ITC LIMITED
ANNUAL REPORT 2010-2011
NOTES ON ACCOUNTS
I. Notes to the Accounts:
(i) Exchange difference in respect of forward exchange contracts to be
recognised in the Profit and Loss Account in the subsequent accounting
period amounts to Rs. 0.26 Crore (2010 - Rs. 0.54 Crore).
(ii) (a) Claims against the Company not acknowledged as debts Rs. 255.17
Crores (2010 - Rs. 258.73 Crores). These comprise: Excise Duty, Sales Taxes
and other Indirect Taxes claims disputed by the Company relating to
issues of applicability and classification aggregating Rs. 182.87 Crores
(2010 - Rs. 193.74 Crores).
Local Authority Taxes / Cess / Royalty on property, utilities etc. claims
disputed by the Company relating to issues of applicability and
determination aggregating Rs. 33.83 Crores (2010 - Rs. 33.49 Crores).
Third party claims arising from disputes relating to contracts
aggregating Rs. 35.08 Crores (2010 - Rs. 29.22 Crores). Other matters
Rs.3.39 Crores (2010 - Rs. 2.28 Crores).
(b) Uncalled liability on shares partly paid Rs. 26.40 Crores (2010 -
Rs.26.40 Crores).
2011 2010
(iii) Earnings per share:
Earnings per share has been computed as under:
(a) Profit after Taxation (Rs. Crores) 4987.61 4061.00
(b) Weighted average number of Ordinary Shares
outstanding 7680673807 7611844333*
(c) Effect of potential Ordinary Shares on
Employee Stock Options outstanding 102243533 80257258*
(d) Weighted average number of Ordinary
Shares in computing diluted earnings per
share [(b)+(c)] 7782917340 7692101591
(e) Earnings per share on profit after
taxation (Face Value Rs.1.00 per share):
- Basic [(a)/(b)] Rs.6.49 Rs.5.34
- Diluted [(a)/(d)] Rs.6.41 Rs.5.28
* After considering Bonus issue.
During the year Bonus Shares in the ratio of 1:1 were allotted on 6th
August, 2010. Previous year figures have been restated for the purpose of
computation of Earnings per share.
(iv) The status on excise matters which is treated as an annexure to these
accounts are as outlined in this year's Report of the Directors &
Management Discussion and Analysis under the Excise section. In the opinion
of the Directors, the Company does not accept any further liability.
(v) Research and Development expenses for the year amount to Rs. 90.24
Crores (2010 - Rs. 77.08 Crores).
(vi) (a) Defined Benefit Plans/Long Term Compensated Absences - As per
Actuarial Valuations as on March 31, 2011 and recognised in the financial
statements in respect of Employee Benefit Schemes:
(Rs. in Crores)
For the year ended
31st March, 2011
Pension Gratuity Leave
Encashment
Funded Unfunded
I Components of Employer Expense:
1 Current Service Cost 38.96 16.57 4.01
2 Interest Cost 32.66 12.36 3.33
3 Expected Return on Plan Assets (35.25) (15.66) -
4 Curtailment Cost/(Credit) - - -
5 Settlement Cost/(Credit) - - -
6 Past Service Cost - - -
7 Actuarial Losses/(Gains) 19.17 2.03 6.87
8 Total expense recognised in
the Statement of Profit & Loss
Account 55.54 15.30 14.21
(Rs. in Crores)
For the year ended
31st March, 2010
Pension Gratuity Leave
Encashment
Funded Unfunded
I Components of Employer Expense:
1 Current Service Cost 29.71 12.89 3.76
2 Interest Cost 24.34 9.64 2.83
3 Expected Return on Plan Assets (27.16) (12.42) -
4 Curtailment Cost/(Credit) - - -
5 Settlement Cost/(Credit) - - -
6 Past Service Cost - - -
7 Actuarial Losses/(Gains) 39.52 4.27 5.01
8 Total expense recognised in
the Statement of Profit &
Loss Account 66.41 14.38 11.60
The Pension and Gratuity Expenses have been recognised in 'Contribution to
Provident and Other Funds' and Leave Encashment in 'Salaries/Wages and
Bonus' under Schedule 17:
(Rs. in Crores)
For the year ended
31st March, 2011
Pension Gratuity Leave
Encashment
II Actual Returns 35.83 16.25 -
III Net Asset/(Liability) recognised
in Balance Sheet:
1 Present Value of Defined
Benefit Obligation 482.51 181.13 54.59
2 Fair Value of Plan Assets 479.85 207.08 -
3 Status [Surplus/(Deficit)] (2.66) 25.95 (54.59)
4 Unrecognised Past Service
Cost - - -
5 Net Asset/(Liability)
recognised in Balance Sheet (2.66) 25.95 (54.59)
IV Change in Defined Benefit
Obligations (DBO):
1 Present Value of DBO at the
Beginning of Period 425.44 159.40 45.21
2 Current Service Cost 38.96 16.57 4.01
3 Interest Cost 32.66 12.36 3.33
4 Curtailment Cost/(Credit) - - -
5 Settlement Cost/(Credit) - - -
6 Plan Amendments - - -
7 Acquisitions - - -
8 Actuarial (Gains)/Losses 19.75 2.62 6.87
9 Benefits Paid (34.30) (9.82) (4.83)
10 Present Value of DBO at the
End of Period 482.51 181.13 54.59
V Change in Fair Value of Assets:
1 Plan Assets at the Beginning
of Period 401.35 184.32 -
2 Acquisition Adjustment - - -
3 Expected Return on Plan Assets 35.25 15.66 -
4 Actuarial Gains/(Losses) 0.58 0.59 -
5 Actual Company Contributions 76.97 16.33 -
6 Benefits Paid (34.30) (9.82) -
7 Plan Assets at the End of
Period 479.85 207.08 -
VI Actuarial Assumptions:
1 Discount Rate (%) 8.00 8.00 8.00
2 Expected Return on Plan
Assets (%) 8.00 8.00 -
(Rs. in Crores)
For the year ended
