579




                                                                                                             151
dividend and interest payments                                170    -3 565 066    -1 789 388
payment of taxes and dues                                     180    -8 738 624    -4 866 437
other expenses (payments)                                     190    -3 636 540   -58 590 271
Total net cash provided (used) by operating activities        200   35 084 722    29 469 427
Cash flows from investing activities

Proceeds from sale of fixed assets and other noncurrent       210       84 228         5 991
assets

Proceeds from sale of securities and other financial assets   220
Dividends received                                            230
Interest received                                             240       94 348       105 776
Proceeds from repayment of loans extended to other            250
organizations

Other proceeds                                                260
Purchase of subsidiaries                                      280
Purchase of fixed assets, income-bearing investments and      290   -17 883 557   -36 968 128
intangible assets

Purchase of securities and other financial assets             300    -4 143 000    -2 827 818
Loans extended to other organizations                         310
Other expenses                                                320        -3 768      -12 403

                                                              340   -21 851 749   -39 696 582
Net cash flow relating to investing activities

Cash flow relating to financing activities                    350
Proceeds from issue of shares and other participatory share   360    8 700 000    40 702 512
instruments

Proceeds from special-purpose financing                       370
Other income                                                  380
Repayment of loans and advances (net of interest)             390   -13 083 382   -21 314 428
Repayment of finance lease obligations                        400    -9 200 935    -8 394 718
Other expenses                                                405
Net cash flow relating to financing activities                410   -13 584 317   10 993 366
Net increase/decrease in cash and cash equivalents            420     -351 344       766 211
Cash closing balance                                          430    4 844 580     5 195 924



                                                                                                152
Effect of changes in exchange rate between foreign   440   209   8 907
currency and Russian rouble




                                                                         153
                                   APPENDIX TO BALANCE SHEET
                                             for 2009

                                                                                                 Codes

              Form No. 5 under OKUD (All-Russian Classifier of Management                       0710005
                                                           Documentation)

                                                                                    Date       31.12.2009

organization: OJSC “Moscow United Electric Grid                           under OKPO
Company”                                                                      (All-Russian
                                                                               Classifier of
                                                                            Businesses and
                                                                            Organizations)

Taxpayer Identification Number                                                       TIN       5036065113

Activity type                                                                 under              40.10.2
                                                                          OKVED (All-
                                                                       Russian Classifier of
                                                                       Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                     under
open joint-stock companies                                             OKOPF/OKF
                                                                          S(All-Russia
                                                                      Classifier of Forms of
                                                                                 Ownership)

Unit of measurement: RUR thousand                                         under OKEI              384
                                                                      (All-Russia Classifier
                                                                           of Measurement
                                                                                     Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                                               Intangible assets

                Parameter                      Code Available      Received        Retired      Available at
                                                     at                                         End of
                                                     Beginning                                  Accounting
                                                     of                                         Period
                                                     Accounting
                                                     Period

                     1                          2         3           4                 5            6
Objects of intellectual property               010
(exclusive rights to results of intellectual
property)

Including:

the right of: a patent holder to an            011
invention, industrial design, utility
model

of possessor of right to computer              012
software, databases


                                                                                                               154
an owner to a trademark and a service        014
mark, the name of the place of origin of
goods

goodwill                                     030
others                                       040
total                                        045




                         Parameter                           Code         Opening            Closing balance
                                                                          balance

                             1                                   2             3                   4
Total depreciation of intangible assets                         050




                                           Основные средства

               Parameter                    Code Available        Received         Retired      Available at
                                                   at                                           End of
                                                   Beginning                                    Accounting
                                                   of                                           Period
                                                   Accounting
                                                   Period

                     1                        2        3              4              5                 6
Buildings                                    110      10 074 1 403 207              -11 582 11 466 570
                                                         945
Structures and transfer means                111      39 882          13 196       -319 953 52 759 395
                                                         678             670
Machinery and equipment                      112     100 650 9 885 361             -143 436        110 392
                                                         679                                           604
Vehicles                                     113     457 255          60 473             -589      517 139
Production and auxiliary fixtures            114
Working animals                              115
Productive livestock                         116
Perennial plants                             117
Other fixed assets                           118     164 790           5 963         -7 755        162 998
Land plots and objects of nature             119       7 223           2 108                           9 331
management

Capital investment in reclamation            120



                                                                                                               155
Total                                         130        151 237         24 553       -483 315     175 308
                                                             570            782                        037




                           Parameter                           Code         Opening         Closing balance
                                                                            balance

                               1                                    2             3                4
Total depreciation of PPE                                          140      31 185 022           42 131 066
including:

buildings and structures                                           141        3 779 606           6 071 575
machinery, equipment and vehicles                                  142      27 335 924           35 993 256
other                                                              143             69 492           66 235
Total PPE leased out                                               150
including:

buildings                                                          151
Structures                                                         156
machinery, equipment and vehicles                                  152
Other                                                              153
PPE assigned for conservation                                      155
Total PPE taken on lease                                           160      57 317 938           66 330 563
including:

buildings and structures                                           161        1 090 612           2 334 699
machinery, equipment and vehicles                                  162      12 032 894           15 172 969
other                                                              163      44 194 432           48 822 895
Real property items accepted for use under state                   165            672 510           56 910
registration

For Reference


Results of revaluation of PPE:                                     170      27 532 285
historical/replacement value                                       171      41 001 514
depreciation                                                       172      13 469 229
Change in PPE value resulting from completion of                   180        6 323 475           9 360 108
construction, retrofit, reconstruction, partial liquidation



                                                                                                              156
                          Income-Bearing Investments in Tangible Assets

              Parameter                 Code Available       Received       Retired      Available at
                                               at                                        End of
                                               Beginning                                 Accounting
                                               of                                        Period
                                               Accounting
                                               Period

                   1                      2         3           4             5                 6
Property for leasing                     210
Property leased out under rental         220
agreement

Other                                    230
Total                                    240
Depreciation of income-bearing           250
investment in tangible assets




                             Research-and-Development Expenditures


             Types of work              Code    Available    Received     Written off Available at
                                                   at                                   End of
                                               Beginning                              Accounting
                                                   of                                    Year
                                               Accounting
                                                  Year

                   1                      2         3           4             5                 6
Total                                    310
including

including:

                                         311

                                         312

                                         313




                        Parameter                        Code       Opening           Closing balance
                                                                    balance

                             1                              2           3                   4


                                                                                                        157
For reference                                                 320

Expenses relating to research-and development work in
progress

                       Parameter                            Code        Accounting     Same Period of
                                                                          Period       Previous Year

                            1                                  2            3                4
Expenses relating to research-and-development work            330
without positive results recognized as non-operating
expenses




                            Natural Resources Development Expenses

            Types of work                Code     Available     Received     Written off Available at
                                                     at                                    End of
                                                 Beginning                               Accounting
                                                     of                                     Year
                                                 Accounting
                                                    Year

                   1                        2           3           4              5             6
Total resource development expenses       410
including

                                          411

                                          412

                                          413



                       Parameter                            Code         Opening       Closing balance
                                                                         balance

                            1                                  2            3                4
Expenses for subsoil plots under non-completed                420
prospecting and evaluation, exploration and/or
hydrogeological survey and other similar work

Amount of expenses for development of natural resources       430
recognized as non-operating expenses as having no
positive results in the accounting period




                                            Investments




                                                                                                         158
                Parameter                  Code          Long-term             Short-term

                                                  Opening      Closing   Opening      Closing
                                                  balance      balance   balance      balance

                    1                       2        3               4     5                6
Total contributions to authorized/share    510    3 972 092 3 685 697
capital of other organizations

including subsidiaries and dependent       511    3 972 092 3 685 697
business entities

Government and municipal securities        515
Total securities of other organizations    520    2 968 747                          2 968 747
including debt securities (bonds, notes)   521    2 968 747                          2 968 747
Loans extended                             525
Deposits                                   530
Others                                     535
Total                                      540    6 940 839 3 685 697                2 968 747

Including investments with current
market value:

Total contributions to authorized/share    550
capital of other
organizations

including subsidiaries and dependent       551
business entities

Government and municipal securities        555
Total securities of other organizations    560
including debt securities (bonds, notes)   561
Others                                     565

Total                                      570
For Reference.

Changed value resulting from adjusted      580
assessment of investments with current
market value

Difference between initial value and par   590
value of debt securities recognized as
financial result of accounting period




                                                                                                 159
                                   Accounts Receivable and Payable

                        Parameter                          Code      Opening      Closing balance
                                                                     balance

                               1                             2         3                4
Accounts receivable:

total short-term receivables                               610       30 636 466      33 037 744
Including:

settlements with buyers and customers                      611        3 986 070       6 573 051
advance payments                                           612       15 521 526       5 011 194
other                                                      613       11 128 870      21 453 499
total long-term receivables                                620       30 002 022      29 159 381
Including:

settlements with buyers and customers                      621          20 900
advance payments                                           622                       29 159 381
other                                                      623       29 981 122
Total                                                      630       60 638 488      62 197 125
Accounts payable:

total short-term payables                                  640       57 135 138      91 079 348
including:

settlements with suppliers and contractors                 641       16 282 953      10 997 114
advance payments received                                  642       36 730 105      38 923 965
taxes and dues                                             643         270 831          261 951
Advances                                                   644        3 672 283      26 738 292
loans                                                      645                            59 251
others                                                     646         178 966       14 098 775
total long-term payables                                   650       67 485 042      35 748 525
including:

settlements with suppliers and contractors                 651
taxes and dues                                             652
Advances                                                   653       38 889 675      11 605 683




                                                                                                    160
loans                                                     654       2 415 236       2 356 507
others                                                    655      26 180 131      21 786 335
Total                                                     660     124 620 180     126 827 873




                      Expenses for Ordinary Activities (By Cost Component)


                        Parameter                         Code For accounting    For previous
                                                                     year            year

                              1                            2          3               4
Financial costs                                           710       1 658 083       1 275 487
Labour costs                                              720       7 515 443       5 171 823
Benefit-related deductions                                730       1 357 480       1 014 935
Depreciation                                              740      11 046 905       5 997 631
Other costs                                               750      47 803 894      43 135 339
Total by cost component                                   760      69 381 805      56 595 215
Changes in balance (increase [+], decrease [-]):

work-in-progress

deferred expenses                                         765                          -10 064
reserve for future expenses                               766        -342 439       3 379 917
Financial costs                                           767




                                               Security

                        Parameter                         Code     Opening      Closing balance
                                                                   balance

                              1                            2          3               4
Total security obtained                                   810          10 727             5 355
including:

notes                                                     811
Assets in pledge                                          820          10 727             5 355
including:

PPE                                                       821


                                                                                                  161
securities and other investments                                822
other                                                           823          10 727            5 355
Total security provided                                         830
including:

notes                                                           831
Pledged assets                                                  840
including:

PPE                                                             841
securities and other investments                                842
other                                                           843




                                        Government Assistance


                          Parameter                             Code For accounting   For previous
                                                                           year           year

                             1                                   2          3              4
Total public funds obtained within accounting period            910
including:

Including:                                                      911

Specific benefit - others                                       912

                                                        На    Получено Возвраще На конец
                                                      начало     за      но за  отчетного
                                                    отчетного отчетный отчетный периода
                                                     периода   период   период

                    1                         2          3            4           5            6
Total government loans                      920
including

including                                   921
Total government loans                      922


7.2. Balance sheet of the issuer for the last accounting year




                                                                                                       162
                                       BALANCE SHEET

                                  as of March 31, 2010

                                                                                               Codes

              Form No. 1 under OKUD (All-Russian Classifier of Management                     0710001
                                                           Documentation)

                                                                                Дата        31.03.2010

organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN        5036065113

Activity type                                                           under                 40.10.2
                                                                    OKVED (All-
                                                                  Russian Classifier of
                                                                  Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                 under
open joint-stock companies                                         OKOPF/OKF
                                                                      S(All-Russia
                                                                  Classifier of Forms of
                                                                             Ownership)

Unit of measurement: RUR thousand                                    under OKEI                 384
                                                                  (All-Russia Classifier
                                                                       of Measurement
                                                                                 Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                                                                       Opening
                        ASSETS                          Code                               Closing balance
                                                                       balance

                           1                                 2             3                     4
I. FIXED ASSETS

Intangible assets                                           110
Property, plant and equipment                               120      133 176 971             131 444 674

Construction in process                                     130        36 678 074             36 853 172
Long-term investments                                       140         3 685 697              3 685 698
Deferred tax assets                                         145            583 386               592 658
Section I TOTAL                                             190      174 124 128             172 576 202
II. CURRENT ASSETS

Stocks                                                      210         6 191 284              6 149 327



                                                                                                             163
raw materials, materials and other similar assets     211      2 416 466      2 405 438
  goods dispatched                                    215           2 640          5 992
  prepaid expenses                                    216      3 772 178      3 737 897
Value added tax on assets purchased                   220       307 796        164 428
Accounts receivable (amounts falling due after more   230     29 159 381     30 242 674
than 12 months from balance sheet date)

Accounts receivable (amounts falling due within 12    240     33 037 744     34 323 036
months from balance sheet date)

buyers and customers (62, 76, 82)                     241      6 573 051      8 877 888

Short-term investments (56,58,82)                     250      2 968 747      3 171 184

Cash                                                  260      4 844 580      6 812 929
Other current assets                                  270                              90
Section II Total                                      290     76 509 532     80 863 668
TOTAL ASSETS                                          300    250 633 660    253 439 870




                                                      Item   Opening         Closing
              EQUITY AND LIABILITIES
                                                      Code   balance         balance

                              1                        2        3              4
III. EQUITY AND RESERVES

Authorised capital                                    410     24 353 546     24 353 546

Additional capital                                    420     63 720 537     63 717 011
Capital reserve                                       430       810 513        810 513

Reserves formed in accordance with laws               431       810 513        810 513

Retained earnings (uncovered loss)                    470     30 792 331     32 914 634
Section III Total                                     490    119 676 927    121 795 704
IV. LONG-TERM LIABILITIES

Loans and credits                                     510     13 962 190      9 072 534

Deferred tax liabilities                              515      1 675 709      1 987 041

Other long-term liabilities                           520     21 786 335     17 074 945
Section IV Total                                      590     37 424 234     28 134 520

V. SHORT-TERM LIABILITIES



                                                                                            164
Loans and credits                                610     26 797 543     30 954 784

Accounts payable                                 620     64 281 805     70 062 629

suppliers and contractors                        621     10 997 114      8 718 080

Debt to the personnel of the organization        622           1 621      702 899

Debt to State non-budgetary funds                623            115       217 173

Debt under taxes and tax collections             624       261 951       1 574 540

Other creditors                                  625     53 021 004     58 849 937

Debt to participants (founders) under earnings   630           2 483          2 443
payment

Reserves for future expenses                     640      2 450 668      2 489 790
Section V Total                                  690     93 532 499    103 509 646

BALANCE                                          700    250 633 660    253 439 870




    INFORMATION ON PRESENCE OF THE VALUES REGISTERED ON THE OFF-
                     BALANCE SHEET ACCOUNTS
                                                        Opening         Closing
             EQUITY AND LIABILITIES              Code
                                                        balance         balance

                             1                    2        3              4

Rented fixed assets                              910     66 330 563     69 393 285
Including by leasing                             911     39 135 192     39 015 596
Debts of insolvent debtors written off           940        25 552          25 552
Security for obligations and payments obtained   950           5 355          5 355

Deterioration of housing facilities              970            529            529




                                                                                      165
                                  PROFIT AND LOSS STATEMENT
                                       for 3 months of 2010


                                                                                               Codes

               Form No. 2 under OKUD (All-Russian Classifier of Management                   0710002
                                                            Documentation)

                                                                                Дата        31.03.2010

organization: OJSC “Moscow United Electric Grid                     under OKPO
Company”                                                                  (All-Russian
                                                                           Classifier of
                                                                        Businesses and
                                                                        Organizations)

Taxpayer Identification Number                                                   TIN        5036065113

Activity type                                                           under                 40.10.2
                                                                    OKVED (All-
                                                                  Russian Classifier of
                                                                  Economic Activities)

Form of legal entity‟s incorporation / form of ownership:                 under
open joint-stock companies                                         OKOPF/OKF
                                                                      S(All-Russia
                                                                  Classifier of Forms of
                                                                             Ownership)

Unit of measurement: RUR thousand                                    under OKEI                 384
                                                                  (All-Russia Classifier
                                                                       of Measurement
                                                                                 Units)

Location: 142100 Russia, moscow region, Podolsk city,
Ordjonikidze street 27

                        Parameter                       Code        Accounting             Same Period of
                                                                      Period               Previous Year

                            1                                2             3                     4

Income and expenditure from common activities

Receipts (net) from sale of goods, products, services       010        25 925 639             22 482 566
net of VAT, excise and similar obligatory payments),
Cost value of goods, products, work, services sold          020      -21 763 608             -16 594 664

Gross profit                                                029         4 162 031              5 887 902

Profit (loss) from sales                                    050         4 162 031              5 887 902

Commercial charges

Interest receivable                                         060              67 722               73 222
Interest payable                                            070           -786 488


                                                                                                            166
Profit from participation in other organizations          080

Other profit                                              090

Other loss                                                100

Non-operating income                                      120

Non-operating expences                                    130
Profit (loss) before tax                                  140
Deferred tax assets                                       141
Deferred tax liabilities                                  142
Current profit tax                                        150
Net profit (loss) of the accounting period                190
For Reference.

Permanent tax liabilities (assets)                        200
Basic profit (loss) per share                             201
Diluted profit (loss) per share                           202




                  Parameter                  Code                        Same Period of
                                                    Accounting Period
                                                                         Previous Year

                                                    profit      loss    profit        loss

                       1                      2       3          4        5            6
Penalty duties, interest, fees accepted or   230
imposed by court (arbitration court)

Profit/loss of previous years                240
Indemnity for losses arising from non-       250
performance or improper performance of
obligations

Exchange rate differences arising from       260
foreign exchange operations

Provision for valuation allowances           270
Written-off accounts receivable and          280
accounts payable due to expired limitation
period




7.3 Summary accounting reports of the issuer for the previous completed fiscal year


                                                                                             167
There is no information in the specified accounting period


7.4. Data on the issuer‟s accounting policy

Regulation about the issue registration policy for 2010, accepted by the Issue for the current fiscal year.
Accounting policy of the Company is carried out in accordance with the Federal law as of November 29,
1996 No.129-FL “On Accounting” (issued as of November 3, 2006) and normative documents of the
Ministry of Finance of the Russian Federation regulating the order of the Financial statement making
and carrying out.


                                                          Appendix 1 to Order of
                                                         JSC “Moscow United Electric Grid
                                                          Company”
                                                          No. 823 dd. 31.12.2009




                                   PROVISION
                             on accounting policy of
                 JSC “Moscow United Electric Grid Company” for 2010




                                                                                                        168
                                           TABLE OF CONTENTS

1. ORGANIZATIONAL AND TECHNICAL ASPECTS OF ACCOUNTING
POLICY ..………………………………………………………………. 4
   1.1. PRINCIPLES OF ORGANIZATIONS AND OBJECTIVES OF ACCOUNTING STATEMENTS
          6
   1.2. FORMS OF PRIMARY ACCOUNTING DOCUMENTS AND RULES OF DOCUMENT
   FLOW………………………. 7
   1.3. ORDER AND TERMS OF STATEMENTS COMPILATION …………………………. 9
   1.4. ORDER OF ESTABLISHMENT, APPROVALS AND CHANGES OF ACCOUNTING POLICY
   …………………………………………………………………..11
   1.5. CHART OF ACCOUNT APPLIED ..........................................................................12
   1.6. INTERNAL ACCOUNTING STANDARDS APPLIED .................................................12
   1.7. ORDER OF ASSETS AND LIABILITIES STOCKTAKING .........................................13
2. METHODICAL ASPECTS OF ACCOUNTING POLICY ......................... 13
   2.1. GENERAL REQUIREMENTS TO STATEMENTS. REQUIREMENTS AND ASSUMPTIONS
   ACCEPTED IN COURSE OF MAINTAINING OF RECORDS AND PREPARATION OF
   REPORTING. REQUIREMENTS TO INFORMATION FORMED BY SYSTEM OF ACCOUNTS
         13
  2.2. GENERAL APPROACHES TO ACCOUNTING ENTITIES' QUALIFICATION ...............16
  2.3. GENERAL APPROACHES TO ACCOUNTING ENTITIES' ESTIMATION .....................19
  2.4. SELECTED WAYS OF CAPITALIZED EXPENSES AND NONCURRENT ASSETS
  ACCOUNTING ...........................................................................................................222
    2.4.1. Capital construction by contractor organizations and using one's own
    resources...................................................................................................... 22
    2.4.2. Operations account by participatory construction of facilities ....... 24
    2.4.3. Accouningt of interest on loans and credits attracted for acquisition
    and/or establishment of noncurrent assets ................................................. 25
     2.4.3.1.Investment assets............................................................. 25
    2.4.3.2. Accounting of credits and loans ……………………………………......
26
    2.4.3.3. Accounting of operations related to issue of bonds ..................... 27
    2.4.4. Fixed assets .................................................................................... 277
    2.4.5. Cost change of fixed assets .............................................................. 31
    2.4.6. Useful life of fixed assets' facilities .................................................. 34
    2.4.7. Amortization of fixed assets ............................................................. 35
    2.4.8. Lease Accounting of fixed assets ..................................................... 36
    2.4.9. Accounting of property leased………………………………..38
    2.4.10. Accounting of equipment requiring assembly ................................ 38
    2.4.11. Intangible assets and their amortization ..............................39
  2.5. SELECTED WAYS OF BUSINESS INVENTORIES ACCOUNTING .............................41
    2.5.1. Assets recognition as business inventories and their estimation ..... 41
    2.5.2. Accounting of business inventories acquisition ............................. 43
    2.5.3. Accounting of business inventories retirement ............................... 45


                                                                                                                       169
    2.5.4. Accounting of business inventories (including spare parts) which
    entered as a result of withdrawal from fixed assets in restoration stage
    (reconstruction, re-equipment, repair) .......................................................................47
    2.5.5. Acconting of automobile tyres.......................................................... 49
 2.6. SELECTED WAYS OF ACCOUNTING OF INCOMES, CURRENT COSTS AND EXPENSES
      49
    2.6.1. General approaches to accounting of incomes and expenses ......... 49
    2.6.2. Incomes and expenses on ordinary types of activity ....................... 51
    2.6.3. Other revenues and expenses ......................................................... 534
    2.6.4. Revenues and expenses of future periods ......................................... 55
    2.6.5. Expenses for advertising .................................................................. 56
    2.6.6. Accounting of exchange rate differences ......................................... 56
 2.7 OPERATIONS ON TRANSACTIONS OF CROSS CURRENCY AND INTEREST RATE SWAP
 ………………. 57
 2.8. PECULIARITIES OF ACCOUNTING OF INTRA-ORGANIZATIONAL SETTLEMENTS
 ……………. 58
 2.9. SELECTED WAYS OF ACCOUNTING OF FINANCIAL INVESTMENTS ………………..
 58
 2.10. PECULIARITIES OF OPERATIONS ACCOUNTING UNDER SIMPLE PARTNERSHIP
 AGREEMENT ………………………………………………………………………60
 2.11. SELECTED WAYS OF OWN FUNDS (CAPITAL) ACCOUNTING .................. .…62
 2.12. SELECTED WAYS OF OBLIGATIONS (ACCOUNTS PAYABLE AND ACCOUNTS
 RECEIVABLE) ACCOUNTING .................................................................................... 64
 2.13. RESERVES FOR FUTURE EXPENSES AND PAYMENTS …………………… 66
 2.14. RESERVES FOR POSSIBLE LOSSES OF FINANCIAL INVESTMENTS
………………….66
 2.15. ACCOUNTING OF CALCULATIONS ON PROFIT TAX
 ………………………………67
 2.16. INFORMATION ON SEGMENTS                ……………………………………. 68
 2.17 EVENTS AFTER REPORTING DATE …………………………………. 68
 2.18. CONTINGENCIES………………………………………………… …………… 69
 2.19. INFORMATION ON RELATED PARTIES……… ……………………………… 71
 2.20. ACCOUNTING OF GOVERNMENT ASSISTANCE
………………………………. 71
 2.21. INFORMATION ON DISCONTINUING OPERATION ……………………………. 72




                                                                                                               170
1. ORGANIZATIONAL                 AND       TECHNICAL            ASPECTS       OF
ACCOUNTING POLICY
       The present Provision establishes the organization, forms and ways of the
accounting maintenance in JSC “Moscow United Electric Grid Company” (or
hereinafter referred to as Company) on basis of the effective regulatory documents:
       Federal law No. 129-FL dd. 21.11.1996 “On bookkeeping”;
       Provisions on accounting records maintenance and accounting statements
keeping in the Russian Federation approved by Order of the Ministry of finances of
Russia No. 34n dd. 29.07.1998;
     Russian Accounting Standard No. 1/2008 “Accounting policy of an
organization” approved by Order of the Ministry of finances of Russia No. 106n
dd. 06.10.2008 (as amended by Order of the Ministry of finances of Russia No.
22n dd. 11.03.2009 "On change introduction in Russian Accounting Standard
"Accounting policy of an organization");
     Russian Accounting Standard No. 2/2008 "Accounting of construction
contracts" approved by Order of the Ministry of finances of Russia No. 116n dd.
24.11.2008 (as amended by Order of the Ministry of finances of Russia No. 35n
dd. 23.04.2009 "On change introduction in Russian Accounting Standard
"Accounting of construction contracts");
     Russian Accounting Standard No. 3/2006 “Accounting of assets and
obligations the cost of which is expressed in foreign currency”, approved by Order
of the Ministry of finances of Russia No. 154n dd. 27.11.2006;
       Russian Accounting Standard No. 4/99 “Accounting statements of an
organization” approved by Order of the Ministry of finances of Russia No. 43n dd.
06.07.1999;
       Russian Accounting Standard No. 5/01 “Accounting of business inventories”
approved by Order of the Ministry of finances of Russia No. 44n dd. 09.06.2001;
       Russian Accounting Standard No. 6/01 “Accounting of fixed assets”
approved by Order of the Ministry of finances of Russia No. 26n dd. 30.03.2001;
       Russian Accounting Standard No. 7/98 “Events after reporting date”
approved by Order of the Ministry of finances of Russia No. 56n dd. 25.11.1998;
       Russian Accounting Standard No. 8/01 “Contingencies of economic
activity” approved by Order of the Ministry of finances of Russia No. 96n dd.
28.11.2001;
       Russian Accounting Standard No. 9/99 “Revenues of an organization”
approved by Order of the Ministry of finances of Russia No. 32n dd. 06.05.1999;
       Russian Accounting Standard No. 10/99 “Expenses of an organization”
approved by Order of the Ministry of finances of Russia No. 33n dd. 06.05.1999;
       Russian Accounting Standard No.11/2008 “Information on related parties”
approved by Order of the Ministry of finances of Russia No. 48n dd. 29.04.2008;
       Russian Accounting Standard No. 12/2000 “Information on segments”
approved by Order of the Ministry of finances of Russia No. 11n dd. 27.01.2000;
       Russian Accounting Standard No. 13/2000 “Accounting of the Government
Assistance” approved by Order of the Ministry of finances of Russia No. 92n dd.
16.10.2000;



                                                                               171
        Russian Accounting Standard No. 14/2007 “Accounting of intangible assets”
 approved by Order of the Ministry of finances of Russia No. 153n dd. 27.12.2007;
        Russian Accounting Standard No. 15/2008 “Accounting of expenses on
 loans and credits” approved by Order of the Ministry of finances of Russia No.
 107n dd. 06.10.2008;
        Russian Accounting Standard No. 16/02 “Information on discontinuing
 operation” approved by Order of the Ministry of finances of Russia No. 66n dd.
 02.07.2002;
        Russian Accounting Standard No. 17/02 “Accounting of expenses for
 scientific and research, design and experimental and technological works”
 approved by Order of the Ministry of finances of Russia No. 115n dd. 19.11.2002;
        Russian Accounting Standard No. 18/02 “Accounting of calculations on
 profit tax” approved by Order of the Ministry of finances of Russia No. 114n dd.
 19.11.2002;
        Russian Accounting Standard No. 19/02 “Accounting of financial
 investments” approved by Order of the Ministry of finances of Russia No. 126n dd.
 10.12.2002;
       Russian Accounting Standard No. 20/03 “Information on participation in the
joint activity” approved by Order of the Ministry of finances of Russia No. 105n
dd. 24.11.2003;
        Russian Accounting Standard No.21/2008 “Changes of assessed values”
 approved by Order of the Ministry of finances of Russia No. 106n dd. 06.10.2008;
        Order of the Ministry of finances of Russia No. 67n dd. 22.07.2003 “On
 forms of accounting statements of organizations”;
        Other effective Russian rules (standards) of bookkeeping.
        Working chart of accounts is used for the accounting records maintenance.
 The Company‟s working chart of accounts is composed according to the account-
 plan book keeping of the financial and economic activity of enterprises and the
 instructions on its usage approved by Order of the Ministry of finances of Russia
 No. 94n dd. 31.10.2000 (with amendments and additions) subject to software
 functionality used for accounting records maintenance in the Company;
     The present provision is also developed on basis of the business opinion and
judgments of:
      ·     IDGC Holding, OJSC;
      ·     the management of JSC «Moscow United Electric Grid Company»;
      ·   people who are responsible for the full and authentic information
establishment on the Company‟s activity and its property status.
      The provision is called upon to:
      ·   declare principle assumption, requirements and approaches to
organization and the maintenance of accounting process (including the statements
composition);
      ·     provide authenticity of the financial (accounting) statements to be
prepared;

                                                                              172
      ·   provide the establishment of full and authentic information on such tax
accounting facilities as revenues, expenses, property, property rights, Company‟s
obligations and economic operations the cost estimate of which determines the tax
base of the current reporting (tax) period;
      ·   provide internal and external users with information in order to
implement control of the calculation correctness, completeness and timeliness of
the taxes‟ amounts payment in the budget with reference to organizational and
branch-wise peculiarities of the Company;
      ·  provide representation of the full and authentic information for actual
data formation in the budget management system.
      The following people must rely upon the present provision on accounting
policy in their activity:
      ·  chiefs and employees of all the organization departments, services and
chapters of the Company who are responsible for the timely representation of
primary documents and another accounting information in the accounting
department;
      ·   chiefs and employees of all the services and chapters who are
responsible for the timely and reasonable development, the second guess and
bringing of reference data to the notice of departments-executers (including the
accounting department);
      ·   employees of accounting department who are responsible for the timely
and qualitative execution of all the types of accounting works and drafting of all
kinds of authentic statements.
      Other Company‟s administrative documents must not contradict to
provisions of the accounting policy‟s present aspects.


      1.1. PRINCIPLES OF ORGANIZATION AND OBJECTIVES OF ACCOUNTING
            STATEMENTS
       Director General of JSC «Moscow United Electric Grid Company» is
responsible for organization of bookkeeping in JSC «Moscow United Electric Grid
Company» and the legislation observance in the course of economic operations
execution.
       Accounting records is maintained by the accounting department of JSC
«Moscow United Electric Grid Company» headed by the chief accountant.
       Chief accountant of JSC «Moscow United Electric Grid Company» submits
directly to the Director General and is responsible for the accounting policy
establishment, accounting records maintenance, timely representation of full and
authentic accounting statements.
       The Executive Body‟s accounting department implements the
methodological management by the branches‟ accounting services.
       Branches of JSC «Moscow United Electric Grid Company» have their own
accounting departments which maintain the accounting records and tax accounting,


                                                                              173
compose uncompleted accounting and tax in-house statements and represent it in
the Executive Body‟s accounting department of JSC «Moscow United Electric
Grid Company».
       Branches‟ chiefs are appointed by an Order of Director General of JSC
«Moscow United Electric Grid Company» and act on the basis of a proxy.
       Chief accountant of a branch of JSC «Moscow United Electric Grid
Company» is responsible for the accepted accounting policy observance,
accounting records maintenance, timely representation of the full and authentic
accounting statements of the branch in the Executive Body of JSC «Moscow
United Electric Grid Company».
       The organizational structure of the Company‟s accounting service conforms
fully to the organizational structure of the enterprise‟s management.


      1.2.
        FORMS       OF   PRIMARY     ACCOUNTING        DOCUMENTS   AND      RULES   OF
DOCUMENT FLOW
       The bookkeeping is made on basis of primary documents which fix the fact
of the business deals execution.
       To register the facts of economic activity JSC «Moscow United Electric
Grid Company» uses standard forms of primary accounting documents which are
established the Russian Federation State Committee on statistics, the Ministry of
finances of Russia and other authorized bodies of the state executive authority. The
documents on which no standard forms are stipulated are developed by the
Company on its own and approved by the order of the Company‟s chief.
       Forms developed by the Company must contain the following mandatory
particulars:
       · document title;
      ·   date of document compilation;
      ·   organization title on behalf of which the document is compiled;
      ·   business deal contents;
      ·   measures of a business deal in physical and monetary terms;
      · appointments titles of persons who are responsible for a business deal
   execution and correctness of its drawing up;
      ·   personal signatures of the stated persons.
      The primary documents composed in the foreign languages must have a
row-by-row translation into the Russian language.
      The computer technology of processing of the primary accounting
information is applied with the help of specialized bookkeeping program "1С:
Accountancy 8.1", Enterprise: 8.1 in JSC “Moscow United Electric Grid
Company”.




                                                                                    174
           Primary and consolidated accounting documents1 received with the computer
    programs application are included for accounting purposes if they are drawn-up in
    paper form and contain mandatory particulars.
           The Company‟s accounting registers are composed in format which is
    stipulated by software on basis of which accounting records are maintained in the
    Company. If accounting records are maintained automatically, the accounting
    registers are printed and signed by responsible people on a monthly basis, paraphed
    by chief accountant or its Deputy.
           The following computer forms of accounting documents created in the
    bookkeeping programs system are established for the internal accounting
    statements:
           turnover balance sheet;
           turnover balance sheet by account;
           ledger (sheet);
           other accounting registers which are necessary for analytical accounting and
    synthetic accounting maintenance of business deals according to the regulatory
    documents‟ requirements and necessary for the operative information receipt.
           The legal force of documents which are stored processed and transferred
    with the help of automated information and telecommunications system is
    confirmed by an electronic digital signature. The legal force of an electronic digital
    signature is admitted if software and hardware facilities are available in the
    automated information system which provides signature identification and the
    fixed reglament observance of their usage.
           Primary accounting documents which entered into the bookkeeping
    department are obligatory subject to be checked.
           Check-up is made by form (completeness and correctness of the documents
    drawing up, completion of particulars), contents (the documented operations‟
    legitimacy, the logical colligation of some indicators).
          The primary accounting document must be drawn up when a transaction is
    carried out and if it‟s impossible directly after its completion.
           Under including of the primary documents for accounting purposes the
    powers of persons who signed it are taken charge of.
           The Company‟s chiefs who act under the Power of Attorney are authorized
    to sign the primary accounting documents. The branches‟ chiefs are authorized to
    sign the primary accounting documents on basis of Proxies issued by the
    Company.
           Documents which reflect economic deals presupposing cash flow (at the
    accounts in banks, in an organization‟s till) are signed by the Company‟s chiefs
    who act under the Power of Attorney and chief accountant and also persons being
    authorized to do it. Documents which reflect the business deals on cash flow (at the
    accounts in banks, in an organization‟s till) are signed in the branches by branches‟


1
  Federal law No. 129-FL dd. 21.11.1996 (as amended as of 30.06.2003) “On bookkeeping”,
item 7 of article 9.

                                                                                          175
    chiefs who act under the Power of Attorney issued by the Company and chief
    accountant and also by people authorized to do that.
          The working chart2 of accounts for bookkeeping, other accounting policy‟s
    documents, coding procedures, programs of machine processing of data (with
    terms mentioning of their usage), accounting references on the amendments
    introduction in the account and statements are kept by the Company at least five
    years after the year in which they were used for the last time for the accounting
    statements compilation.
         The Company‟s chief is responsible for the organization of keeping3 of
    accounting documents and registers.


            1.3.    ORDER AND TERMS OF STATEMENTS COMPILATION
           The statements compilation is based on data of the accounting registers. To
    provide individual responsibility of the bookkeeping department‟s personnel, the
    accounting registers are printed and signed on a quarterly basis by persons who
    compiled4 them. These persons are responsible for the correctness5 of business
    deals‟ reflection in the storage registers.
          The bookkeeping of property, obligations and the Company‟s business deals
    is made in RUR6 and copecks. The accounting statements are made in RUR
    thousand.
           According to the requirements of the above stated normative documents on
    the bookkeeping and accounting policy maintenance of JSC «Moscow United
    Electric Grid Company» the Company‟s branches are maintaining the accounting
    records, compiling statements in the order established by the Executive Body of
    JSC «Moscow United Electric Grid Company», discharging duties on the taxes
    payment according to the requirements of the tax legislation, bearing responsibility
    for the timeliness of representation and the calculation correctness of taxable base
    on taxes paid in a centralized way and also for organization of accounting of the
    segregated property.
           Branches of JSC «Moscow United Electric Grid Company» are stated in the
    Company‟s Charter. The Company‟s branches are provided with property which is
    accounted at their separate (uncompleted) balance sheets. A branch‟s property is
    formed from the property (funds) of the company secured for it and also from cash
    and tangible assets purchased in the course of its economic activity and
    constituting the Company‟s common balance. The property which is on the
    branch‟s balance is the Company‟s ownership.

