Quarterly report

 
 
AO PricewaterhouseCoopers Audit  
White Square Office Center 10 Butyrsky Val Moscow, Russia, 125047 
T: [phone], F:[phone], www.pwc.ru
 
 
Independent Auditor’s Report 
 
To the Shareholders and Board of Directors of Public Joint Stock Company Federal       
Hydro-Generating Company 
– RusHydro (PJSC RusHydro): 
Our opinion  
In our opinion, the consolidated financial statements present fairly, in all material respects, the 
consolidated financial position of PJSC RusHydro and its subsidiaries (together 
– the “Group”) as at 
31 December 2016, and its consolidated financial performance and its consolidated cash flows for the 
year then ended in accordance with International Financial Reporting Standards (IFRS). 
What we have audited 
The Group’s consolidated financial statements comprise: 
  the consolidated statement of financial position as at 31 December 2016; 
  the consolidated statement of profit and loss for the year then ended; 
  the consolidated statement of comprehensive income for the year then ended; 
  the consolidated statement of changes in equity for the year then ended; and 
  the consolidated statement of cash flows for the year then ended; 
  the notes to the consolidated financial statements, which include significant accounting policies 
and other explanatory information. 
Basis for opinion  
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our 
responsibilities under those standards are further described in the Auditor’s Responsibilities for the 
Audit of the Consolidated Financial Statements section of our report. 
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for 
our opinion.  
Independence 
We are independent of the Group in accordance with the International Ethics Standards Board for 
Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the ethical 
requirements of the Auditor’s Professional Ethics Code and Auditor’s Independence Rules that are 
relevant to our audit of the consolidated financial statements in the Russian Federation. We have 
fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code.

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ii 
Our audit approach 
Overview 
PJSC RusHydro
’s shares are listed on the Moscow Exchange. The Group’s principal business 
operations are generation and sales of electricity, capacity and heat energy in the Russian wholesale 
and retail markets. The Group companies are also involved in other operations, including electricity 
transmission and distribution, construction, repairs and provision of other services. 
 
  Overall group materiality: Russian Roubles (“RUB”) 3,600 million, 
which represents 1% of total revenues and government grants. 
  We conducted audit work at those companies of the Group that were 
considered significant components based on their individual share in 
the Group’s revenue, which exceeds 15%: PJSC RusHydro, PJSC DEK, 
JSC DGK, PJSC Yakutskenergo. 
  Our audit scope covered inter alia 67% of the Group’s revenues and 
83% of the Group’s total carrying value of property, plant and 
equipment. 
Key audit matters
 
  Assessment of impairment of property, plant and equipment 
  Assessment of impairment of accounts receivable 
  Contingent tax liabilities 
We designed our audit by determining materiality and assessing the risks of material misstatement in 
the consolidated financial statements. In particular, we considered where management made 
subjective judgements; for example, in respect of significant accounting estimates that involved 
making assumptions and considering future events that are inherently uncertain. We also addressed 
the risk of management override of internal controls, including among other matters consideration of 
whether there was evidence of bias that represented a risk of material misstatement due to fraud. 
Materiality 
The scope of our audit was influenced by our application of materiality. An audit is designed to obtain 
reasonable assurance whether the financial statements are free from material misstatement. 
Misstatements may arise due to fraud or error. They are considered material if individually or in 
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the 
basis of the consolidated financial statements. 
Based on our professional judgement, we determined certain quantitative thresholds for materiality, 
including the overall group materiality for the consolidated financial statements as a whole as set out 
in the table below. These, together with qualitative considerations, helped us to determine the scope of 
our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of 
misstatements, if any, both individually and in aggregate on the consolidated financial statements as a 
whole. 

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iii 
Overall group materiality 
RUB 3,600 million 
How we determined it 
1% of total revenues and government grants 
Rationale for the 
materiality benchmark 
applied 
We chose total revenues and government grants as the 
benchmark because, in our view, it is the benchmark against 
which the Group’s performance is represented to the fullest 
extent possible. We chose 1% which is consistent with 
quantitative materiality thresholds used for profit-oriented 
companies in this sector. 
 
Key audit matters  
Key audit matters are those matters that, in our professional judgement, were of most significance in 
our audit of the consolidated financial statements for the reporting period. These matters were 
addressed in the context of our audit of the consolidated financial statements as a whole, and in 
forming our opinion thereon, and we do not provide a separate opinion on these matters. 
Key audit matter 
How our audit addressed the Key audit 
matter 
Assessment of impairment of property, 
plant and equipment 
For matters requiring disclosures and related 
significant accounting policies, judgements 
and accounting estimates see Notes 2, 7 and 
32 to the consolidated financial statements. 
At 31 December 2016, the Group’s aggregate 
carrying amount of property, plant and 
equipment was RUB 765,047 million. This is 
the most significant asset 
on the Group’s 
balance sheet, it accounts for 78% of the total 
value of assets. 
The Group’s management performed analysis 
of the business performance, industry outlook 
and operational plans and then assessed the 
recoverable value of property, plant and 
equipment by cash generating units for the 
purpose of impairment testing. Impairment 
arises when the recoverable amount, which is 
determined as the hi
gher of the asset’s fair 
value less costs to sell and its value in use, is 
below the carrying amount of the analysed 
assets. 
The management’s testing identified 
impairment of a number of cash generating 
units, and the Company accrued impairment 
loss of RUB 26,525 million in the statement of 
income for the year ended 31 December 2016.  
 
 
We obtained and reviewed financial models that 
the management used for assessing the PP&E 
impairment.  We engaged our valuation experts 
to form our conclusion on the assumptions and 
methodology that were used in the impairment 
assessment. 
Our audit procedures related to the 
management’s assessment of PP&E impairment 
included: 
  review of the methodology used by the 
Group’s management for the impairment test 
purposes; 
  examination, on a test basis, of key 
assumptions used in financial models and 
whether they are in line with the approved 
budgets and business plans, external 
available and reliable sources (including 
macroeconomic forecasts, information on 
regulated and market electricity and capacity 
prices, etc.) and our industry-specific 
expertise; 
  assessment of competence, skills, experience 
and objectivity of the management’s experts; 
  examination, on a test basis, of accuracy and 
relevance of inputs that the management 

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