31st March, 2010
Pension Gratuity Leave
Encashment
II Actual Returns 34.50 14.74 -
III Net Asset/(Liability) recognised
in Balance Sheet:
1 Present Value of Defined
Benefit Obligation 425.44 159.40 45.21
2 Fair Value of Plan Assets 401.35 184.32 -
3 Status [Surplus/(Deficit)] (24.09) 24.92 (45.21)
4 Unrecognised Past Service Cost - - -
5 Net Asset/(Liability)
recognised in Balance Sheet (24.09) 24.92 (45.21)
IV Change in Defined Benefit
Obligations (DBO):
1 Present Value of DBO at the
Beginning of Period 370.84 145.04 38.15
2 Current Service Cost 29.71 12.89 3.76
3 Interest Cost 24.34 9.64 2.83
4 Curtailment Cost/(Credit) - - -
5 Settlement Cost/(Credit) - - -
6 Plan Amendments - - -
7 Acquisitions - - -
8 Actuarial (Gains)/Losses 46.86 6.59 5.01
9 Benefits Paid (46.31) (14.76) (4.54)
10 Present Value of DBO at the
End of Period 425.44 159.40 45.21
V Change in Fair Value of Assets:
1 Plan Assets at the Beginning
of Period 374.69 170.31 -
2 Acquisition Adjustment - - -
3 Expected Return on Plan Assets 27.16 12.42 -
4 Actuarial Gains/(Losses) 7.34 2.32 -
5 Actual Company Contributions 38.47 14.03 -
6 Benefits Paid (46.31) (14.76) -
7 Plan Assets at the End of
Period 401.35 184.32 -
VI Actuarial Assumptions:
1 Discount Rate (%) 7.00 7.00 7.00
2 Expected Return on Plan
Assets (%) 7.00 7.00 -
The estimates of future salary increases, considered in actuarial
valuations take account of inflation, seniority, promotion and other
relevant factors such as supply and demand factors in the employment
market.
VII. Major Category of Plan Assets as a % of the Total Plan Assets:
As at 31st March,
2011 2010
1 Government Securities/Special
Deposit with RBI 27% 26%
2 High Quality Corporate Bonds 28% 26%
3 Insurance Companies* 40% 42%
4 Mutual Funds 3% 4%
5 Cash and Cash Equivalents 2% 2%
* In the absence of detailed information regarding plan assets which is
funded with Insurance Companies, the composition of each major category of
plan assets, the percentage or amount for each category to the fair value
of plan assets has not been disclosed.
VIII. Basis used to determine the Expected Rate of Return on Plan Assets:
The expected rate of return on plan assets is based on the current
portfolio of assets, investment strategy and market scenario. In order to
protect the capital and optimise returns within acceptable risk parameters,
the plan assets are well diversified.
For the year ended
31st March, 2011
(Rs. in Crores)
Pension Gratuity Leave
Encashment
IX. Net Asset/(Liability) recognised
in Balance Sheet (including
experience adjustment impact)
1. Present Value of Defined
Benefit Obligation 482.51 181.13 54.59
2. Fair Value of Plan Assets 479.85 207.08 -
3. Status [Surplus/(Deficit)] (2.66) 25.95 (54.59)
4. Experience Adjustment of
Plan Assets [Gain/(Loss)] 4.99 2.55 -
5. Experience Adjustment of
obligation [(Gain)/Loss] 42.85 20.19 8.96
For the year ended
31st March, 2010
(Rs. in Crores)
Pension Gratuity Leave
Encashment
IX. Net Asset/(Liability) recognised
in Balance Sheet (including
experience adjustment impact):
1. Present Value of Defined
Benefit Obligation 425.44 159.40 45.21
2. Fair Value of Plan Assets 401.35 184.32 -
3. Status [Surplus/(Deficit)] (24.09) 24.92 (45.21)
4. Experience Adjustment of
Plan Assets [Gain/(Loss)] 7.34 2.32 -
5. Experience Adjustment of
obligation [(Gain)/Loss] (12.56) 2.37 3.64
For the year ended
31st March, 2009
(Rs. in Crores)
Pension Gratuity Leave
Encashment
IX. Net Asset/(Liability) recognised
in Balance Sheet (including
experience adjustment impact):
1. Present Value of Defined
Benefit Obligation 370.84 145.04 45.64
2. Fair Value of Plan Assets 374.69 170.31 -
3. Status [Surplus/(Deficit)] 3.85 25.27 (45.64)
4. Experience Adjustment of
Plan Assets [Gain/(Loss)] 1.50 3.53 -
5. Experience Adjustment of
obligation [(Gain)/Loss] (18.42) (0.81) 2.96
For the year ended
31st March, 2008
(Rs. in Crores)
Pension Gratuity Leave
Encashment
IX. Net Asset/(Liability) recognised
in Balance Sheet (including
experience adjustment impact):
1. Present Value of Defined
Benefit Obligation 341.30 136.22 40.36
2. Fair Value of Plan Assets 355.53 155.39 -
3. Status [Surplus/(Deficit)] 14.23 19.17 (40.36)
4. Experience Adjustment of
Plan Assets [Gain/(Loss)] 2.96 (0.53) -
5. Experience Adjustment of
obligation [(Gain)/Loss] (19.19) 0.24 2.52
For the year ended
31st March, 2007
(Rs. in Crores)
Pension Gratuity Leave
Encashment
IX. Net Asset/(Liability) recognised
in Balance Sheet (including
experience adjustment impact):
1. Present Value of Defined
Benefit Obligation 320.53 131.41 37.55
2. Fair Value of Plan Assets 311.77 146.08 -
3. Status [Surplus/(Deficit)] (8.76) 14.67 (37.55)
4. Experience Adjustment of
Plan Assets [Gain/(Loss)] - - -
5. Experience Adjustment of
obligation [(Gain)/Loss] - - -
Amounts towards Defined Contribution Plans have been recognised under
'Contribution to Provident and Other Funds' in Schedule 17: Rs. 51.31
Crores (2010 - Rs. 37.54 Crores).