3
  Federal law No. 129-FL dd. 21.11.1996 (as amended dd. 30.06.2003) «On bookkeeping »,
item 3 of article 17.
4
  Federal law No. 129-FL dd. 21.11.1996 (as amended dd. 30.06.2003) «On bookkeeping »,
item 2 of article 10.
5
  Federal law No. 129-FL dd. 21.11.1996 (as amended dd. 30.06.2003) «On bookkeeping »,
item 2 of article 10.
6 Federal law No. 129-FL dd. 21.11.1996 (as amended dd. 30.06.2003)                        item 1 of article 8.
                                                                      «On bookkeeping »,



                                                                                                                  176
          Forms of the intra-economic statements are worked out in JSC «Moscow
    United Electric Grid Company» subject to the grouping, systematization and
    generalization of information.
          Forms of interim and annual accounting statements are developed in JSC
    «Moscow United Electric Grid Company» on the basis of forms recommended by
    the Ministry of finances of RF subject to additional indicators introduced by IDGC
    Holding, OJSC.
          The accounting statements of JSC «Moscow United Electric Grid Company»
    are compiled according to the order and within the terms stipulated by statutory
    regulations on bookkeeping. It‟s formed by the bookkeeping department of the
    Executive Body on the generalized information basis about property, obligations
    and activity results subject to information which is represented by the branches‟
    bookkeeping departments.
          The accounting statements are signed by the Company‟s chief and chief
    accountant.
           In the profit-and-loss statement the fiscal result of the reporting period is
    reflected as net profit i.e. the final fiscal result revealed for the reporting period, net
    of taxes and other similar obligatory payments due at the expense of profit
    including sanctions for nonobservance of the tax rules and also subject to deferred
    tax assets and deferred tax liabilities7.
            The annual accounting statements of JSC «Moscow United Electric Grid
     Company» is considered and approved by the General Shareholders‟ Meeting and
     represented in terms and to addresses stipulated by the Company‟ constitutional
     documents, the Russian Federation legislation and directive documents of IDGC
     Holding, OJSC .
            The final part of an audit report8 issued by the results of compulsory audit of
     the accounting statement is enclosed to the reports submitted for the approval to
     the Shareholders‟ Meeting.
           The decision taken by the annual Shareholders‟ Meeting of the Company on
    profit distribution of the reporting year is reflected in the accounting statements in
    that period when a meeting was held, i.e. in the period which follows the reporting
    year.
           The approved annual accounting statements of JSC «Moscow United
    Electric Grid Company» is published no later than June, 1st of the year which
    follows the reporting one (article 15 and 16 of Law “On bookkeeping”).
           The Company‟s interim accounting statements9 is compiled within 30 days
    after a quarter‟s end, the annual statement – within the terms established by the
    Russian Federation legislation and directive documents of IDGC Holding, OJSC
    but no later than 90 after a year end.



7
    Order of the Ministry if finances of Russia No. 67n dd. 22.07.2003.
8 Order of the Ministry of Finance of RF No. 43n dd. 06.07.1999 “On approval of Russian Accounting Standard “Accounting statements of an
organization” (RAS 4/99)», item 41.
9 Federal law No. 129-FL dd. 21.11.1996 (as amended dd. 30.06.2003) «On bookkeeping », item 2 of article 15.



                                                                                                                                           177
            The contents of the accounting registers and internal statements are a
     commercial secret and in cases stipulated by the Russian Federation legislation –
     the state secret. Persons who got access to information contained in the accounting
     registers and in internal statements must keep the commercial secret. They bear
     responsibility for its divulgation established by the Russian Federation legislation.


           1.4.   ORDER OF ESTABLISHMENT, APPROVAL AND CHANGE OF ACCOUNTING
     POLICY
          The accounting policy change is made from the reporting year beginning if
     something else is not preconditioned by a reason of such a change10.
          Any change of the accounting policy is formed in form of additions and
     changes to the given Provision which are approved by the Company‟s chief.
           Addition to the accounting policy is not considered as its revised version and
     applied after the approval.
           The accounting policy changes for the year which follows the reporting year
     are declared by the Company in an explanatory note11 which constitutes the
     organization‟s12 accounting statements. The changes‟ consequences of the accounting
     policy which influenced or are able to influence significantly on the organization‟s
     financial state, fiscal results of its activity and (or) cash flow are reflected in the
     accounting statements retrospectively except for cases when such consequences
     assessment in money terms can‟t be made with sufficient reliability13 in relation of
     periods which precede the reporting period.
             Those ways of accounting records maintenance are recognized essential14
     without knowledge on application of which it‟s impossible for the users of
     accounting reports concerned to assess authentically the organization‟s financial
     state, fiscal results of its activity and (or) cash flow.


           1.5.   CHART OF ACCOUNT APPLIED
         JSC «Moscow United Electric Grid Company» applies the working chart of
     accounts for bookkeeping developed on basis of model Pattern of accounts
     recommended for the usage by IDGC Holding, OJSC.
            The working chart of accounts for bookkeeping must be applied compulsory
     by all the bookkeeping department‟s employees of the Company and used in the


10
   Russian Accounting Standard No. 1/2008 “Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 12;
11
   Russian Accounting Standard No. 1/2008 «Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 24;
12
   Russian Accounting Standard No. 1/2008 Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 25;
13
   Russian Accounting Standard No. 1/2008 Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 15;
14
   Russian Accounting Standard No. 1/2008 «Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item17;

                                                                                          178
process of accounting records maintenance in the branches. The Company‟s chief
accountant is delegated an authority to introduce, clarify and exclude sub-accounts
to synthetic accounts, establish additional systems of analytical accounting.
      The business deals reflection in the accounting is made according to the
model Pattern of accounts of JSC «Moscow United Electric Grid Company». The
Company maintains bookkeeping of property, obligations and economic operations
by the double entry according to the Chart of accounts for bookkeeping.


      1.6.   INTERNAL ACCOUNTING STANDARDS APPLIED

      The Company applies internal accounting regulations (intra-company
standards of accounting) which are developed on basis of standard internal
accounting standards.

       Intra-company standards of accounting contain requirements (the instruction
material in detail) to the accounting records maintenance of concrete business deals
of the Company, the organization of documentation procedure.
      Intra-company standards of accounting must be compulsory applied by all
the Company‟s employees.

      All the current changes in the intra-company standards of accounting caused
by change of the legislation, nature of operations implemented or the accounting
process organization is formed by an Instruction of the Company‟s chief
accountant.
      1.7.   ORDER OF ASSETS AND LIABILITIES STOCKTAKING
      Taking inventory of property and obligations is made according to Law of
the Russian Federation No. 129-FL dd. November, 21st of 1996 “On bookkeeping”
and Instructional guidelines on taking inventory of property and financial liabilities
approved by order of the Ministry of finances of Russia No. 49 dd. 13.06.1995.
       The order, taking terms of the planned inventory and the composition of the
central inventory commission are established by an order of the Director General
of JSC «Moscow United Electric Grid Company» and in case when the inventory
taking is compulsory - on basis of orders of the Company‟s Director General and
the branches‟ Directors by the attribution. The approval and composition of
inventory commissions in the field is established by orders of the Company‟s chief
(for the Executive Body) and branches‟ chiefs (for branches) correspondingly.


2. METHODICAL ASPECTS OF ACCOUNTING POLICY


      The given section describes the selected ways of the accounting records
maintenance which influence essentially on the assessment and decisions taking by
the users of the statements which are standard in the establishment course of the
Company‟s accounting policy.


                                                                                  179
          GENERAL REQUIREMENTS TO STATEMENTS. REQUIREMENTS AND
       2.1.
ASSUMPTIONS ACCEPTED IN COURSE OF MAINTAINING OF RECORDS AND
PREPARATION OF REPORTING. REQUIREMENTS TO INFORMATION FORMED BY
SYSTEM OF ACCOUNTS

     The Company‟s system of accounts must provide authenticity, completeness
and reliability of the accounting information with an admissible level of
expenditures for its establishment and representation.
      The reporting is considered to be authentic and complete which is formed
according to the rules established by the statutory regulations on bookkeeping and
the present Provision on the accounting policy.
      The reporting is considered to be reliable if it doesn‟t contain any essential
mistakes. One can count on the mistakes absence due to the multilevel authenticity
control of the records maintaining and preparation of the Company‟s reporting:
control of a specialist executing the corresponding accounting procedures, control
of a chief of the bookkeeping department‟s structural subdivisions which signs
consolidated accounting registers, control of the internal supervision and auditing
service, audit checks-up.
       The information (except for special-purpose reports) must be neutral,
i.e. devoid of one-sidedness, single-side accounting of the requirements of one of
the reporting users (for example tax bodies). The information is not neutral if it
influences on the decisions and assessments of the users concerned by way of
selection or representation form aimed at predetermined results or consequences
achieving.

       Information on the Company‟s property status is formed (represented by
way of accounting balance-sheet - form No. 1) in the composition of the external
reporting for its users, fiscal results of activity and changes in the Company‟s
financial state (is represented by way of a profit-and-loss statement - form No. 2),
clarifications and explanations being useful for the wide range of users concerned
in the course of decisions taking (is represented by way of enclosures to the
balance-sheet – of form No. 3 “Report on capital‟s changes”, No. 4 “Report on
cash flow", No. 5 “Enclosure to the balance sheet” and in the explanatory note).
     The principle sections of the explanatory note are determined by item 4 of
  th
13 article of Federal law No. 129-DL dd. November, 21st of 1996 “On
bookkeeping”.
       In particular:
              ·   information on organization;
              ·   organization‟s financial state;
              ·   data comparability for the reporting year and years preceding to it;
              ·   assessment methods and essential accounting reports‟ articles:
                  · on intangible assets and Research and Development;


                                                                                    180
                    · on fixed assets and income-bearing placements;
                    · on business inventories;
                    · on financial investments;
                    · on credits and loans;
                    · on profit tax imputation;
                    · on exchange differencies;
                    · on events after the reporting date;
                    · on economic activity‟s conventional facts;
                    · on discontinuing operation;
                    · on affiliated persons;
                    · on state assistance;
                    · facts of accounting rules non-application;
                    · changes in accounting policy for the next reporting year.
           The explanatory note‟s structure can be different of the facts of some
     sections (for example, the non-application of accounting rules, changes in
     accounting policy) are absent or the organization‟s activity demands expanded
     explanations.
           The annual reporting is represented by the Company in a full scope of forms
     with the explanatory note‟s enclosure, the interim statements is represented by the
     Company in a volume of the Accounting balance-sheet and the profit-and-loss
     Statement.
            The bookkeeping‟ purpose in relation to information for the internal users
     consists in information establishing which is useful for the Company‟s
     management to take managerial decisions. The Company‟s management is
     interested in information represented to external users and in different additional
     information which is represented in forms of the internal statements in volume
     approved by the Company‟s chief or a person authorized by him/her.
           In the forming course of information the Company is guided by generally
     accepted requirements to the records maintenance and preparation of reporting: the
     requirement15 of completeness, the requirement of timeliness, the requirement of
     prudence, the requirement of priority of contents rather than the form, the
     requirement of consistency, the requirement of rationality.




15
  Russian Accounting Standards No. 1/2008 “Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 6;

                                                                                         181
            Beside the stated requirements the accounting process (including the
     reporting formation) is made by the Company on basis of the following
     assumption16:
                  · assets and liabilities of the organization exist separately from assets
           and liabilities of this organization‟s owners and assets and liabilities of other
           organizations (the economic entity assumption of the organization);
                  ·  the organization will continue its activity in the foreseeable future
           and it has neither intentions nor necessity to liquidate or decrease essentially
           its activity and consequently the obligations will be redeemed in accordance
           with the established procedure (the organization‟s going concern
           assumption);
                  · accounting policy approved by the organizations is applied in
           succession from one reporting year to another (the accounting continuity
           assumption);
                  · economic activity‟s facts of the organizations refer to that reporting
           period in which they took place regardless if the actual time of cash inflow
           or cash outflows related to these facts (the accrual principle assumption).


           2.2.   GENERAL APPROACHES TO ACCOUNTING ENTITIES' QUALIFICAGTION

           The Company‟s assets are subdivided into assets and expenses (uncompleted
     investments in the assets establishment).
            The Company uses (expends) different kind resources within the reporting
     period: tangible, financial, labor and others. The utilized resources‟ cost estimate
     taken to accounting is qualified as expenses (uncompleted investments in the assets
     establishment).
     When the period comes to an end the accumulated costs give rise to assets
     formation (fixed assets finished commodity etc.) or expenses (decision taking on
     writing off to losses of uncompleted capital investments by virtue of liquidation or
     sale of a half constructed facility, losses writing off to Research and Development
     which didn‟t give any results, writing off of the prime cost of works executed and
     services rendered etc.).
           Completion moment of expenses’ accrual period is determined by that
     moment when the conditions of assets‟ recognition are observed or when it‟s
     obvious that expenses incurred reduce the Company‟s economic benefits without
     any asset formation.
           The expenses are subdivided into capital (noncurrent) and ongoing (current).
               Capital expenses are those ones recognized by the Company the goal of
          which is noncurrent assets establishment including the expenses for the

16
  Russian Accounting Standards No. 1/2008 “Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 5;

                                                                                         182
          acquisition of new facilities, new construction, enlargement, reconstruction,
          modernization and re-equipment.
                All other expenses are recognized by the Company as ongoing. The
          cost estimate of the utilized resources - expenses – is calculated preliminary
          on accounts of expense, for example:
                ·  expenses for manufacture of products, works, services (current) -
           account 20, 25;
                ·   auxiliary production expenses - account 23
                ·   general economic expenses - account 26;
                ·    expenses for acquisition (establishment) of noncurrent assets
           (capital investments) - account 08.
          Сost accounting at accounts of expenses on acquisition (establishment) of
     noncurrent assets is made item-by-item17.
           Сost accounting at accounts of expenses on acquisition of current assets is
     made with a breakdown into nomenclature18 numbers, parts, homogeneous groups
     of business inventories.
           When the period of expenses accrual comes to an end the Company
     recognizes that the cost outlay has given rise to the asset establishment if property
     item was formed from the usage or alienation of which an economic benefit is
     expected in the future. The Company recognizes as assets only property items
     which belong to it on an ownership basis (the economic entity assumption19).

            Would-be economic20 benefits are potential possibility of property to
     promote directly or indirectly to cash or their equivalents inflow in the Company.
     It‟s considered that a property item will give economic benefits in the future when
     it can be:
                · used separately or in combination with another item in the
           manufacture process of products, works, services meant for sales;
                ·   changed by another property item;
                ·   used for the satisfaction of accounts payable;
                ·   distributed among owners.



17
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01», item 6.
18
   Order of the Ministry of Finance of RF No. 44n dd. 09.06.2001 “On approval of Russian
Accounting Standard “Accounting of business inventories” RAS 5/01», item 3.
19
   Russian Accounting Standards No. 1/2008 “Accounting policy of an organization” approved by
order of the Ministry of Finance of Russia No. 106n dd. 06.10.2008, item 5;
20
   “Concept of bookkeeping in the market-based economy of Russia” (approved by the
Methodological Council for Accounting under the Ministry of Finance of RF dd. 29.12.1997), item
7.2.1.

                                                                                           183
            For the recognition of a property item in bookkeeping, its value must be
     measured with a sufficient reliability degree21. The company recognizes the
     measure of value to be sufficiently reliable in case when a property item is ready
     for the usage in planned purposes and all the expenses on its bringing to this state
     are recognized in accounting and estimated on basis of accounting documents,
     contractual or market prices and tariffs.

           If the normative documents‟ requirements change on qualification of
     separate accounting entities, the Company qualifies all the accounting entities –
     both purchased before the given changes and purchased after their coming into
     effect (provision of uniformity of property accounting) according to the new
     requirements.

            If the cost outlay doesn‟t result in an asset establishment, then when the
     accrual period of expenditures ends the Company recognizes expenses. At the
     same time the decrease of the Company‟s economic benefits as a result of the
     retirement of assets (cash assets, another property) and (or) the circumstances
     occurrence which brings about decrease of the capital (except for decrease of the
     participants‟ contributions) is recognized to be expenses22.
           The Company recognizes expenses only in that case if the retirement of
     assets is of absolute character. If under certain conditions the retired assets are
     given back to the Company then the accounts receivable or establishment of
     another asset (for example, financial investments) is recognized in accounting.
            The Company doesn‟t recognize23 as expenses cash assets and another
     property which is passed with a condition of a possible or compulsory further
     repayment (granted loans, advance payments, transfer of property for sale to the
     commission buyer or agents, sums of turnover taxes singled out by a separate entry
     in settlement documents with supplier etc.).

            The Company‟s economic benefits‟ increase as a result of assets acquisition
     (cash assets, another property) or obligations retirement which results in increase
     of the capital except for participants‟ contributions (owners of property) is taken to
     mean revenues24.




21
   “Concept of bookkeeping in the market-based economy of Russia” (approved by the
Methodological Council for Accounting under the Ministry of Finance of RF dd. 29.12.1997), item
8.3.
22
   Order of the Ministry of Finance of RF No. 33n dd. 06.05.1999 “On approval of Russian
Accounting Standard “Expenses of an organization” RAS 10/99”, item 2.
23
   Order of the Ministry of Finance of RF No. 33n dd. 06.05.1999 “On approval of Russian
Accounting Standard “Expenses of an organization” RAS 10/99”, item 3.
24
   Order of the Ministry of Finance of RF No. 32n dd. 06.05.1999 “On approval of Russian
Accounting Standard “Revenues of an organization” RAS 9/99», item 2.

                                                                                           184
           The Company doesn‟t recognize25 as revenues the cash inflow and another
     property received with a condition of a possible or compulsory further economic
     turnover transfer to other participants (raised loans, advances and prepayments
     entered, sums of turnover taxes singled out by a separate entry in settlement
     documents with supplier etc.).

          The sum of assets‟ value net of the amount of its obligations (accounts
     payable) is recognized to be the Company‟s Capital26.


             2.3.   GENERAL APPROACHES TO ACCOUNTING ENTITIES' ESTIMATION

           To include property and obligations for accounting purposes the Company
     estimates them in monetary terms. The assessment of property is made as follows:
             · property27 received by the Company as a contribution in the authorized
      capital is assessed in a pecuniary valuation which is defined by the Company‟s
      founders (shareholders) according to the current legislation‟s requirements;
                                                                         28
             property acquired by the Company for the payment
             ·                                                                is assessed by the
      sum of expenses actually made for its acquisition.
             · property which is made in the Company29 itself is assessed by the prime
      cost of its manufacture (actual expenditures related to manufacture of a property
      item);
             · tangible assets which are left from writing off of fixed assets30 unsuited
      for a recovery and further usage, spare parts31 appearing as a result of the fixed
      assets recovery (reconstruction, re-equipment, repair) are assessed by the current
      market value as of the date of the fixed assets writing off or as of the date of the
      spare parts including for accounting purposes;
         ·   property received by the Company on a gratis basis and property revealed
     при in the course of assets and obligations32 stocktaking by the Company is


25
   Order of the Ministry of Finance of RF No. 32n 1999 dd. 06.05.1999 “On approval of Russian
Accounting Standard “Revenues of an organization” RAS 9/99», item 3.
26
   “Concept of bookkeeping in the market-based economy of Russia” (approved by the
Methodological Council for Accounting under the Ministry of Finance of RF), item 7.4.
27
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01», item 9.
28
   Order of the Ministry of Finance of RF No. 34n dd. 29.07.1998 “On provision approval on
maintenance of accounting records and accounting statements in the Russian Federation”, item 23.
29
   Order of the Ministry of Finance of RF No. 34n dd. 29.07.1998 “On provision approval on
maintenance of accounting records and accounting statements in the Russian Federation”, item 23.
30
   Order of the Ministry of Finance of RF No. 34n dd. 29.07.1998 “On provision approval on
maintenance of accounting records and accounting statements in the Russian Federation”, item 54.
31
   Order of the Ministry of Finance of RF No. 91n dd. 13.10.2003 “On approval of methodological
instructive regulations on fixed assets accounting”, item 79.
32
   Order of the Ministry of Finance of RF No. 91n dd. 13.10.2003 “On approval of
methodological instructive regulations on fixed assets accounting”, item 36.

                                                                                            185
     assessed by the current market value as of the date of property including for
     accounting purposes. The cash funds‟ sum which can be received as a result of the
     stated asset sales as of the date of including for accounting purposes is taken to
     mean the current market value. The current market value is formed on basis of the
     prices which are good for the given or similar property type. Thereby the data on
     the effective price must be confirmed documentary or by expertise33.
            In the determination course of the current market value the data on prices for
     similar fived assets can be used, received in a written form from organizations-
     producers, data on the prices level possessed by the State statistics authorities,
     trade inspections and also in mass media and specialist literature, expert‟s reports
     (for example those of appraisers) on the cost of some fixed assets‟34 facilities. An
     independent expert‟s report or that of authorized specialists of the Company who
     have special knowledge and skills is taken to mean an expert‟s report. The given
     specialists are appointed by a chief‟s order of the Company or that persons
     authorized by him/her as members of the permanent commission on including for
     accounting purposes or writing off of property.
            The current market value of securities received by the Company on a
     gratis basis having market quotations is taken at the amount of their market
     value35 calculated in an established procedure by the trade organizer in the
     securities market and conformed documentary (information in professional mass
     media, listing of exchange etc.)
                  The property received by the Company on contracts which stipulate a
     discharge of obligations (payment) with non-monetary assets (in particular by
     barter contracts)36 is assessed on the valuables cost which are transferred or subject
     to be transferred to the Company. The valuables cost which are transferred or
     subject to be transferred to the Company is established from the price on which the
     Company usually defines the similar valuables‟ cost under comparable
     circumstances.
          If it‟s impossible to establish the valuables‟ cost transferred or subject to be
     transferred, the fixed assets‟ cost received by the organization on contracts which
     stipulate a discharge of obligations (payment) with non-monetary assets is
     determines on basis of the cost by which similar facilities of fixed assets are
     acquired under comparable circumstances.
          The actual expenditures cost for the facility construction of transmitting party
     which is stated in the Transfer and Acceptance Act of property is recognized the
     primary cost of fixed assets received instead of the retired property in terms of the
     agreements on losses compensation.

33
   Order of the Ministry of Finance of RF No. 34n dd. 29.07.1998 “On provision approval on
maintenance of accounting records and accounting statements in the Russian Federation”, item 23.
34
   Order of the Ministry of Finance of RF No. 91n dd. 13.10.2003 “On approval of
methodological instructive regulations on fixed assets accounting”, item 29.
35
   Order of the Ministry of Finance of RF No. 126n dd. 10.12.2002 “On approval of Russian
Accounting Standard “Accounting of financial investments” RAS 19/02», item 13.
36
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 11.

                                                                                             186
            While assessing property acquired on any grounds its actual cost is formed
     with the expenditures addition incurred by the Company to bring the property to the
     usable state (for carrying out expert examinations, consultations and assessments,
     for the services payment of agents and other intermediaries, delivery, installation
     and trial startups, book entries, payment of fees etc.)37.

           The property and obligations assessment the cost of which under purchase
     (appearance) is expressed in a foreign currency is made in RUR by way of a
     foreign currency recalculation at the rate of the Central Bank of the Russian
     Federation, the rate being effective as of the date property items including for
     accounting purposes.

          Property cost in which they are included for accounting purposes is not
     changeable, except for cases defined by the Russian Federation legislation.
            Change of noncurrent assets (except for intangible assets) is allowed in case
     of a further construction38, further equipping, reconstruction, re-equipment, partial
     liquidation and re-evaluation of fixed assets‟ facilities.
            It‟s allowed for current assets in case if business39 inventories outdated, lost
     fully or partially their primary quality or the current market cost, the sales value of
     which decreased.
           The carrying value adjustment is made to the market value for financial40
     investments on which one can define the current market value in the established
     procedure.

            If the documents on the cost of facilities which entered towards property
     arrivals (fixed assets, business inventories etc.) are not available, they are included
     for accounting purposes at the contingent valuation subject to the agreed cost,
     expenses on delivery defined according to the data of railroad waybill and other
     transportation documents.

      In the reports the property which relates to depreciable assets (fixed assets,
intangible assets and income yielding investments into tangible assets) is reflected
by the depleted cost (the primary cost net of the accrued depreciation) and by the
financial investments on the balance sheet value - net of an established reserve.


           2.4.
              SELECTED WAYS OF CAPITALIZED EXPENSES AND NONCURRENT ASSETS
     ACCOUNTING


37
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 12.
38
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 14.
39
   Order of the Ministry of Finance of RF No. 44n dd. 09.06.2001 “On approval of Russian
Accounting Standard “Accounting of business inventories” RAS 5/01”, item 25.
40
   Order of the Ministry of Finance of RF No. 126n dd. 10.12.2002 “On approval of Russian
Accounting Standard “Accounting of financial investments” RAS 19/02”, item 20.

                                                                                            187
      The capitalized expenses are connected to:
            ·  capital construction implementation by way of new construction
      and also reconstruction, modernization, enlargement and re-equipment
      (further named - construction);
            ·  acquisition of buildings, constructions, equipment, transport
      vehicles and other separate facilities (or their parts) of fixed assets;
            ·   land plots and natural resources sites acquisition;
            ·   acquisition and establishment of intangible assets.


      2.4.1.    Capital construction by contractor organizations and using
one's own resources
       The capitalized expenses result in the noncurrent assets (fixed assets)
establishment after putting of the given facilities into service which is drawn up
with the corresponding notes and if necessary – with drawing up of the certificate
of the State registration of rights of property for estate.
      While including property unit for accounting purposes as a facility of fixed
assets the sum of actual expenses on its establishment accounted as capital
investments in the given facility forms the primary cost of the fixed assets‟ facility:
            ·   property units constructed by the Company and its departments by
      an economic or contractor way, - after putting into service of fixed assets‟
      facilities;
            ·  fixed assets which are included in the construction estimates (meant
      for the run in projects under construction), - after putting into service of all
      the construction project;
           ·   fixed assets which need to be installed, - after the installation
      process completion;
            ·  fixed assets which don‟t need to be installed, - after the facility
      entry from the supply department in the operating department. Thereby if the
      operating department puts the facility received to stock then it‟s reflected in
      accounting as facility of fixed assets in stock (in reserve).
       Accounting of investments in noncurrent assets is made with a breakdown
into construction projects.
     Construction project – is a separately standing building or construction, type
or complex of works for the construction of which design and estimate
documentation must be drawn up.
       Construction project is considered with all the developments, equipment,
furniture, fixtures, subsidiary and auxiliary units relating to it, and also if necessary
– with engineering networks adjoining to it and general on-site works (the oversite
excavation, capital improvement, planting of greenery etc.).




                                                                                     188
        The accounting of expenses is made on an accrual basis from the
construction beginning of the facility with a breakdown into reporting periods till
facilities putting into service or full production of corresponding works. The
builder (customer) accounts expenses on account 08 “Investments in noncurrent
assets”.
       Legal person who possesses a land plot on an ownership basis or a leasehold
basis and who took a decision on the construction program implementation at it of
a complex of facilities is taken to mean builder. The decision defines the financial
provision methods of construction and makes the works coordination on its
implementation.
      The construction-in-process – is a builder‟s expenses on erection of building
projects from the construction beginning till facilities putting into operation,
accounted as capital investments by account 08 “Investments in noncurrent assets”.
      Accounting of the construction-in-process is made:
           ·   on separate construction projects;
           ·   on technological structure of expenses on a construction project.

     The expenditures on a separate construction project are grouped on the
expenses‟ technological structure which is defined by a cost estimating
documentation for a corresponding project.
      Technological structure of expenses stipulates expenses, in particular:
           ·   for construction works;
           ·   works on equipment installation;
           ·   acquisition of equipment given for installation;
           ·  acquisition of equipment which doesn‟t need to be installed,
      instruments and inventory, equipment which needs to be installed but is
      meant for the constant store;
           ·   other capitalized expenses.

      The capital investments by way of construction (reconstruction, re-
equipment) of facilities made by an economic way are reflected monthly in
accounting as far as they are formed. Thereby the department which implements
capital investments reflects them monthly on account 08 “Investments in
noncurrent assets”.

      The capital investments made in the course of capital works which are
executed for the Company by outsourced contractor organizations are reflected in
accounting as far as they are executed on basis of signed certificates of work
performed and settlement documents.


      2.4.2.     Operations account by participatory construction of facilities



                                                                                   189
      There are two possible variants of contracts conclusion of participatory
construction of facilities:
           ·    Company comes into the joint activity the subject of which is a
      facility construction. A distinguishing feature of such a contract is the thing
      that all the parties on such a contract don‟t only contribute cash funds but
      take part actually in the construction in some way;
           ·   Company invests own funds or accumulates other persons‟ funds
      for a facility construction. In this case only one of the parties (builder-
      customer) is actually engaged in construction and the other party (parties)
      just invests cash assets to receive a needed result – appears to be an investor.

       In the first case the parties‟ relations are reflected according to the order
established for the joint activity.
       The Company‟s contribution in the joint activity is reflected on account 58
“Financial investments. Contributions under simple partnership agreement”. The
contributions receipt and expenses on construction are accounted at a separate
balance-sheet of the joint activity by a party which is imposed on such a duty
according to the contract. After the construction end the Company forms the
accounts payable on completed capital investments which are due to it. Account 08
“Investments in noncurrent assets” is used to reflect them. So, putting into service
of the completed facility (in part which belongs to the Company according to the
contract clauses) is reflected in the Company‟s accounting. Such facility of fixed
assets owned by two or several organizations is reflected in the composition of the
Company‟s fixed assets in proportion to its share in facility‟s the total cost.

       In the second case the investments actually made by the Company (cash
assets and another property transfer) are reflected in the long-term accounts
receivable composition at separate account 76 “Settlement of accounts with
different debtors and creditors” (including the services payment of the builder-
customer).
      If the Company discharges duties of the builder-customer then other
investor‟s funds received by it are reflected as the long-term accounts payable.
Thereby the additional payment of the Company‟s services (over the expenses sum
for construction) is reflected by the Company at business accounts of sales
(account 90 “Sales”) as far as supervision over construction and other works is
made.


      2.4.3.     Accouningt of interest on loans and credits attracted for
acquisition and/or establishment of noncurrent assets


      2.4.3.1 Investment assets.
      To define the accounting order of capitalizable costs as to interest on loans
and credits attracted the Company singles out investment assets among objects of


                                                                                  190
investments. Investment assets are taken to mean property items the preparation of
which to the assumed usage needs a long period of time and significant expenses
for acquisition, construction and (or) manufacture. To the investment assets the
Company relates with the cost of over RUR 10 billion and with the establishment
term of over 5 years.
     The investment assets are facilities of construction-in-process which will be
subsequently included for accounting purposes by a customer (investor, buyer) as
fixed assets (including land plots), intangible assets or other noncurrent assets
(RAS 15/2008 dd. 06.10.2008 Order of the Ministry of finances No.107).
     Interest payable to the loaner (creditor) connected directly with the
acquisition, construction and (or) production of an investment asset is included in
the investment asset‟s cost.
     If the acquisition, construction and (or) production of an investment asset is
suspended for a long period of time (over three months), interest payable to the
loaner (creditor) cease to be included in the investment asset‟s cost from the first
day of the month which follows the month of suspension of acquisition,
construction and (or) production of an asset. Interest payable to the loaner
(creditor) are included within the stated period in the composition of the
organization‟s other expenses.
     Under renewal of acquisition, construction and (or) production of an
investment asset interest payable to the loaner (creditor) is included in the
investment asset‟s cost from the first day of the month which follows the month of
renewal of acquisition, construction and (or) production of an asset.
     Term within which the agreement of additional technical and (or)
organizational issues is made which appeared in the course of acquisition,
construction and (or) production of an investment asset is not considered the
suspension period of acquisition, construction and (or) production of an investment
asset.
     Interest payable to the loaner (creditor) cease to be included in the investment
asset‟s cost from the first day of the month which follows the month of cessation of
acquisition, construction and (or) production of an investment asset.
     Expenses on loans are subject to inclusion in an investment asset‟s cost or in
the composition of other expenses on a straight-line basis on reporting periods.
     Expenses on loans and credits received, connected with an investment assets
establishment are included in the cost of such an asset regardless of the fact if is
recognized amortizable assets or not.


      2.4.3.2 Accounting of credits and loans.
       The indebtedness of JSC «Moscow United Electric Grid Company» on
credits and loans secured issued by own bills is accounted separately at account 66
“Settlement of accounts on short-term credits and loans” – short-term indebtedness,
at account 67 “Settlement of accounts on long-term credits and loans” - long-term
indebtedness.
      Borrowing cost is:

                                                                                 191
             Interest payable to the loaner (creditor);
            Additional expenses on loans which include the sums paid for information
     and consulting services; sums paid for the expert appraisal of the loan agreement
     (credit agreement); Additional expenses on loans are reflected in bookkeeping and
     reports evenly within the loan agreement‟s (credit agreement‟s) effect.
             other expenses connected directly with the loans (credit agreements) receipt.
           In the bookkeeping the borrowing cost is reflected separately from the
     principle amount of an obligation on a loan (credit) received. The principle amount
     of an obligation on the loan (credit agreement) received is reflected in bookkeeping
     by an organization-borrower as accounts payable in the amount of funds
     receivable, according to the loan agreement‟s (credit agreement‟s) clauses.


             2.4.3. Accounting of operations related to issue of bonds
       Accounting of operations connected to the issue of bonds is made at account
 67 “Settlement of accounts on long-term credits and loans”. The coupon yield‟s
 amount in percent and the selling (distribution) price is defined by a decision of the
 Board of Directors of JSC «Moscow United Electric Grid Company».
       The accrual of due and payable revenue (interest of discount) on floated
 bonds is made according to the contract clauses and is reflected by JSC «Moscow
 United Electric Grid Company» in other expenses of those reporting periods to
 which the given accruals refer.
       Organization – issuer doesn‟t account preliminary the amounts of revenue
 payable to the loaner on sold bonds as deferred expenses41.
             2.4.4.             Fixed assets
           The Company recognizes as fixed assets those assets in relation of which the
     following conditions are fulfilled at the same time:
             · production usage in the manufacture course is presupposed under works
          execution or services rendering or managerial needs for a long period of time
          (the useful life with duration of over 12 months or normal operating cycle if it
          exceeds 12 months);
             ·ability to provide economic benefits (revenue) in the future and also the
          organization didn‟t plan to resale the given assets42 further on.
            Assets in relation of which the conditions stipulated by the present Provision
     are fulfilled and with the cost of no more than RUR 20000 per unit are reflected in
     the accounting records and accounting statements in the composition of business
     inventories.
           Fixed assets meant exceptionally for the assignation in temporary possession
     and use with the goal of an income acquisition are accounted by JSC «Moscow

41
     Chart of accounts No. 94n, section VI
42 Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 (as amended on 18.05.2002) “On approval of Russian Accounting Standard
“Accounting of fixed assets” RAS 6/01”, item 4.



                                                                                                                                      192
  United Electric Grid Company» in the composition income yielding investments
  into tangible assets, account 03 Income yielding investments into tangible assets.
         Items of immovable property which are set in operation till the state
 registration are itemized separately in the composition of fixed assets.
         If a library holding is available the printed publications‟ cost being included
 in the fund is entered in the fixed assets‟ composition on debit side of account 01
 “Fixed assets” in the correspondence from credit side of account 08 “Investments in
 noncurrent assets”.
           The Company doesn‟t recognize as fixed assets those facilities in relation of
     which under their including for accounting purposes (at the qualification moment)
     a decision on alienation in favor of other persons is taken - resale, barter etc. is
     planned. In this case a facility is qualified by the Company as goods.
        A separate structurally self-standing subject meant for the fulfillment of
 certain self-contained functions or a self-standing complex of structurally linked
 subjects representing the integral whole and meant for a certain work43 fulfillment
 is recognized to be an inventory item of fixed assets.

            If one or several subjects of the same of different application represent self-
     standing complex of structurally linked subjects which have the common fixtures
     and fittings, common management installed at one and the same foundation. As a
     result of it each subject can perform its functions only in the composition the
     complex, all the complex as the integral whole is included for accounting purposes
     as an inventory item.

            If one inventory item has several parts having a significantly different useful
     life then each such part is accounted as a self-standing inventory item regardless of
     the fact if the stated item‟s part can perform a self function or not.
           Self-standing inventory items are the following ones:
                ·   capital investments in leased items of fixed assets;
                ·  capital investments for the fundamental improvement of lands
           (drainage, irrigative and other reclamation works);
                · parts of items of fixed assets which are in the equity ownership of
           the Company and another (other) owner (organizations).

           Computers can be accounted as a separate structurally self-standing subject
     having its number or as subject composed of separate subjects (the base unit,
     monitor unit etc.); each of them has its own inventory number.

           The fixed assets are included for accounting purposes by the primary cost
     defined depending on the way of entry – acquisition for the payment, creation
     using one‟s own resources (construction), gratuitous receipt etc.

43
 Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 6.

                                                                                         193
           Sum of the Company‟s actual expenses for acquisition, construction and
     production (except for a value added tax and other recoverable taxes) 44 is
     recognized the primary cost of fixed assets acquired for the payment.
         Actual expenditures are:
                ·   sums paid to suppliers according to a delivery contract;
                ·   sums paid to outsourced organizations for services on property
           delivery into storehouses (incl. the railway tariff);
                ·  sums paid to organizations for information and consultative services
           connected to the fixed assets acquisition;
                ·   customs duties and customs fees;
                ·   unrecoverable taxes, state duty paid due to the acquisition of the
           fixed assets item;
                ·   remunerations paid to an intermediary organization via which the
           fixed assets item is acquired;
                ·    expenditures for commissioning works, individual testing of some
           machinery types and mechanisms, complex testing of all the equipment
           types and engineering facilities in order to check up the quality of their
           installation made “idly”;
                ·  general economic and other similar expenditures in case when they
           are connected directly with an acquisition of a fixed assets item;
                ·    other expenditures which are connected directly to the acquisition,
           construction and production of a fixed assets item and bringing of it to the
           state in which it‟s suitable for use (for example, expenses on issue a letter of
           credit to acquire fixed assets, travelling allowances, including those above
           norms established by the legislation if they are connected directly with the
           fixed assets acquisition).
       Expenses for acquisition and establishment of fixed assets (except for
 investment assets) are not included in the actual expenses:
       interest payable to loaners and creditors on loans and credits received from
 them;
       interest, discount on bills and bonds payable.
        Expenses on internal handling of fixed assets items between the Company‟s
  departments are not included on the primary cost.
           Consignment note for internal handling of the fixed facilities items (f. OS-2)
     and plan-record card (f. OS-6) are the grounds for including the fixed assets for
     accounting purposes received by an internal handling between the Company‟s
     departments.