(vii) Micro and Medium scale business entities:
There are no Micro, Small and Medium Enterprises, to whom the Company owes
dues, which are outstanding for more than 45 days during the year and also
as at 31st March, 2011. This information as required to be disclosed under
the Micro, Small and Medium Enterprises Development Act, 2006 has been
determined to the extent such parties have been identified on the basis of
information available with the Company.
(viii) The Company's significant leasing arrangements are in respect of
operating leases for premises (residential, office, stores, godowns etc.).
These leasing arrangements which are not non-cancellable range between 11
months and 9 years generally, or longer, and are usually renewable by
mutual consent on mutually agreeable terms. The aggregate lease rentals
payable are charged as 'Rent' under Schedule 17.
With regard to certain other non-cancellable operating leases for premises,
the future minimum rentals are as follows:
(Rs. in Crores)
As at 31st March,
2011 2010
Not later than one year 9.47 7.10
Later than one year and not later than five years 12.57 10.57
Later than five years 0.88 2.94
(ix) The following donations were made to political parties during the year
: Indian National Congress - Rs. 0.50 Crore (2010 - Rs. 2.50 Crores),
Bharatiya Janata Party - Rs. Nil (2010 - Rs. 2.50 Crores), Samajwadi Party
- Rs. Nil (2010 - Rs. 0.42 Crore), Rashtriya Janata Dal - Rs. Nil (2010 -
Rs. 0.33 Crore), Dravida Munnetra Kazhagam - Rs. Nil (2010 - Rs. 0.22
Crore), Shiv Sena Rs. Nil (2010 - Rs. 0.17 Crore) and Nationalist Congress
Party - Rs. Nil (2010 - Rs. 0.14 Crore).
(x) Interests in Joint Ventures:
The Company's interest, as a venturer, in jointly controlled entities
(incorporated Joint Ventures) is:
Name A B C
Maharaja Heritage Resorts Limited India 25% 25%
Espirit Hotels Private Limited India 26% -
A = Country of Incorporation
B = Percentage of Owenershio interests as at 31st March, 2011
C = Percentage of Owenershio interests as at 31st March, 2010
The Company's interest in these Joint Ventures is reported as Long Term
Investments (Schedule - 7) and stated at cost. However, the Company's share
of each of the assets, liabilities, income and expenses, etc. (each without
elimination of the effect of transactions between the Company and the Joint
Venture) related to its interests in these Joint Ventures are:
(Rs. in Crores)
As at 31st March,
2011 2010
I ASSETS:
1 Fixed Assets 44.99 0.05
2 Current Assets, Loans and Advances:
a) Sundry Debtors 0.59 0.61
b) Cash and Bank Balances 0.22 -
c) Loans and Advances 0.37 0.26
3 Deferred Tax - Net 0.38 0.25
II LIABILITIES:
1 Secured Loans 0.02 -
2 Current Liabilities and Provisions:
a) Liabilities 1.59 1.05
b) Provisions 0.01 0.01
(Rs. in Crores)
For the year ended
31st March,
2011 2010
III INCOME:
1 Sales 1.01 0.85
2 Other Income 0.01 0.01
IV EXPENSES:
1 Excise Duties and Taxes on Sales of
Services 0.10 0.08
2 Manufacturing, Selling etc. Expenses 1.69 1.16
3 Depreciation 0.01 0.02
4 Provision for Taxation (0.13) (0.23)
(xi) DIRECTORS' REMUNERATION:
Salaries 5.40 4.43
Performance Bonus to Executive Directors 9.66 7.84
Other Benefits 1.05 0.82
Commission to Non-Executive Directors 0.67 0.59
Directors' Fees 0.38 0.26
17.16 13.94
The above (a) excludes contribution to the approved group pension and
gratuity funds and provisions for leave encashment, which are actuarially
determined on an overall Company basis and (b) includes Rs. 0.89 Crore, in
respect of two Executive Directors, Mr. P. V. Dhobale and Mr. N. Anand,
whose appointment by the Board of Directors for tenures commencing from 3rd
January, 2011 are subject to approval of the Members at the forthcoming
Annual General Meeting.
Computation of Net Profits in accordance with Section 198 of the Companies
Act, 1956 and Directors' Commission:
(Rs. in Crores)
For the year ended
31st March,
2011 2010
Profit before Taxation 7268.16 6015.31
Add:
- Directors' Remuneration 17.16 13.94
- Wealth Tax - Net 5.33 2.35
- Depreciation 655.99 678.48 608.71 625.00
7946.64 6640.31
Less :
- Depreciation under Section
350 of the Companies Act, 1956 655.99 608.71
Profit on Sale of Long Term
Investments 63.01 31.70
Profit for the purpose of
Directors' Commission 7227.64 5999.90
Non-Executive Directors'
Commission @1% 72.28 60.00
Payable for the Year 0.67 0.59
(xii) Derivative Instruments:
The Company uses Forward Exchange Contracts and Currency Options to hedge
its exposures in foreign currency related to firm commitments and highly
probable forecasted transactions. The information on Derivative Instruments
is as follows :
a) Forward Exchange Contracts outstanding as at year end:
(in Million)
As at 31st As at 31st
March, 2011 March, 2010
Currency Cross Currency Buy Sell Buy Sell
US Dollar Indian Rupees 9.00 84.40 37.50 128.50
EURO US Dollar 57.40 - 10.55 -
CHF US Dollar 0.92 - - -
GBP US Dollar 3.00 - 4.00 -
SEK US Dollar 3.20 - - -
JPY US Dollar 483.08 - - -
b) Currency Option Contracts outstanding as at year end:
(in Million)
As at 31st As at 31st
March, 2011 March, 2010
Currency Cross Currency Buy Sell Buy Sell
US Dollar Indian Rupees 20.00 45.00 - -
EURO US Dollar 6.00 - - -
c) Foreign Exchange Currency Exposures that have not been hedged by a
Derivative Instrument or otherwise as at year end :
(in Million)
As at 31st As at 31st
March, 2011 March, 2010
Currency Cross Currency Buy Sell Net* Buy Sell Net*
US Dollar Indian Rupees 133.88 120.50 13.38 62.16 57.90 4.26
EURO US Dollar 1.64 3.66 (2.02) 7.17 6.88 0.29
GBP US Dollar 2.07 1.96 0.11 2.04 2.06 (0.02)
JPY US Dollar 94.20 - 94.20 15.07 - 15.07
SEK US Dollar 2.69 - 2.69 16.89 - 16.89
CHF US Dollar 0.70 - 0.70 2.82 - 2.82
SGD US Dollar 0.86 - 0.86 0.12 - 0.12
CAD US Dollar - 0.10 (0.10) - 0.06 (0.06)
AUD US Dollar 0.20 - 0.20 0.29 - 0.29
AED US Dollar - - - 0.04 - 0.04
MYR US Dollar 0.04 - 0.04 - - -
* Figures in brackets indicate Open Exports. Figures without brackets
indicate Open Imports.
(xiii) The Employee Stock Option Scheme section in the Report on Corporate
Governance and the disclosure in respect of Employees Stock Options which
are outlined in this year's Annexure to the Report of the Directors are
treated as an annexure to these accounts.
(xiv) Excise Duties and Taxes on Sales of Services comprise:
(Rs. in Crores)
For the year ended
31st March,
2011 2010
Excise Duties 9360.30 8046.39
Taxes on Sale of Services 76.51 60.02
(xv) ADDITIONAL INFORMATION PURSUANT TO THE PROVISIONS OF PARAGRAPHS 3, 4C
AND 4D OF PART II OF SCHEDULE VI OF THE COMPANIES ACT, 1956:
(A) Licensed & Installed Capacity and Actual Production:
CAPACITY
Class of Goods Unit of Registered/Licensed
Quantity 2011 2010
Cigarettes Million 1,23,547 (a) 1,23,547 (a)
Smoking Tobacco Tonne N.A. N.A.
Printing and Packaging
including Flexibles Tonne N.A. N.A.
Unmanufactured Tobacco Tonne N.A. N.A.
Pulp Tonne N.A. N.A.
Paperboards and Paper Tonne N.A. N.A.
Packaged Food Products Tonne N.A. N.A.
Personal Care Products Tonne N.A. N.A.
CAPACITY
Class of Goods Unit of Installed
Quantity 2011 2010
Cigarettes Million 1,41,754 1,34,383
Smoking Tobacco Tonne N.A. N.A.
Printing and Packaging
including Flexibles Tonne 1,07,852 1,06,148
Unmanufactured Tobacco Tonne N.A. N.A.
Pulp Tonne 2,35,000(c) 2,35,000 (c)
Paperboards and Paper Tonne 4,52,500(c) 4,52,500 (c)
Packaged Food Products Tonne 1,07,724 87,029
Personal Care Products Tonne 2,35,962 2,35,962
Class of Goods Unit of PRODUCTION
Quantity 2011 2010
Cigarettes Million 69,171 68,857
Smoking Tobacco Tonne 26 39
Printing and Packaging
including Flexibles Tonne 72,814(b) 73,807(b)
Unmanufactured Tobacco Tonne 1,04,624(b) 1,05,101(b)
Pulp Tonne 2,55,511(b) 2,51,369(b)
Paperboards and Paper Tonne 5,58,884(b) 5,47,931(b)
Packaged Food Products Tonne 46,101 29,948
Personal Care Products Tonne 36,704 25,398
a) The 'Registered/Licensed Capacity' (including as approved by 'Letters of
Intent') is exclusive of additional capacities permissible under the policy
of the Government of India.
b) Includes production meant for internal consumption.
c) Based on Capacity rated by equipment manufacturers/project consultants
at the time of installation.
N.A. - Not Applicable
(B) Particulars in respect of Sales*:
Unit of Quantity Value
Quantity (Rs. in Crores)
2011 2010 2011 2010
Cigarettes and
Smoking Tobacco:
- Cigarettes
- Smoking Tobacco Million 81,723 84,040 19821.16 17277.91
Tonne 27 54 4.50 4.31
Agri/Aqua Products
and Commodities:
- Unmanufactured
Tobacco Tonne 75,812 85,242 1291.41 1442.53
- Soya Extraction Tonne 96,970 31,332 177.20 62.94
- Soya Oil Tonne 20,815 10,670 105.95 46.25
- Soya Seeds Tonne 1,92,927 1,08,395 433.53 242.30
- Coffee Tonne 33,662 23,563 325.50 217.33
- Fruit Pulp Tonne 15,940 16,749 81.86 84.30
- Others (Spices,
Rice, Chillies, Aqua,
Agri Inputs etc.) 356.27 205.05
Paperboards, Paper
and Packaging:
- Paperboards and Paper Tonne 4,26,478 4,31,885 2017.67 1808.57
- Printed Materials Tonne 26,076 23,831 297.91 236.17
Packaged Food Products Tonne 7,75,469 7,11,034 2893.71 2317.29
Matches Million
Boxes 4,119 4,424 252.51 253.16
Hotel Sales/Income
from Hotel Services 1067.98 904.92
Others (Branded
Garments, Education
and Stationery
products, Personal
Care products,
Agarbattis etc.) 1477.23 1156.57
TOTAL 30604.39 26259.60
* Net of Sales Returns and Damaged Stocks.