44
  Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 (as amended dd. 18.05.2002)
“On approval of Russian Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 8.

                                                                                          194
      Items of fixed assets taken or transferred for keeping accountable for assets
are accounted at off balance sheet account 002 “Goods and materials accepted for
custody” in prices which are stipulated in acceptance delivery statements.
     If the Company takes a decision on the full cessation of own operation of
some fixed assets items then the following things are reflected in accounting
depending on a situation:
            ·   closing down temporarily of the given facilities – then these
      facilities stand separately in the analytic account;
            ·  the stated facilities transfer to other users on the basis of non-
      gratuitous contracts (lease, rent) - then these facilities are transferred to
      business account of income-bearing placements in tangible assets;
            · writing off from accounting of facilities which are constantly not
      used (obsolescence and/or depreciation) – then the Company recognizes
      expenses.
                    Writing off of the cost of some fixed assets items
       Assets acquired after 01.01.2006 till 01.01.2008 with the cost of no more
than RUR 10000 and from 01.01.2008 of no more than RUR 20 000 per unit are
reflected in accounting records and accounting statements in the composition of
business inventories at account 10 “Materials”. Forms of primary accounting
documents on fixed assets accounting are not applied in relation of these assets, in
particular the following forms are not drawn up under receipt and transfer of fixed
assets: form No. OS-1, form No. OS -2 under internal handling of facilities, form
No. OS-4 under their retirement, inventory card of fixed assets accounting is not
opened form No. OS-6 etc.
      To provide these assets‟ preservation in production or under operation JSC
«Moscow United Electric Grid Company» makes the credit ticket on them by form
No. М-4, requisition slip by form No. М-11, inventory record card by form No. М-
17 and others.
       The following forms are drawn up on acquired transport vehicles, including
in the leasing process, with the cost of no more than RUR 20 000 per unit, besides
that by off-balance account: form No. OS-1 under the receipt and transfer of fixed
assets, form No. OS-2 under the internal handling of facilities, form No. OS-4
under their retirement, inventory card of fixed assets accounting is opened form
No. OS-6.


                                Retirement of fixed assets
       Revenues and expenses connected to the sales, retirement and another
writing off of fixed assets items from the accounting records, are subject to the
profit and loss account crediting as other revenues and expenses.
       Under retirement of fixed assets items and other assets due to impossibility
of usage owing to unsuitability to a further operation, obsolescence and writing off,



                                                                                 195
 the loss from retirement and writing off of property is subject to including into
 other expenses.45

                                  Expenses for repair of fixed assets
        The expenses for making of all kinds of repair (current, medium and capital)
 are included in expenses on ordinary types of activity of that reporting period in
 which they were made. No reserve for future expenses is established for repair of
 fixed assets.
                    Accounting of fixed assets repair in composition of prime cost
           The following principle groups are singled out in the composition of
     expenses for repair of fixed assets included in the prime cost: expenses for repair
     made by a contractor way; expenses for repair made by an economic way,
     including payroll expenditures of employees engaged in repair which is made by
     an economic way; material expenses, other expenses for repair.
           In case of production necessity other accounting groups can be singled out.


           2.4.5.       Cost change of fixed assets
           The primary cost change of fixed assets by which they are included for
     accounting purposes is allowed in cases of a further construction, further
     equipping, reconstruction, re-equipment, partial liquidation and re-evaluation of
     fixed assets items46.
            The works on a further construction, reconstruction and re-equipment
     (including partial liquidation) of the Company‟s fixed assets are fulfilled on basis
     of the annual plan of reconstruction and re-equipment of fixed assets approved by
     the Company‟s chief.
            The re-equipment or reconstruction presupposes the rearrangement of the
     existing items of fixed assets as a result of which the qualitative characteristics of
     fixed assets functioning taken earlier improve (increase):
                ·     capacity;
                ·     productivity;
                ·     transmission capacity;
                ·     other qualitative characteristics.
          Full or partial rearrangement and re-equipment of the existing facilities
     without enlargement of the available constructions, buildings and installations
     connected to the production improvement and increase of its technical and
     economic level refers to the reconstruction. The reconstruction is made with the

45
   Items 12, 31 of section III of RAS 6/01, item 11 of section III of RAS 10/99, items 7, 8 of
section III of RAS 9/99, item 82 of Provision 34n
46
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 “On approval of Russian
Accounting Standard “Accounting of fixed assets” RAS 6/01”, item 14.

                                                                                                 196
     goals of production capacities increase, their qualitative characteristics
     improvement.
          The complex of arrangements on the technical and economic level increase
     of some facilities on the basis of an advanced technology introduction,
     mechanization and automation of production, change of obsolete and depreciated
     equipment by new, more productive one refers to re-equipment.

            If the sum of expenses for re-equipment of a fully depreciated facility of
     fixed assets amounts to RUR 20 000 and over, the Company includes the
     depreciated facility in the composition of depreciated property. Its primary cost
     will represent the expense amount for re-equipment. In this case a new fixed
     assets47 item will be established in the Company.
          If the expenses amount for re-equipment (of fixed assets items with the
     primary cost of less than RUR 10000, the cost of which is written off
     nonrecurrently for expenses) doesn‟t exceed RUR 20 000 then in this case all the
     amount of expenses is included nonrecurrently in a full volume in expenses under
     the profit48 tax calculation.
            Erection of new part of buildings, constructions, rearrangement of the
     existing facilities which make the integral whole with the fixed assets facility as a
     result of which quantitative characteristics of fixed assets change, refers to a
     further construction:
                  ·  construction of additional premises at an operating capacity (the
            build-up of storey, accessory building of new premises);
                  ·   supplement facilities construction and fixed assets introduction in
            the existing complex‟s composition.
           The qualitative change (decrease) of physical or technical facilities‟
     properties which result in economic benefits decrease from their usage (liquidation
     of separate facility‟s structural elements which are effective in the complex‟s
     composition of fixed assets, change of some parts under re-equipment or
     reconstruction etc.) refers to the partial liquidation.
           Under the partial liquidation of fixed assets facilities the depreciation
     accrued on them is written off in the same proportion.

     Capital repair of the electric grid equipment made according to the engineering
     documentations doesn‟t change the fixed assets‟ cost if holding of routine
     operations in terms of the overhaul reconditioning brings about improvement
     (increase) of qualitative characteristics taken earlier of the fixed assets facility
     functioning with life extension. Such works equated with re-equipment and
     accounted in the order of capital investments with the cost increase of fixed assets
     facilities. Singling out of works as a result of which the fixed assets‟ facility re-


47
     Letter of the Ministry of Finance of Russia No. 03-02-05/3/50 dd. 09.06.2004
48
     Letter of the Ministry of Finance of Russia No. 03-03-06/1/266 dd. 07.05.2007

                                                                                      197
     equipment is made is made on report basis of a maintenance management
     employee authorized by a chief engineer.

           The custody transfer of fixed from reconstruction and re-equipment is drawn
     up by an acceptance certificate of reconstructed and re-equipped facilities (form
     OS-3) on basis of a certificate of work performed (form KS-2) on basis of which a
     note of cost of performed work is filled in (form KS -3).
        Re-evaluation of fixed assets is made in the order established by the
 legislation on basis of a corresponding administrative document of the Company‟s
 chief once two years.
        Increase in the value of a fixed assets facility as a result of reapprisal is
 reflected on debit side of a business account of fixed assets in correspondence with
 a credit side of a business account of the added capital. Increase in the value of a
 fixed assets facility being equal to the sum of its price mark-down made within
 previous reporting periods and charged to the business account of retained earnings
 (loss), charged to credit side of business account of the retained earnings (loss) in
 correspondence with debit side of a business account of fixed assets49.
        Price mark-down amount of the fixed assets facilities as a result of reapprisal
 is reflected on a debit side of a business account of the retained earnings (loss) in
 correspondence with a credit side of a business account of fixed assets. Price mark-
 down amount of the fixed assets facility is charged to the Company‟s added capital
 decrease which is formed due to the final appraisal amounts of this facility which is
 made in previous reporting periods and is reflected in accounting records on debit
 side of a business account of the added capital and credit side of a business account
 of fixed assets accounting. The excess of price mark-down of the facility over the
 sum of its final appraisal credited to the organization‟s added capital as a result of
 reapprisal made in previous reporting periods is reflected on a debit side of a
 business account of retained earnings (loss) in correspondence with a credit side of
 business account of fixed assets.
        Under retirement of a fixed assets‟ facility the amount of its final appraisal is
 written off from debit side of a business account of the added capital in
 correspondence with the credit side of a business account of the organization‟s
 retained earnings.


           2.4.6.    Useful life of fixed assets' facilities
       Definition of a useful life of fixed assets‟ facilities is made on basis of an
 expected depreciation which depends on the operating regime, natural conditions
 and corrosive environment influence, system of repair making50. The useful life of
 the facilities of fixed assets is determined with the boundaries approved by

49
   Order No. 91n dd. 13.10. 2003 “On approval of methodological instructive regulations on
accounting records of fixed assets” (as amended by the Ministry of Finance of Russia No. 156n dd.
27.11.2006), item 48
50
   Order of the Ministry of Finance of RF No. 26n dd. 30.03.2001 (as amended dd. 18.05.2002)
“On approval of Russian Accounting Standard “Accounting of fixed assets” RAS 6/01», item 20.

                                                                                             198
 Government regulation of the Russian Federation No. 1 dd. 01.01.2002, on the list
 which is approved by the Company‟s chief. The useful life on new facilities of
 fixed assets is determined at an average indicator level established by Government
 regulation of the Russian Federation No. 1 dd. 01.01.2002, on a corresponding
 group.
        The useful life of the facilities of fixed assets is established under their
 including for accounting purposes on basis of a facility‟s certification, other
 technical documents or on basis of technical services‟ assessment of the Company
 or its departments according to internal documents on basis of a decision of a
 permanent commission. The useful life is fixed in an inventory card (OS-6).

            The useful life of a facility of fixed assets is revised in case of improvement
     (increase) of the initially taken standard indicators of functioning of a facility as a
     result of a further construction, further equipping, reconstruction or re-equipment51
     made. Thereby the useful life increase of the fixed assets usage can be made within
     terms established for the depreciation group in which the given fixed asset is
     included.

           The useful life of a re-equipped facility is calculated as a difference between
     a recently established useful life of a facility after recovery and its operation life
     towards the re-equipment completion.
        The useful life definition of a fixed assets facility used earlier by another
 organization is defined according to a formula: useful life calculated for a new
 facility of fixed assets minus actual operation life of a fixed assets facility of a
 previous owner and the assumed useful life by the Company which is determined
 subject to:
               ·  expected period of use of this facility in an organization according
         to the expected productivity or capacity;
                ·   expected depreciation which depends on the operating regime,
           natural conditions and corrosive environment influence, system of repair
           making;
                ·   regulatory and other restrictions of this facility usage.
            The assumed useful life of fixed assets on basis of a documentary evidence
     of its value is established by a commission and approved by the Company‟s or
     branch‟s chief under the facility including for accounting purposes as fixed assets.
       If an acquired secondhand facility of fixed assets exhausted fully its life
 according to the data of a supplier and technical certificate, its useful life is
 determined by the branch‟s commission which included the stated facility for
 accounting purposes.




51
  Order of the Ministry of Finance of RF No. 91n dd. 13.10.2003 “On methodological instructive
regulations approval on accounting records of fixed assets”, item 60.

                                                                                           199
2.4.7.          Amortization of fixed assets
       Accrual of depreciation of the fixed assets is performed by a straight-line
 depreciation process, based on the original or current (recovery) value (in case of
 revaluation) of the facility of fixed assets and the depreciation rate, estimated by
 reference to the useful life of this facility.
           Real properties, on which the capital investments are finished, the
     corresponding primary accounting documents on transfer and acceptance are
     executed, the documents are transferred for state registration and are actually in
     operation, are accepted to the accounting as fixed assets and are isolated in the
     analytic account52.
            On the fixed assets gained free of charge53, as well as on the fixed assets,
     gained with the assistance of special purpose54 financing recourses, accrual of
     depreciation is performed in the same rate, in which fraction of revenue of the
     future periods as the Company‟s income is recognized.

           Amortization is not accrued on:
                · facilities of the fixed assets used for the execution of the Russian
           Federation Law on mobilization preparation and mobilization, which are
           preserved and are not used in the production of products, at the execution of
           works and rendering of services, for management needs of the organization
           or for providing by the organization at a charge for temporary possession
           and use or for temporarily use;
                ·housing facilities (residential houses, hostels, apartments etc.), non-
           earning;
                ·fixed assets, application properties of which do not change with the
           course of time (land properties; natural resources sites; properties etc.);

           Facilities of fixed assets, application properties of which do not change with
     the course of time (land properties; natural resources sites etc.) are not subjected to
     amortization.




52
   Order of the Ministry of Finance of the Russian Federation No 91n dd. 13.10.2003 “On approval
of methodological instructions for the fixed assets accounting”, item 52.
53
   Order of the Ministry of Finance of the Russian Federation No32n dd. 06.05.1999 (edited on
30.03.2001) “On approval of Russian Accounting Standard “Company‟s income” RAS 9/99”, item
8.
54
   Order of the Ministry of Finance of the Russian Federation No 92n dd. 16.10.2000 “On approval
of Russian Accounting Standard “Accounting of government assistance” RAS13/2000”, item 9.

                                                                                            200
            Accrual of deprecation is suspended on the fixed assets transferred to
     preservation55. The Company accepts grounding of the facility for the period of
     more than 3 months as preservation. Expenses on amortization of the facility
     (examination, lubrication, booting, fencing etc.), as well as on grounding of the
     facility for the period of more than 3 months are accepted by the Company as other
     expenses56;
            On the stated facilities accrual of depreciation from the month, following the
     month of the transfer and starts from the month, which follows the month of setting
     of these facilities to operation.

           On the property in store57 (reserve), not transferred to the preservation mode,
     accrual of depreciation is performed in the usual order.
        Accrual of depreciation on the facility of fixed assets starts from the first
 number of the month, following the month of the acceptance of this facility to the
 accounting, and is performed till full paying off of value of this facility or writing
 off of this facility from the accounting.
        Accrual of depreciation on the facility of fixed assets stops from the first
 number of the month, following the month of the full paying off of value of this
 facility or writing off of this facility from the accounting.
           2.4.8.     Lease accounting of fixed assets
            The Company (Lessor) can rent out fixed assets, gained for own production
     activities or for management needs.

           Expenses on carrying out of current repair are recognized as the Company‟s
     expenses, if the current repair is provided in the lease contract at the expenses of
     the Lessor, otherwise the Lessor is obliged to maintain the property in working
     condition and perform the current repair at his own expense.
           ·     Lessor is obliged to perform at his own expenses capital repairs of the
     leased property, unless otherwise stipulated by law, other legal acts or lease
     contracts. In this case the Lessor‟s expenses on carrying out of the capital repairs
     of the leased property are related to the costs of revenue on the lease.
            The Company (the Lessor) can, pursuant to the concluded contracts, rent the
     fixed assets, owned by other proprietors.
           ·   The Lessee is obliged to maintain the property in working condition and
     perform the current repair at his own expense and bear expenses on property


55
   Order of the Ministry of Finance of the Russian Federation No 26n dd. 30.03.2001 (edited
on18.05.2002) “On approval of Russian Accounting Standard “Accounting of fixed assets” RAS
6/01”, item 23.
56
   Order of the Ministry of Finance of the Russian Federation No 33n dd. 06.05.1999 (edited on
30.03.2001) “On approval of Russian Accounting Standard “Company‟s expenses” RAS 10/99”,
item 4, 12.
57
   Order of the Ministry of Finance of the Russian Federation No 91n dd. 13.10.2003 “On approval
of methodological instructions for the fixed assets accounting”, item 61.

                                                                                            201
supporting, unless otherwise stipulated by law or the lease contract (the capital
repairs are performed, if it is stipulated in the contract). The specified expenses are
reflected on the same cost accounts, as well as the expenses on the rent of the fixed
assets.
      ·   Performed by the Company (the Lessee) separate improvements of the
leased property at his own expenses and without the consent of the Lessor to
compensate the incurred charges, is the property of the Lessee. Useful life on such
a property is determined according to the generally established procedure
(according to the internal documents of the Company based on the decision of the
permanent commission).
      The cost of the performed by the Company (the Lessee) of non-separate
improvements, without damage to the leased property and performed at his own
expenses and with the consent of the Lessor, can be taken into account at
calculations on rental or the Lessee has a right on compensation of the cost of these
improvements after termination of the contract, unless otherwise stipulated by the
lease contract. In case if no compensation of the stated expenses is stipulated by
the contract to the Lessee, the cost of the non-separated improvements is reflected
on the balance of the Company and is amortized during the validity period of the
contract.


      2.4.9. Account of the leased property.
      The leased property, entered to the Lessee, is taken into consideration on off-
balance account 001 “Leased fixed assets” in the whole sum of the leasing contract
(p.8 Order of the Ministry of Finance of the Russian Federation No 15 dd.
17.02.1997, Instruction on application of chart of account of the accounting No
94n dd. 31.10.2000). In the leasing agreement besides the lease payments
redemption value of the property is stated. Accrual of lease payments is reflected
on credit side 76 “Settlements with debtors and creditors” and debit side 26
“General business expenses”. While redemption of the leased property its cost as
of the date of the transfer of the ownership is written off from off-balance sheet
account 001 and is entered in records through 08 balance account to 01 balance
account on the redemption price.

       In this case, the redemption price, determined in the purchase contract is the
sum of the expenses for the acquisition of the property, and the leasing payments
are the cost for usage of this property. If determined by the leasing agreement and
the purchase contract redemption price is not above RUR 20000, the Company
considers this property as a part of business inventory on account 10 “Materials” at
actual cost and equal redemption price.


      2.4.10.     Account of equipment, requiring assembly




                                                                                   202
            Equipment for assembly includes equipment, which is brought into operation
     only after assembling of its parts and attaching to the foundation or supports, to the
     floor, inserted floor and other bearing structures of buildings and constructions, as
     well as set of spare parts of this equipment. This equipment includes measuring
     and test equipment and other devices, intended for mounting as part of assembling
     equipment58.

           The equipment for assembly is accepted to accounting on account 07 on
     actual cost of acquisition, which is gained from the sum on acquisition prices and
     expenses on acquisition and delivery of this equipment at depot of the Company.


           2.4.11. Intangible assets and their amortization
           Intangible assets are owned by the Company, not having physical structure
     non-monetary objects, independent on their cost, meant for beneficial use in the
     production of products, rendering of services or for management needs during the
     period not less than 12 months and able to bring economic benefits in the future.
            The Company does not recognize as intangible assets objects, in respect to
     which while their accounting (at the moment of qualification) the decision about
     subtraction to the advantage of other parties is made – resale, exchange etc. are
     intended. In this case a facility is qualified by the Company as goods. Expenses
     related to the Company‟s formation (organization expenses), intellectual or
     business qualities of the personnel of the Company, their qualification and capacity
     for work are not intangible assets also.
           Intangible assets include created and acquired in terms of the corresponding
     contacts:
                ·  exclusive rights of the patentee for the invention, industrial sample,
           useful models;
                ·  exclusive rights of the owner of the certificate of trademark, service
           marks, appellation of origin of goods;
                ·   exclusive copyrights for computer software, databases;
                ·   business reputation.
           Accounting entity of intangible assets is the collection of rights, originated
     from one patent, certificate, and agreement on the session of rights. The main
     feature according to which one facility is identified from another one, is the
     performance by it its own function in the production of products, execution of
     works and rendering of services or usage for management needs of the Company.




58
  Order of the Ministry of Finance of the Russian Federation No94n dd. 31.10.2000 (edited on
07.05.2003) “On approval of chart of accounts of accounting of financing and operating activities
of organizations and instructions on their operation”, account 07 “Equipment for assembly”.

                                                                                              203
      Intangible assets are accepted for accounting on actual (primary) value,
determined as of the date of acceptance to accounting.
      The cost of intangible assets, on which they are accepted to accounting, shall
not be subjected to variation.
       Business reputation is accepted to accounting in the amount of difference
between the actual purchase price of the acquired company (or its part) as the
property complex in whole and the value of all (or the corresponding part) its
assets and liabilities on the balance as of the date of purchase.
      Negative business reputation is fully related to financial results of the
organization as other expenses.
      Positive business reputation is treated as biding to the price, paid by the
buyer in waiting of future economic benefits. It is considered as separate business
inventory facility.
      Amount of depreciation on intangible assets is defined at rates, calculated on
the basis of their initial cost and useful life (a straight-line method).
      Useful lives of intangible assets are determined by the expert committee and
are approved by the chief of the Company while taking the facility to accounting
based on the following provisions:
           ·   by rights, gained on the base of patents, certificates and other
      similar documents of title, containing their validity periods, or having legally
      defined duration – based on the duration noted in such a document;
           ·  by rights, gained on the base of copyright agreements, assignments
      agreements and other similar agreements, containing specific dates, for
      which intangible assets are gained – based on the terms, specified in such
      agreements;
           ·    on other facilities of intangible assets – based on expectable useful
      life of the facility, during which the Company can gain economic benefits
      from usage of such assets;
           ·    on facilities of intangible assets, useful life of which is impossible
      to establish, amortization charges are established in relation to the period of
      20 years (but not more than the duration of the property complex, to which
      this asset belongs);
           ·   useful life of business reputation and organization expenses is
      established in relation to the period of 20 years (but not more than the
      duration of the property complex, to which this asset belongs).

       Amortization is performed every month on special account 05 “Amortization
of intangible assets” (except business reputation, the cost of which is satisfied by
reduction of the account balance of intangible assets).
      Amortization charges cannot be suspended.



                                                                                  204
           Usage of facilities of intangible assets for production purposes, rendering of
     services and management needs of the Company is finished in particular:
                ·    with expiration of the validity period, specified in patents,
           certificates or other similar documents of title;
                ·   with expiration of the validity period, specified in the corresponding
           contracts;
                ·   with impossibility of useful life of the facility before expiration of
           the above specified periods having the assurance that in future this facility
           will not be used in the production of products, while rendering of services or
           for management needs of the Company;
                ·   with the session of the exclusive right and its transfer in the
           properly order.

            In case of retirement of the facility of the intangible assets its cost is
     subjected to writing-off in the corresponding accounting period. Herewith
     retirement of the intangible assets is reflected on the remaining value similar to the
     procedure, determined for the fixed assets.


           2.5. SELECTED WAYS OF BUSINESS INVENTORIES ACCOUNTING
           2.5.1.     Recognition of the assets as business inventories and their
     estimation
           Business inventories (hereinafter business Inventories) are the assets59:
                ·  used as materials, spare parts, fuel and lubricants etc. When
           rendering of services, executing works (production of products, intended for
           sale), including the special instrument, special appliances, special
           equipment, working clothes independent on useful life;
                ·   used inventory, instrument and house wares with service life less
           than a year, which is recognized on account 10 “Materials”;
                ·   held for sale - goods;
                ·   used for management needs of the Company.

         Accounting unit of the business inventories is a nomenclature number or a
     homogeneous group (depending on the type of the business inventory).

          Goods,     purchased     by     the      branches     of     the    JSC
     Moscow United Electric Grid Company, are recognized on account 41 “Goods”.

           Transport and other expenses, connected with the goods delivery, are
     included:

59
  Order of the Ministry of Finance of the Russian Federation No 44n dd. 09.06.2001 “On approval
of statutory accounting “Business inventory accounting” RAS 5/01”, item 2.

                                                                                           205
            • As part of factual expenses for purchase of goods on account 41 “Goods”,
     if they are formed before the moment of their acceptance to accounting;

           • As part of expenses in correspondence with account 76 “Settlements with
     debtors and creditors”, if transport expenses on delivery are formed after their
     acceptance to accounting60.

                               Estimation of business inventories.
           Business inventories for the purposes of their acceptance to accounting are
     estimated depending on the cause of receipt: acquisition at a charge, production
     using own recourses, uncompensated receipt etc.
        Business inventories are accepted to accounting at cost of acquisition of
 production.
        Actual cost of business inventories, purchased at a charge, is the sum of
 actual expenses of the organization, excluded value added tax and other
 recoverable taxes (unless otherwise provided by law of the Russian Federation).
        Actual expenses for business inventories purchase include:
        • amounts paid according to the contract to the supplier (seller);
        • amounts paid to the organization for informative and consulting services,
 related to purchase of the business inventories;
        • custom duties;
        • non-recoverable taxes, paid due to acquisition of a business inventory
 facility;
        • rewards paid to facilitating agency, through which the business inventories
 are purchased;
        • expenses on production and delivery of the business inventories to stocks,
 including insurance expenses;
        • interests on credits and loans, provided by the suppliers (commercial
 credit), before their acceptance to accounting of the business inventories;
        • interests on loans, if they are used for acquisition of these business
 inventories, as well as expenses on the maintenance of the stated loans and credits,
 before their acceptance to accounting of the business inventory;
        After acceptance to accounting the business inventories expenses on the
 interests for the credits received and loans are reflected in the accounting in usual
 order with reference to other expenses61.
        Actual cost of the business inventories received by the organization under
 the donation contract or free of charge, as well as remaining after retirement of the
 intangible assets or other assets, is determined based on their current market value



60
   Items 16 and 18 RAS 5/01, account No94n, division II, Items 21, 24, 26 Order of the Ministry
of Finance of the Russian Federation dd. 26.12.2002
61
   Order of the Ministry of Finance of the Russian Federation No 33n dd. 06.05.1999 “On approval
of Russian Accounting Standard “Company‟s expenses” RAS 10/99”, item 11.



                                                                                            206
 as of the date of acceptance to the accounting. Current market value is the amount
 which can be received as a result of sale of the stated assets.
       Actual cost of the business inventories, brought to the account of investment
into the charter (received) capital of the organization is determined bases on the
money value, adjusted by the shareholders (participants) of the organization, unless
otherwise provided by law of the Russian Federation.
       Actual cost of the business inventories received under the contracts, which
provide performance of obligations (payment) by non-monetary assets, is the cost
of the assets, transferred or referable by the organization.
        Actual cost of material values, produced by own recourses is determined
 based on the actual expenses connected with their production.
        Actual expenses on purchase of the business inventories do not include
 general economic and other similar expenses, unless they are directly connected
 with the purchase of the business inventories.



    2.5.2.  ACCOUNTING                  OF        BUSINESS          INVENTORIES
ACQUISITION
       The materials consist of the basic and auxiliary materials, purchased half-
finished products and component items, fuel, containers, spare parts, building and
other materials, and also the special equipment, the special tools, special gadgets,
special equipment, trade clothing.
      Materials are included for accounting purposes (accounted) on account 10
"Materials" in accordance with the actual prime cost of their acquisition
(provision).
      Actual prime cost establishment of materials is carried out by applying of
accounts 15 «Provision and acquisition of material assets» and 16 «Deviation in
cost of material assets».

      Credit of account 15 «Provision and acquisition of material assets» contains
the cost of actually arrived and entered inventories in JSC "Moscow United
Electric Grid Company" in correspondence with account 10 "Materials".

      If it is impossible to make the direct inclusion of ordering costs into the
actual cost of materials (add to contract price of the material), ordering costs are
accepted to the account with reference to account 15 «Provision and acquisition of
material assets» and use of account 16 «Deviations in cost of material assets».

      Amount of a difference of costs of acquired inventories is estimated in the
actual prime cost of acquisition (provision) and the prices paid to the supplier
according to the contract shall be written off account 15 «Provision and acquisition
of material assets» to account 16 «Deviation in cost of material assets».
      The reserve for depreciation of material assets cost is not created.


                                                                                207
          The unbilled deliveries are the inventories which arrived in the Company
     and which do not have the accounting documents62.

            Unbilled deliveries are entered and considered in analytical and synthetic
     accounting in accordance with the registered prices accepted by the Company - the
     price specified in the contract of the supplier (the contract price). In cases the
     Company uses the actual prime cost of the materials as the book prices, the
     specified inventories are entered in accordance with the market prices. Thus
     account 60 «Calculations with suppliers and contractors» is entered to the cost of
     the arrived valuables.

            Receiving the documents from suppliers62:

            • additional record is carried out for the VAT amount if it is determined;

           • if arrived documents do not correspond to the delivery prices the additional
     record for the amount of deviation in accordance with debit of account 16
     «Deviation in cost of material assets» and to the credit of the account of
     calculations with the subsequent writing-off from account 16 «Deviation in cost of
     material assets» in the regular order shall be made.
           If accounting documents on unbilled deliveries arrived next year after
     representation of the annual accounting reporting, it runs as follows:
            1. Book value of the inventories does not change;

           2. The amount of the value added tax is accepted to accounting in the
     determined order;
           3. Calculation with the supplier shall be specified, thus the amount of the
     occurred difference between book value of the entered inventories and their actual
     prime cost shall be written off in the month the documents have arrived at:
            • reduction of cost of inventories is reflected under the debit of accounts of
     calculations and the credit of accounts of financial results (as the profit of past
     years revealed in accounting year);
            • increase in cost of inventories is reflected under the credit of accounts of
     calculations and an output of accounts of financial results (as the losses of past
     years revealed in accounting year).63
           Business inventories which belong to JSC «Moscow United Electric Grid
     Company» but being transported or transferred against security are considered in
     accounting in accordance with the book prices that is to the prices specified in the
     contract.

62
 Order of the Ministry of Finances of the RF as of 28.12.2001 No.119n «On approval of
methodological instructive regulations on accounting records of business inventories», item 36.
63
 Items 6, 13 and 26 of section II of Russian Accounting Standards 5/01, item 59 of Regulation No. 34n, item 39 of the order of the
Ministry of Finance of the Russian Federation as of 28.12.2001 No.119n. 4.4.3.


                                                                                                                             208
        2.5.3. ACCOUNTING OF BUSINESS INVENTORIES RETIREMENT
      The industrial release of materials is understood as their delivery from a
 warehouse directly for rendering of services (performance of works, production
 manufacturing), and also the release of materials for administrative needs of the
 Company.
        The order of release of materials from a warehouse of the Company‟s
 division to sites, brigades, and workplaces is established by the Head of Division
 of Material Supplies of the Company in coordination with the Chief Accountant of
 the Company.
       Primary accounting documents specify the release of materials from
 Company warehouses in divisions, to the sites, brigades, and workplaces the
 following:
        • material title;
        • quantity;
        • price;
        • amount and also the purpose - number (code number) and (or) the name of
 a service type (maintenance service, repair, starting-up and adjustment works and
 etc.) for which realization the materials are released, either number (code number)
 and (or) the name of expenses.
      Actually spent materials are divided into - the acquirer of materials - draws up
the Statement on writing-off of the spent material assets (Form No. 4) and the
Report on the expenditure of the basic materials and spare parts on capital and
flowing repairs in comparison to the industrial norms.
      Writing-off of materials from the account of the corresponding division of the
Company and bringing of their cost to production expenses (depending on what
goals the materials were spent for) is carried out on the basis of specified above the
Statement and the Report.
      Writing-off of the inventories (except for cable production) during the release
to production and other retirement is made in accordance with the average prime
cost of group (type) of stocks in the branch in general by division of the general
prime cost of group (type) of stocks into their quantity, developing, accordingly,
from the prime cost and quantity of the rest for the beginning of month and the
arrived stocks within the given month.
       Writing-off of cable products during writing-off is made in accordance with
the registration unit cost.
     Release of materials for contractors is carried out if there are the contracts or
agreements.
      If the contractor‟s agreement stipulates the transfer of materials to the
contractor without payment, materials are considered as expenses of the customer.
Cost of the materials transferred to contractors as expenses of the customer, is

                                                                                  209
considered on account 10.9.1. «Materials transferred to third parties for processing».
Subsequently on the basis of the document called «Report for provided services»
cost of the materials transferred to the contractor as expenses of the customer, and
the amount of deviations of costs of the given materials, are written off to production
costs or to account 08 "Capital investments".
            The actual prime cost of release represents the amount of their cost and the
     amount of the deviations accounted for the written off resources.
             Writing-off of deviations with the use of account 16 «Deviation in cost of
     material assets» is made proportionally to the costs of the spent inventories
     particularly in each nomenclature of materials, proceeding from average amount,
     the amount of deviations as of the beginning of month and current deviations over
     the month, to the amount of the rest of materials as of the month beginning and the
     materials entered over a month under the given nomenclature.
            The accounting of the Company separates out the subaccount on account 10
     "Materials" for control over trade clothing use:
            • trade clothing in operation (among the employees - responsible persons).
            Period of use is defined on the basis of typical branch norms of free delivery
     of the special clothes to workers, special footwear and other means of individual
     protection confirmed by proxy bodies.
            Cost of the special clothes, which term of operation according to norms of
     delivery does not exceed 12 months, is written off to the debit of corresponding
     accounts of the account of expenses for production at the moment of its transfer
     (release) to employees of the organization.
            Cost of the special clothes, which term of operation, according to norms of
     delivery, exceeds 12 months, is cleared off in the linear way, proceeding from
     terms of useful use of the special clothes, provided in typical branch norms of free
     delivery of the special clothes, special footwear and other means of individual
     protection.
            Cost of special equipment is cleared off in the linear way, proceeding from
     the actual prime cost of object of special equipment and the norms estimated
     proceeding from terms of useful use of this object.
            Charge of repayment of cost of special equipment and special clothes is
     reflected under the debit of accounts of the account of expenses for production and
     the credit of the account "Materials" of subaccounts "Special equipment in
     operation" and "Special clothes in operation".
            The trade clothing which cost is no more than RUR 20000 per unit, are
     reflected in accounting and the accounting reporting of the Company as a part of is
     inventories64.
            The analytical account of special equipment and the special clothes, being in
     production (operation), is carried out in accordance with the names (nomenclature
     numbers), quantity and the actual cost price, with instructions of date of production
     entering (putting into operation) (month, year), operation places (on divisions) and
     financially responsible persons.


64
     RAS 6/01, item 5

                                                                                      210
           Delivery to workers and delivery of individual protection means by them
     should register in a personal card of the worker, approved by the Decision of the
     Ministry of Labour and Social Development of the Russian Federation «On the
     approval of the rules on provision of workers with the special clothes, special
     footwear and other means of individual protection» No.51 as of 18.12.1998.
           The special clothes which have been given out to workers, is the property of
     the organization and is a subject to return: when fired, if transited to other work for
     which given out by special clothes, the special footwear and safety adaptations are
     not provided by norms, and also upon termination of their useful period terms
     instead of the received new one.

           2.5.4. Accounting of is inventories (including spare parts) which entered
     as a result of withdrawal from fixed assets in a restoration stage (reconstruction,
     re-equipment, repair)
            Accounting of the inventories revealed during the inventory making, and
     (or) the property received during the dismantling of fixed assets taken out of
     service, materials or other property received as a result of carrying out of repair or
     reconstruction of the fixed assets which is not taken out of service is carried out at
     the account of stocks calculation (account 10 "Materials" of the card of accounts of
     the Company) and are other incomes of the Company (account 91 of the card of
     accounts of the Company).
           Spare parts which entered as a result of withdrawal from the fixed assets at a
     stage of restoration are included for accounting purposes separately from new
     spare parts, as independent nomenclature numbers.
            If it is necessary to repair the spare parts entered as a result of withdrawal
     from the fixed assets during the stage of restoration, the following sequence of
     accounts is carried out. During the transition to repair the spare parts are written off
     from the credit of accounts of the account of stocks (account 10 "Materials" of card
     of accounts of the Company) to the debit of accounts of the account of expenses
     for repair by forces of structural divisions of auxiliary process (for example
     account 23 «Auxiliary process» of Company book of accounts). All expenses for
     repair of the specified spare parts are written off to the debit of the same account.
     Upon termination of repair the restored spare parts are entered from the credit of
     the account of the account of expenses for repair to the debit of the account of the
     account of stocks (account 10 "Materials" of the card of accounts of the Company)
     in accordance with the cost taking into account repair.
            Inventories (including spare parts), remaining from retirement of the fixed
     assets and other retirement, are estimated proceeding from current market cost for
     the date of acceptance to book keeping65. Current market cost is understood as the



65
   Order of the Ministry of Finance of the Russian Federation as of 09.06.2001 No. 44n «On
approval of Russian Accounting Standard «Accounting of business inventories» RAS 5/01», item
9.

                                                                                          211
     amount of money resources which can be received as a result of sale of the
     specified assets.
            In case of absence of information on current market cost, the inventories
     (including spare parts), entered as a result of dismantling of the fixed assets in a
     restoration stage, are estimated in accordance with the book value of the last
     acquired similar inventories, spare parts taking into account the interest of actual
     deterioration of entered objects (but not below scrap metal cost).
           2.5.5. Accounting of automobile tyre
            Automobile tyres (a tyre cover, the chamber and rim strip), arriving together
     with the new car or the trailer (on wheels and one spare complete set), enter into
     the cost of the car and are considered as a part of the fixed assets. Tyres got for
     replacement of the worn out ones, are considered at subaccount 10.4.1"Spare parts
     in a warehouse».
            Tyres which were released from a warehouse for replacement of the worn
     out ones, which become worthlessness or for other reasons, for seasonal change
     ("summer", "winter") and fixed to the car are considered at subaccount 10.4.2
     "Automobile tyres in operation" of account 10.4 "Spare parts".
            Cost of automobile tyres is cleared off at a time depending on the mileage
     upon termination of operation period in accordance with the norms confirmed by
     the document «Time norms of operational mileage of tyres of vehicles» No. RD
     3112199-1085-02, approved by the Ministry of Transport of the Russian
     Federation as of 04.04.2002 to the debit of corresponding accounts of the account
     of expenses (the Information letter of the Ministry of transport of the Russian
     Federation as of 07.12.2006 No.0132-05/394). If the mileage is not enough its
     reasons shall be defined (fault of the driver, production works and etc.) and
     reflected in the Writing-off statement.
            Costs for the repairs66 of the automobile tyres are included into the structure
     of the material costs in the costs regarding the ordinary types of activity within the
     limit of the norms approved by the Ministry of Transport of the Russian
     Federation.