(C) Details of Finished Goods:
Unit of Quantity Value
Quantity (Rs. in Crores)
2011 2010 2011 2010
(i) Opening Stock:
Cigarettes and
Smoking Tobacco:
- Cigarettes Million 5,200 9,382 731.84 1148.24
- Smoking Tobacco Tonne 2 17 0.28 0.59
Agri/Aqua Products and
Commodities:
- Soya Extraction Tonne 1,676 522 2.66 0.28
- Soya Oil Tonne 495 - 2.24 -
- Coffee Tonne 2,138 3,059 18.01 27.88
- Fruit Pulp Tonne 10,912 6,962 38.19 32.29
- Others (Spices, Rice,
Chillies, Aqua, Agri
Inputs etc.) 25.03 11.31
Paperboards, Paper
and Packaging:
- Paperboards and
Paper Tonne 17,667 22,285 65.64 83.71
- Printed Materials Tonne 684 404 4.74 3.83
Packaged Food Products Tonne 26,485 31,127 86.12 78.97
Matches Million
Boxes 253 271 14.75 14.27
Others (Branded
Garments, Education
and Stationery
products, Personal
Care products,
Agarbattis etc.) 213.53 253.97
1203.03 1655.34
(ii) Closing Stock:
Cigarettes and
Smoking Tobacco:
- Cigarettes Million 5,990 5,200 837.76 731.84
- Smoking Tobacco Tonne 1 2 0.04 0.28
Agri/Aqua Products
and Commodities:
- Soya Extraction Tonne 5,224 1,676 7.69 2.66
- Soya Oil Tonne 456 495 2.27 2.24
- Coffee Tonne 3,492 2,138 34.64 18.01
- Fruit Pulp Tonne 7,075 10,912 33.74 38.19
- Others (Spices,
Rice, Chillies,
Aqua, Agri Inputs
etc.) 26.39 25.03
Paperboards, Paper
and Packaging:
- Paperboards and
Paper Tonne 12,487 17,667 51.34 65.64
- Printed Materials Tonne 801 684 6.49 4.74
Packaged Food Products Tonne 32,225 26,485 133.98 86.12
Matches Million Boxes 295 253 18.23 14.75
Others (Branded
Garments, Education
and Stationery
products, Personal Care
products, Agarbattis
etc.) 340.95 213.53
1493.52 1203.03
(iii) Purchase of
Finished Goods for
Resale:
Agri/Aqua Products
and Commodities:
- Soya Extraction Tonne 3,714 3,236 6.09 7.91
- Soya Oil Tonne 78 5,180 0.95 22.33
- Soya Seeds Tonne 1,92,927 1,08,395 433.11 247.70
- Coffee Tonne 15,893 15,582 156.04 135.09
- Fruit Pulp Tonne 8,051 18,359 38.16 55.40
- Others (Spices,
Rice, Chillies,
Aqua, Agri Inputs
etc.) 108.95 88.87
Packaged Food Products Tonne 83,384 94,388 15.30 21.04
Matches Million 4,168 4,424 238.77 239.62
Boxes
Others (Branded
Garments, Education
and Stationery
products, Personal
Care products,
Agarbattis etc.) 382.43 198.79
1379.80 1016.75
(D) Details of Raw Materials including Packing Materials Consumed during
the year*:
Unit of Quantity Value
Quantity (Rs. in Crores)
2011 2010 2011 2010
Unmanufactured Tobacco Tonne 1,63,997 1,73,203 1811.04 1795.02
Waste Paper and Pulp Tonne 2,49,988 2,36,936 560.46 460.08
Hardwood and Bamboo BDT** 10,67,126 6,38,841 284.13 282.19
Soya Seeds Tonne 1,23,674 36,519 228.24 92.72
Wheat Tonne 4,90,465 5,05,357 639.20 625.75
Coffee Tonne 23,977 9,614 178.87 66.83
Board Tonne 13,491 10,527 114.77 75.26
Filter Rods Million 14,017 13,591 191.40 183.03
Aluminium Foil/
Metallised Paper Bobbin 7,04,136 6,40,808 62.21 56.80
Film and Laminates Tonne 13,027 14,293 202.59 174.32
Wheat Flour (Maida) Tonne 1,50,979 1,27,159 236.40 197.76
Sugar Tonne 86,921 70,165 270.81 195.84
Hydrogenated Vegetable
Oil Tonne 42,834 33,729 195.68 145.54
Surfactants Tonne 46,877 38,335 244.75 170.12
Inks, Solvents and
Adhesives Various 126.89 118.61
Chemicals and
Fragrances Various 408.31 360.39
Packing Materials Various 209.77 179.06
Others# 1064.65 775.98
7030.17 5955.30
* Relates to the Company's main products and the principal raw materials.
** BDT - Bone Dry Tonne.
# Others primarily include Hotel Consumables, Spices, Skimmed Milk Powder,
Fabrics, Agri Inputs etc.
Note:
The Board of Directors of the Company have specifically consented to the
continued disclosure of certain items individually constituting less than
10% of the total value of turnover, purchases, opening and closing stocks,
and raw materials consumed, covered in (B), (C) and (D), as appropriate, in
the Additional Information provided above.
(E) Contract Processing Charges:
Unit of Quantity Value
Quantity (Rs. in Crores)
2011 2010 2011 2010
Cigarettes Million 13,392 11,069 30.21 19.60
Agri/Aqua Products
and Commodities:
- Unmanufactured
Tobacco Tonne 36,188 36,455 40.50 39.66
- Soya Extraction Tonne 96,940 29,249 8.65 2.41
- Soya Oil Tonne 20,805 5,935 5.28 1.66
- Coffee Tonne 19,159 6,793 3.79 1.25
- Fruit Pulp Tonne 4,241 2,365 2.87 1.76
- Others (Spices,
Rice, Chillies,
Aqua, Agri Inputs
etc.) 7.52 4.60
Packaged Food Products Tonne 6,53,825 5,86,957 193.66 172.02
Others (Branded
Garments, Education
and Stationery
products, Personal
Care products etc.) 159.03 118.24
451.51 361.20
(F) Value of Raw Materials, Spare Parts and Components Consumed during the
year:
Value
(Percentage) (Rs. in Crores)
2011 2010 2011 2010
Raw Materials:
Imported 13.35 12.00 938.50 714.48
Indigenous 86.65 88.00 6091.67 5240.82
100.00 100.00 7030.17 5955.30
Spare Parts and
Components:
Imported 29.31 29.45 62.41 57.62
Indigenous 70.69 70.55 150.55 138.04
100.00 100.00 212.96 195.66
(G) Earnings etc. in Foreign Exchange during the year (on realisation
basis):
(Rs. in Crores)
2011 2010
Export of Goods (F.O.B.) 2295.18 1929.72
Hotel Earnings 476.27 398.51
Freight and Insurance recoveries 32.60 21.21
Other Earnings* 10.22 4.83
2814.27 2354.27
* Primarily consist of Finance & Storage Charges, Certified Emission
Reduction (CER) credits and sundry recoveries.