         2.6. SELECTED WAYS OF                        ACCOUNTING             OF     INCOMES,
     CURRENT COSTS AND EXPENSES
           2.6.1. General approaches to accounting of incomes and expenses

           The account of incomes and expenses is carried out:

           • in general in the Company;
           • in Moscow;



66
  Order of the by the Ministry of Transport of the Russian Federation as of 24.06.2003 No. 153
«On approval of the guidelines on account of the incomes and costs on ordinary types of activity in
motor transport», item 43.

                                                                                               212
              • in Moscow region.
           The Company subdivides incomes into incomes of ordinary types of activity
     and other incomes.

           Incomes of ordinary types of activity are the proceeds connected with
     rendering of services, performance of works, from sale of production and the
     goods to the foreign organizations 67.

              Incomes of ordinary types of the Company‟s activity are:
            • incomes from services regarding the transfer and electric power
     distribution;

              • incomes from services regarding the connection of capacity to electric
     grids;
           • incomes from performance of works and rendering of services of industrial
     character;

          • incomes from performance of works and rendering of services of non-
     productive character and other types of activity.

            Incomes from services regarding the transfer and electric power distribution
     include all incomes of the transmission of energy consumed by subjects of the
     market in region of service defined by Company. Transfer and electric power
     distribution is the regulated type of activity.

            Incomes of services regarding the connection of the capacity to electric grids
     are the incomes of the Company received by them as a result of implementation of
     the complex of works (activities ) of organizational and technical character,
     directed to provide the possibility of connection to power consuming devices of
     legal and physical persons according to the parameters declared by them.
          Incomes from realization of other works and services are all incomes
     connected with the realization of other works and services for the Company.
           Other incomes contain all incomes not connected with realization of works
     and services by ordinary types of activity.

          Volumes of the building and installation works implemented during the
     own-account construction (for own needs) are not considered as incomes and not
     accounted in the proceeds from sales.




67
  Order of the Ministry of Finances of the Russian Federation as of 06.05.1999 No. 32n «On
approval of Russian Accounting Standard «Incomes of the organization» RAS 9/99», item 5.

                                                                                             213
          Company‟s incomes according to a charge principle are recognized in that
     accounting period in which they took place, irrespective of actual time of the
     money means entering connected with these facts68.

           Company subdivides costs on expenses by ordinary types of activity and
     miscellaneous expenses.

           Expenses by ordinary types of activity are the expenses connected with
     rendering of services, and performance of works 69.
           Expenses, by ordinary types of activity in directions are the following:
           • expenses regarding the transfer and electric power distribution;
           • expenses regarding the connection of capacity to electric networks;
           • expenses regarding other works and services of industrial character
           • expenses on other works and services of non-productive character and
     other types of activity which is ordinary for JSC «Moscow United Electric Grid
     Company» on their types;
           Prime cost of the services of transfer and electric power distribution
     represents the set of the expenses connected with the maintenance and operation:
            • power transmission lines, distribution devices, substations and other
     constructions and the equipment, intended for transfer and electric power
     distribution;
           • means of account and control of electric power.
           Prime cost of services of connection to electric grids represents a set of the
     expenses connected with performance of a complex of works (activities) of
     organizational character, the connection directed to a possibility to power
     accepting devices legal and physical persons according to the parameters declared
     by them.
          • prime cost of other works and services represents the total expenses
     connected with realization of other works and services for the Company.
           Miscellaneous costs concern, not connected with realization of works and
     services in ordinary types of activity.
                Expenses are recognized by the Company in two cases:
     • when there is a confidence that expenses implementation is the reason for getting
     of the corresponding income. Expenses can be recognized by the expense directly
     (in case of realization of services, works, approval of administrative or commercial

68
   Order of the Ministry of Finance of the Russian Federation as of No. 60n 09.12.1998 (issued as
of 30.12.1999) «On approval of Russian Accounting Standard «Accounting policy of the
organization» RAS 1/98», item 6.
69
   Order of the Ministry of Finance of the Russian Federation as of No. 33n 06.05.1999 (issued as
of 30.03.2001) «On approval of Russian Accounting Standard «Expenses of the organization»
RAS 10/99», item 5.

                                                                                              214
     expenses) or through retirement of assets for which creation the Company carried
     out earlier these expenses (the fixed assets, is inventories, own production and
     etc.). Then the account admits the costs by ordinary types of activity or
     miscellaneous costs (retirement of other assets which are distinct from production);
     • when expenses implementation cannot be directly correlated with any income or
     it becomes obvious that the suggested income will not be received in accordance
     with the correspondent expenses. Then miscellaneous costs are recognized in the
     account (for example, payment of the interest on credits, expenses on preservation
     of the fixed assets, losses and etc.). Expenses are also recognized in case of
     occurrence of the obligation without the fact of property acquisition.

          2.6.2. Incomes and expenses on ordinary types of activity

        Incomes from services directed to transfer and distribution of the electric
 power are recognized in the accounting as of the date of the parties‟ approval of
 Balance of the electric power and Statements of the rendered services (works
 executed) directed to transfer and distribution of electric energy under the contracts
 signed with the Marketing companies. Statements are made on the basis of the
 monthly Balance of the electric power which contains: total amounts of the
 received (acquired) electric energy to the Company network, total amounts of the
 electric power received by the consumers (useful release), total amounts of the
 electric power given to adjacent networks (transit), total amounts of actual losses.
        In JSC «Moscow United Electric Grid Company» the basic way of the
 industrial account is the way of expenses sum up. Expenses of the branches for
 transfer and distribution of electric energy are transferred to the executive office of
 JSC «Moscow United Electric Grid Company» under the aviso (from the point of
 view of items of expenses) for definition of the full prime cost for transfer and
 distribution of electric energy to 8th day of the month following the reporting one
 with the calculation for the transfer and distribution of the electric energy.
        Transfer and distribution of electric energy in one stage coincides in time
 with its realization, therefore in the basic production connected with transfer and
 distribution of electric energy there are no remains of uncompleted production.
        Gain and expenses of branches by other types of activity are considered by
 them independently with definition of result from a certain type of activity.
        The total balance of profits and losses is monthly transferred by branches
 under the aviso in the executive office of JSC «Moscow United Electric Grid
 Company»70 not later than on the 9th day of the month following the reporting one.

           Full prime cost of transfer and distribution of electric energy




70
  Guidelines regarding the planning, account and calculation of the cost price of the electric and
heat power approved by the Ministry of Power and Electrification of the USSR as of 1970.

                                                                                                 215
       Full prime cost of transfer of electric energy is formed in the executive
office of JSC «Moscow United Electric Grid Company» and defined in general in
the Company as a cost estimation used in the course of production and sale of
types of production of natural resources, raw materials, materials, energy, fixed
assets and manpower, and also other expenses for transfer of the electric energy,
created by all divisions of JSC «Moscow United Electric Grid Company».
      Representation of expenses by activity types
       Writing-off of expenses by types of activity of JSC “MOESK” is made by the
direct account according to the Guidelines developed by the financial block of the
Company (Appendix No. 4 «Distribution of expenses by activity types»).
     Expenses by ordinary types are formed on accounts 20 «Basic production»,
23 «Auxiliary production», and 25 «General Industrial expenses».
       Account 23 «Auxiliary production» has the expenses connected with
processes, being auxiliary in relation to the basic technological processes on
electric power transmission, in accordance with technological connection.
      Auxiliary production concerns include the Services of transport and repair.
      In case of motor transport use during the construction by the industrial
means they carry out the writing off the costs to 08 balance account through 23
balance account.
      Expenses of auxiliary production are included in the prime cost of those
goods (works, services) in the process of production of which goods (works,
services) of the above stated organization departments were used.

       Account 25 «General industrial expenses» is used for the account of
information about the management and service costs of the Principle production
divisions.
       Information about the general industrial expenses is formed in a cut of
articles of expenses.
      Account 26 «General business expenses» is used for the account of the
administrative expenses providing functioning of the Company as the complete
business subject, not connected directly with the implementation of the industrial
functions in structural divisions of the basic and auxiliary production of the
Company.
      Information about the general business expenses is formed in a cut of articles
of expenses.
      Account 20 «Principle production» has the expenses connected directly with
rendering of services connected with transfer of electric energy, technological
connections, expenses connected with service of the Principle production and also
expenses of auxiliary production. Expenses of auxiliary production are written off
into 20 balance account «Principle production» through 25 balance account.
      Expenses from 25 and 26 balance accounts are written off directly to 20
balance account «Principle production».


                                                                                216
           2.6.3.     Other revenues and expences71
        As other incomes the Company admits incomes on the independent
 economic operations which are not a subject of its activity but carried out for the
 purpose of data acquisition of incomes, that is:
        accruals connected with participation in authorized capital stocks of other
 organizations (including interest and other incomes under securities);
        accruals from sale of the fixed assets and other assets which are distinct from
 bank notes (except for a foreign currency) production, the goods;
        profit received under the simple partnership agreement and other accruals;
        Interest received from money resources use of JSC «Moscow United Electric
 Grid Company», and also interest for use by bank of the money resources which
 are on the account of the Company in this bank;
        Penalties, fines, charges for infringement of conditions of contracts;
        Accruals for compensation of caused losses of JSC «Moscow United Electric
 Grid Company»;
        Free acquisition of assets;
        Profit of past years revealed in accounting year;
        Amount of accounts payable and receivable creditor on which has expired
 term of limitation of activities;
        amount of the complete assessment of assets;
        rate differences;
        other incomes which conform to RAS 9/99.
        As miscellaneous costs the Company admits:
        - Expenses connected with representation for a payment in temporary using
 of assets of the organization;
         - Expenses connected with sale, retirement and other writing-off of the fixed
 assets and other assets which are different from money resources (except for a
 foreign currency), the goods, production.
        - Expenses under loans (credit contracts) (except for the expenses concerning
 an investment active).
        - Added interest on bills and interest and (or) discounts under bonds. The
 amount under the given out bills and bonds is reflected as creditor debts separately
 from interests.

           2.6.4. Revenues and expenses of the future periods
           Incomes72 the future periods are incomes of gratuitous acquisition of assets,
     under debt securities on which current market cost is not defined, the difference
     between initial cost and a nominal value is reflected by the Company as a part of
     incomes of the future periods with the subsequent monthly writing-off in structure

71
  RAS 9/99«Incomes of an organization» and RAS 10/99 «Expenses of organization», approved
correspondently by the orders of the Ministry of Finance of the Russian Federation No. 32b and
No. 33n as of 6.05. 1999.



                                                                                            217
 of other incomes. Calculation of the monthly amount of incomes is carried out
 proceeding from term of the reference of the bill, including repayment date and
 quantities of days in accounting month.

________________
 72
   Order of the Ministry of Finance of the Russian Federation as of No. 94n 31.10.2000 “On
 approval of chart of accounts for bookkeeping of financial and economic activity of an
 organization and the guidelines regarding its use”, account 98 “Revenues of the future periods”
             Expenses of the future periods contain the expenses of the future periods,
but pertaining to the following accounting periods. Expenses of the future periods
are considered in accounting and reflected in balance in the separate line as expenses
of the future periods.
         Expenses in the form of the service received for technological connection of
  power accepting devices of the Company to networks of the adjacent network
  organizations, participating in the scheme «One window» are written off by the
  Company to the prime cost in that accounting period in which the Statements of
  the executed works is signed with the end user for the amount declared by them in
  the contract with JSC “MOESK”. Thus, in the prime cost the Company represents
  the amount of the above-stated expenses corresponding to incomes received from
  the end user.
         Retirement of assets as the advance payment of inventories and other values,
  works and services do not pertain to the costs of the future periods if treaty
  provisions or requirements of the legislation and statutory acts, or according to
  customs of a business turnover, the return of the listed money resources is possible,
  including prescheduled cancellation of the contract does not concern expenses of
  the future periods. Such payments are classified as advance payments (advance
  payment) and considered on accounts of calculations with suppliers and
  contractors separately73.

        Writing-off of expenses of the future periods
       Expenses of the future periods are subject to writing-off by types of
 expenses in regular intervals proceeding from quantity of calendar days in the
 accounting period, and also proceeding from term of useful use of this property
 defined by treaty provisions, and in case of absence of such conditions in the
 contract - constantly operating commission of branch on definition of terms of
 useful use74.

        2.6.5. Expenses for advertising
        Expenses for advertising are:
      • expenses for publicity through mass media and telecommunication
 networks;
        • expenses for light and other outdoor advertising (including manufacturing
 of displays and publicity boards);


                                                                                            218
           • expenses for acquisition (manufacturing) of the prizes which are handed
     over to winners of draws during mass advertising campaigns;
__________
73
     Item 65 of Regulation No. 34n, chart of accounts, section VI and VIII.
74
     Item 65 of Regulation No.34n.



- Expenses connected with participation in exhibitions - rent of exhibition facilities,
stands;
- Miscellaneous costs for advertizing.


                 2.6.6. Accounting of exchange rate differences
        Accounting of assets and obligations which cost is expressed in foreign
currency is carried out in accordance with the Regulation on accounting “Account of
assets and the liabilities which cost is expressed in foreign currency”75.
        Cost of assets and the obligations, expressed in foreign currency, for
reflection in accounting and the accounting reporting is subject to recalculation in
RUR.
        Recalculation of cost of assets and the obligations expressed in foreign
currency in RUR is made at a Central Bank rate of the Russian Federation for this
foreign currency in relation to RUR operating for date of fulfillment of operation in
foreign currency.
        The recalculation of cost of assets and obligations (bank notes in cash desk
of the organization, means on accounts of the organization, monetary and payment
documents, short-term securities, means in calculations (including under extra
obligations with legal bodies) in rubles is made at the Central Bank rate of the
Russian Federation operating for accounting date.
        The exchange rate difference is reflected in accounting and the accounting
reporting in that accounting period which date of execution of obligations on
payment concerns or for which the accounting reporting is made.
       Recalculation of cost of bank notes in cash desk of the organization and
means on accounts in the credit organizations, expressed in foreign currency, in
process of change of courses of the foreign currencies quoted by the Central bank of
the Russian Federation, is not made.
        The exchange rate difference is subject to transfer on financial results as
other incomes and a miscellaneous cost.
        The account of the obligations expressed in foreign currency, but subject to
payment in RUR, is carried out according to Position on accounting «Account of
assets and the obligations which cost is expressed in foreign currency»76.
      In accounting the obligations expressed in foreign currency but subject to
payment in RUR are recalculated as of:


                                                                                   219
_______________
75
   RAS 3/2006 «Account of assets and liabilities which cost is expressed in foreign currency»
order of the Ministry of Finance of the Russian Federation No.154n as of 27.11.2006
76
   RAS 3/2006 «Account of assets and liabilities which cost is expressed in foreign currency»
order of the Ministry of Finance of the Russian Federation No.154n as of 27.11.2006



         as of the date of including for accounting purposes;
         as of the last date of month within the period when they are registered in the
     account;

          as of the date of the liabilities repayment77.
          Thus arising differences are called as the course.
          During repayment of the obligations expressed in foreign currency, but
     subject to payment in RUR a gain reflected at the moment of realization in
     accounting of the Company as the seller, property cost (works, services) reflected
     in Company accounting as buyer, shall not be recounted78.

        2.7 OPERATIONS ON TRANSACTIONS OF CROSS CURRENCY
     AND INTEREST RATE SWAP

           Operations under currency and interest rate SWAP transactions concluded for
     the purpose of hedging are reflected in the account of the Company by recognition
     of obligations and requirements of participants of agreements by an urgent part of a
     currency SWAP and on interest SWAP in balance of the Company of and accounts
     payable.
           Accounts payable and receivable are reflected in accounting in the amount, to
     corresponding amount of money resources actually listed by the parties at
     execution of the first part of currency SWAP transactions (initial payment). The
     amount of excess (reduction) of final payment over initial (if the last is provided
     by conditions of the agreement the SWAP), in accounting at the moment of
     fulfillment of an initial exchange by payments is not reflected, and considered at
     execution of the second part of a currency SWAP transactions.
           The obligation of the counterpart on transfer (return) to the Company of initial
     payments (in USA dollars) by the second part of transactions of a currency SWAP
     and transfer to the Company of a floating rate of interest (in USA dollars) are
     reflected in balance account 76.12 “Calculations with other debtors and creditors”
     in correspondence according to balance account 52 «Currency account» both 91.1
     “Other incomes and expenses”.
            Accounts receivable by the second part of transactions of a currency SWAP
     as obligations of the counterpart to a Company, expressed in foreign currency and
     not concerning the amount of advance payments, advance payment and
     inclinations, are overestimated by the Company in an order provided by RAS
     3/2006 for date of fulfillment operations (maturity date) and for accounting date
     with reference of an exchange rate difference into account 91.


                                                                                         220
      Obligations of the Company to the counterpart on return transfer (return) of
payments by the second part of transactions of currency SWAP at a rate of initial
payments and on transfer of the fixed interest rate are reflected in balance account
76.99 in the form of accounts payable in correspondence according to balance
account 51 "Settlement account" both 91.2"Other incomes and expenses».
77
   Item 3 of RAS 3/2006 «Account of assets and liabilities the cost of which is expressed in the
foreign currency”, order of the Ministry of Finance of the Russian Federation as of 27.11.2006
No.154n
78
   Items 1 of the Appendix to the Order of the Ministry of Finance of the Russian Federation as of
27.11.2006
      Accounts payable and receivable on an exchange of payments, and also the
debts of the parties on payments in the form of interest rates, are reflected as a part
of short-term or long-term debts depending on its recognition in the account
according to the current legislation (item 19 of RAS 4\9). Assets and obligations are
represented as short-term, if term of the reference (repayment) on them no more than
12 months after accounting date or duration of an operational cycle if it exceeds 12
months. All other assets and obligations are represented as long-term ones.

2.8. PECULIARITIES OF ACCOUNTING OF INTRA-ORGANIZATIONAL
SETTLEMENTS

       In JSC «Moscow United Electric Grid Company» the following order of
intraeconomic calculations is applied: Transfer of material assets (the fixed assets,
the equipment, cable production), performance of works and rendering of services
by one structural divisions for needs of others is an intersystem turn and is made
with account 79 «Intra-organizational settlements» under the actual prime cost
without reflection on realization accounts.
       Transfer of financially industrial stocks, one structural division for needs of
others is an intersystem turn and is made with account 79 use «Intra-organizational
settlements» under the average prime cost without reflection of retirement of
material assets on realization accounts.

2.9. SELECTED               WAYS        OF       ACCOUNTING              OF      FINANCIAL
INVESTMENTS


Assessment of financial investments (initial and subsequent)

      Financial investments are accepted to book keeping at initial cost. In initial
cost of the financial investments got for a payment, the amount of actual expenses
for their acquisition, except for the tax to the added cost and other compensated
taxes admits.
       General economic and other similar expenses shall not be included into actual
expenses for acquisition of financial investments, except cases when they are
directly connected with acquisition of financial investments.


                                                                                              221
      In case of insignificance (at the rate to 0,05 %) the amounts of expenses
(except the amounts paid according to the contract to the seller) on acquisition of
such financial investments as securities, in comparison with their face-value, such
expenses do not join to initial cost of financial investments, and concern on
miscellaneous costs in that accounting period in which the specified securities have
been included for accounting purposes.
       Financial investments sold and bought at a stock exchange on which it is
possible to define current market cost, are reflected in book keeping at current
market cost by quarterly updating of their estimation for the previous accounting
date. Difference between the assessment of financial investments at current market
value as of the reporting date and the previous assessment of financial investments
posts to financial results as a part of other incomes and expenses.
       Financial investments on which no current market value is defined are subject
to reflection in accounting records on the primary cost.


Retirement of financial investments

      During the retirement of financial investments on which current market cost is
not defined, their cost is defined as follows:
       Contributions to authorized capital stocks of other organizations (except for
activities of joint-stock companies), the loans given to another organizations,
depositary contributions in the credit organizations, accounts receivable on the basis
of a concession of the right of the requirement, are estimated at initial cost of each
retirement unit of financial investments;
        Securities (activities and bonds) are estimated at retirement at average initial
cost;
      Purchased bills are estimated at retirement (payment for the performed works
(the goods, services) at the price of acquisition;
      During the retirement of the assets accepted to book keeping as financial
investments on which current market cost is defined, their cost is defined proceeding
from their last assessment 79.

       Classification of financial investments, proceeding from term of their use
       Depending on term of the reference (repayment) financial investments are
 subdivided into short-term and long term ones80.

     2.10. PECULIARITIES OF OPERATIONS ACCOUNTING ON
 PARTICIPATION    IN   JOINT ACTIVITY  (UNDER  SIMPLE
                          81
 PARTNERSHIP AGREEMENT)

         Jointly carried out operations



                                                                                    222
        Jointly carried out operations are understood as performance by each
 participant of the contract of a certain production phase of production (work
 performance, rendering of service with use of own assets. Thus each participant of
 the contract in book keeping reflects the part of expenses and obligations, and also
 a share of economic gains due to it or the income according to treaty provisions.
_____________________________
79
    Items 26, 27, 28, 30 RAS 19/02
80
    Items 41, 42 RAS 19/02.
 81
     «Information about the participation in the joint activity», RAS 20/03, approved by the order of
the Ministry of Finances of the Russian Federation No. 105n as of 24.11.2003.




       Incomes, expenses, obligations and assets acquired as a result of the joint use
of assets, each participant of the contract shall consider separately in the analytical
account under corresponding synthetic accounts of the account of incomes,
expenses, obligations and assets.
        Each participant of the contract in book keeping of a share of production due
 to it and (or) the income of production sale (performance of works, rendering of
 services) carries out reflection for the accounting period according to treaty
 provisions. Thus the participant who is carrying out the final stage of joint
 production, a share of production which is due to other participants of the contract,
 considers behind balance, and in a case if the contract provides production sale
 (works, services) the incomes which are subject to reception by other participants
 of the contract, reflects in book keeping as an obligation towards them82.

        Jointly used assets
        Assets are considered shared in a case when the property is in the general
 ownership of participants of the contract with determination of a share of each of
 proprietors in the property right (the share property) and proprietors conclude the
 contract for the purpose of sharing of such property for reception of economic gains
 or the income. Thus each of participants of the contract reflects in book keeping a
 share of expenses and obligations, and also a share of incomes due to it from
 sharing of assets according to treaty provisions.
        Incomes, expenses, the obligations received as a result of sharing of assets,
 are considered by each participant of the contract separately in the analytical
 account under corresponding synthetic accounts of the account of incomes,
 expenses, obligations. The assets belonging to the participant of the contract on the
 right of the share property and brought by it as the contribution, continue to be
 considered by it on corresponding accounts of accounting and in structure of
 financial investments are not translated. Thus the contribution of the participant of
 the contract, the economic operations connected with performance of such contract,
 and also received from sharing of assets financial results, are not allocated for
 separate balance.



                                                                                                 223
        Each participant of the contract in accounting for the accounting period
 reflects its share of the incomes received from sharing of assets, and also
 obligations and the expenses suffered by it in connection with performance of the
 contract.
        In accounting of the participant the obligations which have arisen directly at
 the participant in connection with participation in the contract, and also its share in
 joint obligations with other participants of the contract are subject to reflection.

_________________________________
82
   Items 6, 7 of section II RAS 20/03.




        In the participant‟s accounting records those expenses are accounted which
 are made directly by the participant due to participation in the contract and its share
 in joint expenses with other participants of the specified contract.83

                                           Joint activity
        In accordance with simple partnership agreement84 (to the contract on joint
 activity) two or several persons (companions) undertake the obligation to connect
 the contributions and in common to operate without formation of the legal person
 for extraction of profit or achievement of other purpose not contradicting the law.
        Contribution to simple association admits the Company account financial
 investments. Property brought in the account of the contribution under the contract
 on joint activity (the simple partnership agreement), joins the organization-
 companion in structure of financial investments in accordance with the balance cost
 85
    for date of the introduction of the contract in force.
        Acknowledgement of the fact of reception of the property contribution for
 the organization-companion is the notice (aviso) on acceptance to the account of
 property a companion conducting common causes, or the primary registration
 document on property reception (the acceptance-assignation Statement,
 unprofitable, payment documents and etc.).
        At formation of financial result each organization-companion the share of
 profit or the losses which are subject to reception as a result of joint activity,
 includes in structure of other86 incomes or expenses.
        The property which is subject to reception by each organization-companion
 by results of section87, according to item 1050 of the Civil Code of the Russian
 Federation, at the termination of joint activity is reflected as repayment of the
 contributions considered as a part of financial investments. In case of difference
 occurrence between a cost estimation of the contribution considered as a part of
 financial investments, and cost of the received assets after the termination of joint
 activity it joins in structure of other incomes or a miscellaneous cost at formation of
 financial result. The assets received by the organization-companion after the
 termination of joint activity, are accepted to the account in an estimation which is


                                                                                    224
 registered in separate balance for date of decision-making on the termination joint
 activity 88.

        Information disclosing in the accounting statements

_______________________________________
83
   Items of 9, 10 of section III of RAS 20/03
84
   «Civil Code of the Russian Federation (second part) No 14-FL as of 26.01.1996 (approved CC
of RF as of 22.12.1995) (issued as of 18.07.2005), article 1041.
85
   Order of the Ministry of Finance of the RF No.105n as of 24.11.2003 «On approval of Russian
Accounting Standard «Information on participation in joint activity» RAS 20/03», item 13.
86
   Order of the Ministry of Finance of the RF No.105n as of 24.11.2003 «On approval of Russian
Accounting Standard «Information on participation in joint activity» RAS 20/03», item 14.
87
   Order of the Ministry of Finance of the RF No.105n as of 24.11.2003 «On approval of Russian
Accounting Standard «Information on participation in joint activity» RAS 20/03», item 15
88
   Items 12,13.14 of section IV of RAS 20/03




        Organization which is the participant of the contract on joint activity, in the
 accounting reporting the following information on participation in joint activity is
 subject to disclosing:
        a) purpose of joint activity (production, performance of works, rendering of
           services etc.) and the contribution to it;
        b) way of extraction of an economic gain or the income (in common carried
           out operations, shared assets, joint activity);
        c) classification of an accounting segment (operational or geographical);
        d) cost of assets and the obligations concerning joint activity;
        e) amounts of incomes, expenses, profit or a loss concerning joint activity89.
        Information disclosing in the accounting statements of the organization about
 participation in joint activity is carried out in explanatory note90.

    2.11. SELECTED                  WAYS        OF     OWN        FUNDS        (CAPITAL)
 ACCOUNTING

       As a part of own capital of the Company the additional and reserve capital,
 undistributed profit and other reserves are considered as authorized ones.
       In the balance sheet the amount of an authorized capital stock registered in
 authorized documents is reflected.
       The amount complete assessment of the fixed assets, objects of capital
 construction and other material objects of property with term of useful use from
 above 12 months, spent when due hereunder, and other similar amount s are
 considered as additional assets 91.
       Undistributed profit is accounted as:
       Undistributed profit of last years;
       Undistributed profit of the accounting period;
       Use of profit of the accounting period;


                                                                                          225
        Uncovered loss of last years;
        Uncovered loss of the accounting period;
        Target investment means.
        Target financing is the acquisition of the budgetary means within the limits
 of the program of target financing and financing of target investment programs
 according to contracts of investment and share participation 92.
        Use of profit of JSC «Moscow United Electric Grid Company», remaining at
 its order after charge of the profit tax of the organizations and other similar
 obligatory payments, including sanctions for non-observance of rules of the
 taxation, shall be approved by general meeting of shareholders93.
_______________________
89
   Item 22 of section V of RAS 20/03
90
   Russian Accounting Standard "Information on segments" RAS 12/2000.
91
    Item 68 of Regulation on accounting approved by order of the Ministry of Finance of the
Russian Federation No. 34n as of 29.07.1998
92
   Items 66, 67, 68 of Regulation 34n
93
   Federal law No. 208-FL as of 26.12.1995 «On Joint-Stock Companies».




                                 Establishment of funds.

        JSC «Moscow United Electric Grid Company» does not create any funds at
 the expense of the profit remaining at its order, except for cases when creation of
 such funds is provided by constituent documents. In this case the order of their
 creation and use is defined on the basis of the decision of general meeting of
 shareholders.
        In JSC «Moscow United Electric Grid Company» the reserve fund at a rate
 of 5 (five) interest from the Company authorized capital stock is created.
        The amount of obligatory annual deductions in reserve fund of the Company
 makes not less than 5 (five) interest from net profit of the Company before
 achievement by reserve fund of the established amount.
        The reserve fund of the Company is intended for a covering of losses of the
 Company, and also for repayment of bonds of the Company and the repayment of
 assets of the Company in case of absence of other means.

2.12. SELECTED WAYS OF OBLIGATIONS (ACCOUNTS PAYABLE AND
ACCOUNTS RECEIVABLE) ACCOUNTING
       The Company recognizes as obligations the debts which are a consequence of
certain activities or inactivity in relation to other person (creditor) and is connected
with the requirement to transfer of money resources, property, to perform works or
services, make other activities in favor of this person (creditor) arising owing to the
contract, the law or other rule of law, and also customs of a business turn.
Company obligations are subdivided into:
• debts against suppliers of the goods, works, services;


                                                                                       226
• debts against the budget and off-budget funds;
• debts against employees on a salary;
• debts against buyers on the received advance payments;
• debts on the received extra means (to credits and loans);
• other debts.
      Accounts payable for suppliers of the goods, works, and services are
considered in the amount of the accounts accepted for payment and amount of the
added obligations according to settlement documents.
      Accounts payable on non-invoiced to deliveries are considered in analytical
and synthetic accounting at the book prices accepted by the Company - to the prices
specified in the contract of the supplier.
The debts under obligations are divided into:
• long-term and short-term ones:
• short-term debts are debts under the received obligations which term of repayment
according to treaty provisions does not exceed 12 months;
• long-term debts are debts under the received obligations which term of repayment
under treaty provisions exceeds 12 months;
• urgent and delayed:
• urgent debts are debts under the received obligations which term of repayment
under treaty provisions has not come or it is prolonged when due hereunder;
• delayed debts are debts under the received obligations with expired according to
treaty provisions for repayments.
      In case of the conclusion of additional agreements to the contract the short-
term debts are translated in the long-term.
       Debts under the received loans and credits are estimated taking into account
due on the end of the accounting period to payment of interest according to
conditions of contracts. The amount of interest due for payment under promissory
notes is charged for expired month last working day of each month.
     Accounts payable at attraction of extra means by delivery to the Company of
own bill are formed as follows:
       • during attraction of extra means by delivery own interest bill 94, providing
charge of interest, in the amount of actually arrived means which is equal to the bill
amount . Interest charged subsequently increase accounts payable till the moment of
their payment to the creditor. Throughout all term of a loan the amount of accounts
payable does not change;
       • during attraction of extra means by delivery of own discount bill - in the
 amount of actually arrived means and discount (the income which is subject to
 reception by the creditor, at repayment of the bill by the borrower). Throughout
 term of a loan the amount of creditor debts in this case also does not change (all



                                                                                  227
     incomes due to the borrower have initially generated the amount of creditor
     debts).
           Company considers the given expenses as expenses of the future periods.


                        Writing-off order of accounts payable and receivable
           Accounts receivable on which term of limitation of activities has expired,
     other debts, not real for collecting, are written off under each obligation on the
     basis of the data of the spent inventory, a written substantiation and the report on
     JSC «Moscow United Electric Grid Company» and concern on financial results.
           Debt writing-off at a loss owing to insolvency of the debtor is not debts
     cancellation. These debts are reflected behind accounting balance within five years
     from the moment of writing-off for supervision over possibility of its collecting in
     case of change of a property status of the debtor.
____________________________________
93
     Federal law No. 208-FL as of 26.12.1995 «On Joint-Stock Companies».
94
     Order of the Ministry of Finances of the RF No. 107n as of 06.010.2008 (RAS 15/08), item 15.




            The amounts payable and receivable on which term of limitation of activities
     has expired, are written off under each obligation on the basis of the data of the
     spent inventory, a written substantiation and the order of the head of JSC «Moscow
     United Electric Grid Company» and concern on financial results95.
           2.13. RESERVES FOR FUTURE EXPENSES AND PAYMENTS
            JSC «Moscow United Electric Grid Company» does not establish reserves
     for future expenses and payments96.


         2.14. RESERVE              FOR      POSSIBLE         LOSSES       OF     FINANCIAL
     INVESTMENTS
           If there are any signs of diminution of value JSC "MOESK" establishes a
     reserve under diminution of value of financial investments.
            JSC "MOESK" forms the specified reserve at the expense of financial results
     of the organization as a part of miscellaneous costs.
           In the accounting reporting cost of such financial investments is shown at
     book value minus the amount of the formed reserve under their depreciation.
          Check for diminution of value of financial investments is made as of
     December, 31st of fiscal year.



                                                                                               228
           If based on the results of testing on depreciation of financial investments the
     further decrease in their settlement cost the amount before the created reserve
     under depreciation of financial investments is corrected aside its increase and
     reduction of financial result (as a part of miscellaneous costs) comes to light.
           If based on the check results for diminution of value of financial
     investments, their estimated value increase is revealed then the amount of the
     reserve established earlier for diminution of value of financial investments is
     adjusted aside its reduction and the financial result increase in composition of other
     revenues.
         At occurrence (as a result of the conducted check for diminution of value of
 financial investments) of financial investments‟ stable decrease in subsidiaries and
 affiliates JSC "MOESK" defines the estimated cost of shares for the given reserve
 establishment. Company while defining the estimated cost uses a method of net
 assets valuation. In accounting statements the cost of such financial investments is
 shown at balance sheet value minus the accrued reserve.

           2.15. ACCOUNTING OF CALCULATIONS ON PROFIT TAX

        Concept of constant differences, temporary differences, and constant tax
 liabilities

_____________________________
95
     Items 77 and 78 of Regulation No. 34n.
96
     Item 72 of Regulation No. 34n
        Constant differences are understood as incomes and the costs forming an
 accounting profit (loss) of an accounting period and excluded from account of tax
 base under the profit tax as accounting and the subsequent periods.
        As time differences are understood incomes and the costs forming an
 accounting profit (loss) in one accounting period, and tax base under the profit tax -
 in the friend or other accounting periods.
        Constant tax obligation is understood as the amount of the tax which leads to
 increase in fiscal charges under the profit tax in an accounting period
        Information on constant and time differences is formed on the basis of
 primary accounting documents in accounting registers and tax ledgers 97.

           Order of accounting of deferred tax assets

        JSC «Moscow United Electric Grid Company» recognizes the deferred tax
 assets in that accounting period in which there are subtrahend time differences,
 under condition of existence of probability of that the Company will receive the
 taxable profit in the subsequent accounting periods. The deferred tax assets are
 reflected in book keeping of the executive office of JSC «Moscow United Electric
 Grid Company» in separate synthetic account 09 «Deferred tax assets». Thus
 deferred tax assets in analytical accounting are accounted separately on types of
 assets where the extracted temporary difference occurred98.


                                                                                       229
        Order of accounting of deferred tax liabilities

        The deferred tax liabilities are recognized in that reporting period in which
 taxable temporary difference appear. Deferred tax liabilities are reflected in the
 accounting records of the executive office of JSC «Moscow United Electric Grid
 Company» at separate synthetic account 77 «Postponed tax obligations». Thus in
 the analytical accounting the deferred tax liabilities are accounted differentially
 specified by assets and obligations types in estimation of which a taxable temporary
 difference appeared99.

        Reflection order of deferred tax assets and obligations in reports

Deferred tax assets and deferred tax liabilities are reflected in the balance sheet of
the executive office of JSC «Moscow United Electric Grid Company» accordingly
as non-current assets and long-term obligations100.
_____________________________
97
   Items 4, 5, 7, 8, 13 RAS 18/02
98
   Item 14 RAS 18/02.
99
   Item 15 RAS 18/02
100
    Item 23 RAS 18/02




                                    Reflection order in reports

         The constant tax obligations, the deferred tax assets, the deferred tax
 liabilities are reflected in the report on profits and losses101.

        Determination method of current profit tax amount

        The Company applies a method of determination of the amount of the
 current profits tax on the basis of the data generated in the business accounting.

      2.16 INFORMATION ON SEGMENTS
       Under establishment of information on segments the accounting statements
 of JSC «Moscow United Electric Grid Company» information on operational
 segments is considered primarily and secondary one is that on geographical
 segments. Order and rules of information representation on segments in accounting
 statements are determined by RAS 12/2000 «Information on segments».

        2.17. EVENTS AFTER REPORTING DATE102

       Acknowledgement of event after reporting date of the accounting
 statements


                                                                                  230
        Event after the reporting date is the fact of economic activities which has
 rendered or can influence a financial condition, movement of funds or results of
 activity of JSC «Moscow United Electric Grid Company» and which took place
 during the period between a reporting date and date of signing of accounting
 records for an accounting year.
        Event after the reporting date is the announcement of annual dividends when
 due according to results of work for the reporting year103.

        Estimation of event‟s consequences after reporting date

       They make the corresponding calculation and provide confirmation of such
 calculation for estimation of the event‟s consequences after a reporting date in
 money terms. The calculation is carried out by service to which the event concerns
 according to carried out functions104.

        Disclosing of events after reporting date in reports

___________________
101
    Items 24, 19 RAS 18/02.
102
    RAS 7/98 «Events after the reporting date», approved by the Ministry of Finance of the RF No.
56n
as of 25.11.1998 103 Item 3 of section II of RAS 7/98
104
    Item 8 of section III of RAS 7/98.



       Events after the reporting date are reflected in the accounting reporting by
specification of the data about corresponding assets, obligations, the capital, incomes
and JSC «Moscow United Electric Grid Company» or by disclosing of the
corresponding information in explanations to accounting balance and the report on
profits and losses. Declaration of dividends is revealed in explanations to accounting
balance and the report on profits and losses105.
        In a case if the new information on events is received during the period
 between date of signing of the accounting reporting and date of its statement after
 the reporting date, disclosed in the accounting reporting represented to users, and
 (or) events have occurred which can make essential impact on a financial condition,
 movement of funds or results of activity of the organization, the Company informs
 the persons to whom it has been presented 106.


        2.18. СONTINGENCIES107

        Recognition of contingencies in the accounting statements.
        Accounting statements of JSC «Moscow United Electric Grid Company»
 reflects all essential contingencies concerning consequences and probability of their
 occurrence in the future if there is an uncertainty that is which final result will be


                                                                                             231
 confirmed only during the occurrence (or non occurrence) of one or several
 uncertain events in future 108.

        Structure of contingencies

        Contingencies are:
        Proceedings not finished as of reporting date, in which JSC «Moscow United
 Electric Grid Company» acts as the claimant or the respondent, and decisions on
 which can be accepted only during the subsequent accounting periods;
        Disagreements not resolved for accounting date with tax departments
 concerning payment of payments in the budget;
        Guarantees and other types of maintenance of the obligations, given out in
 favor of the third parties dates of performance on which have not occurred;
        Discounted bills, which term of repayment has not come;
        Sale either what termination or directions of activity of JSC «Moscow United
 Electric Grid Company», closing of branches or their moving;
_______________________________________
105
    Items 7, 9, 10 of section III of RAS 7/98.
106
    item 12 of RAS - 7/98 is implemented by the order of the Ministry of Finance of the RF No.
143n
as of 20.12.2007
107
    RAS 8/01 «Conditional facts of the economic activity», approved by the Ministry of Finance of
the Russian Federation No 96n as of 28.11.2001.
108
    Item 3 of section I and item 7 of section II of RAS 8/01




     Termination or a type of activity of JSC «Moscow United Electric Grid
 Company», liquidation of branches;
     Others similar facts109.


       Order of contingencies representation in reports


      JSC «Moscow United Electric Grid Company» establishes reserves in
connection with obligations existing for accounting date, if there is an uncertainty
regarding the amount or the term of performance. The created reserve is directed to
the organization expenses.
     Conditional assets are not reflected in accounts of accounting of JSC
«Moscow United Electric Grid Company».
       Information on the conditional obligation is revealed in the explanatory note
to the accounting reporting of JSC «Moscow United Electric Grid Company» 110.


       Estimation of consequences of contingencies


                                                                                             232
      JSC «Moscow United Electric Grid Company» estimates contingent liabilities
in money terms. Calculation of a contingent liability (asset) is carried out in the
event that this amount can be soundly estimated.
      Calculation is made by service which acquires the contingency according to
functions carried out. Contingent asset are not subjected to estimation in money
terms111.


2.19. INFORMATION ON RELATED PARTIES 112
      Disclosing of information on the related parties in the reports

        JSC «Moscow United Electric Grid Company» includes in the explanatory
note the information on the related parties which is a part of the accounting reports.
It is included in the form of separate section. Together with this, the specified data is
not applied during the forming of the reporting for the internal purposes, and the
reporting made for the state statistical supervision, for the credit organization or for
other special purposes.




__________________________
107
    RAS 8/01 «Contingencies», approved by the Ministry of Finance of the Russian Federation as
of 28.11.2001 No 96n.
108
    Item 3 of section I and item 7 of section II of RAS 8/01
109
    Item 3 of section I of RAS 8/01
110
    Items 7, 8, 9, 13 of section II of RAS 8/01
111
    Item III RAS 8/01
112
    RAS 11/2008 «Information on related parties» approved by the Ministry of Finance of the RF
No. 48n as of 29.04.2008.

      Data regarding information on the related parties in the accounting reports are
data about operations between JSC «Moscow United Electric Grid Company» and
the connected party.
      Together with this the operation between JSC «Moscow United Electric Grid
Company» and the connected party is any operation on transfer (receipt) of assets,
rendering (consumption) of services or occurrence (termination) of obligations
between JSC «Moscow United Electric Grid Company» and the connected party.




                                                                                          233
       2.20. ACCOUNTING OF GOVERNMENT ASSISTANCE113


        Classification of budgetary funds.

        For the goals of accounting records the budgetary funds are divided into:
        funds for financing of the capital expenditures connected with purchasing,
 building or acquisition in other ways of non-current assets (fixed assets, etc.);
        funds for financing of current expenses. Budgetary funds which are different
 from those intended for the financing of capital costs 114.
        Order of reflection of budgetary funds in accounting records.
        Budgetary funds included for accounting purposes are reflected in accounting
 records as origin of target financing and indebtedness on these funds.
        Budgetary funds are recognized in the accounting records in process of actual
 acquisition of resources.
         Budgetary funds are written off from a business account of target financing
 as increase in financial results.
        Simultaneously depreciation allocations are accrued in a general order on
 noncurrent assets acquired at the expense of budgetary funds and subjected
 according to effective rules of depreciation.
        Writing-off of budgetary funds from the business account of target financing
 is carried out on a regular basis:
        Amount of budgetary funds for financing of capital expenditures -
 throughout term of useful use of the non-current assets are subject according to
 acting rules of depreciation. Thus target financing is considered as deferred
 revenues during putting of objects of non-current assets in operation with the
 subsequent reference during the term of useful use of objects of non-current assets
 at a rate of the added depreciation on financial results of JSC «Moscow United
 Electric Grid Company» as incomes;
        Amounts of budgetary funds for current expenses financing - during the
 periods of costs recognition for financing of which they were represented.
        Budget credits are reflected in the accounting records in the general order
 accepted for borrowed funds accounting.

        2.21. INFORMATION ON DISCONTINUING OPERATION115
                   Disclosure of information on discontinuing operation.




113
    «Accounting government assistance» RAS 13/2000 approved by the order of the Ministry of
Finance of the Russian Federation No.92n as of 16.10.2000.
114
    Item 4 of section I of RAS 13/2000
115
  for reporting “Information on discontinuing operation”, RAS 16/02 approved by Order of the
Ministry of Finance of Russia No. 66n as of 2.07.2002.



                                                                                           234
      JSC “Moscow United Electric Grid Company” incorporates the following
information on discontinuing operation into the explanatory note included into the
accounting reports:
      description of discontinuing operation;
      cost of the assets and obligations of JSC “Moscow United Electric Grid
Company” that is supposed to be retired or redeemed within the framework of
discontinuing operation;
      amounts of income, expenses, profit, or loss before taxation, as well as the
amount of the accrued income tax that refer to discontinuing operation;
      cash flow that refers to discontinuing operation in terms of current,
investment, and financial activity in the course of the current fiscal period.




Chief accountant                                               L.A. Sklyarova




                                Regulation
                         on Tax Accounting Policy
               of JSC “Moscow United Electric Grid Company”
                             for the year 2010




                                                         Appendix No. 2 to Order of
                                                         JSC “MOESK”
                                                         No. 823 as of 31.12.2009




                                                                                235
                              TABLE OF CONTENT


1. TAX ACCOUNTING STRUCTURE                                                        4

1.1. General                                                                       4

1.2. Assignment of duties between the Executive Body and branches of JSC “Moscow
United Electric Grid Company”                                              4

1.3. Tax Authorities Interaction Procedure                                         6
1.4. Reconciliation Procedure for Tax Payable and Accrued with Tax Authorities             6

1.5. Procedure for Addressing Tax Authorities on the Issues of Taxation Legislation 7
1.6. Tax Accounting Records Management                                                 7

   2. LIABILITY FOR MAINTENANCE OF TAX RECORDS AND
COMPILATION OF TAX REPORTS                                                         8
3.1. General                                                                       9
3.2. Procedure for recognition of income and expenses                                  9
3.3. Tax accounting as for expenses incurred with creation of objects related to
amortizable assets                                                                     10
3.4. Tax accounting as for fixed assets                                                11

3.5. Tax accounting of intangible assets                                               14

3.6. Accounting of inventories                                                         16
3.7. Expenditure accounting                                                                17

3.8. Income tax accounting                                                                 23

3.9. Accounting procedure for leasing income and expenditure                               25

3.10. Tax accounting of securities                                                         25

3.11. Tax accounting of debenture interest                                             26

3.12. Reserves/provisions                                                              26

3.13. Income tax settlement procedure                                              27

4. Value-added tax                                                                 28



                                                                                           236
5. Company's property tax                                          29
6. Insurance fees to the Pension Fund of the Russian Federation,    30
Social Insurance Fund of the Russian Federation,
Federal Compulsory Medical Insurance Fund
and Territorial Compulsory Medical Insurance Funds




                                                                    237
                      1.   TAX ACCOUNTING STRUCTURE

                                     1.1. GENERAL
       1.1.1. The Regulation defines a system of tax accounting adopted at JSC
“Moscow United Electric Grid Company” for the purpose of computing,
discharging and declaring taxes, as well as an interaction procedure for
separate units of JSC “Moscow United Electric Grid Company” on issues
related to tax accounting.
The tax accounting policy for taxation purposes is obligatory for the branches
of JSC “Moscow United Electric Grid Company”.
       1.1.2. Amendments to the tax accounting policy of JSC “Moscow
United Electric Grid Company” are made when amending the accounting
procedure for individual business transactions and (or) for taxation purposes in
case of changes in the legislation or applicable methods of accounting, or when
JSC “Moscow United Electric Grid Company” has started to perform new
kinds of business activity.
      Decisions on any amendments are reflected in the tax accounting policy
for taxation purposes.
       1.1.3. JSC “Moscow United Electric Grid Company” applies a system of
tax ledgers and a procedure of their completion stipulated by the 1C:
Accounting 8.1 Software.
       1.1.4. Inventory of liabilities related to payments under taxes and dues,
reconciliation of tax debts with tax authorities are made by the Executive Body
and branches of Moscow United Electric Grid Company, OJSC, on a
residential basis.
       1.1.5.      To each IFTS of Moscow, Moscow Region, and other regions of
Russia a responsible branch is appointed to verify payments under customer accounts of
JSC “Moscow United Electric Grid Company” against centralized taxes in
accordance with Order of JSC “Moscow United Electric Grid Company”.

      1.2. Assignment of duties between the Executive Body and branches
             of JSC “Moscow United Electric Grid Company”

      1.2.1. The Executive Body acknowledges liabilities of a tax payer
(calculation of taxable base, submission of declarations [advance calculations])
regarding the following taxes:
     Income tax – it calculates tax payable by JSC “Moscow United Electric
Grid Company” as a whole, allocates the total of fiscal charges between the
budgets of different level, submits a consolidated tax declaration (advance
calculations) in electronic form to the tax authority where it is registered as a
major tax payer, and also submits declarations (advance calculations) through
the tax authority where it is registered as a major tax payer to the tax
authorities where the responsible separate units are registered (§3 Art.80, §2
Art.288 of the Tax Code of the Russian Federation hereinafter referred to as
TCRF).




                                                                                  238
     Value-added tax - it calculates tax payable by JSC “Moscow United
Electric Grid Company” as a whole, and submits a tax declaration in electronic
form to the tax authority where it is registered as a major tax payer;
     Property tax – it calculates tax payable by JSC “Moscow United Electric
Grid Company” as a whole, submits a consolidated tax declaration (advance
calculations) in electronic form to the tax authority where it is registered as a
major tax payer, and also submits declarations (advance calculations) through
the tax authority where it is registered as a major tax payer to the tax
authorities where the separate units are registered that have separate balance
sheets (braches), and to the tax authorities where the real estate entities are
registered being located beyond the seat of the company, company‟s separate
units that have separate balance sheets (branches);
     Land tax – as to land plots accounted at the Executive Body it calculates
taxes, and submits tax declarations (advance calculations) in electronic form to
the tax authority where it is registered as a major tax payer;
     Individual income tax (Fiscal Agent) – as to compensations to the
employees made by the executive body, it calculates individual income tax,
and submits data on individual incomes in electronic 2-PIT form for the
individual tax payers to the tax authority where JSC “Moscow United Electric
Grid Company” is registered as a major tax payer;
      As a Fiscal Agent the executive body, when paying dividends to the
shareholders of JSC “Moscow United Electric Grid Company” calculates and
deducts corporate income tax from legal entities and individual income tax.
      The Executive Body calculates and deducts VAT, income tax from the
amount of the income paid by the Executive Body to the nonresidential
companies that are not registered with a tax authority in the Russian Federation
in accordance with TCRF.
      The Executive Body collects electronic tax declarations (advance
calculations) for land tax, transport tax from the branches, and submits them to
the tax authority where JSC “Moscow United Electric Grid Company” is
registered as a major tax payer.
               1.2.2.    Branches of JSC “Moscow United Electric Grid
                   Company” calculate the following taxes in accordance with
                   the procedure stipulated by the corresponding chapter of
                   TCRF and submit electronic tax declarations (advance
                   calculations) to the Executive Body in accordance with the
                   regulations of JSC “MOESK” concerning electronic
                   reporting of the branches:
     Land tax – as to land plots booked on the branch balance;
     Transport tax – as to transport vehicles registered at the location of the
branches and structural units.
     The branches calculate, deducts, and, three days before the transfer of
VAT calculated from the income paid by the branch to the nonresidential
organizations that are not registered with a tax authority in the Russian
Federation, hand over an application stating the VAT total, and due date for
the transfer of income to the Executive body.
       1.2.3. Branches of JSC “Moscow United Electric Grid Company” submit
electronic forms to the tax authority where the separate unit is registered that
reflect information on individual income tax (as 2-PIT), and accrued and

                                                                             239
deducted individual income as well. It is permissible that the braches submit 2-
PIT data where registered (with a breakdown into KPP codes). The transfer of
individual income tax is made by the branch at the location of each separate
unit.
      1.2.4. Payment of taxes into the budgets is made as follows:
      By the branch in case of payments due by the branch and by the branch
and its structural units;
      By the Executive Body in case of payments due y the executive body,
and VAT amounts calculated by the branches on the income paid by to the
nonresidential companies;
      Centralized tax – by the executive body.


             1.3. Tax Authorities Interaction Procedure

      1.3.1. Tax payer (Fiscal Agent) rights and liabilities are implemented by
JSC “Moscow United Electric Grid Company” through the interaction with tax
authorities which control the accuracy and timeliness of tax payment and
submission of reports, and fulfill other functions in accordance with the Tax
Code of the Russian Federation.
       1.3.2.     In order to enjoy proper interaction with tax authorities at the
local level JSC “Moscow United Electric Grid Company” by order appoints a
responsible branch for each IFTS of Moscow, Moscow region, and other
regions of Russia.
       1.3.3. Tax authorities can be addressed by the authorized representatives
of the Executive body, branch of JSC “Moscow United Electric Grid
Company” that has a power of attorney in accordance with the procedure
stipulated by the civil legislation of the Russian Federation. Such powers of
the representatives should be secured in the job descriptions only within the
scope of competence.

     1.4. Reconciliation Procedure for Tax Payable and Accrued with Tax
Authorities

       1.4.1. Reconciliation of settlements with budgets is made in accordance
with the procedure stipulated by Order of FTA, Russia, No. SAE-3-01.444@
as of 09.09.2005 “On approval of the Regulation of Work Management for
those paying taxes, dues, and insurance fees for obligatory pension insurance,
and fiscal agents”.
       1.4.2. Reconciliation of settlements with budgets is made every three
months on the date specified by the order of JSC “Moscow United Electric
Grid Company”. As to centralized taxes the responsible branch submits
original reconciliation certificates into the accounts department of the
Executive body. As to the branch taxes the photocopies of the reconciliation
certificates are submitted to the accounts department of the Executive Body
with the originals being stored at the corresponding branch.




                                                                               240
    1.5. Procedure for Addressing Tax Authorities on the Issues of
            Taxation Legislation

        1.5.1. In accordance with Article 21 of TCRF, JSC “Moscow United
Electric Grid Company” has the right to receive written explanatory statements
on the issues of legislative execution for taxes and dues from tax authorities. In
order to receive such a statement, JSC “Moscow United Electric Grid
Company” submits a corresponding written inquiry to the tax authority where
it is registered as a tax payer.
        1.5.2. Questions about the tax and due legislative execution are sent by
the chief accountants of the branches or appointed employees to the accounts
department of the Executive Body of JSC “Moscow United Electric Grid
Company”. The accounts department of the Executive body, on the assumption
of the required adherence to the united approach to the issues of taxation and
tax accounting at JSC “Moscow United Electric Grid Company” as a whole
responds these questions in writing. If, on the basis of the tax legislation, it is
impossible to formulate an unambiguous reply to the questions, the accounts
department of the Executive Body of JSC “Moscow United Electric Grid
Company” (with the experts of the legal department present if needed)
compiles a written inquiry to the tax authority or other competent authorities of
the Russian Federation.
        1.5.3. Branches have the right to apply regarding the issues of the tax
and due legislation execution to the tax authorities where they are registered
only if these issues deal with the calculation procedure for the taxes to be paid
to this tax authority (e.g., local taxes).
        1.5.4. Original inquiries to tax authorities and the answers are to be
stored at the accounts department of the Executive Body of JSC “Moscow
United Electric Grid Company” or its branch. The branch chief accountant
should ensure the delivery of copies of all the inquiries and answers applied to
IFTS where the branch is registered, to the accounts department of the
Executive body.


                   1.6. Tax Accounting Records Management

      1.6.1. Accounting documents mean tax declarations (advance
calculations), turnover balance sheets in succession of accounting, data on the
individual income in the 2-PIT form, payment orders to transfer taxes (dues),
calculation of taxable base, tax ledgers, and primary accounting documents.
      1.6.2. Original primary documents are stored in accordance with the
prescribed procedure at the accounts department of the executive body, or
branch respectively.
      1.6.3. Liability for the integrity of the accounting documents in hard
copies and electronic form is charged by the order of the Director General of
JSC “Moscow United Electric Grid Company” and Head of the corresponding
branch of JSC “Moscow United Electric Grid Company”.




                                                                               241
          2. LIABILITY FOR MAINTENANCE OF TAX RECORDS AND
                     COMPILATION OF TAX REPORTS
       2.1. Tax accounting is applied at all the administration levels of JSC
“Moscow United Electric Grid Company”. The liability for compilation of tax
reports rests with the employees of the accountant's service headed by the chief
accountant of JSC “Moscow United Electric Grid Company” and with the
chief accountant of the branch.
       The power and liabilities of the tax departments and chief accountant of
the branch at every level of administration are defined by the Regulation on the
Department, Regulation on the Tax Accounting Policy of JSC “Moscow
United Electric Grid Company” and job descriptions of the employees charged
with maintenance of tax records and compilation of tax reports at the company
(or its branch).
       The documents validating the calculations of the taxes and dues accrued
and payable by the Company as a whole are drafted by the accounts department
of the Executive Body on the basis of the data provided by the branches of JSC
“Moscow United Electric Grid Company”.
       The documents validating the calculations of the taxes and dues accrued
and payable by the branches individually are drafted by the accounts
department of the certain branch.
       2.2. In order that the Company ensures accurate and comprehensive
assessment of the taxes paid by the Company as a whole, the branches should
submit necessary information within the time limit prescribed by the order of
the Company's Director General and in the form and volumes approved by the
corresponding instructions of the Chief Accountant of JSC “Moscow United
Electric Grid Company”.
       2.3. Accounting of tax payments made to the budget is carried out
continuously by accumulation during a fiscal period separately for each tax
according to the budget level (federal, regional and local), areas of payment,
and types of debts (arrears of the principal tax amount, fines and penalties).
        2.4. Accounting follows the requirements to the tax accounting in
accordance with the provisions of the Tax Code of the Russian Federation
(hereinafter referred to as TCRF).

                             3. INCOME TAX
                                    3.1. General

       3.1.1. JSC “Moscow United Electric Grid Company” determines a united
system of organizations, modes and forms of tax accounting for income
taxation purposes on the basis of Chapter 25 of TCRF and this Regulation.
       3.1.2. JSC “Moscow United Electric Grid Company” calculates taxable
base at the end of each reporting (fiscal) period on the basis of tax accounting
data.
       3.1.3. JSC “Moscow United Electric Grid Company” admits
clarification and expansion of the principles, procedure, and forms of tax
accounting stated in this Regulation during a fiscal period through introducing
supplementary analytics, registers and principles of summarizing the data


                                                                            242
facilitating more transparent disclosure of the principles and procedure to form
the taxable base.
       3.1.4. Primary documents for taxation purposes are represented primary
accounting documents (including the accountant's report), tax ledgers, and
calculation of taxable base.
       3.1.5. The tax accounting and calculation of taxable base is founded on
the data contained in the primary documents used for accounting, as well as
special calculations of entity and business transaction accounting for taxation
purposes in accordance with Chapter 25 of TCRF including those made using
1C Software.
       3.1.6. Forms of tax ledgers, accountants‟ and other reports used when
calculating income tax are designed also (when needed) in the Software
packages. The tax ledgers are kept electronically, transferred to paper, and
signed by the chief accountant and executor on the expiry of the fiscal
(reporting) period.

           3.2. Procedure for recognition of income and expenses

       3.2.1. JSC “Moscow United Electric Grid Company” calculates income
and expenses for taxation purposes on an accrual basis. In accordance thereof
income (expenses) are acknowledged for that reporting period when these
actually took place irrespective of the actual inflow (expenditure) of money.
       3.2.2. Accounting procedure and acknowledgment moment of separate
kinds of income (expenses) are specified in separate paragraphs of this
Regulation.

    3.3. Tax accounting as for expenses incurred with creation of objects
                           related to amortizable assets
       3.3.1. Fixed assets for taxation purposes are regarded as that part of the
Company's property used as labor facilities to produce and sale goods
(implement works, render services) in order to derive revenue or to manage
JSC “Moscow United Electric Grid Company” with the cost thereof being
extinguished by means of accrual of depreciation.
       The amortizable assets of JSC “Moscow United Electric Grid Company”
for taxation purposes are accepted as such in case the following requirements
are met at once:
      its useful life exceeds 12 months, and its initial value exceeds RUR 10
000 for the property commissioned before 01.01.2008, and for the property
that costs over RUR 20 000 and is commissioned after 01.01.2008
(irrespective of the time of purchase) (Federal Law N 216-FZ as of
24.07.2007, letter of the Ministry of Finance of Russia N 03-03-06.1.767 as of
03.11.2007).
       As well, the amortizable assets can include as follows:
        capital investments into the rented objects of the fixed assets in the form
of permanent improvements made upon consent of the lessor (Reason: § 1,
Art. 256 of TCRF);
       3.3.2. Initial cost of the fixed assets is defined as the total expenses for
their purchase, construction, production, delivery, and their adjustment to be

                                                                               243
applicable except for VAT (apart from the activity exempt from VAT) and
excise tax (Reason: § 1, Art. 257 of TCRF).
       The initial cost of the donated fixed assets is defined on the assumption
of the assessment of such property in accordance with § 8 Art. 250 of TCRF.
       The fixed assets obtained as a result of the Company's reorganization in
the form of separation or connection are accepted for accounting at
depreciation value which is defined in accordance with the data of tax
accounting provided by the transferring party as of the date of reorganization.
       The fixed assets collected in accordance with the leasing agreement are
accepted for accounting at the redemption value stipulated by the leasing
agreement.
       The initial cost of the fixed assets varies in cases of extension of
construction, further equipping, reconstruction, technical retooling,
modernization, partial liquidation of certain objects, and on the other similar
grounds.
      3.3.3. Tax accounting of expenses related to creation of amortizable
asset objects is made in the system of tax accounting and provides
introduction of expenses into the initial cost of the amortizable asset objects in
accordance with Chapter 25 of TCRF.




                     3.4. Tax accounting as for fixed assets

       3.4.1.      For taxation purposes the fixed assets accepted to the
accounting are included into the corresponding depreciation group on the basis
of the useful life defined independently in accordance with the provisions of
Article 258 of TCRF and Decree of the Government of the Russian Federation
No. 1 as of 01.01.2002 “On the classification of the fixed assets included into
depreciation groups”. For new objects of the fixed assets the useful life is
defined at the level of the average rate stipulated by the Decree of the
Government of the Russian Federation No. 1 as of 01.01.2002 applied to a
specific group.
        3.4.2. Fixed assets with the rights subject to state registration in
 accordance with the legislation of the Russian Federation are included into a
 corresponding depreciation group from the moment of the documentary
 confirmation of the fact that the documents for registration of the specified
 rights have been submitted.
        3.4.3. JSC “Moscow United Electric Grid Company” has the right to
 extend the useful life of the fixed assets object after the date of commissioning
 in case if reconstruction and technical retooling of the object have caused
 extension of its useful life. The useful life of the fixed assets can be extended
 within the terms established for the depreciation group in which this object was
 earlier included.
        3.4.4. Depreciation of the fixed assets is calculated by a straight-linear
 method.


                                                                               244
       3.4.5. As to motor cars and passenger microbuses with the initial cost of over
600 000 RUR and 800 000 RUR, and 300 000 RUR and 400 000 RUR (as to
the vehicles purchased before January 1st, 2008) specific rate of 0.5 has not
been applied since January 1st, 2009 (Article 27.2 of Federal Law N 224-FZ as
of 26.11.2008; Reason: Article 27.2 of Federal Law N 224-FZ as of
26.11.2008, letter of the Ministry of Finance No. 03-03-06.1.47, No. 03-03-
06.2.19 as of 10.02.2009, No. 03-03-06.1.677 as of 05.12.08).
       3.4.6. As to the amortizable fixed assets used to work under the
conditions of an aggressive environment and/or extended shifts, a specific rate
is applied to the basic rate of depreciation that is approved by an order of the
Director General of the Company for each object of the fixed assets (≥ 2, Art.
259.3 of TCRF).
       3.4.7. As to the amortizable fixed assets related to the objects with a high
energy efficiency in accordance with the list approved by the Government of
the Russian Federation, a specific rate is applied to the basic rate of
depreciation that is approved by an order of the Director General of the
Company for each object of the fixed assets (≥ 2, Art. 259.3 of TCRF).
       3.4.8. The amount of deprecation for taxation purposes is monthly
defined in accordance with the procedure stipulated by Art. 259, 259.1 and
Art. 322 of TCRF. The depreciation is calculated separately for each object of
the fixed assets.
       3.4.9. The calculation of depreciation as to newly commissioned objects
of the fixed assets starts from the first day of a month that follows the month
when the following conditions were met:
       Objects were commissioned;
       Submission of the documents for registration is officially confirmed for
the objects the rights for which are subject to state registration in accordance
with the legislation of the Russian Federation. In case if the Company (branch)
meets with a refusal of state registration, the expenses in the amount of the
accrued depreciation are subject to clarification toward reduction from the first
day of a month that follows the month when the documents were submitted for
state registration. In this case, the Company submits a revised income tax
declaration to the tax authority.
      3.4.10. Calculation of depreciation for an object of the fixed assets terminates
on the first day of a month that follows the month when the cost of such an object
was completely written off, or when this object is retired from the list of the
amortizable property of JSC “Moscow United Electric Grid Company” for any
reason.
     3.4.11. In case of purchasing the used objects of the fixed assets, the
Company defines a depreciation rate for such property, taking into account the
useful life reduced for the years (months) this property was used by the
previous owners.
     If the term of actual use of this fixed asset by the previous owner turns out
to be equal to its useful life defined on the basis of the Decree of the
Government of the Russian Federation No. 1 as of 01.01.2002 “On the
classification of the fixed assets included into depreciation groups”, or exceeds
this term, the Technical Commission appointed by the Company (branch)


                                                                                  245
independently defines the term of useful life of this fixed asset, taking into
account safety requirements and other factors. The useful life established by
the Company (branch) is thus approved by an order of the Director General of
JSC “Moscow United Electric Grid Company” or by the Director of the
Branch.
      3.4.12. In case of liquidation, reorganization of the Company, depreciation
is calculated in accordance with a specific procedure:
      - the company to be dissolved, reorganized calculates depreciation up to
the month when the reorganization was completed (inclusive).
      - the resultant company after reorganization starts to calculate depreciation
for the property transferred in succession from the first day of a month that
follows the month when the succession was publicly registered.
      Reason: Federal Law N 158-FZ as of 22.07.2008 (§ 5 Art. 259 of TCRF).
       3.4.13. Calculation of depreciation for the amortizable property as capital
investments into the objects of rented fixed assets to be depreciated is made as
follows:
        1) lessor starts to calculate depreciation from the first day of a month
that follows the month when the property was commissioned, but not earlier
than the month when the lessor compensated the cost of the specified capital
investments to the lessee;
        2) lessor starts to calculate depreciation from the first day of a month
that follows the month when the property was commissioned (Reason: § 3, Art.
259.1 of TCRF).
        The Company establishes the following procedure for defining the useful
life of the capital investments made by the lessee upon consent of the lessor
which are not subject to compensation.
        In case if the capital investments into the rented property was separated
by the Company into an individual inventory in accordance with the Classifier
of the fixed assets, the lessee is calculates the depreciation of the capital
investments at rates irrespective of the useful life of this property, i.e. on the
basis of the useful life of intrinsic improvements. The depreciation can be
accrued only prior to the termination of the leasing agreement.
        3.4.14. Depreciation is not applicable for:
        Land and other objects of nature management (water, minerals resources
and other natural reserves);
       inventories;
       goods;
       incomplete capital construction objects;
       securities;
       financial instruments of future transactions.
       3.4.15. From the amortizable property the following fixed assets are
excluded:
       Transferred (obtained) for free use by agreements;
        To be suspended by the decision of the administration of JSC “Moscow
United Electric Grid Company” for a period of over three months;



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       Under reconstruction or upgrade by the decision of the administration of
JSC “Moscow United Electric Grid Company” for a period of over 12 months.
       3.4.16. Branches of JSC “Moscow United Electric Grid Company”
where the objects of the fixed assets are transferred to suspension for a period
of over three months, or reconstruction for a period of over 12 months should
promptly and prior to suspension or withdrawal to reconstruction prepare and
submit a draft decision of the administration of JSC “Moscow United Electric
Grid Company” signed by the Branch Director to the Executive Body of the
Company on suspension or withdrawal of the certain object of the fixed assets
to reconstruction.
       3.4.17. As to the donated fixed assets, from the first day of a month that
follows the month when the donation of the fixed assets took place, the
calculation of depreciation is not applicable. The same procedure is applied for
the fixed assets transferred in accordance with the decision of the
administration of JSC “Moscow United Electric Grid Company” to be
suspended for a period of over three months, and for the fixed assets that are
by the decision of the administration of JSC “Moscow United Electric Grid
Company” under reconstruction, upgrade, and technical retooling during a
period of over 12 months.
       Upon expire of the fixed asset free usage and return agreement, as well
as when bringing back to service or completing reconstruction, depreciation is
accrued in accordance with the procedure stipulated by Chapter 25 of TCRF
starting from the first day of a month that follows the month when the return of
the fixed assets of JSC “Moscow United Electric Grid Company”, as well as
completion of reconstruction or recurred commissioning of the fixed assets
took place.
       When bringing the fixed assets back to service, the useful life is
extended for a period when the fixed assets were suspended.

      Sale and retirement of amortizable assets.

        3.4.18. Profit (loss) from the sale or retirement of the amortizable
property is defined on the basis of the analytical accounting for each object to
the date of the income (expenses) acknowledgment. The income and expenses
accounting of the amortizable property is made separately for each object.
        3.4.19. Profit gained as a result of sale of the amortizable property is
included into the taxable basis of the fiscal period when the property was sold.
        3.4.20. Expenses incurred as a result of sale of the amortizable property are
reflected in the analytical accounting among other expenses. The resultant
expenses are included into the other expenses as equal shares during a period
defined as a difference between the useful life of this property and actual term
of its operation before sale.
        3.4.21. The amounts of the fixed assets depreciation to be accrued when
liquidated are referred to as non-operating expenses.

                         3.5.Tax accounting of intangible assets




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     The intangible assets are those purchased and/or created by JSC “Moscow
United Electric Grid Company” results of the intellectual activity, and other
objects of intellectual property (exclusive rights for such property) used when
producing goods (implementing works, rendering services) or for managerial
needs of JSC “Moscow United Electric Grid Company” on a long-term basis
(over 12 months).
     In order to be acknowledged as intangible assets these should provide
economic benefits (revenue) to the Company and have properly drafted
documentation that validate the existence of the intangible asset itself and .or
exclusive right enjoyed by the Company towards the results of intellectual
activity (including patents, certificates, other protection documents, patent
assignment (purchase) agreement, trade mark).
       The useful life of the intangible asset object is assessed on the basis of
the lifetime of a patent, certificate, and/or other limits of service life for the
objects of intellectual property in accordance with the legislation of the
Russian Federation or applicable legislation of a foreign company, and on the
basis of the useful life of intangible assets stipulated by the corresponding
agreements. If it is impossible to define the useful life of intangible assets, the
depreciation rate is assigned per ten years.
       The depreciation of intangible assets is calculated by a straight-line
method on the basis of the rates calculated for the defined useful life of the
objects.
       The depreciation amount for taxation purposes is monthly defined in
accordance with the procedure stipulated by Article 259 of TCRF. The
depreciation is calculated separately for each object of the intangible assets.
The calculation of intangible asset depreciation begins with the first day of a
month that follows the month when the object was commissioned. The
calculation of intangible asset depreciation terminates on the first day of a
month that follows the month when the cost of such an object was completely
written off, or this object was withdrawn from the list of the intangible assets
of JSC “Moscow United Electric Grid Company” for any reason.
       The cost of the intangible assets created by JSC “Moscow United
Electric Grid Company” is defined as a total of actual expenses for the
creation, production (including material expenses, payroll expenses, expenses
for the third party services, patent and certification fees), except for value-
added tax and excise taxes.
       The initial cost of the amortizable intangible assets is defined as total
expenses for their purchase (creation) and adjustment to be applicable except
for taxes accounted within the expenses in accordance with TCRF.
     The results of intellectual activity and other objects of intellectual property are
not regarded as property for taxation purposes (§ 2 Art. 38 TCRF, Art. 128 CCRF).
Therefore, even if the cost of such objects is less than 10 000 RUR, these should
also be accounted among the amortizable property (letter of FTA, Russia N 04-2-
05.2 as of 27.02.2006 N 04-2-05.2 "On the application procedure for certain
provisions of the Tax Code of the Russian Federation").
     If the expenses allocated by the Company to research and/or development
result in the acquirement of exclusive rights for the results of intellectual
activity stated in § 3 Art. 257 of TCRF, these rights are acknowledged as



                                                                                    248
intangible assets and subject to depreciation in accordance with § 2 Art. 258 of
TCRF and § 5 Art. 258 of TCRF.
       The purchased rights for the results of intellectual activity and other
objects of intellectual property are not subject to depreciation if the agreement
for purchasing these rights stipulates the settlement to be made by recurring
payments during the term of the specified agreement.
     From January 1st, 2009, the expenses related to purchasing the right for
usage of computer software and data bases by agreements with the copyright
holder (by license agreements), as well as expenses for purchasing exclusive
rights for the computer software with a cost of less than RUR 20 000, and
updates for computer software and data bases are coincidently accounted
among other expenses (§§ 26 § 1 Art. 264 TCRF).
     Prior to January 1st, 2009, the expenses related to purchasing the right for
usage of computer software and data bases by agreements with the copyright
holder (by license agreements), as well as expenses for purchasing exclusive
rights for the computer software with a cost between RUR 10 000 and RUR 20
000 are acknowledged as amortizable property.

                        3.6. Accounting of inventories

      3.6.1. The cost of inventories is defined on the basis of their acquisition
prices (without deductible taxes or taxes included into expenses in accordance
with TCRF) including commission paid by intermediary organizations, import
custom duties and fees, transportation costs, and other expenses related to
acquisition of inventories.
      3.6.2.      The cost of inventories does not include the following:
      Expenses in the form of any debenture interests taken in order to
purchase inventories;
      Expenses in the form of exchange rate difference that appears in the case
when the amount of accrued obligations and requirements calculated on the
basis of the exchange rate for currency units specified by the agreement of
parties as at the date on which the inventories are entered in accounting
records does not agree with the actually paid amount in RUR.
      The expenses specified under this paragraph are included into the
extraordinary charges.
      3.6.3.      The cost of inventories that include raw materials, supplies,
spare parts, accessories, intermediates, and other tangibles produced by own
strength, as well as the cost of works and services produced by own strength
included into the material expenses is defined as a cost of fabricated
commodity in accordance with the procedure stipulated in Article 319 of TC
RF.
       3.6.4. When defining the amount of material expenses in the course of
deduction of inventories used for fabrication (production) of commodities
(execution of works, rendering of services), an average cost evaluation
procedure is applied.
       3.6.5. Into the extraordinary income at market value the Company
includes income in the form of the following cost: materials or other property
obtained when dismantling or splitting-up in the course of liquidation of the

                                                                              249
decommissioned fixed assets; surplus of inventories and other property, which
is revealed as a result of inventory, in the full size of their cost, and in the
course of sale or other kind of property redemption revealed when dismantling
or splitting-up of fixed assets (previously included into the extraordinary
income), the Company considers, among expenses for the purpose of income
tax computation, the whole amount that was earlier acknowledged among
income.


            Bought-in goods depreciation procedure

       3.6.6. The cost of goods is defined on the basis of their acquisition prices
(without deductible taxes or taxes included into expenses in accordance with
TCRF) including commission paid by intermediary organizations, import
custom duties and fees, transportation costs, and other expenses related to
acquisition of inventories.
       3.6.7. The cost of goods does not include the following:
      Expenses in the form of any debenture interests taken in order to
purchase inventories;
      Expenses in the form of exchange rate difference that appears in the case
when the amount of accrued obligations and requirements calculated on the
basis of the exchange rate for currency units specified by the agreement of
parties as at the date on which the goods are entered in accounting records
does not agree with the actually paid amount in RUR.
      The expenses specified under this paragraph are included into the
extraordinary charges.
       3.6.8. When selling goods the income from sales is reduced by the
purchase cost for these goods defined on the basis of the cost of the first made
procurement (FIFO method).