(H) Value of Imports during the year (C.I.F. Basis):
(Rs. in Crores)
2011 2010
Raw Materials 844.90 603.94
Components and Spare Parts 77.12 68.25
Capital Goods 225.94 267.50
Other Goods* 16.96 11.12
1164.92 950.81
* Including Packing materials, Hotel Consumables and sundry items.
(I) Expenditure in Foreign Currency during the year (on payment basis):
(Rs. in Crores)
2011 2010
Professional Fees 28.32 29.22
Hotel Reservation/Marketing Expenses 26.11 24.04
Export Promotion Expenses 5.37 5.99
Agency Commission 8.02 9.48
Storage and Warehousing 3.56 4.09
Licence Fees 1.05 1.41
Miscellaneous Expenditure* 17.03 17.42
89.46 91.65
* Including Advertising/Sales promotion, Training, Subscription fees,
Export Claims etc.
(J) Dividend Remittance in Foreign Currency:
Year of On Account of No. of No. of (Rs. in
Remittance Financial Year Non-Resident Shares Crores)
Shareholders held
2010/2011 2009/2010 56 1,22,14,39,474 1221.44
2009/2010 2008/2009 58 1,22,53,13,612 453.37
20. Segment Reporting:
PRIMARY SEGMENT INFORMATION (BUSINESS SEGMENTS):
(Rs. in Crores)
2011
External Sales Inter Segment Total
Sales
1. Segment Revenue:
FMCG - Cigarettes 19827.56 - 19827.56
FMCG - Others 4473.72 8.63 4482.35
FMCG - Total 24301.28 8.63 24309.91
Hotels 1067.98 9.41 1077.39
Agri Business 2919.55 1828.44 4747.99
Paperboards, Paper
and Packaging 2315.58 1351.30 3666.88
Segment Total 30604.39 3197.78 33802.17
Eliminations (3197.78)
Total Revenue 30604.39
2. Segment Results:
FMCG - Cigarettes 5766.75
FMCG - Others (297.59)
FMCG - Total 5469.16
Hotels 266.56
Agri Business 566.29
Paperboards, Paper
and Packaging 819.24
Segment Total 7121.25
Eliminations (71.57)
Consolidated Total 7049.68
Unallocated corporate
expenses net of
unallocated income 251.56
Profit before Interest
etc. and Taxation 6798.12
Interest paid - Net 48.13
Interest earned on loans
and deposits, income
from current and long
term investments, profit
and loss on sale of
investments etc. - Net 518.17
Profit before Taxation 7268.16
Provision for Taxation 2280.55
Profit after Taxation 4987.61
3. Other Information:
Segment Segment
Assets Liabi-
lities*
FMCG - Cigarettes 4684.53 1622.39
FMCG - Others 2420.13 523.01
FMCG - Total 7104.66 2145.40
Hotels 2949.10 220.66
Agri Business 2150.27 588.62
Paperboards, Paper and
Packaging 4241.58 471.46
Segment Total 16445.61 3426.14
Unallocated Corporate
Assets/Liabilities 9379.80 6446.00
Total 25825.41 9872.14
Capital Depreciation Non Cash
Expendi- expenditure
ture other than
depreciation
FMCG - Cigarettes 312.89 192.16 2.58
FMCG - Others 112.05 93.24 6.68
FMCG - Total 424.94 285.40 9.26
Hotels 322.30 85.19 3.61
Agri Business 91.07 22.75 1.66
Paperboards, Paper and
Packaging 249.53 231.32 14.26
Segment Total 1087.84 624.66 28.79
(Rs. in Crores)
2010
External Inter Segment Total
Sales Sales
1. Segment Revenue:
FMCG - Cigarettes 17283.03 - 17283.03
FMCG - Others 3638.73 2.95 3641.68
FMCG - Total 20921.76 2.95 20924.71
Hotels 904.92 5.89 910.81
Agri Business 2388.18 1473.96 3862.14
Paperboards, Paper
and Packaging 2044.74 1188.87 3233.61
Segment Total 26259.60 2671.67 28931.27
Eliminations (2671.67)
Total Revenue 26259.60
2. Segment Results:
FMCG - Cigarettes 4938.12
FMCG - Others (349.51)
FMCG - Total 4588.61
Hotels 216.64
Agri Business 447.75
Paperboards, Paper
and Packaging 684.26
Segment Total 5937.26
Eliminations (31.07)
Consolidated Total 5906.19
Unallocated corporate
expenses net of
unallocated income 191.74
Profit before Interest
etc. and Taxation 5714.45
Interest paid - Net 64.75
Interest earned on
loans and deposits, income
from current and
long term investments,
profit and loss on sale
of investments etc. -
Net 365.61
Profit before Taxation 6015.31
Provision for Taxation 1954.31
Profit after Taxation 4061.00
3. Other Information:
Segment Segment
Assets Liabi-
lities*
FMCG - Cigarettes 4336.38 1375.59
FMCG - Others 2098.47 432.12
FMCG - Total 6434.85 1807.71
Hotels 2669.60 212.25
Agri Business 1910.13 330.57
Paperboards, Paper and
Packaging 4056.47 345.20
Segment Total 15071.05 2695.73
Unallocated Corporate
Assets/Liabilities 8271.36 6582.30
Total 23342.41 9278.03
Capital Depreciation Non Cash
Expenditure expenditure
other than
depreciation
FMCG - Cigarettes 443.95 168.29 4.23
FMCG - Others 166.35 81.67 16.57
FMCG - Total 610.30 249.96 20.80
Hotels 417.94 77.83 3.78
Agri Business 11.58 34.02 2.34
Paperboards, Paper
and Packaging 208.08 216.72 23.48
Segment Total 1247.90 578.53 50.40
* Segment Liabilities of FMCG - Cigarettes is before considering Rs.755.60
Crores (2010 - Rs.628.64 Crores) in respect of disputed Taxes, the recovery
of which has been stayed or where States' Special Leave Petitions are
pending before the Supreme Court. These have been included under
Unallocated Corporate Liabilities'.