                          3.7. Expenditure accounting

          3.7.1. The expenses of JSC “Moscow United Electric Grid Company”
are defined on the basis of source documents and data of the tax records which
are kept in accordance with this Regulation.
         3.7.2. In the course of defining expenses which reduce the income of
JSC “Moscow United Electric Grid Company”, the documentary confirmation
and economic validity of the expenses is to be obligatory checked.
          3.7.3. Documentarily confirmed expenses mean those expenses that
are confirmed by source documents drafted in accordance with the legislation
of the Russian Federation.
      The source documents should contain the following compulsory details:
      a) title of the document;
      b) date of document compilation;
      c) name of the organization on which behalf the document is compiled;
      d) content of the economic operation;
      e) parameters of the economic operation in physical and monetary terms;

                                                                               250
       f) title of the positions of those officials who are responsible for the
 implementation of the economic operation and accuracy of its execution;
       g) personal signatures of the specified persons.
        The documentary confirmation of the incurred expenditures should rely
 on the source accounting documents which are drafted not only in accordance
 with the legislation of the Russian Federation, but also on the documents
 drafted in accordance with the business traditions typical of the foreign country
 in the territory thereof the corresponding expenses were incurred, and (or) on
 the documents that indirectly confirm the incurred expenses (including customs
 declaration, business trip order, travel documents, contract work statement)
 (Reason: § 1, Art. 252 of TC RF);
          3.7.4.    The expenses of JSC “Moscow United Electric Grid
 Company”, except for the expenses neglected for the purpose of taxation in
 accordance with Art. 270 of TC RF, are divided as follows:
       - expenses related to the production and sales; transmission and
distribution of electric power at once coincides in time with its sale, and thus
main production related to transmission and distribution of electric power
leaves no remains of incomplete production.

       - expenses related to the activities aimed at usage of service sector
facilities in accordance with Art. 275.1 of TC RF;
       - extraordinary expenses.
          3.7.5.   The expenses for production and sales incurred in the course
of the reporting (fiscal) period are divided as follows:
        direct;
        indirect.
         3.7.6. For the purpose of taxation direct expenses (of balance accounts
20, 23, 25) include as follows:
      - material costs defined in accordance with Art. 254 of the Code;
      - expenses for salary settlements with the staff who participated in the
process of good production, implementation of works, and rendering of
services;
      - insurance fees to non-budgetary funds accrued to the amounts of staff
salary expenses (except for insurance fees for industrial accidents);
      - amount of the amortization accrued to the fixed assets used when
producing goods, works, or services.
         3.7.7. The direct expenses related to the specific kind of activity
(including expenses for the salary of the staff involved in a specific kind of
activity, amortization of the fixed asset used in a specific kind of activity) for
the purpose of tax accounting are included into the expenses for a
corresponding kind of activity in accordance with the procedure approved by
JSC “Moscow United Electric Grid Company” for the benefit of accounting of
such expenses.
         3.7.8. The indirect expenses (of balance accounts 20, 23, 25) include as
follows:



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     All other amounts of expenses for production and sale, i.e. not reflected in
§ 3.7.6 of this Accounting policy except for extraordinary expenses and
expenses that are not accounted for the purpose of taxation in accordance with
Article 270 TC RF;
     Expenses on balance account 26 in full including expenses for rendering
services related to power connection to the electric grids formed in the
accounting records.
        3.7.9.     The extraordinary expenses include reasonably incurred
expenditures for the activity directly not related to the production and sale.
The extraordinary expenses form in accordance with Article 265 of TC RF.
       3.7.10. The expenses not accounted for the purpose of taxation form in
accordance with Article 270 of TC RF.
       3.7.11. The expenses accepted for the purpose of taxation with account of
provisions of Chapter 25 of TC RF are acknowledged as such in that reporting
(fiscal) period to which these are related irrespective of the time of actual cash
outflow and (or) other form of payment.
     3.7.12. The dates to acknowledge specific kinds of expenses are accepted
in accordance with the procedure stipulated in Article 272 of TC RF.
      The expenses related to the procurement of software and data bases,
licensing expenses, property insurance expenses, and other deferred
expenditures are distributed for a corresponding amount of reporting (fiscal)
periods on the basis of the agreement terms. If the terms of agreements do not
relate origination of expenditures to the specific reporting (fiscal) periods, then
the expenses are deducted under the procedure established for the purpose of
accounting records, i.e. regularly on the basis of the term of beneficial use of
this property defined by the permanent commission that identifies terms of
beneficial use.
     The expenses in the form of a service provided for the technological
connection of the Company's power receivers to the grids of the affiliated grid
companies involved in the One Window package are deducted by the Company
as expenses that reduce the taxable base related to income tax in that reporting
(fiscal) period when the Job Completion Report is signed by the ultimate
consumer. The Company reflects the amount of the above stated expenses that
corresponds to the income received by the ultimate consumer in the expenses
item.
       3.7.13. The expenses (costs) for the purpose of tax accounting are
generated according to the actual place of expenses incurred, i.e. the Executive
Body and branches of JSC “Moscow United Electric Grid Company”.
       3.7.14. The amount of indirect expenses for production and sale fully
incurred in the reporting (fiscal) period refers to the expenses of the current
reporting (fiscal) period with due account for the requirements stipulated by
TC RF.
       3.7.15 The costs included into the expenses are accounted in accordance
with the present Regulation with due account for marginal rates and standards
prescribed by TC RF for separate expenses items or marginal rates stipulated
by JSC “Moscow United Electric Grid Company”.


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        3.7.16. The expenses for purchasing land parcels are accounted in the
amount of 30% of the taxable base of the previous fiscal period. The taxable
base excludes amounts of expenses for purchasing rights for this land plots
accounted last year (Ind. 3 It. 1 § 3 Art. 264.1 of TC RF). The expenses are
accounted in the corresponding reporting (fiscal) period before complete
admission of the total amount of the costs.
        3.7.17 The expenses in the form of exchange rate difference that appears
if the amount of the incurred liabilities and requirements calculated at the rate
of currency units fixed by the agreement of the parties as at the date on which
the goods (works, services), property rights are sold (or entered in accounting
records) does not correspond to the actually received (or paid) amount in RUR,
are reflected under the extraordinary expenses.
       The exchange rate difference is acknowledged as expenses in the
       following cases:
       when selling goods (works, services), property rights - as at the date
when receivables were collected for the sold goods (works, services), property
rights, and in case of advance payment - as at the date when the goods (works,
services), property rights were sold;
       when purchasing goods (works, services), property rights - as at the date
of receivables collected for the purchased goods (works, services), property,
property or other rights, and in case of advance payment - as at the date when
the goods (works, services), property, property or other rights were purchased
(§ 9 Art. 272 of TC RF).
       3.7.18. The expenses for the fixed assets repair are acknowledged for the
purpose of taxation in the amount of the actual costs in that reporting (fiscal)
period when these were incurred. The expenses for the fixed assets repair are
accounted on the basis of the data reflected in the ledgers.
     3.7.19. The expenses in the form of rentals for the rented property are
reflected in the tax accounting as at the date of their display in the book
records, but not later than the last day of the month to which these relate with
due account for the principle of equal and proportionate buildup of expenses.
     3.7.20. The expenses in the form of leasing payments for the leased
property are reflected in the tax accounting for the date of their display in the
accounting records, but not later than the last day of the month to what these
relate in the amount stipulated by the leasing payment accrual schedule under
the agreement. At the same time, principal of leasing refers to the kind of
activity, i.e. technological connection, and per cents to the electric power
transmission.
      3.7.21. SWAP tax accounting.
      The cross-currency interest rate swap of the Company is a single deal
concluded for the purpose of hedging.
      Hedging operation (§ 5 Art. 301) is understood as operations with
financial instruments of futures deal concluded for the purpose of
compensation for possible losses appeared as a result of adverse change in
price or other index of the hedging object. The hedging object means assets
and (or) liabilities, as well as cash flows related the specified assets and (or)
liabilities or to the expected deals.



                                                                             253
      In order to confirm reliability of reckoning operations with financial
instruments of futures deals among hedging operations the Company makes
calculation that confirms that these operations result in reduction in the amount
of possible losses related to deals with hedging objects.
      The income related to such operations with financial instruments of
futures deals increase while the expenses decrease taxable base for other
operations with hedging objects (§ 5 Art. 304).
      In accordance with paragraph 6.2 of Section VI “Procedure for filling-in
income tax declaration form (Order of Ministry of Finance of Russia No. 54n
as of 05.05.2008) the Company reflects extraordinary income related to
hedging operations in Line 100 of the declaration form.
      The expenses related to hedging deals are displayed in Line 200 of
declaration form (Section VII. Procedure for filling-in Appendix N 2 to Sheet
02 "Expenses related to production and sales, extraordinary expenses and
losses equated with extraordinary expenses").
      SWAP deals tax accounting is implemented by the Company on the
assumption that currency swap transaction is represented by two deals:
      - cash settlement with immediate execution (initial exchange of payments
or first of currency SWAP)
      - futures deal (ultimate exchange of payments or second part of currency
SWAP).
      Reason: letter No. 404 of the Bank of Russia as of 03.02.1997
      The Company includes the following into taxable base as to the first part
of currency SWAP:
      - difference between the evaluation of sold currency amount at the rate of
the Central Bank of the Russian Federation as at the date of execution
(payment) of the currency SWAP first part and amount received from
Contractor in RUR.
      The Company includes the following into taxable base as to the second
part of currency SWAP:
      - exchange difference appeared in the course of revaluation of
requirements as at the date of deal conclusion for the end of the reporting
(fiscal) period and at the date of execution of the SWAP deal second part
(ultimate execution of a deal). The revaluation for the date of deal conclusion
is made on the basis of the currency rate stipulated in the contract (agreement)
of the parties.

                                Interest rate SWAP
     The income and expenses of the Company related to interest rate SWAP
in the form of interest rates are defined by the Company for the end of the
reporting (fiscal) period.
     The currency differences appeared in the course of when revaluating the
amounts of the income in the form of floating interest rate in currency are
calculated by the Company for the end of reporting (fiscal) period and date of
payment.

                                                                             254
                                   Payroll expenses
     3.7.22. For the purpose of taxation payroll expenses are accounted, except
for the amounts of contributions under the agreements of compulsory and
voluntary insurance concluded in favor of the employees, on the basis of
accounting data. The value of the stated contribution accepted for the purpose
of taxation is calculated in the tax ledgers.
     The payroll expenses include all accruals to the employees of JSC
“Moscow United Electric Grid Company” that satisfy the provisions of Article
255 of TC RF and stipulated by orders and other executive documents of JSC
“Moscow United Electric Grid Company”, accordingly approved regulations of
the branches and Executive Body, as well as collective and employment
agreements.
      3.7.23. The payroll expenses also include expenses for the salaries of
freelancers who executed works under the civil law agreements.
      3.7.24. The payroll expenses acknowledged for the purpose of taxation do
not account expenses listed in Article 270 of TC RF.
       3.7.25.     For the purpose of taxation payroll expenses are
acknowledged on a monthly basis on the assumption of the amount of payroll
expenses accrued for the given period.


    Tax accounting of other indirect costs related to production and sale

    3.7.26. The indirect costs include expenses for Research & Development,
expenses for compulsory and voluntary property insurance, and other expenses
stipulated by Article 263 of TC RF. The expenses included into the indirect
costs are defined in accordance with Articles 262, 263 and Article 272 of TC
RF, and other regulations of the Russian Federation legislation on taxes and
levies.

    3.7.27. The expenses for capital investments of the first, second, eighth,
ninth, and tenth depreciation groups in the amount of 10 per cent, and those of
the third, fourth, fifth, sixth, and seventh depreciation groups in the amount of
30 per cent of the initial cost of the fixed assets (except for the donated fixed
assets) and (or) expenses incurred in case of further construction, further
equipment, modernization, technical upgrade, reconstruction, partial
dismantling of corresponding fixed asset groups are included into the expenses
of the reporting (fiscal) period (Reason: § 9, Art. 258 of TC RF).

    In case if the fixed assets towards which the regulations of the first indent
of this paragraph are applied need to be sold earlier than five years from the
moment of their commissioning, the amounts of expenses included into the
expenses of the next successive reporting (fiscal) period are subject to recovery
and incorporation to the taxable base related to income tax (Federal Law
No.224-FZ as of 26.11.2008).

                                                                             255
     3.7.28. The research & development costs that yielded a positive result are
evenly included into the other expenses during one year from the first day of
the month that follows the month when the research was completed (individual
research stages).
     The expenses that yield no positive result are evenly included into the
other expenses during one year in the amount of actually incurred costs (Ind. 3
§ 2 Art. 262 of TC RF).
     The research & development expenses incurred after January 1st, 2009
which are included into the special list determined by the Government of the
Russian Federation should be reflected under the other expenses in that
reporting (fiscal) period when these were incurred in the amount of actual costs
with a multiplying factor of 1.5 (Ind. 5 § 2 Art. 262 of TC RF). The Research
& Development list is approved by Ordinance No. 988 of the RF Government
as of 24.12.2008.




                         3.8. Income tax accounting

       3.8.1. The income of JSC “Moscow United Electric Grid Company”
accounted in the taxation of income is defined on the basis of source
documents and data of accounting that is made in accordance with this
Regulation; collected income is considered documentarily confirmed not only
with source accounting documents, but also with such other documents as civil
law agreements, quotation of currency rates of the Central Bank of the Russian
Federation and MICEX, other income confirming documents (Reason: It. 2, §
1 Art. 248 of TC RF);
       3.8.2. In order to compute income taxes all the revenues of JSC
“Moscow United Electric Grid Company” are divided into two groups:
      income from sales;
      extraordinary income.
       3.8.3. When defining income it is necessary to exclude amounts of taxes
displayed by JSC “Moscow United Electric Grid Company” in accordance
with TC RF to the purchaser (acquirer) of goods (works, services, property
rights).
       3.8.4. The income is acknowledged in that reporting (fiscal) period
when it took place irrespective of actual receipt of cash assets, other property
(works, services) and (or) property rights.
       3.8.5. As to the income related to the power connection to the electric
grids the date of signing the Job Completion Report for connection works is
considered as the date of income collection (letter of the Ministry of Finance
of Russia 03-03-04.1.674 as of 28.09.2006).
       3.8.6. As to the income from sales the date of goods (works, services,
property rights) sale defined in accordance with paragraph 1 of Article 39 of
TC RF (date of ownership transfer) irrespective of actual arrival of money
(other property (works, services) and (or) property rights) as payment is


                                                                            256
considered as the date of income collection. When selling goods (works,
services) under the commission agreement (agency contract) JSC “Moscow
United Electric Grid Company” acting as a consignor (principal), the date of
selling property (property rights) that belongs to the consignor (principal)
stated in the sales notification of a salesman (agent) and (or) in the salesman
(agent) report is considered as the date of income collection.
       3.8.7. The date of extraordinary income collection is accepted in
accordance with the procedure stated in paragraph 4 of Article 271 of TC RF.
       3.8.8. The income from sales is defined by kinds of activity: in case if
there is another taxation procedure for this kind of activity it is necessary to
apply another tax rate, or provide for a different procedure for accounting
profit and loss gained from this kind of activity.
       3.8.9. For the purpose of taxation income from sale of the fixed assets
and other property (except for securities which yield income when sold agrees
the procedure stipulated in TC RF) is accounted on the basis of accounting
data with due account for provisions of Article 40 TC RF.
       The leasing income is reflected in the tax accounting in the amount due to be
paid for the reporting (fiscal) period in accordance with the terms of concluded
agreements with due account for the principle of equal and proportionate buildup of
income and expenses. The income stated is acknowledged in the tax accounting as at
the date of their display in accounting books, but not later than the last day of the
month to which it relates.
       3.8.10.      The value difference is regarded as income in the following
       cases:
       when selling goods (works, services), property rights as at the date when
receivables were collected for the sold goods (works, services), property
rights, and in case of advance payment - as at the date when the goods (works,
services), property rights were sold;
       when purchasing goods (works, services), property rights - as at the date
of receivables collected for the purchased goods (works, services), property,
property or other rights, and in case of advance payment - as at the date when
the goods (works, services), property, property or other rights were purchased
(§ 7 Art. 271 of TC RF).
       The value differences in accounting records are reflected under the
extraordinary income.


    3.9. Accounting procedure for leasing income and expenditure

       Property leasing revenue is acknowledged as sales income for the
purpose of tax accounting. The expenses related to leasing of the
corresponding property are acknowledged as expenses related to production
and sale for the purpose of tax accounting (§ 4 Art. 250 of TC RF, It. 1 § 1
Art. 265 of TC RF).


                       3.10. Tax accounting of securities



                                                                                 257
      3.10.1. The cost of securities is defined on the assumption of their
purchase price including expenses for their acquisition. The expenses for the
conversion (or other disposition) of securities are defined on the assumption of
the price of securities, costs of their conversion, amount of the accumulated
interest (coupon) yields paid by JSC “Moscow United Electric Grid
Company” to the seller of securities. The expenses do not include the amount
of the accumulated interest (coupon) income that was earlier accounted in the
course of taxation. In case of conversion or other disposition of securities the
cost of the disposed securities regarded as incurred expenses is defined per
unit cost.

       3.10.2. Tax accounting of bills of exchange
     The expenses for manufacturing or purchasing bill forms are accounted
under the extraordinary expenses (It. 3 § 1 Art. 265 of TC RF). The interest
(discount) expenses are evenly acknowledged during the term of bills
circulation as included into extraordinary expenses with due account for the
limitations stipulated by this Regulation based on Article 269 of TC RF, and
monthly incorporated into the taxable base for the end of the month of the
corresponding reporting period (§ 8 Art. 272 of TC RF).
     As to discount bills of exchange payable at sight the expenses (discount)
is defined from the bill issue date, i.e. period of bill circulation is accepted to
be equal 365 (or 366) days.
     In order to accrue discount to bills payable at sight but not earlier, the
supposed term of bill circulation that is stipulated in accordance with
legislation on bills of exchange (365 (or 366) days plus a period from the bill
issue to the minimum date of its presentation for payment) is used as a term of
circulation that serves to define discount for the end of the month of the
corresponding reporting period.
     In case of early payment of debenture the expenses are regarded as
effected. The expenses are included into the extraordinary expenses as at the
date of the contract termination.


                    3.11. Tax accounting of debenture interest

      The bond-debt interest expenses are included into the extraordinary
expenses regardless of the nature of the (current and/or investment) credit or
loan granted.
      Under the loan agreements or other similar agreements (other debt
obligations including securities) with the period of validity exceeding one
reporting period, the expenses are acknowledged as effected and included into
the corresponding item of expenses for the end of the month of the
corresponding reporting period.
      The Company defines that the marginal interest amount acknowledged
under expenses is accepted as equal to the refinancing rate of the Central Bank
of Russia multiplied by 1.1 when issuing debt obligation in RUR and by 15 %
in case of debt obligations are issued in currency.


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      The calculation procedure of the marginal interest amount is specified in
paragraph 1 Article 269 of TC RF. If the actual interest amount related to a
specific debt obligation is less than the margin, the percentage is fully
accounted for the purpose of income taxation, and if more than the margin, this
extra is not accounted in the taxable base related to the income tax.
      Since 2010 the marginal level of the interests equals accountable to the
refinancing rate of the Central Bank of Russia multiplied by 1.1.
      It however covers only the debt obligations emerged as of November 1st,
2009.
      As to the debt obligations in RUR emerged before November 1st, 2009,
within the period from January 1st till June 30th, 2010, concerning the
expenses in the form of interest related to such obligations the regulations of
tax accounting stipulated by Federal Law No. 368-FZ as of 27.12.2009 shall
apply.
      This means that from January 1st till June 30th, 2010, the marginal
interest amount acknowledged under expenses is regarded to be equal to the
refinancing rate of the Central Bank of Russia multiplied by 2 when issuing
debt obligation in RUR and by 15 % in case of debt obligations are issued in
currency.
      As to the debt obligations (loans, credits in RUR) with the prescribed
fixed interest rate that do not contain any terms of interest rate variation during
the whole period of debenture validity in order to calculate the marginal
interest level (during the whole term of validity of such obligation) the
refinancing rate of the Central Bank of Russia with the effect as at the date of
raising debts.
      The above-stated procedure is also applied to the bill interests, and the
bill interest concept for calculating the marginal interest amount includes
percentage of the annual income specified in the bill of exchange, and discount
that forms at the bill drawer as a difference between the repurchase
(redemption) price and the bill selling price.




                              3.12. Reserves/provisions

      3.12.1.      Provision for doubtful debts.
       In order to cover losses due to uncollectable debts according to the
results of the inspection of accounts receivables implemented at the end of the
previous reporting (fiscal) period JSC “Moscow United Electric Grid
Company” creates provisions for doubtful debts pursuant to the procedure
established by Article 266 of TC RF.
     Doubtful debt means any debt to a taxpayer appeared due to the sale of
goods, implementation of works, rendering of services, and under the
adherence to the terms stipulated by the regulations of Article 25 of TC RF
(Reason: § 1, Art. 266).
       The provision for doubtful debts may be used only to cover
uncollectable debts, i.e. debts to JSC “Moscow United Electric Grid


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Company” with the expired established period of limitation, as well as those
debts towards which, in accordance with the civil legislation, the liability is
terminated due to frustration, on the basis of an act of a public authority, or
due to liquidation of organization. At the same time, provisions for doubtful
debts are used only to cover uncollectable debts of those contractors and
amounts for which these provisions were created.

     3.12.2. Provisions for future expenses to repair fixed assets.
Provisions for future expenses to repair fixed assets are not made.
The expenses for the repair are accounted as actual costs.




                   3.13. Income tax settlement procedure

      3.13.1.      During a reporting (fiscal) period (quarter) JSC “Moscow
United Electric Grid Company” pays monthly advance income tax payments.
The monthly advance payment is made by equal shares in the amount of one
third of the quarterly advance payment for the quarter that precedes the
quarter when the monthly advance payment is made.
      3.13.2.      The advance payments, as well as taxes subject to be paid to
the budgets of the Russian Federation subjects are made at the residence of
JSC “Moscow United Electric Grid Company”, as well as at the residence of
each responsible subdivision. The amount of tax subject to be paid to the
budget of a Russian Federation subject is defined on the basis of the income
share calculated from the whole of rates of the autonomous subdivisions in
the territory of this Russian Federation subject.
      A share of income related to these autonomous subdivisions is defined
as an arithmetical mean density of the average number of employees, and
density of mean residual cost of the depreciable property of “Moscow United
Electric Grid Company” and specified autonomous subdivisions over a
reporting (fiscal) period.




                               4. Value-added tax

      4.1.     VAT payments to the Federal budget are centrally made by the
Executive Body of JSC “Moscow United Electric Grid Company”.
     4.2. The definition of value-added tax basis (except for the terms of sale
stipulated in §§ 3, 7- 11, 13- 15, Art. 167 of TC RF) should rely on the earliest
of the following dates:
      1) date of dispatch (transfer) of goods (works, services), property
rights;

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       2) date of payment, partial payment on account of future deliveries of
goods (execution of works, rendering of services), transfer of property rights
(§ 1 Art. 167 of TC RF).
       In case the goods are not dispatched and transported, but there is
transfer of property rights for these goods, this transfer of property rights is
set equal to goods dispatch with the aim of calculating VAT (§ 3 Art. 167 of
TC RF).
       The definition of value-added taxable base in the course of
construction-and-assembling operations for the own consumption should
take place at a last day of each fiscal period (§ 10 Art. 167 of TC RF).
       In case if the date of definition of the taxable base coincides with the
date of payment, partial payment of outstanding good deliveries (execution
of works, rendering of services), or date of property right transfer, then the
date of good dispatch (execution of works, rendering of services), or the date
of property right transfer on account of the earlier received payment, partial
payment, is also considered as a moment of taxable base definition (§ 14 Art.
167 of TC RF).
        4.3. VAT tax data from the branches should monthly be reflected in
Account 68 "Budget settlements" at a separate subaccount on the basis of
letters of advice monthly received from the corresponding branch together with
monthly tax calculation which is an internal document of the Company. In
accordance with the results of the fiscal period (one quarter after 2008), the
branches should submit a collective tax settlement. A tax declaration is
submitted by the Executive Body for the whole Company over a fiscal period.
        The amounts in the letters of advice are set in RUR and copecks.
       4.4. The procedure for compiling and drafting invoices, purchase ledgers,
and sales ledgers is regulated by the existing legislation.
       In case of renting state (municipal) property, JSC “Moscow United
Electric Grid Company” pays income to public authorities (local bodies), and
acts as a VAT fiscal agent, and at the same time issues an invoice to itself in
one copy which stays with JSC “Moscow United Electric Grid Company”.
       Over a fiscal period (one month) one invoice is issued and dated with
the last day of the current month for a total amount of the rental fee transferred
during this month.
       In case of renting state (municipal) property, invoices are issued in
accordance with the common procedure, taking into account the following
features.
       In an invoice in line 2 "Vendor" the fiscal agent specifies a taxpayer
from the income of which VAT is deducted, e.g. Department of Property of
Moscow. Column 5 of the invoice table where the cost of goods (works,
services) excluding VAT is not filled in by the fiscal agent. But total amount
of the income paid to the lessor of the state (municipal) property is put in
Column 9 “Cost of goods (works, services), total including taxes”. Column 7
shows settlement rate of tax - 18.118, and Column 8 shows the amount of the
tax deducted. The same procedure is applied for compiling invoices in case of
procurement of goods, works, and services from foreign organizations without
registered representative offices in the tax authority in the territory of the
Russian Federation.


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       Journals of VAT invoices received and issued, purchase ledgers, and
sales ledgers are kept by the branches and have a continuous numbering with
indexes that correspond to the code of the branch. Journals of VAT invoices
received and issued are stored straight at the branches. In order to compile
collective purchase and sales ledgers for the whole Company, the branches
should submit numbered and bound purchase and sales ledgers, as well as total
rates for the reporting (fiscal) period to the accountant‟s department of the
Executive body.
       4.5 The Company maintains separate VAT records in accordance with
the Procedure for purchased goods (works, services) used to implement
operations both liable and not liable to VAT under the condition that the share
of the cumulated expenses for the production of goods (works, services),
property rights which are not liable to taxation when being sold exceeds 5% of
the total amount of the cumulated expenses for the production. The Procedure
is an integral part of the Company‟s accounting policy.


                            5. Company‟s property tax
     Accounting of the company‟s property tax is centrally made on the basis
of Chapter 30 of TC RF.
      The object of taxation is movable and immovable property accounted on
the balance of JSC “Moscow United Electric Grid Company” as objects of the
fixed assets in accordance with the prescribed procedure of the maintenance of
accounting records.
    Taxation objects do not include land parcels, and other objects of nature
management (water bodies and other natural resources).
     In order to correctly apply property tax reliefs, the Executive Body of JSC
“Moscow United Electric Grid Company” and branches of JSC “Moscow
United Electric Grid Company” keep separate records of the property subject
to exemption in accordance with the existing legislation on Company‟s
property tax.
      The composition of the property objects which is accounted for the
reduction of the property cost calculated for the purpose of taxation is defined
in accordance with Article 381 of TC RF.
      In order to calculate property tax, branches of JSC “Moscow United
Electric Grid Company” submit calculations and lists of property which are
accounted for the reduction of the property cost calculated for the purpose of
taxation within the terms specified in the Order of the Company‟s Director
General. These calculations and lists of property are coordinated by the
corresponding subdivisions of the Executive Body:
      List of power lines, as well as constructions which are regarded as
integral technological parts of the specified objects is coordinated with the


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Deputy Director General in Distribution Networks, Deputy Chief Engineer in
High-Voltage Electric Grids.
     Company‟s property tax is distributed and paid to the budget in
accordance with the residence of JSC “Moscow United Electric Grid
Company”, in accordance with the residence of the branches, and each object
of immovable property that locates beyond the residence of JSC “Moscow
United Electric Grid Company”, or beyond the residence of the branches in
accordance with Articles 383, 384, 385 of TC RF.


     6. Insurance fees to the Pension Fund of the Russian Federation,
Social Insurance Fund of the Russian Federation, Federal Compulsory
Medical Insurance Fund and Territorial Compulsory Medical Insurance
Funds

       Since January 1st, 2010, in accordance with Federal Law No. 212-FZ as
of 24.07.2009 "On Insurance fees to the Pension Fund of the Russian
Federation, Social Insurance Fund of the Russian Federation, Federal
Compulsory Medical Insurance Fund and Territorial Compulsory Medical
Insurance Funds", insurance fees to the State non-budgetary funds have been
introduced instead of a unified social tax.
       Insurance fees are not considered as tax payments.
       The basis for insurance fee computation is the amount of payments and
other bonuses acknowledged as an object of imposition.
       The basis for insurance fee computation is defined separately with
respect to each physical person on an accrual basis from the beginning of the
settling period upon the expiry of each calendar month.
       The objects of imposition in the course of insurance fee computation
(Art. 7 of Federal Law No. 212-FZ) are acknowledged to be payments and
other bonuses accrued by the taxpayers in favor of physical persons under
employment and civil contracts, which are concluded for executing works,
rendering services, and also under the author‟s contracts.
       The effective date for payments and other bonuses in favor of employees
(other physical persons) is acknowledged to be the date of their calculation.
       The limiting value of the basis for insurance fee computation with
respect to each physical person in 2010 should not exceed 415 000 RUR on an
accrual basis from the beginning of the settling period (§ 4 Art. 8 of Federal
Law No. 212-FZ) and is subject to annual indexation in accordance with the
growth of mean salary in the Russian Federation.
       The branches should individually calculate and pay separately insurance
feed to the Pension Fund, Federal and Territorial Compulsory Medical
Insurance Funds, and to the Federal Compulsory Social Insurance Fund, and
submit calculations for accrued and paid insurance fees in accordance with the
procedure stipulated in Art. 15 of Federal Law No. 212-FZ.
       The branches which incorporate separate subdivisions calculate and pay
insurance fees for the subdivisions centrally on a residential basis.
       The taxable base for each physical person is calculated on an accrual
basis from the beginning of the year. If during the fiscal period a physical
person passes from one subdivision of JSC “Moscow United Electric Grid


                                                                           263
 Company” into another, the limiting value of the basis for insurance fee
 computation in relation to each physical person should not exceed 415 000
 RUR on an accrual basis from the beginning of the settling period from the
 taxable base calculated with due account for payments from all the
 subdivisions.
       The payment of the insurance fees to the non-budgetary funds is made as
 follows:
       on the branch‟s payments and its structural subdivisions – by the branch;
       on the Executive Body‟s payments - by the Executive Body.
      Chief accountant                                             L.A.
Sklyarova




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7.5. Data on total amount of export and an export share in the total amount of sales
The Issuer does not carry out the export of the products (goods, works services).
7.6. Data on the value of the issuer‟s real estate and essential changes which occurred in the
structure of the issuer‟s property after the date of the previous completed fiscal year


  Total value of immovables by the end date of financial quarter, RUR: 64 795 422 317
  Charged amortization value by the end date of financial quarter, RUR:
  6 806 667 899
  Information on significant changes in the issuer‟s property structure, that took place during 12 months by the
  end date of financial quarter
    Significant changes in the issuer‟s property structure during 12 months by the end date
    of financial quarter did not took place


Data on any acquisition or retirement due to any purposes of any issuer‟s property, if book
value of such property exceeds 5 per cent of book value of issuer‟s assets, as well as data on
any other significant for the issuer changes, that took place in the other issuer‟s property
structure after the end date of the last completed fiscal year by the end date of financial
quarter:
There were no such changes
7.7. Data on participation of the issuer in litigations if such participation may have a material
effect on the financial and economic activities


There were no judicial proceedings which could considerably influence the financial and industrial
activity of the Company.




VIII. Additional information on the issuer and equity securities placed by
the one

8.1. Additional data on the issuer


8.1.1. Data on the amount, structure of the authorized (joint-stock) capital (share fund) of the
issuer
Amount of the authorized capital: RUR 24 353 545 787
Ordinary shares:
Total face value 24 353 545 787
Share amount in authorized capital, %: 100



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Preferred shares
Total face value: 0
Share amount in authorized capital, %: 0



8.1.2. Data on the change of the amount of the authorized (joint-stock) capital (share fund) of the
issuer


  Data on the authorised capital amount (share fund) change of the emitter for the last 5
  completed financial years preceding a termination date of accounting quarter, and also in
  accounting quarter
  The date of the authorized capital amount change: 19.09.2008
  The authorized capital amount before changes (rbl): 14 124 679 850

  The authorized capital structure before changes

    Ordinary shares
      Total face value: 14 124 679 850
      Share amount in authorized capital, %: 100
Preferred shares
      Total face value: 0
      Share amount in authorized capital, %: 0

  The authorized capital amount after changes (rbl): 24 353 545 787
  The name of the emitter controls, made the decision on change of the emitter authorised
  capital amount (share fund): Shareholders Extraordinary General Meeting of OJSC
  "MOESK" as of 18.04.2008
  Date of the emitter controls meeting report drawing up on which the decision on change of
  the size authorised the capital (share fund) the emitter is accepted: 28.04.2008
  Report number: 6

8.1.3. Data on formation and use of the reserve fund and other funds of the issuer

  For 2005
    Data about the Reserve Fund formation and using, and also other issue funds, formating
    due to net profit.
    Fund name: reserve
    Fund amount, established by the corporate establishment documents: in accordance with
    the issue charter is provided the reserve Fund creation in amount of 5 % from the
    authorized capital of the issue.
    The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
    0
    Amount of fond in per cent from the authorized capital (share fund): 0
    Amount of transfers to the fund during the accounting period: 0



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   Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period

For 2006
   Data about the Reserve Fund formation and using, and also other issue funds, formating
   due to net profit.
   Fund name: reserve
   Fund amount, established by the corporate establishment documents: in accordance with
   the issue charter is provided the reserve Fund creation in amount of 5 % from the
   authorized capital of the issue.
   The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
   64 690 000
   Amount of fond in per cent from the authorized capital (share fund): 0.458
   Amount of transfers to the fund during the accounting period: 64 690 000
   Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period


 For 2007
   Data about the Reserve Fund formation and using, and also other issue funds, formating
   due to net profit.
   Fund name: reserve
   Fund amount, established by the corporate establishment documents: in accordance with
   the issue charter is provided the reserve Fund creation in amount of 5 % from the
   authorized capital of the issue.
   The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
   251 470 000
   Amount of fond in per cent from the authorized capital (share fund): 1.78
   Amount of transfers to the fund during the accounting period: 186 780 000
   Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period

 For 2008
   Data about the Reserve Fund formation and using, and also other issue funds, formating
   due to net profit.
   Fund name: reserve
   Fund amount, established by the corporate establishment documents: in accordance with
   the issue charter is provided the reserve Fund creation in amount of 5 % from the
   authorized capital of the issue.
   The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
   695 356 000
   Amount of fond in per cent from the authorized capital (share fund): 2.86


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    Amount of transfers to the fund during the accounting period: 443 886 000
    Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period

For 2009
    Data about the Reserve Fund formation and using, and also other issue funds, formating
    due to net profit.
    Fund name: reserve
    Fund amount, established by the corporate establishment documents: in accordance with
    the issue charter is provided the reserve Fund creation in amount of 5 % from the
    authorized capital of the issue.
    The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
    810 513 000
    Amount of fond in per cent from the authorized capital (share fund): 3.33
    Amount of transfers to the fund during the accounting period: 115 157 000
    Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period

  For the accounting quarter


    Data about the Reserve Fund formation and using, and also other issue funds, formating
    due to net profit.
    Fund name: reserve
    Fund amount, established by the corporate establishment documents: in accordance with
    the issue charter is provided the reserve Fund creation in amount of 5 % from the
    authorized capital of the issue.
    The Fund amount in monetary assets on the terminate date of the accounting period, rbl.:
    810 513 466
    Amount of fond in per cent from the authorized capital (share fund): 3.33
    Amount of transfers to the fund during the accounting period: 0
    Amount of fond assets, using during the accounting period: 0
Ways of the given assets using :
The Reserve fund assets didn‟t use during the accounting period


8.1.4. Data on the procedure of convocation and carrying out the meeting (conference) of the
issuer supreme governance body


Name of the top body of the issuer‟s management: General meeting of shareholders


The order of shareholders‟ notifying on meeting (session) carrying out of the top body of the issuer‟s
management in accordance with the Articles:



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         11.5. Notification on the General Meeting of shareholders carrying out is addressed to (or
handled to) each person indicated in the list of persons possessing the right to take part in the General
meeting of shareholders and also shall be published by the Company at least 30 days prior to the date
of its carrying out in socio-political newspaper “Izvestia”.
         If the nominee shareholder is registered in the Company’s shareholder’s register the
notification on the General meeting of shareholders carrying out is directed to the nominee
shareholder if the list of persons possessing the right for participation in the General meeting of
shareholders does not contain other postal addresses the notification on the General meeting of
shareholders shall be directed to.
         11.6 Agenda issues voting bulletins shall be sent via postal special delivery to the address
indicated in the list of persons possessing the right to participate in the general meeting of
shareholders or given against signature to each person indicated in the list of persons possessing the
right to participate in the General meeting of shareholders if there is no other address the notification
on the General meeting of shareholders carrying out shall be sent to.
       Each person included into the list shall be presented one copy of the bulletin for voting
concerning all items or one copy of two and more bulletins for voting concerning different issues.
        12.4 Notification on the General Meeting of shareholders carrying out by means of the
absentee voting shall be published by the Company in the socio-political newspaper “Izvestia” at least
30 (Thirty) days prior to the date of the bulletin acquisition deadline.
         12.5. Agenda questions voting bulletins shall be sent via postal special delivery to the address
indicated in the list of persons possessing the right to participate in the general meeting of
shareholders or given against signature to each person indicated in the list of persons possessing the
right to participate in the General meeting of shareholders at least 20 (Twenty) days prior to the date
of the Company’s bulletins acquisition deadline.
       Each person included into the list shall be presented one copy of the bulletin for voting
covering all agenda items or one copy of two and more bulletins for voting concerning different issues.
        The order of persons’ familiarization with agenda items information (materials) concerning
the agenda of the General meeting of shareholders and the list of such information (materials) shall be
determined by the decision of the Company’s Board of Directors.


Persons (bodies) entitled to convene (require holding) of the extraordinary meeting (session) of the
issuer‟s top management body and also the order of the direction (presentation) of such requirements
in accordance with the Articles:


       14.2. Extraordinary General Meeting of Shareholders shall be carried out by the decision of
the Board of Directors of the Company on the basis of their own initiative, requirements of the
Checkup Committee of the Company, Company’s Auditor and also a shareholder (shareholders) of the
Company possessing at least 10 (Ten) per cent of the voting shares of the Company for the date of the
requirement presentation.
        14.4 Items that are to be included into the agenda of the Company’s General Meeting of
Shareholders shall be presented in the requirement of the Company’s General meeting of shareholders
carrying out.
        14.5. If the requirement to hold the Extraordinary General Meeting of shareholders of the
Company is presented by the shareholder (shareholders), it shall contain the name (description) of the
shareholder (shareholders) requiring the meeting carrying out indicating the quality, category (type)
of the Company’s shares belonging to them.
        Requirements of the company’s extraordinary General Meeting of shareholders convening
shall be signed by a person (persons) who require the Company’s Extraordinary General Meeting of
shareholders.




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The order of the meeting date of the Issuer‟s top management body determination is carried out in
accordance with the Articles:


       11.1. Annual General meeting of shareholders of the Company shall be carried out not earlier
than two months after and not later than six months after the financial year end.
         Annual General meeting of shareholders must solve the issues of the election of the Board of
Directors, and Checkup committee. It must also approve the Auditor of the Company, Annual report of
the Company presented by the Company’s Board of Directors together with reports on profits and
losses (income statement) of the Company, and also profit distribution (including the payment
(declaration) of dividends except for profit distributed as dividends concerning the results of the first
quarter, half year, nine months of the financial year) and losses of the Company concerning the results
of the financial year.
         14.3. Convening of the General Meeting of shareholders by the requirement of the Checkup
Committee of the Company, Auditor of the Company and shareholder (shareholders) being the owners
of at least 10 (Ten) percent of the Company’s voting shares is carried out by the Company’s Board of
Directors.
        Such General meeting of shareholders shall be carried out within 40 (Forty) days since the
moment of the requirement presentation on the Company’s General Meeting of shareholders carrying
out, except for the case determined by paragraph 14.9 of the Articles.


Persons who are entitled to introduce suggestions to the agenda of the issuer‟s top management body
meeting and also the order of such suggestions introduction according to the Articles:
        13.1. Shareholders (shareholder) being the owners of at least 2 per cent of the company’s
voting shares possess the right to introduce the amendments to the agenda to the Annual general
meeting of shareholders and promote candidates to the Company’s Board of Directors and Checkup
committee, which amount can not exceed the qualitative structure amount of the correspondent body.
Such proposals shall be introduced to the Company not later than 60 (Sixty) days after the financial
year end.
        13.2. The suggestion to introduce the issues to the agenda of the General Meeting of
shareholders and the suggestion on the candidates promotion shall be presented in the written form
with the indication of the name (description) of the shareholders (shareholder) representing them,
amount and category (type) of shares belonging to them and are to be signed by the shareholders
(shareholder).
        13.3. The suggestion to present the items to the agenda of the General meeting of shareholders
shall contain the wording of each proposed item, and the proposal on candidates’ promotion shall
contain the name and data of the document of identification (series and (or) number of the document,
date and place of its issue and the body issued the document) of each promoted candidate, and the
name of the body he/she is promoted to.


Persons that possess the right to familiarize themselves with information (materials), presented for the
preparation and carrying out of the meeting (session) of the top management body of the issuer and
also the order of familiarization with such information (materials) in accordance with the Articles:


         11.7. Information (materials) concerning the agenda items of the General Meeting of
shareholders 20 (Twenty) days prior, or should the General Meeting of shareholders agenda contain
the item on the Company’s restructuring - 30 (Thirty) days prior to the General Meeting of
Shareholders carrying out shall be available for the persons entitled to take part in the General
Meeting of shareholders for them to familiarize themselves in the office of the General Meeting of
shareholders. The abovementioned information (materials) shall be available for the persons entitled
to take part in the General meeting of shareholders during its carrying out.




                                                                                                    270
        The order of the persons entitled to take part in the General meeting of shareholders
familiarization with information (materials) concerning the agenda items of the General meeting of
shareholders and the list of such information shall be determined by the Company’s Board of
Directors.
  Announcement order (promulgation of data to shareholders (participants) emitter) of decisions accepted by
  the emitter supreme body of management, and also voting results:
  The voting and decision results accepted by the Company General meeting of shareholders , can be
  announced on the Company Shareholders General meeting.
In case the voting and decision results accepted by the Company General meeting of shareholders, were not
announced on General meeting, later than 10 (Ten) days after drawing up of the report on results of voting,
the decisions accepted by the Company General meeting of shareholders, and also voting results are published
by the Company in the political newspaper "Izvestiya" in the form of report on voting results.


8.1.5. Data on the commercial companies, in which the issuer owns at least 5 percent of the
authorized (joint-stock) capital (share fund) or at least 5 percent of ordinary shares


  The list of the commercial companies where the emitter on a termination date of last
  accounting quarter owns not less than 5 percent of authorized capital (share fund) or not less
  than 5 percent of ordinary stocks.


  Full company name: Open Joint Stock Company «Energocenter»
  The short name: OJSC «Energocenter»

  Location: 142117 Russia, Moscow region, Podolsk city, Kirova street 65
  VAT: 5036072424
  PSRN: 1065074061579
  Emitter share in the authorized capital of the person, %: 50
  Share of ordinary stocks of the emitter, belonging to the person, %: 50
  Share of the person participation in the authorized capital of the emitter, %: 0
  Share of the emitter ordinary stocks, belonging to the person, %: 0


  Full company name: Open Joint Stock Company «Moscabelsetmontazh»
  Short company name: OJSC «MCSM»

  Location: 107140 Russia,Moscow, Nizhnyaya Krasnoselskaya street, 6, bld. 1
  VAT: 7708659347
  PSRN: 1077764814632
  Emitter share in the authorized capital of the person, %: 100
  Share of ordinary stocks of the emitter, belonging to the person, %: 100
  Share of the person participation in the authorized capital of the emitter, %: 0
  Share of the emitter ordinary stocks, belonging to the person, %: 0


  Full company name: Open Joint Stock Company «Moscabelenergoremont»
  Short company name: OJSC «MCER»



                                                                                                          271
  Location: 115569 Russia, Moscow, Shipilovskaya 13 bld. 2
  VAT: 7737527095
  PSRN: 1077764814907
  Emitter share in the authorized capital of the person, %: 100
  Share of ordinary stocks of the emitter, belonging to the person, %: 100
  Share of the person participation in the authorized capital of the emitter, %: 0
  Share of the emitter ordinary stocks, belonging to the person, %: 0


  Full company name: Open Joint Stock Company « Plant on power electric equipment repair
  »
  Short company name: OJSC «Zavod RETO»
 Location: 115201Russia, Moscow, Starokashirskoye highway, 4а
  VAT: 7724646338
  PSRN: 1077764814324
  Emitter share in the authorized capital of the person, %: 100
  Share of ordinary stocks of the emitter, belonging to the person, %: 100
  Share of the person participation in the authorized capital of the emitter, %: 0
  Share of the emitter ordinary stocks, belonging to the person, %: 0



8.1.6. Data on material transactions completed by the issuer (поискать перевод)


The given transactions were not made.


8.1.7. Information on credit ratings of the issuer
  Credit ratings familiar to the emitter for last 5 completed financial years and if the emitter
  carries out the activity less than 5 years - for each complete fiscal year
  Object of a rating assignment: issue
      The organization which appropriated a credit rating
      Full company name: Moody's Investors Service Ltd., CJSC «Rating agency Moody‟s
      Interfax»,
      Short company name:
      Location: the Great Britain, London, Minster Kort 2, Minsing line, EC3R 7XB


  The short description of a technique of a credit rating assignment or Internet page where
  the information is available for free on a technique of a credit rating assignment:
  http://rating.interfa x.ru
  Value of a credit rating on a termination date of accounting quarter: Ba2 the forecast stable
  (on the international scale), Aa2 (on a national scale)
  History of change of a credit rating values for last 5 complete financial years previous a termination date of



                                                                                                           272
  accounting quarter and if the emitter carries out his activity less than 5 years - for each complete fiscal year
  proceeding a termination date of accounting quarter, with instructions of a credit rating value and date of a
  credit rating value assignment (change)




 Assignment                 Credit rating values
    date

26.10.2007            Ba2 The forecast positive (on the international scale)

26.10.2007            Aa2.ru (On a national scale)

27.11.2008            Ba2 The forecast stable (on the international scale)

27.11.2008            Aa2.ru (On a national scale)



8.2. Data on each category (type) of the issuer‟s stocks

Category: ordinary registered shares
Nominal value of each share: RUR 0.5
Amount of outstanding shares (amount of shares canceled or void): 48 707 091 574 (Forty eight
billion seven hundred seven million ninety one thousand five hundred seventy four) pieces.


Amount of additional outstanding shares being in the process of placement (amount of shares of the
additional issue which did not go through the state registration of the report on the results of the issue):
0


Amount of declared shares: 3 718 126


Amount of shares being on the issuer‟s balance: 0


Amount of the additional shares which can be placed as a result of conversion of the placed securities
convertible into shares or as a result of the obligations carrying out concerning the issuer‟s option: 0



  Stocks issues of the given category (type):


  date of the state                                   State registration number
    registration

31.05.2005               1-01-65116-D


Rights provided by each security to the owner:
According to paragraph 6.2. of article 6 of the Issuer’s Articles: “Each ordinary share entitles the
shareholder – its owner with equal amount of rights.
Shareholders – owners of the ordinary shares of the Company are entitled to:


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    1) take part personally or via representatives in the General meeting of Company’s’
       shareholders with the right to give votes for all the questions concerning their scope of
       functions;
    2) introduce the suggestions to the agenda of the general meeting in the order determined by the
       Legislation of the Russian Federation and Articles;
    3) acquire information concerning the Company’s activity and get acquainted with the
       documents of the Company in accordance with article 91 of the Federal law “On Joint-Stock
       Companies”, other normative legal acts and the Article;
    4) receive dividends declared by the Company;
    5) primarily acquire additional shares and equity securities convertible into shares placed by
       means of open public subscription in the amount proportionate to the amount of ordinary
       shares belonging to them;
    6) get a part of its property in case of the Company’s liquidation;
    7) carry out other rights determined by the legislation of the Russian Federation and the
       Articles”


Item 13.1 of article 13 of the Charter: “Shareholders (shareholder) of the Company, possessing
together with the owners at least 2 per cent of the voting shares of the Company are entitled to
introduce items to the agenda of the Annual general meeting of shareholders and promote candidates
to the Board of Directors of the Company and Checkup Committee of the Company. Their amount
shall not exceed the quantitative structure amount of the correspondent body. Such proposals shall be
presented to the Company not later than 60 (Sixty) days after the financial year end.”


Item 14.2 of Article 14 of the Articles: “Extraordinary General meeting of shareholders shall be
carried out by the Decision of the Company’s Board of Directors on the basis of their own initiative,
requirements of the Checkup committee of the Company, Auditor of the Company or shareholder
(shareholders) of the company being the owners of at least 10 (Ten) per cent of the voting shares of the
company for the date of the requirements presentation”.


Item 21.7 of article 21 of the Articles: “Checkup (Audit) of the financial and industrial activity of the
Company can be carried out each time by the initiative of the Checkup Committee of the Company,
decision of the General meeting of shareholders, Company’s Board of Directors or by the requirement
of the shareholder (shareholders) of the Company possessing in total at least 10 per cent of the voting
shares of the Company”.
Other data on shares, specified by the issue at its discretion
8.3. Data on the previous issues of the issuer‟s equity securities except for the issuer‟s stocks
8.3.1. Data on the issues all the securities of which are repaid (annulled)


There are no issues where all equity securities were redeemed (cancelled).




8.3.2. Data on the issues, the securities of which are outstanding
  Security type: bonds
  Security form: nominal book-entry
  Series: 01
  Documentary unconvertible percentage bearer bonds of a series 01 with the obligatory
  centralised storage with repayment term in 1820 calendar day from a placing date started,
  without possibility of preschedule repayment.



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  The obligatory centralised storage of issue securities is provided
    Data about depositary, carrying out the centralised storage of issue securities


Full name: Closed Joint Stock Company “The National Depository Center”
The short name: CJSC “NDC”
The location: Moscow, Sredny Kislovsky lane, 1/13, bld. 4


Data about the license for depositary activity carrying out on the securities market
Number of the license: 177-03431-000100
Date of issuance: 4 December 2000
Validity: for an unlimited term
The authority which issued the license: Federal Commission for the Securities Market of Russia
  Quantity of bonds of release: 6 000 000
  Face-value of each bond of release, rbl.: 1 000
  Release volume on a face-value: 6 000 000 000




  Date of the state registration of the report on release results: 24.10.2006
  The body which has carried out the state registration of the report on results of release: FFMS
  Russia
  Quantity of bonds of release: 6 000 000
  Face-value of each bond of release, rbl.: 1 000
  Release volume on a face-value: 6 000 000 000
  State Registration issue number: 4-01-65116-D
  Date of the state registration of release: 22.06.2006
  The body which carried out the state registration of release: FFMS of Russia

  Date of the state registration of the report on issue results: 24.10.2006
  The body which carried out the state registration of release: FFMS of Russia
  Additional securities issues were not carried out

Rights determined by each security of the issue:


Bonds are direct liabilities of the Open Joint-Stock Company “Moscow Region Power Grid
Company” (hereinafter referred to as – “Issuer”)


Bonds owner possesses the right to acquire during the bonds redemption the nominal value of the
bonds for the term determined by the Decision on the securities issue and the Prospectus of the
securities.


Bonds owner possesses the right to acquire the coupon profit (per cent of the Bonds nominal value)
at the end of the coupon period which determination order is presented in paragraph 9.3. of the
Issue Decision and 9.1.2. of the Securities Prospectus.



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Bonds owner is entitled with the right to require the Issuer‟s bonds acquisition in cases and on
conditions determined in paragraph 10 of the Decision on the Securities Issue and 9.1.2 of the
Securities prospectus.


In case of non-fulfillment or improper fulfillment of the obligations by the Issuer the owners and/or
nominal holders of the bonds possess the right to address to the person who presented the guarantee
concerning the Bonds issue in accordance with the conditions of the requirements provision
indicated in paragraph 12 of the Securities issue decision and paragraphs g), h). and paragraph
9.1.2. of the Securities Prospectus.


A collateral trust bond entitles the owner with the rights implied in such a guarantee. With the
transition of all the rights to the Bond the acquirer gets all the rights arisen from such a guarantee
in the same amount and on the same conditions which are valid for the moment of the rights
transition to the Bond. Rights transition occurred from the given guarantee without the transition of
the rights to the Bond is invalid.

The Issuer undertakes the obligation to ensure the return of investment means to the owners should
the Bonds issue be considered void or invalid according to the legislation of the Russian Federation.

Besides all the rights enumerated the Bonds owner is entitled to exercise other property rights
stipulated by the present Legislation of the Russian Federation.

There are no securities of issue placed.

Order and conditions of bonds redemption

Form of bonds redemption:

Bonds‟ paying off is carried out by money means in RUR (Russian Rubles) in cashless order. The
possibility to choose the form of the bonds redemption is not stipulated.

Order and conditions of bonds paying off including the maturity date.

Bonds‟ paying off is carried out by the Paying agent at the expense of and by the order of the Issuer.

Functions of the Paying agent during the bonds paying off are carried out by Noncommercial
Partnership “National Depositary Center”. Information on Noncommercial Partnership “National
Depositary Center”
is presented in paragraph 9.6. of the Issue decision and paragraph 9.1.2. e) of the Prospectus.

The Issuer is entitled to assign other Paying agents and cancel such assignments. Official
announcement of the Issuer concerning the abovementioned actions shall be published by the
Issuer in the news line and also in the newspaper “Izvestia” within 5 days since the date of such
assignments occurrence or their cancellation. The publican in the “Izvestia” newspaper shall be
carried out after the publication in the news line.

The Bonds shall be paid off according to the nominal value within 1820 calendar days since the
date of the placement beginning.

If the date of the placement beginning is a day off, irrespective of the fact whether it is a state day
off and/or a day off for the accounting activities the payment of the proper amount is carried out on
the first working day following the day off. Bonds owner is not entitled to require per cents charge
or any other indemnification for such a payment delay.




                                                                                                  276
Redemption of the Bonds nominal value is carried out by money means in RUR (Russian Ruble)
currency in cashless term for benefit of the Bonds owners.

It is presumed that the nominal holders – are the depositors of NDC (Depositary) are entrusted with
the right to get the amounts of the Bonds nominal value paying off. NDC depositor is not entrusted
by the clients to get the amounts of the Bonds nominal value paying off shall transfer the list of
Bonds owners containing all the data further determined in the List of owners and/or Bonds
nominal holders to NDC not later than 13-00 prior (Moscow Time) on the 3rd working day before
the date of the bonds paying off.

If the Bonds‟ owner rights are taken into consideration by the nominal holder and the nominal
holder is entitled to get the amount of the Bonds nominal value paying off, the body entrusted to get
the amount of the Bonds nominal value paying off is the nominal holder.

Should the Bonds‟ owner rights not taken into consideration by the nominal holder or the nominal
holder is not entrusted by the owner to get the amount of the Bonds nominal value paying off, the
body entitled to get the amount of the Bonds nominal value paying off is the owner (for the physical
persons there shall be indicated Name, Last name and Patronymic of the owner).

Bonds‟ nominal value redemption is carried out for benefit of the Bonds‟ owners being such as of
the moment of NDC operation day end preceding the 3rd working day before the date of the Bonds‟
nominal value paying off (hereinafter referred to as – “Date of the list of owners and/or Bonds‟
nominal holders compiling”).

The obligations fulfillment in relation to the owner included into the List of owners and/or Bonds
nominal holders is considered proper also in case of Bonds alienation after the date of the list of
owners and/or Bonds‟ nominal holders compiling.

Beginning with NDC operation day end on the Date of the List of owners and/or Bonds nominal
holders compiling for the purpose of the Bonds‟ nominal value paying off the Bonds purchase and
sale transactions making from purchasing organizers assumed the Bonds for trading shall be
stopped according of the rules of the trading organizers.
Should the owners who entrusted the nominal holder to acquire the amounts of the Bonds paying
off consist of the non residents and/or physical persons the nominal holder is to indicate in the list
of the Bonds owners, the following information concerning these persons:
    - Full name/ Name, last name and patronymic of the Bonds owner;
    - Amount of shares belonging to the owner;
    - Complete list of persons entrusted to get the Bonds‟ paying off amounts;
    - Location (place of registration – for physical persons) and postal address including the
        index of the Bonds owner;
    - Details of the Persons‟ Bank Account entrusted to get Bonds‟ paying off amounts;
    - Tax payer identification number (TPIN) of the Bonds owner;
    - Tax status of the Bonds owner if the Bonds owner is the legal person-non-resident;
    - Personal identification number (PIN) if any, if the Bonds owner is the physical person:
    - Type, number date and place of the document issue identifying the Bonds owner and name
        of the body issued the document;
    - Number of the state pension insurance certificate of the Bonds owner (if any);
    - TPIN of the Bonds owner (if any);
    - Date, month and year of the Bonds owner;

Not later than on the 2nd (second) working day before the date of the Bonds nominal value paying
off NDC gives the Issuer and the Paying agent the List of Owners and/or Bonds nominal holders
containing the following data:

    a) Full name of the person entitled to get the amounts of the Bonds nominal value paying off
       (Name, Last name and patronymic for the physical person);



                                                                                                 277
    b) Amount of bonds considered on the security account of the Body entrusted to get the
       amounts of the Bonds nominal value paying off;
    c) Location and postal address of the person entrusted to get the Bonds nominal value paying
       off;
    d) Details of the bank account of the person entrusted to get the Bonds nominal value paying
       off, that is:
    - Account number;
    - Name of the bank the account is opened at;
    - Bank correspondent account the account is opened at;
    - Bank identification code (BIC) of the Bank the account is opened at.
E) Tax payer identification number (TPIN) of the body entrusted to get the amounts of the Bonds
nominal value paying off (if any);
F) Tax status of the person entrusted to get the amounts of the Bonds nominal value paying off
(resident/non-resident with permanent establishment on the territory of the Russian Federation;
non-resident without the permanent establishment on the territory of the Russian Federation and
etc.)
g) Code of the reason for registration (Tax Code) of the person entrusted to get the amounts of
revenue and/or Bonds paying off.
Bonds owners, their authorized persons including NDC depositors, on their own shall check up the
fullness and topicality of the bank account information and other data presented by them to NDC. If
the abovementioned information was not presented or presented untimely to NDC, the Issuers‟
obligations fulfillment directed to the Bonds nominal value paying off is presented to the person
who required the obligations fulfillment and is the Bonds owner for the date of the requirement
presentation. Together with this, the Issuer‟s Bonds obligation fulfillment shall be carried out on
the basis of NDC data. In this case, the Issuer‟s obligations are considered fulfilled in full scale and
proper manner. If the bank account requisites and other information necessary for the Issuers‟
obligations fulfillment does not let timely carry out money means transmission such a delay can not
be considered as delay in Bonds obligations performance, and the Bonds owner can not require the
interest accrual or any other indemnification payment for such a delay in payment. In the
abovementioned cases the Issuer as well as the Paying agent does not bear the responsibility for the
delay in payments.
Not later than on the 2nd (second) working day before the date of the Bonds nominal value paying
off the Issuer shall transmit necessary money means to the account of the Paying agent. On the
basis of the List of Owners and/or Bonds‟ nominal holders of the given NDC, the Paying agent
accounts the amounts of the money means subjected to payment of each of the persons indicated in
the List of owners and/or Bonds nominal holders.
On the date of the Bonds nominal value paying off the Paying agent transmits necessary money
means to the bank accounts of the persons entrusted to acquire the amounts of Bonds nominal
value paying off determined in the list of Owners and/or Bonds nominal holders.
If one person is entrusted with the obligation to acquire the amounts of the Bonds nominal value
paying off from the part of Bonds several holders such a person gets the amount concerning each
Bonds holder.
After the accounts end with persons authorized to get the amount of the Bonds nominal value
paying off by the person determined in the list of the owners and/or Bonds nominal holders, the
Paying agent notifies NDC hereof. If the date of the Bonds nominal value paying off is a day off –
irrespective of the fact whether it is a state holiday or accounting operations day off, the payment of
the proper amount shall be carried out on the first working day following the day off. Bonds owner
is not entitled to require interest accrual or any other indemnification for such a payment delay.


Bonds issue paying off term:
Paying off date:




                                                                                                   278
In 1820th (On thousand eight hundred and twentieth) calendar day since the date of the Bonds
placement.


Possibility and conditions of the early Bonds paying off.
The possibility of early bonds paying off is not determined.


Amount of the percent (coupon) Bonds revenue, the order and conditions of its payment:


The order of the coupon per cent rate determination:


1) First coupon per cent rate is determined by means of the contest carrying out among the Bonds
potential buyers on the date of the Bonds placement beginning.
The order and conditions of the contest are determined in paragraph 8.3 of the Decision on the
Securities issue and paragraph 2.7 of the Securities prospectus.


2) Together with the determination of the date of the Securities placement, the Issuer can take the
decision to acquire the Bonds from their holders within 5 (Five) days of j-th coupon period (j=
1,2…9). Coupon percent rates which ordinal number is less or equal j shall be determined equal to
the first coupon per cent rate. The abovementioned information including the ordinal number of
the coupons which per cent rate is determined equal to the first coupon and also the ordinal
number of the (j) coupon period, where the bonds owners can require the Issuer‟s Bonds
acquirement shall be brought to the notice of the Bonds‟ potential buyers by means of information
disclosure in the correspondent order stipulated by the Federal law “On securities market” and
legal acts of the Securities Market Federal executive body determined in paragraph 11 of the
Securities issue decision and paragraph 2.9. of the Securities prospectus.
If together with the determination of the date of the Bonds placement the Issuer did not take the
decision on the Company‟s Bonds acquirement all coupons per cent rates beginning with the
second one shall be determined equal to the first coupon per cent rate.
3) Coupons per cent rate, which amount (order of determination) was not stipulated by the Issuer
before the date of the Bonds placement (i=(j+1)…..10) shall be determined by the Issuer in figures
after the State registration of the report on the result of the securities issue on the date of the
determined i- coupon which comes at least 10 (Ten) calendar days prior to the date of the (i-1)-th
coupon. The Issuer is entitled to determine on the date of the i-th stake coupon determination the
amount of the non-determined coupons following the i-th coupon (together with this k – is the
number of the last determined coupon.) I-th coupon per cent rate shall be brought by the Issuer to
the notice of the Bonds owners in the order and in terms stipulated by paragraph 11.5 of the
Securities issue decision and paragraph 2.9. of the Securities prospectus.


The Issuer informs the exchange on the decision taken including the certain stakes at least 10 (Ten)
days prior the date of the (j-1) coupon period (the period j-th and the following coupons per cent
rate is determined) end.


Should after the coupons rates‟ announcement the Bonds will retain the undetermined stakes at
least of one of the following coupons, together with the notification on the stakes of the i-th and
other Bonds determined coupons the Issuer is entitled to ensure the Bonds owners rights to require
from the Issuer the Bonds Acquisition within 5 (Five) days of the k-th coupon period (if the Issuer
determined the rate only of one i-th coupon, i=k). The abovementioned information including the
ordinal number of the coupons which per cent rate determined on the date of the i-th coupon
determination and also the ordinal number of the coupon period (k), where the Bonds acquirement
will take place shall be brought to the notice of the Bonds potential acquirers by means of


                                                                                                279
publication in the order and terms determined in paragraph 1.1.5 of the Decision of the securities
issue and paragraph 2.9. of the Securities prospectus.The amount of payment concerning any
coupon per one Bond is determined to a precision of one kopeck (rounding –up is carried out in
accordance with the rules of the mathematical rounding-up. Together with this, the rule of the
mathematical rounding-up is the method or rounding up where the meaning of one kopeck (num
kopecks) does not change if the first figure following the rounded-up one equals from 0 to 4 and
changes, increasing by one if the first figure following the rounded-up one equals 5-9). First
coupon per cent rate amount is the amount of 8.05 (eight point nought five) per cent per annum
was approved by the decision of the sole executive body of the Open Joint Stock Company “Moscow
Regional Power Grid Company”, since September 12, 2006.In accordance with the Decision on
the securities issue the second, third, fourth, fifth, sixth, seventh, eighth, ninth and tenth coupons of
the Bonds is established equal the per cent rate of the first coupon.


The order and term of Bonds payment including the order and revenue payment term
concerning each coupon.
The order and term of Bonds payment including the order and revenue payment term
concerning each coupon.
Coupon (percent) period                             Term (date) of the Date of the Bonds owners list
                                                    coupon (per cent) compiling for the coupon (per
                                                    revenue payment    cent) revenue payment
Beginning date            End date


1. Coupon: First coupon per cent rate – C (1) – is determined by means of the contest carrying out
among the Bonds potential buyers on the date of the Bonds placement beginning. The order and
conditions of the contest are presented in paragraph 8.3. of the Bonds issue decision and paragraph 2.7
of the Securities prospectus.


First coupon period First coupon end        First Bonds coupon                 Bonds coupon payment is
beginning date is the date is 182nd (one    revenue payment date is            carried out for benefit of Bonds
date of the bonds hundred and eighty        182nd (one hundred and             owners as of the end of NDC
placement             second) day since the eighty second) day                 operation day preceding the
                      date    of     Bonds  since the date of the              third working day before the
                      placement beginning   Bonds        placement             date of the Bonds coupon
                                            beginning                          revenue payment.
Bonds revenue payment is carried out by money means in the Russian            Federation currency in cashless
terms for the benefit of the Bonds holders.

Bonds holder, if he/she is not the NDC depositor, is entitled but not obliged to entrust the Bonds nominal
holder – NDC depositor to get the amounts of the Bonds revenue payment.

If the Bonds holder did not entrust the NDC depositor to get for his/her benefit the amounts from the Bonds
revenues payment the Bonds revenues payments shall be carried out for the benefit of the Bonds owner.

It is presumed that the nominal holders – NDC depositors are entrusted with the right to acquire the Bonds
revenue.

NDC depositor not authorized by their clients to acquire the amounts of bonds revenue prior to 13:00
(Moscow time) on the 3rd (third) working day before the date of the Bonds revenue payment shall transmit to
NDC the list of owners containing all the account details determined further for the List of owners and/or
Bonds nominal holders.

Bonds revenue payment is made for the benefit of the Bonds owners as of the end of the NDC operation day


                                                                                                    280
prior to 3 (Third) working day before the date of the Bonds revenue payment.

If among the owners who entrusted the nominal holder to get the amounts of the Bonds coupon revenue
there are non residents and/or physical persons, the nominal holder is entitled to indicate in the list of the
Bonds owners the following information:
    - Full name/ Name, last name and patronymic of the Bonds owner;
    - Amount of shares belonging to the owner;
    - Complete list of persons entrusted to get the Bonds‟ paying off amounts;
    - Location (place of registration – for physical persons) and postal address including index of the
        Bonds owner;
    - Details of the Persons‟ Bank Account entrusted to get Bonds‟ paying off amounts;
    - Tax payer identification number (TPIN) of the Bonds owner;
    - Tax status of the Bonds owner if the Bonds owner is the legal person-non-resident;
    - Personal identification number (PIN) if any, if the Bonds owner is the physical person:
    - Type, number date and place of the document issue identifying the Bonds owner and name of the
        body issued the document;
    - Number of the state pension insurance certificate of the Bonds owner (if any);
    - TPIN of the Bonds owner (if any);
    - Date, month and year of birth of the Bonds owner.

Obligations fulfillment in relation to the owner included into the List of owners and/or Bonds nominal
holders are considered proper also in case of the Bonds alienation after the date of the abovementioned List
compiling.

Should the rights of the Bonds owner be considered by the Bonds nominal holder and the Bonds nominal
holder is authorized to get the amount of the Bonds revenue the person authorized to get the amount of
Bonds revenue is the Bonds nominal holder.

Should the rights of the Bonds owner not considered by the Bonds nominal holder or the Bonds nominal
holder is not authorized by the owner to get the Bonds revenue amounts the body authorized to get the
amounts of the Bonds revenue is Bonds Owner.

Not later than on the 2nd (second) working day before the date of the Bonds nominal value paying off the
NDC gives the Issuer and the Paying agent the List of Owners and/or Bonds nominal holders containing
the following data:

    a) Full name (Last name, Name and Patronymic) of the person entitled to get the amounts of the Bonds
    nominal value paying off;
    b) Amount of bonds considered on the security account of the Body entrusted to get the amounts of the
    Bonds nominal value paying off;
    b) Location and postal address of the person entrusted to get the Bonds nominal value paying off;
    c) Details of the bank account of the person entrusted to get the Bonds nominal value paying off, that
        is:
    - Account number;
    - Name of the bank the account is opened at;
    - Bank correspondent account the account was opened at;
    - Bank identification code (BIC) of the bank the account was opened at.
    d) Tax payer identification number (TPIN) of the body entrusted to get the amounts of the Bonds
        nominal     value paying off (if any);
    e) Tax status of the person entrusted to get the amounts of the Bonds nominal value paying off
        (resident/non-resident with the permanent establishment on the territory of the Russian Federation;
        non-resident without the permanent establishment on the territory of the Russian Federation and
        etc.)
    f) Code of the reason for registration (Tax Code) of the person entrusted to get the amounts of revenue
        and/or Bonds paying off.




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Bonds owners, their authorized persons including NDC depositors, on their own check up the fullness and
topicality of the bank account information and other data presented by them to NDC. If the abovementioned
information was not presented or presented untimely to NDC, the Issuers‟ obligations fulfillment directed to
the Bonds nominal value paying off is presented to the person who required the obligations fulfillment and
is the Bonds owner for the date of the requirement presentation.


Together with this, the Issuer‟s Bonds obligation fulfillment shall be carried out on the basis of NDC data.
In this case, the Issuer‟s obligations are considered fulfilled in full scale and proper manner. If the bank
account requisites and other information necessary for the Issuers‟ obligations fulfillment does not let
timely carry out money means transmission such a delay can not be considered as Bonds obligations delay
in performance, and the Bonds owner can not require the interest accrual or any other indemnification
payment for such a delay in payment. In the abovementioned cases the Issuer as well as the Paying agent
bears the responsibility for the delay in payments.


Not later than on the 2nd (second) working day before the date of the Bonds nominal value paying off the
Issuer transmits necessary money means to the account of the Paying agent.


On the basis of the List of Owners and/or Bonds‟ nominal holders of the given NDC, the Paying agent
accounts the amounts of the money means subjected to payment of each of the persons indicated in the List
of owners and/or Bonds nominal holders. On the date of the Bonds nominal value paying off the Paying
agent transmits necessary money means for the bank accounts of the persons entrusted to acquire the
amounts of Bonds nominal value paying off indicated in the list of Owners and/or Bonds nominal holders.


If one person is entrusted with the obligation to acquire the amounts of the Bonds nominal value paying off
from the part of bonds several holders, such a person gets the amount concerning each Bonds holder.


If the date of the Bonds nominal value paying off is a day off – irrespective of the fact whether it is a state
holiday or accounting operations day off, the payment of the proper amount shall be carried out on the first
working day following the day off. Bonds owner is not entitled to require interest accrual or any other
indemnification for such a payment delay.

2. Coupon: Second coupon per cent rate – C(2) - is determined in accordance with the order assigned
by paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of Securities prospectus.

Second coupon period Second coupon end            Second Bonds coupon         Bonds coupon payment is
beginning date is the date is 364th (three        revenue payment date is     carried out for benefit of Bonds
date of the bonds hundred and sixty               364th (three hundred        owners as of the end of NDC
placement             fourth) day since the       and sixty fourth) day       operation day preceding the
                      date     of    Bonds        since the date of the       third working day before the
                      placement beginning         Bonds       placement       date of the Bonds coupon
                                                  beginning                   revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the second Bonds coupon – C(3) – is identical
to the order determined in paragraph 9.3.1. Securities issue decision and paragraph 9.1.2. Securities
prospectus.


3. Coupon: Third coupon per cent rate – C(3) - is determined in accordance with the order assigned
by paragraph 9.3.1.of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Third coupon period Third coupon end Third Bonds coupon Bonds coupon payment is
beginning date is the date is 546th (five revenue payment date is carried out for benefit of Bonds


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date of the second hundred and forty               546th (five hundred and     owners as of the end of NDC
coupon period end. sixth) day since the            forty sixth) day since      operation day preceding the
                   date    of    Bonds             the date of the Bonds       third working day before the
                   placement beginning             placement beginning         date of the Bonds coupon
                                                                               revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the third Bonds coupon is identical to the order
of the first coupon (per cent) Bonds revenue payment.
4. Coupon: Forth coupon per cent rate – C(4) - is determined in accordance with the order assigned
by paragraph 9.3.1.of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Forth coupon period       Forth coupon end         Forth Bonds coupon          Bonds coupon payment is
beginning date is the     date is 728th (seven     revenue payment date is     carried out for benefit of Bonds
date of the third         hundred and twenty       728th (seven hundred        owners as of the end of NDC
coupon period end.        eight) day since the     and twenty eight) day       operation day preceding the
                          date    of    Bonds      since the date of the       third working day before the
                          placement beginning      Bonds       placement       date of the Bonds coupon
                                                   beginning                   revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the forth Bonds coupon is identical to the order
of the first coupon (per cent) Bonds revenue payment.
5. Coupon: Fifth coupon per cent rate – C(5) - is determined in accordance with the order assigned by
paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Fifth coupon period       Fifth coupon period      Fifth Bonds coupon           Bonds coupon payment is
beginning date is the     end date is 910th        revenue payment date is      carried out for benefit of
date of the fifth         (nine hundred and        910th (nine hundred and      Bonds owners as of the end of
coupon period end.        tenth) day since the     tenth) day since the date    NDC operation day preceding
                          date    of    Bonds      of the Bonds placement       the third working day before
                          placement beginning      beginning                    the date of the Bonds coupon
                                                                                revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the fifth Bonds coupon is identical to the order
of the first coupon (per cent) Bonds revenue payment.
6. Coupon: Sixth coupon per cent rate – C(6) - is determined in accordance with the order assigned by
paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Sixth coupon period       Sixth coupon period      Sixth Bonds coupon          Bonds coupon payment is
beginning date is the     end date is 1092nd       revenue payment date is     carried out for benefit of Bonds
date of the fifth         (one thousand and        1092nd (one thousand        owners as of the end of NDC
coupon period end.        ninety second) day       and ninety second) day      operation day preceding the
                          since the date of        since the date of the       third working day before the
                          Bonds     placement      Bonds        placement      date of the Bonds coupon
                          beginning                beginning                   revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the sixth Bonds coupon is identical to the order
of the first coupon (per cent) Bonds revenue payment.
7. Coupon: Seventh coupon per cent rate – C(7) - is determined in accordance with the order assigned
by paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Seventh coupon period Seventh           coupon Seventh Bonds coupon Bonds               coupon    payment    is


                                                                                                   283
beginning date is the period end date is           revenue payment date is     carried out for benefit of Bonds
date of the sixth 1274th (one thousand             1274th (one thousand        owners as of the end of NDC
coupon period end.    two hundred and              two    hundred    and       operation day preceding the
                      seventy fourth) day          seventy fourth) day         third working day before the
                      since the date of            since the date of the       date of the Bonds coupon
                      Bonds     placement          Bonds       placement       revenue payment.
                      beginning                    beginning
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the seventh Bonds coupon is identical to the
order of the first coupon (per cent) Bonds revenue payment.
8. Coupon: Eight coupon per cent rate – C(8) - is determined in accordance with the order assigned
by paragraph 9.3.1.of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Eight coupon period       Eighth coupon period     Eight Bonds coupon          Bonds coupon payment is
beginning date is the     end date is 1456th       revenue payment date is     carried out for benefit of Bonds
date of the seventh       (one thousand four       1456th (one thousand        owners as of the end of NDC
coupon period end.        hundred and fifty        four hundred and fifty      operation day preceding the
                          sixth) day since the     sixth) day since the date   third working day before the
                          date    of    Bonds      of the Bonds placement      date of the Bonds coupon
                          placement beginning      beginning                   revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the eighth Bonds coupon is identical to the
order of the first coupon (per cent) Bonds revenue payment.
9. Coupon: Ninth coupon per cent rate – C(9) - is determined in accordance with the order assigned
by paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Ninth coupon period       Ninth coupon period      Ninth Bonds coupon          Bonds coupon payment is
beginning date is the     end date is 1638th       revenue payment date is     carried out for benefit of Bonds
date of the eighth        (one thousand six        1638th (one thousand        owners as of the end of NDC
coupon period end.        hundred and thirty       six hundred and thirty      operation day preceding the
                          eighth) day since the    eighth) day since the       third working day before the
                          date     of    Bonds     date of the Bonds           date of the Bonds coupon
                          placement beginning      placement beginning         revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the ninth Bonds coupon is identical to the
order of the first coupon (per cent) Bonds revenue payment.
10. Coupon: Tenth coupon per cent rate – C(10) - is determined in accordance with the order assigned
by paragraph 9.3.1. of the Securities issuer decision and paragraph 9.1.2 of the Securities prospectus.