SECONDARY SEGMENT INFORMATION (GEOGRAPHICAL SEGMENTS):
(Rs. in Crores)
2011 2010
1. Segment Revenue:
- Within India 28140.72 24020.27
- Outside India 2463.67 2239.33
Total 30604.39 26259.60
2. Segment Assets:
- Within India 16439.68 15063.52
- Outside India 5.93 7.53
Total 16445.61 15071.05
3. Capital Expenditure:
- Within India 1087.84 1247.90
- Outside India - -
Total 1087.84 1247.90
NOTES:
(1) The Company's corporate strategy aims at creating multiple drivers of
growth anchored on its core competencies. The Company is currently focused
on four business groups : FMCG, Hotels, Paperboards, Paper & Packaging and
Agri Business. The Company's organisational structure and governance
processes are designed to support effective management of multiple
businesses while retaining focus on each one of them.
(2) The business groups comprise the following :
FMCG:
Cigarettes:
- Cigarettes, Cigars and Smoking Mixtures.
Others:
- Branded Packaged Foods (Staples, Biscuits, Confectionery, Snack Foods,
Noodles, Ready to Eat Foods), Garments, Educational and other Stationery
products, Matches, Agarbattis and Personal Care products.
Hotels:
- Hoteliering.
Paperboards, Paper and Packaging:
- Paperboards, Paper including Specialty Paper and Packaging including
Flexibles.
Agri Business:
- Agri commodities such as rice, soya, coffee and leaf tobacco.
(3) The geographical segments considered for disclosure are:
- Sales within India.
- Sales outside India.
(4) Segment results of FMCG:
Others' are after considering significant business development, brand
building and gestation costs of Branded Packaged Foods and Personal Care
Products businesses.
(5) The Company's Agri Business markets agri commodities in the export and
domestic markets; supplies agri raw materials to the Branded Packaged Foods
Business and sources leaf tobacco for the Cigarettes Business. The segment
results for the year are after absorbing costs relating to the strategic e-
Choupal initiative.
21. Related Party Disclosures:
1. ENTERPRISES WHERE CONTROL EXISTS:
i) Subsidiaries:
a) Srinivasa Resorts Limited
b) Fortune Park Hotels Limited
c) Bay Islands Hotels Limited
d) Russell Credit Limited and its subsidiaries
Greenacre Holdings Limited
Wimco Limited and its subsidiaries
Pavan Poplar Limited
Prag Agro Farm Limited
Technico Pty Limited, Australia and its subsidiaries
Technico ISC Pty Limited, Australia (deregistered on 03.11.2010)
Technico Agri Sciences Limited
Technico Technologies Inc., Canada
Technico Asia Holdings Pty Limited, Australia and its subsidiary
Technico Horticultural (Kunming) Co. Limited, China
e) ITC Infotech India Limited and its subsidiaries
ITC Infotech Limited, UK
ITC Infotech (USA), Inc. and its subsidiary
Pyxis Solutions, LLC
f) Wills Corporation Limited
g) Gold Flake Corporation Limited
h) Landbase India Limited
i) BFIL Finance Limited and its subsidiary
MRR Trading & Investment Company Limited
j) Surya Nepal Private Limited
k) King Maker Marketing, Inc.
The above list does not include:
a) ITC Global Holdings Pte. Limited, Singapore (in liquidation) and its
subsidiaries:
Hup Hoon Traders Pte. Limited, Singapore (struck off w.e.f. 31.03.2011 by
the Registrar of Companies, Singapore) AOZT 'Hup Hoon', Moscow Hup Hoon
Impex SRL, Romania, and b) BFIL Securities Limited (a subsidiary of BFIL
Finance Limited) which is under voluntary winding up proceedings.
ii) Other entities under control of the Company:
a) ITC Sangeet Research Academy
b) ITC Education Trust
c) ITC Rural Development Trust
2. OTHER RELATED PARTIES WITH WHOM THE COMPANY HAD TRANSACTIONS:
i) Associates & Joint Ventures:
Associates:
a) Gujarat Hotels Limited
b) International Travel House Limited - being associates of the Company,
and
c) Tobacco Manufacturers (India) Limited, UK - of which the Company is an
associate.