Tenth coupon period       Tenth coupon period      Tenth Bonds coupon          Bonds coupon payment is
beginning date is the     end date is 1820th       revenue payment date is     carried out for benefit of Bonds
date of the eighth        (one thousand eighth     1820th (one thousand        owners as of the end of NDC
coupon period end.        hundred          and     eighth hundred and          operation day preceding the
                          twentieth) day since     twentieth) day since the    third working day before the
                          the date of Bonds        date of the Bonds           date of the Bonds coupon
                          placement beginning      placement beginning         revenue payment.
Order of the coupon (per cent) revenue payment:
Order of the coupon (per cent) revenue payment concerning the tenth Bonds coupon is identical to the order
of the first coupon (per cent) Bonds revenue payment.
To pay the tenth coupon revenue the List of Owners and/or Bonds nominal holders is used being compiled
for the purposes of Bonds redemption.


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Tenth coupon revenue is paid together with the Bonds redemption.


Type of the assigned guarantee:


Guarantee (Offer of the guarantee provision in the form of a guarantee for the purposes of the
Bonds issue).


Collateral trust bond entitles its owner with the rights subsequent upon such a guarantee.


With the transition of the rights to the collateral trust bond, the new owner (acquirer) gets all the
rights subsequent upon such a guarantee.


Rights transition arisen from the given guarantee without the rights transition to the Bond is
considered invalid.


8.3.3 Data on the issues, the obligations of the issuer under the securities of which were not
executed (default)


There were no specified securities issues.


8.4. Data on the person (persons) who provided securing the bonds of the issue
State registration number (SRN): 4-01-65116-D
Full company name: Limited Liability Company “PROMTEKHNIKA”
Short company name: LLC “PROMTEKHNIKA”

  Location
    115114 Russia, Moscow, the 1-st derbenevskiy lane, 5 office 304
  VAT: 7720528340
  PSRN: 1057747190049



8.5. Terms of execution of the securing under the issuer‟s bonds

Type of a guarantee (type of the assigned guarantee)


Guarantee (Offer of the guarantee provision in the form of a guarantee for the purposes of the
Bonds issue).


Collateral trust bond entitles its owner with the rights subsequent upon such a guarantee.


With the transition of the rights to the collateral trust bond, the new owner (acquirer) gets all the
rights subsequent upon such a guarantee.




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Rights transition arisen from the given guarantee without the rights transition to the Bond is
considered invalid.


Amount of the guarantee (RUR): 8 400 000 000 (Eight billion four hundred million) rubles


1. Terms and definitions


1.1. “FFMS” - Federal Financial Markets Service
1.2. “Issuing documents” – Decision on the securities issue, Securities prospectus and Bonds
certificate.
1.3. “Issuer” – Open Joint-Stock Company “Moscow Regional Power Grid Company”.
1.4. “NDC” – Noncommercial partnership “National Depository Center” fulfilling the functions of
the Company‟s depository.
1.5. “Bonds” - non-convertible registered interest bearer bonds of 01 series with the obligatory
centralized storage in the amount of 6,000,000 (Six million) pieces of the nominal value RUR 1,000
each issued by the Issuer in accordance with the Issuing documents.
1.6. “Guarantor” - Limited Liability Company “PROMTEKHNIKA”
1.7. “Amount of unfulfilled obligations” – amount of unfulfilled obligations the Issuer did not carry
out to the Bonds owner.
1.8. “Issuer‟s obligations” – Issuer‟s obligations to the Bonds owner determined by paragraph 3.1.
of the Offer.
1.9. “Offer” – the present OFFER.
1.10. “Ceiling amount” – amount accounting for RUR 8,400,000,000 (Eight billion four hundred
million) rubles including:
       Aggregate Coupon Profit payment Ceiling Amount – amount accounting for RUR 2 400 000
        000 (Two billion for hundred million);
       Bonds‟ Acquisition and Redemption Ceiling Amount – amount accounting for RUR 6 000
        000 000 (Six billion)
1.11. “Unfulfilled Obligations Event” – any of those described in the paragraphs 3.3.1., 3.3.2. and
3.3.3 of the Events offer.
1.12. “Issuer‟s Obligations Fulfillment term” - any of those indicated in paragraphs 3.3.1., 3.3.2.
and 3.3.3. of the Terms offer.
1.13 “Bonds Fulfillment Requirement” – requirement of the Bonds‟ owner to the Guarantor meting
the conditions of paragraphs 3.7, 3.7.1.-3.7.5. of the Offer.


2. Subject and character of the Offer. Its acceptance conditions.


2.1. By means of the present Offer, the Guarantor offers each person possessing the intention to get
the Bonds to make an agreement with the Guarantor on the guarantee provision in the form of
guarantee for the purposes of the Bonds issue in accordance with the legislation of the Russian
Federation, Guarantor‟s articles of association and Offer conditions.
2.2. The Offer is public and expresses the Guarantor‟s will to make a guarantee agreement with any
person accepting the Offer on conditions determined in the Offer.
2.3 The Offer is irrevocable that is can not be called off within the term determined for the Offer‟s
acceptance.
2.4. All the conditions of the Offer are subjected to the inclusion in full amount to the Issuing
Documents. The Offer is considered accepted by the addressee in the moment of the Issuer‟s


                                                                                                 286
provision to all prospective Bonds acquirers the access to information on the Bonds issue contained
in the Issuing documents and subjected to the disclosure in accordance with the Federal law on the
“Securities market” as of April 22, 1996 No. 39-FLand normative acts of the Securities market
Federal executive body.
2.5. Offer‟s acceptance can be carried out by means of only one or several shares acquisition in the
order and on conditions determined by the Issuing Documents. Bonds acquisition means the
conclusion of the Guarantee agreement between the Bonds acquirer and Guarantor. According to
the Contract, the Guarantor is obliged to the Bonds acquirer to fulfill the obligations on conditions
determined by the Offer. The Guarantee agreement is considered concluded since the moment the
first owner gets the rights on such obligations and together with this the writing form of the
agreement is considered fulfilled. With the transition of the rights to the Bond, its acquirer gets the
rights determined by the abovementioned guarantee agreement in the same amount and in the same
conditions which exist for the moment of the rights transition to the Obligation. Rights transition
arisen from the given provision without the rights transition to the Bond is considered invalid.


3. Guarantor‟s obligations. The order and conditions of its fulfillment.


3.1. The Guarantor gets the responsibility for the Issuer‟s fulfillment of his/her obligations directed
to their Nominal value (total amount of debt) payment together with the interests payable (coupon
revenue) to the Bonds owners and also the Bonds acquisition in accordance with the Issuing
Documents on the following conditions:
3.1.1 Limit of the Guarantor‟s responsibility concerning the Issuer‟s Obligations is restricted by the
Ceiling amount considering the following regulations:
3.1.1.1. Limit of the Guarantor‟s responsibility concerning the coupon revenue is restricted by the
Coupon Revenue payment Ceiling amount. Limit of the Guarantor‟s responsibility concerning the
acquisition and redemption of the Bonds is restricted by the Bonds Acquisition and Redemption
Ceiling amount.
3.1.1.2. If the Coupon Revenue Payment Ceiling amount is insufficient to fulfill the requirements
of all the Bonds owners presented by them to the Guarantor, due to the non-fulfillment or improper
fulfillment of the obligations by the Issuer directed to the Coupon Revenue payment, the Issuer
distributes the Coupon Revenue Payment Ceiling amount between all the Bonds holders
proportionate to the presented requirements;
3.1.1.3. In case of the Bonds Acquisition and Redemption Ceiling amount insufficiency to satisfy all
the requirements of the Bonds holders presented by them to the Guarantor in accordance with non-
fulfillment or improper fulfillment of the requirements directed to redemption and/or acquisition of
Bonds by the requirement of the holders, the guarantor distributes Bonds Acquisition and
Redemption Ceiling amount between the Bonds owners proportionate to the requirements presented
by them.
3.2 If there was determined the fact of non-fulfillment or improper fulfillment of obligations by the
Issuer the Guarantor shall bear the responsibility for the Issuer‟s obligations fulfillment concerning
the part of the Issuer‟s obligation non-fulfillment (Guarantor‟s joint and several liability).
3.3. The Fact of the non-fulfillment or improper fulfillment of the Issuer‟s obligations is considered
determined in the following cases:
3.3.1. The Issuer did not fulfill or fulfilled improperly the coupon revenue in the form of per cents to
the nominal value of the Bonds to the Bonds owners within terms stipulated by the Issuer
Documents.
3.3.2. The Issuer did not fulfill or fulfilled not in the proper amount the basic debt amount during
the Bonds redemption within the terms determined by the Issuing documents and Bonds holders.
3.3.3. The Issuer did not fulfill the obligation or fulfilled not in the proper amount the requirement
of the Bonds holder in terms and on conditions determined by the Issuing documents.




                                                                                                   287
3.4. The Guarantor is entitled in accordance with the Offer conditions to bear the responsibility for
non-fulfillment of the obligations carried out by the Issuer in the amount of Non-fulfilled
obligations within the limits of the Ceiling amount. The amount of the Non-fulfilled obligations
shall be determined by the Guarantor in accordance with the announcement to the Guarantor made
by the Issuer or by his/her order to the third persons if the Issuer publicly discloses information on
the amount of the Non-fulfilled obligations amount in accordance with the legislation of the
Russian Federation.
3.5 In his/her relations with the Bonds owners the Guarantor acts according to the unfulfilled
obligations amount announced to the Guarantor by the Issuer or by his/her order to the third
persons or publicly disclosed by the Issuer in accordance wit the legislation of the Russian
Federation if the Bonds owner will not prove the larger amount of Unfulfilled obligations.
3.6. In case of the fact settlement of non-fulfillment or improper fulfillment of the Obligations by
the Issuer, the Guarantor is entitled to bear the responsibility in accordance with the Offer
conditions for Issuer‟s non-fulfillment of obligations in the amount of Non-fulfilled obligations
and within the limits of the Ceiling amount if the Requirements on Offer Obligations fulfillment will
be presented to the Guarantor by Bonds owners and/or Nominee holders in accordance with the
Offer conditions.
3.7. Requirement on the Obligations fulfillment shall meet the following conditions:
3.7.1. The Requirement on the Obligations fulfillment shall be presented to the Guarantor in the
written form and signed by the Bonds owner (physical person or the head and the chief accountant
of the legal person, and sealed by the legal person) or the Bonds nominee holder (if Bonds were
transmitted to the nominal ownership and the nominal holder is authorized to get the amounts of
redemption and/or other Bonds revenues and/or require form the Issuer to acquire the Bonds and
present the Requirement on the Obligations fulfillment);
3.7.2. The Requirement on obligations fulfillment shall contain the following:
       Name, last name, patronymic and the full name of the Bonds holder or person authorized to
        get the redemption amounts and/or other Bonds revenues and/or require from the Issuer the
        Bonds acquisition and present the Requirement on the Obligations fulfillment;
       Amount of Bonds and the details of the issue belonging to the Bonds holder, amount of
        non-fulfilled obligations concerning the owners;
       Legal and postal address (location), contact phones of the owner or person authorized to get
        the amounts of redemption and/or other Bonds revenues and require from the Issuer the
        Bonds acquirement and the Requirement on the Obligations fulfillment;
       Tax status of the owner or person authorized to get the amounts of redemption and/or other
        Bonds revenues and/or require from the Issuer to acquire Bonds and present the
        Requirement on the Obligations Fulfillment (resident, nonresident with the permanent
        establishment on the territory of the Russian Federation);
       Details of the bank account of the owner or person authorized to get the redemption
        amounts and/or other Bonds revenues and/or require from the Issuer the Bonds‟ acquisition
        and present the Requirement on the Obligations fulfillment;
3.7.3. Requirement on the Obligations fulfillment shall be presented to the Guarantor at least 60
(Sixty) days since the moment of the Bonds fulfillment term beginning concerning the Bonds owner
addressing the given requirement on the Obligation fulfillment;
3.7.4. The Requirement on the Obligations Fulfillment shall contain the security account statement
in NDC or depositaries being depositors in relation to NDC; in case of the Requirement
presentation on the obligations fulfillment together with unfulfillment or improper fulfillment of
obligations by the Issuer directed to Bonds redemption there should be applied a copy of the NDC
report certified by the depositary on transition of the Bonds to the section of the security account set
for the securities blocking during the redemption; should the requirements be presented to the
owner representatives, the documents shall be drawn in accordance with the normative legal acts of
the Russian Federation approving the persons obligations presented the requirement on behalf of
the owner;




                                                                                                   288
3.7.5. Requirement on Obligation fulfillment and the documents attached to it shall be transmitted
to the Guarantor by the registered letter, courier mail or express mail to the address of the
Guarantor‟s location.
3.8. The guarantor considers the Requirement on Obligations fulfillment within 30 (Thirty) days
since the presentation of the Requirement to the Guarantor. The day of the requirement
presentation to the Guarantor is the day of the Guarantor‟s requirement acquisition presented by
any of the ways determined in paragraph 3.7.5 of the Offer. Together with this, the Guarantor is
entitled to set forth against the requirement on the Obligations fulfillment any other objections even
if the Issue rejected them and approved his/her debt.
3.9. The requirements on Obligations fulfillment presented to the Guarantor later than 60 (Sixty)
days since the date of the Obligations fulfillment term beginning concerning the Bonds holders
directing the Requirement on Obligations Fulfillment shall not be taken into consideration.
3.10 Should the Guarantor satisfy the Requirement on obligation fulfillment, the Guarantor notifies
the owner or the Bonds nominal holder and within 5 days since the expiry date of the Requirement
consideration on Obligations fulfillment (paragraph 3.8. of the Offer) the Guarantor carries out the
Payment in accordance with the conditions of the Offer to the bank account of the owner or the
Bonds nominal holder whose requisites are determined in the Requirement on Obligations
fulfillment.
3.11. The Guarantor does not carry the responsibility on the payment of he legal expenses of the
Bonds holder concerning the collection and other losses of the owners to the Issuer caused by the
unfulfillment or improper fulfillment of the Bonds obligations by the Issuer.
3.12. The Guarantor shall direct information on satisfaction/refusal in satisfaction of the
Requirement on obligations fulfillment during the unfulfillment or improper fufillment of the
Obligations by the Issuer directed to the Bonds redemption with the indication of the Last name,
Name and patronymic of the Bonds owner, amount of Bonds and name of the Depositary where the
security account of the Bonds owner was opened in NDC.


4. Term of the guarantee duration


4.1 Guarantee determined by the Offer enters into force since the moment of the agreement
conclusion by the Bonds acquirer with the Guarantor in accordance with article 2.5. of the Offer.
4.2 The Guarantee determined by the offer ends:
4.2.1 if the Guarantor properly fulfilled all the obligations to the Bonds holders directed their
requirements on the Obligations fulfillment in the order and terms determined by the present Offer;
4.2.2. if the Issuer‟s Bonds obligations were ended;
4.2.3 if the term of the Issuer‟s Obligations fulfillment was changed, during the prolongation of
such a term or any other prolongation of the Issuer‟s Obligations or any other restructuring and
also in case of other Changes of the Issuer‟s obligation causing the increase of the responsibility or
any other unfavorable consequences for the Guarantor without his/her agreement;
4.2.4. due to other grounds determined by the Legislation of the Russian Federation.
4.3. The following circumstances do not entail the termination of the Guarantee determined by the
Offer:
4.3.1. Change of the Issuer‟s name without the change of its organizational and legal status;
4.3.2. Change of the location of the sole executive body of the Issuer.


5. Other conditions.




                                                                                                  289
5.1. All issues concerning the Guarantor and Bonds holders, concerning the Bonds and not
regulated by the civil legislation of the Russian Federation and the Issuing Documents shall be
understood and determined in accordance with them.
5.2. In case of unfulfillment or improper fulfillment of the Offer Obligations the Guarantor bears
the Responsibility in accordance with the present legislation.
5.3 The Guarantor does not bear the responsibility to the Issuer‟s creditors concerning the
obligations of other persons giving the Guarantee for the Issuer for the purpose of the Obligations
issue even if the persons gave such a guarantee together with the Guarantor.
5.4. Discussions due to the Offer are subjected to arbitral court trial and in the court of the general
Jurisdiction (for the Bonds owners – physical persons) by the location of the bearer of
responsibility.


Amount of the Issuer‟s net assets for the accounting date before the guarantee presentation: RUR 28
861 397 thousand.


Amount of the legal person‟s net assets who gave the guarantee for the accounting date before the
guarantee presentation: RUR 2 324 thousand.


Amount of the legal person‟s net assets who gave the guarantee for the date of the accounting quarter
end: RUR : 12 925 thousand.


8.5.1. Conditions of execution maintenance of obligations on bonds with a hypothecary covering
The issuer did not place the bond with a hypothecary covering, obligations on which are not
executed yet



8.6. Data on the Companies which carry out registration of the rights to the equity securities


The person who keeps the register of owners of the issuer's nominal securities - the registrar.
The full company name of the registrar: Registrar society "STATUS" Joint-Stock Company
The reduced company name: Status Company
The location of the registrar: 109544, Moscow, Dobrovolcheskaya street, 1/64
Number of the license: 10-000-1-00304
Date of license issuance: 12 March 2004
Validity of the registrar's license for carrying out the activities of keeping the register of securities
owners: for an indefinite time
The authority which issued the license: Federal Commission for the Securities Market of the Russian
Federation
The date, when the registrar starts to carry out the register of the issuer's nominal securities
owners keeping: 01.02.2007

Documentary securities of the emitter with the obligatory centralised storage are in
circulation: documentary securities of the emitter with the obligatory centralised storage are
in circulation.

  Depositories.



                                                                                                            290
The depository which carries out the centralized storage:


Full name: Closed Joint Stock Company “The National Depository Center”
The abbreviated name: CJSC “NDC”
The location: Moscow, Sredny Kislovsky lane, 1/13, bld. 4
VAT: 7703394070
PSRN: 1097799013256


Data about the license for depositary activity carrying out on the securities market


Number of the license: 177-03431-000100
Date of issuance: 4 December 2000
Validity: for an unlimited term
The authority which issued the license: Federal Commission for the Securities Market of Russia


8.7. Data on the legislative acts regulating issues of import and export of the capital, which may
influence payment of dividends, interest and other payments to non-residents

Federal Law No. 173-FL as of 10 December 2003 "On foreign currency regulation and foreign
currency control" (as amended as of 26 July 2006);
The Tax Code of the Russian Federation, part I, as of July 31, 1998. № 146-FL (edition as of
30.12.2006);
 The Tax Code of the Russian Federation, part II, as of 5 August 2000 No. 117-FZ (117-ФЗ)
(edition as of 31.12.2006 with changes as of 23.03.2007
Disclosure letter of the Central Bank of the Russian Federation as of 31.10.2002 №20
«Statutory acts practice brief of Bank of Russia concerning currency regulation»;
Decree No.1184 of the President of the Russian Federation as of 10 June 1994 "On improvement of
the Russian Federation bank system operation" (as amended as of 27 April 1995)
Regulation of the Central Bank of the Russian Federation as of 04.05.2005 №269-P « About
opening of non-residents bank accounts by Bank of Russia in currency of the Russian
Federation and tranzactions carrying out under the specified accounts»
Instruction No. 117-I (117-И) of the Central Bank of the Russian Federation as of 15 June 2004
"On the procedure of representation by residents and non-residents of documents and information
at realization of foreign currency transactions to the authorized banks; the procedure of the
accounting by the authorized banks of foreign currency transactions and registration of transaction
certificates";
Disclosure letter of the Central Bank of the Russian Federation as of 31.03.2005 №31
«Question, concerning the Federal law using as of 10.12.2003 №173-FL «About
exchange regulation and currency control» and legally enforceable enactments of
Bank of Russia»;

Other normative legal enactments of the Russian Federation.



8.8. Description of incomes taxation procedure of the issuer‟s floated equity securities and equity
securities which are in the process of floatation




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The taxation procedure of incomes on the placed and placing currency papers of the emitter
is regulated by the Tax Code of the Russian Federation (further referred to as TC) as well
as other regulative legal acts of the Russian Federation accepted in accordance with the
Tax Code of the Russian Federation.
Tax rates


                    Legal persons                                   Individuals


Type of income         Residents        Nonresidents        Residents        Nonresidents

                      20 % (from
Income from         which: federal
the sales of          budget – 2;            20 %             13%                 30%
securities            budget of a
                    person – 18 %)

Income in the           0 % (sub-
form of             cl.1cl.3 art. 284
dividends from       TC RF) and 9
Russian             % (pp.2p.3 art.          15%               9%                 15%
companies              284 TC RF




Taxation procedure applied to individuals.
Type of tax – profits tax.
Into the number of profits from the sources of the Russian Federation there are included:
   -   dividends and interest received from a Russian companies as well as interest
       received from Russian individual entrepreneurs and/or a foreign organization in
       connection with the activity of its permanent representative office in the Russian
       Federation;
   -   income from the sales in the Russian Federation of shares or other securities as well
       as participation shares in the charter capital of organizations.

   Tax base.
   The income of a tax payer received as material benefit is considered to be material
   benefit received from the purchase of securities. Tax base is defined as the overrun of
   the market cost of securities which is defined taking into consideration the marginal
   limit of fluctuations of securities market cost over the amount of the actual charges of a
   tax payer spent on its purchase. The procedure for the determination of the market price
   of a federal body which realizes securities market regulations. When the tax base on
   incomes received in the connection with operations with securities is defined, income
   received in the connection with the following operations is taken into consideration:
   -   sales and purchase of securities negotiating within the organized securities market;

   -   sales and purchase of securities not negotiating within the organized securities
       market.


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Income (loss) on the operations of securities purchase and sale is defined as a divide
between the amounts of income received from securities conversion and document
supported charges on the purchase, conversion and storage of securities actually
performed by a tax payer or property deductions charged in decrease of income from
purchase and sale.
To the number of pointed charges the following charges are included:
-   amounts paid to a salesman in accordance with the contract;

-   payment for the services of depositary;

-   commitment fees to the professional participants of securities market, the discount
    paid (compensated) to the governing company of the mutual investment fund on the
    sales (redemption) by the investor of the investment unit of the mutual investment
    fund defined in accordance with the procedure set up by the legislation of the
    Russian Federation concerning investment funds;

-   market charge (stock exchange commission);

-   payment for the services of a registrator;

-   other charges directly connected with the purchase, sales and storage of securities
    performed for the services rendered by the professional participants of the securities
    market within the field of their professional activity.

Income (loss) on the operations of the purchase and sale of securities, negotiating
within the organized securities market, is being decreased (increased) on the amount of
interest paid for the use of financial resources, attracted for the settlement of the
purchase and sale transaction of securities within the limits of amounts, considered in
accordance with the relevant refinance rate of the Central Bank of the Russian
Federation.
Loss on operations with securities, negotiating within the organized securities market,
received in the result of the pointed operations, performed within the tax period,
decreases the tax base on the operations of purchase and sale of securities of this
category.
Income on operations with securities, not negotiating within the organized securities
market, which on the moment of their purchase meet the requirements, set up for
securities, negotiating within the organized securities market, can be decreased on the
amount of loss, received within the tax period on the operations of the purchase and
sale of securities, negotiating within the organized securities market.
The date of the actual receiving of income is defined as a day:
-   of income payment including the transfer of income on the accounts of a tax payer
    in banks or under the instructions of a tax payer on the accounts of third parties –
    when income is received in the form of money;

-   of the purchase of securities – when the income is received in the form of material
    benefit.

The tax base on the operations of purchase and sale of securities and operations with
the financial instruments of time bargains is defined in the end of the tax period. The
accounting and payment of tax amount are performed by a tax agent in the end of the


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tax period or on the payment of money to a tax payer before the expiry of the succeeding
tax period.
On the payment of money by a tax agent before the expiry of the succeeding tax period
tax is paid from the share of income which corresponds to the actual amount of paid
money. The share of income is defined as the product of the general amount of income
multiplied to the relation of the amount of payment to the cost estimate of securitie,s
defined on the date of the payment of money, in connection with which a tax agent acts
as a broker. If money is paid to a tax payer more often than once during the tax period
the accounting of the amount of a tax is performed as a cumulative sum taking into
account the before paid amounts of income. The cost estimate of securities is defined
taking into consideration actually born and document supported charges on their
purchase. Under the payment of money we understand the payment of cash money, the
transfer of money to the bank account of an individual or on the account of a third
party on the order of an individual. If it is impossible to withhold with a tax payer the
assessed amount of taxes as a source of income payment a tax agent (broker, trustee or
other person performing operations according to an agency contract, contract of
commission agency, other contract in favour of a tax payer) during one month from the
moment of the appearing of this circumstance informs in writing a taxation body at the
place of the accounting about the impossibility of the pointed withholding and the
amount of the debts of a tax payer. Taxpaying in this case is done in accordance with
Article 228 of TC.
The taxation procedure of legal persons.
The type of a tax – income tax.
 To income belong the following:
- revenues from the sales of securities (income received from sales);
- extraordinary income from interest, long coupon income on securities and/or from
    participatory interest in other organizations.
Tax base.
The income of a tax payer from the operations of sales or other retirement of securities
(including redemption) are defined on the basis of a selling price or other retirement of
a security.
The sales charges (or other retirement charges) of securities are defined on the basis of
the purchase price of a security (including charges connected with its purchase),
charges on its sales, the discount rate from the estimated value of investment units, the
amount of accumulated interest (long coupon) income paid by a tax payer to the seller
of a security.
Securities are accepted as negotiating on the organized market of securities only in case
of simultaneous observing of the following conditions:
1) if they are accepted to negotiating at least by one of the organizers of trade who has
    a right for it in accordance with the national legislation;
2) if the information concerning their prices (quotations) is published in mass media
    (including electronic mass media) or can be represented by the organizer of trade or
    other authorized person to any concerned person during three years after the date of
    the performing of an operation with securities;
3) if market quotation is accounted on their basis when it is stipulated by the
    corresponding national legislation.




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   The market price of securities, negotiating on the organized market of securities, for the
   purposes of taxation is considered to be the actual price of sales or other retirement of
   securities if this price is between the minimum and maximum prices of bargains (the
   interval of prices) with the pointed security registered by the organizer of trade on the
   securities market as on the settlement of the corresponding transaction. In case of the
   sale of securities, negotiating within the organized securities market, at the price lower
   than the minimum transaction price within the organized securities market when
   financial result is being defined, the minimum transaction price within the organized
   securities market is considered.
   In relation to securities, not negotiating on the organized securities market, for the
   purposes of taxation the actual price of sales or other retirement of these securities is
   considered in case at least one of the following conditions is observed:
   1) if the actual price of the corresponding transaction is within the interval of prices on
      a similar (identical, homogeneous) security registered by the organizer of trade on
      the securities market as on the settlement of the transaction or as on the nearest
      trading session, taken place before the day of the settlement of the corresponding
      transaction, if trading sessions on these securities were held at the organizer‟s of
      trade at least once during the last 12 months;
   2) if the deviation of the actual price of the corresponding transaction is within the
      limits of 20 per cent towards the increase or decrease from the weighted average
      price of a similar (identical, homogeneous) security accounted by the organizer of
      trade on the securities market in accordance with established by him rules following
      the results of a trading session which took place as on the conclusion of such a
      transaction or as on the nearest trading session held before the day of the settlement
      of the corresponding transaction, in case trading sessions on these securities were
      held at the organizer‟s of trade at least once during the last 12 months.
In case there is no information concerning the results of trading sessions on similar
(identical, homogeneous) securities the actual price of a transaction is accepted for the
purposes of taxation if the pointed price differs no more than 20 per cent from the estimated
price of this security. The estimated price of shares can be defined by a tax payer with the
help of an appraiser who uses cost method of valuation stipulated in the legislation of the
Russian Federation. Also tax payers (excluding professional participants of the securities
market performing dealer activity) define the tax base on operations with securities,
negotiating on the organized market of securities, separately from the tax base on
operations with securities, not negotiating on the organized market of securities.
In case of the sales or other retirement of securities a tax payer by themselves in accordance
with the accepted for the purposes of taxation accounting policy chooses one of the
following methods of depreciation for charges on the price of retired securities:
    1) according to the first considering the time of purchase (FIFO);
    2) according to the price of a unit.
In accordance with the accounting policy of the emitter the depreciation for charges on the
price of retired securities is done in the following manner:
    1) for bills of exchange – according to the price of a unit;
    2) for shares and bonds - according to the first considering the time of purchase
        (FIFO).
Tax payers, received loss (losses) from the operations with securities in the previous tax
period or previous tax periods, have a right to decrease a tax base received in operations



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with securities in the accounting (tax) period (to transfer the pointed losses to the future) in
the manner and under the conditions set up by Article 283 of TC.


Alongside with this losses from operations with securities, not negotiating on the organized
market of securities, received in the previous tax period (previous tax periods), can be
referred to the decrease of the tax base from operations with such securities, defined in the
accounting (tax) period. Losses from operations with securities, negotiating on the
organized market of securities, received in the previous tax period (previous tax periods),
can be referred to the decrease of the tax base from operations on the sales of this category
of securities. During the tax period the transfer to the future of losses received in the
corresponding accounting period from operations with securities, negotiating on the
organized market of securities, and securities, not negotiating on the organized market of
securities, is performed separately for the pointed categories of securities respectively within
the limits of profit, received from operations with such securities. In case of the payment by
a tax agent of a foreign organization of income which in accordance with international
contracts (agreements) are taxable in the Russian Federation on decreased rates, the
accounting and retention of the amount of taxes are performed by a tax agent according to
the corresponding decreased rates under the condition that a foreign organization provides
to a tax agent a confirmation stipulated by Clause 1 Article 312 of TC of the Russian
Federation. In case of application of statement of international contracts of the Russian
Federation a foreign organization should provide to a tax agent, who pays income, a
confirmation that proves that this foreign organization has a permanent location in the
state, with which the Russian Federation has an international contract (agreement),
regulating taxation issues, which should be certified by a competent authority of a foreign
state. If this confirmation is in a foreign language, a tax agent is also given its translation
in Russian. If a foreign organization, that has a right on income receiving, provides a
confirmation to a tax agent, who pays income, before the date of the payment of income, in
relation to which there is prescribed a preferential tax treatment in the Russian Federation
by an international contract of the Russian Federation, in relation to such income there is
performed a release from the retention of a tax with the source of payment or the retention
of a tax with the source of payment on decreased rates.



8.9. Information on declared (accrued) and paid dividends on the emitter‟s shares and on income
on the emitter‟s bonds
8.9.1. Information on declared (accrued) and paid dividends on the emitter‟s shares for the last 5
completed financial years or for each completed financial year if the emitter is performing its
activity for less than 5 years
Dividend period
Year: 2005
Period: full year
Title of the regulatory body of the emitter taken decision (declared) about the payment of
dividends on the emitter‟s shares: General Assembly of shareholders (participants)
Date of the emitter‟s regulatory body meeting (session) holding, during which there was taken
a decision about the payment (declaring) of dividends: 26.06.2006
Date by which there was completed a list of persons having right on the receiving of dividends
for this dividend period: 12.05.2006
Date of the minutes‟ completion: 06.07.2006



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Number of the minutes: 3
Category (type) of shares: ordinary
Size of declared (accrued) dividends on the shares of this category (type) with a view to one
share, rub.: 0.00177
Total size of declared (accrued) dividends for all shares of this category (type), rub.: 50 001
000
Total size of dividends paid on all the shares of the emitter of one category (type), rub.:
50 001 000
Period considered for the payment of declared dividends on the emitter‟s shares: during 60
days from the day when the decision concerning the payment of dividends was taken
Way and other conditions of the payment of declared dividends on the emitter‟s shares: in
money terms
Dividend period
Year: 2006
Period: full year
Title of the regulatory body of the emitter taken decision (declared) about the payment of
dividends on the emitter‟s shares: General Assembly of shareholders (participants)
Date of the emitter‟s regulatory body meeting (session) holding, during which there was taken
a decision about the payment (declaring) of dividends: 15.06.2007
Date by which there was completed a list of persons having right on the receiving of dividends
for this dividend period: 11.05.2007
Date of the minutes‟ completion: 21.06.2007
Number of the minutes: 4
Category (type) of shares: ordinary
Size of declared (accrued) dividends on the shares of this category (type) with a view to one
share, rub.: 0.002124
Total size of declared (accrued) dividends for all shares of this category (type), rub.: 60 000
000
Total size of dividends paid on all the shares of the emitter of one category (type), rub.:
60 000 000
Period considered for the payment of declared dividends on the emitter‟s shares: during 60
days from the day when the decision concerning the payment of dividends was taken
Way and other conditions of the payment of declared dividends on the emitter‟s shares: in
money terms
For 2007
Category of shares: ordinary
The Annual General Assembly of shareholders of OJSC Moscow Associated Grid Electrical
Company 28 May 2008 took a decision not to pay dividends on the ordinary shares of OJSC
Moscow Associated Grid Electrical Company summarizing the results of 2007. (Minutes No
7 dated 05.06.2008)
For 2008
Category of shares: ordinary



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The Annual General Assembly of shareholders of OJSC Moscow Associated Grid Electrical
Company 11 June 2009 took a decision not to pay dividends on the ordinary shares of
OJSC Moscow Associated Grid Electrical Company summarizing the results of 2008.
(Minutes No 8 dated 25.06.2009)



8.9.2. Issue of bonds on which the income was paid for the last 5 completed financial
years, proceeding the termination date of last accounting quarter and if the emitter
carries out the activity less than 5 years - for each completed fiscal year proceeding a
termination date of last accounting quarter

    Security kind: bonds
    The security form: documentary to bearer
    A series: 01
    Documentary unconvertible percentage bearer bonds of a series 01 with the obligatory centralised storage
    with repayment term in 1820 calendar day from a placing date started, without possibility of preschedule
    repayment.
    The state registration number of release: 4-01-65116-D
    Date of the state registration of release: 22.06.2006
    The body which carried out the state registration of release: FFMS of Russia


    Date of the state registration of the report on release results: 24.10.2006
    The body which has carried out the state registration of the report on results of release: FFMS Russia
    Quantity of bonds of release: 6 000 000
    Face-value of each bond of release, rbl.: 1 000
    Release volume on a face-value: 6 000 000 000


    The basic data on incomes under release bonds:
    Payments of the coupon income under bonds of a series 01:

Coupon Payment period                   Payment date          Interest The sum on Total sum of Payment form
Payment                                                        rate                    payments
                                                                          one bond (rbl)
number

1          September 12, 2006 – March 13, 2007 8,05 %                     40,14                        Money means
                                                                                          240 840 000,00
           March 13, 2007

2          March 13, 2007 –                             8,05
                                        September 11, 2007 %              40,14                        Money means
                                                                                          240 840 000,00
           September 11, 2007

3          September 11, 2007 – March 11, 2008 8,05 %                     40,14                        Money means
                                                                                          240 840 000,00
           March 11, 2008

4          March 11, 2008 –                             8,05
                                        September 09, 2009 %              40,14                        Money means
                                                                                          240 840 000,00
           September 09, 2009

5          September 09, 2009 – March 10, 2009 8,05 %                     40,14           94 590             Money means
           March 10, 2009                                                                 190,98

6          March 10, 2009 –                             8,05
                                        September 08, 2009 %              40,14           94 590             Money means


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         September 08, 2009                                                          190,98

7        September 08, 2009 – March 09. 2010 8,05 %                  40,14           94 590         Money means
         March 09. 2010                                                              190,98


Issuing undertaking on incomes payment under the first-sixth coupon of issue bonds is executed in full
version.



8.10. Other data

8.11. Data on given securities and the emitter of given securities, the property right on
which is admitted by the Russian Depositary Receipts.
The emitter is not the emitter of given securities, the property right on which is admitted by the Russian
Depositary Receipts




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