Associates of the Company's Subsidiaries:
a) Russell Investments Limited
b) Classic Infrastructure & Development Limited
c) Divya Management Limited
d) Antrang Finance Limited - being associates of Russell Credit Limited,
and
e) ATC Limited - being associate of Gold Flake Corporation Limited
Joint Ventures:
a) Maharaja Heritage Resorts Limited
b) Espirit Hotels Private Limited (w.e.f. 24.09.2010) - being joint
ventures of the Company
Joint Venture of the Company's subsidiary:
a) ITC Filtrona Limited - being joint venture of Gold Flake Corporation
Limited
ii) a) Key Management Personnel (KMP):
Y.C. Deveshwar Executive Chairman
N. Anand Executive Director
P.V. Dhobale Executive Director (KMP w.e.f. 26.07.2010)
K.N. Grant Executive Director
A. Singh Executive Director (upto 23.07.2010)
A. Baijal Non-Executive Director
S. Banerjee Non-Executive Director
S.H. Khan Non-Executive Director
A.V. Girija Kumar Non-Executive Director
S.B. Mathur Non-Executive Director
D.K. Mehrotra Non-Executive Director
H.G. Powell Non-Executive Director
P.B. Ramanujam Non-Executive Director
A. Ruys Non-Executive Director
B. Sen Non-Executive Director
K. Vaidyanath Non-Executive Director
B. Vijayaraghavan Non-Executive Director
Members - Corporate Management Committee:
A. Nayak
S. Sivakumar
T.V. Ramaswamy
R. Tandon
B.B. Chatterjee
K.S. Suresh
b) Relatives of Key Management Personnel:
Mrs. B. Deveshwar (wife of Mr. Y.C. Deveshwar)
Mrs. S. Chatterjee (wife of Mr. B.B. Chatterjee)
iii) Employee Trusts where there is significant influence:
a) IATC Provident Fund
b) IATC Staff X Provident Fund
c) ITC Defined Contribution Pension Fund
d) ITC Management Staff Gratuity Fund
e) ITC Employees Gratuity Fund
f) ITC Gratuity Fund C'
g) ITC Pension Fund
h) ILTD Seasonal Employees Pension Fund
i) ITC Platinum Jubilee Pension Fund
j) Tribeni Tissues Limited Provident Fund
k) Tribeni Tissues Limited Gratuity Fund
l) ITC Bhadrachalam Paperboards Limited Management Staff Pension Fund
m) ITC Bhadrachalam Paperboards Limited Gratuity Fund A'
n) ITC Bhadrachalam Paperboards Limited Gratuity Fund B'
o) ITC Bhadrachalam Paperboards Limited Gratuity Fund C'
p) ITC Bhadrachalam Paperboards Limited Staff Provident Fund
q) ITC Hotels Limited Employees Superannuation Scheme
r) ITC Hotels Limited Employees Gratuity Fund
3. DISCLOSURE OF TRANSACTIONS BETWEEN THE COMPANY AND RELATED PARTIES AND
THE STATUS OF OUTSTANDING BALANCES AS ON 31.03.2011:
(Rs. in Crores)
RELATED PARTY TRANSACTIONS Enterprises where control exists
SUMMARY Subsidiaries Others
2011 2010 2011 2010
1. Sale of Goods/Services 181.06 169.60 0.01 0.02
2. Purchase of Goods/Services 289.16 297.03
3. Acquisition cost of Fixed Assets 1.39 19.34 0.05
4. Sale of Fixed Assets/Scraps
5. Investments Purchased from
Subsidiary* 387.31
6. Investments in Subsidiary 25.00 147.00
7. Acquisition of Investments
8. Interest Income
9. Remuneration to Key Management
Personnel:
- Directors [See Schedule
19(xi)]
- Others
10. Rent Paid 4.01 3.58
11. Remuneration of Managers on
Deputation Reimbursed 0.91 0.69
12. Remuneration of Managers on
Deputation Recovered 10.41 8.50
13. Donations 1.78 1.99
14. Contributions to Employees'
Benefit Plans
15. Dividend Income 70.50 76.33
16. Dividend Payments
17. Expenses Recovered 12.81 10.75 0.04
18. Expenses Reimbursed 1.63 1.65 0.02
19. Loans Given 239.61 809.45
20. Receipt towards Loans Repayment 201.25 905.15
21. Advances Given during the year 1.27 10.68
22. Adjustment/Receipt towards
Refund of Advances 3.31 119.14
23. Advances Received during the
year 102.69 121.10
24. Adjustment/Payment towards
Refund of Advances 97.74 83.03
25. Receipt towards Refund of
Deposits
26. Balances as on 31st March:
i) Debtors/Receivables 14.91 18.04 0.02
ii) Advances Given 25.67 27.71
iii) Loans Given 181.79 143.43
iv) Deposits Given 2.56 2.56
v) Advances Taken 54.34 49.39
vi) Deposits Taken
vii) Creditors/Payables 3.62 5.23
viii) Investments in Non-
Convertible Debentures 15.00 15.00
27. Provision for subsidiary
as at 31st March 47.55 47.55
28. In addition, remuneration of
managers on deputation,
absorbed 1.46 1.87 0.21 0.27
(Rs. in Crores)
RELATED PARTY TRANSACTIONS Associates Joint Ventures
SUMMARY 2011 2010 2011 2010
1. Sale of Goods/Services 0.86 0.84 6.42 7.25
2. Purchase of Goods/Services 80.55 57.97 131.63 119.65
3. Acquisition cost of Fixed
Assets
4. Sale of Fixed Assets/Scraps 0.09 0.05
5. Investments Purchased from
Subsidiary*
6. Investments in Subsidiary
7. Acquisition of Investments 2.13
8. Interest Income
9. Remuneration to Key Management
Personnel:
- Directors [See Schedule
19(xi)]
- Others
10. Rent Paid
11. Remuneration of Managers on
Deputation Reimbursed 0.19 0.15
12. Remuneration of Managers on
Deputation Recovered 2.87 0.61 1.43 1.16
13. Donations
14. Contributions to Employees'
Benefit Plans
15. Dividend Income 0.57 0.52
16. Dividend Payments 992.78 367.33
17. Expenses Recovered 1.40 1.14 0.36 0.37
18. Expenses Reimbursed 0.24 0.37 0.02
19. Loans Given
20. Receipt towards Loans Repayment
21. Advances Given during the year 0.10
22. Adjustment/Receipt towards
Refund of Advances 1.80 2.98
23. Advances Received during
the year
24. Adjustment/Payment towards
Refund of Advances
25. Receipt towards Refund
of Deposits
26. Balances as on 31st March:
i) Debtors/Receivables 1.29 0.32 6.07 4.02
ii) Advances Given 0.30 2.10
iii) Loans Given
iv) Deposits Given 0.10 0.10
v) Advances Taken
vi) Deposits Taken 0.06 0.06
vii) Creditors/Payables 6.02 6.23 1.96 1.27
viii) Investments in Non-
Convertible Debentures
27. Provision for subsidiary
as at 31st March
28. In addition, remuneration
of managers on deputation,
absorbed 0.41 1.98
(Rs. in Crores)
RELATED PARTY TRANSACTIONS Key Management Relatives of Key
SUMMARY Personnel Management
Personnel
2011 2010 2011 2010
1. Sale of Goods/Services
2. Purchase of Goods/Services
3. Acquisition cost of Fixed
Assets
4. Sale of Fixed Assets/Scraps
5. Investments Purchased from
Subsidiary*
6. Investments in Subsidiary
7. Acquisition of Investments
8. Interest Income 0.11 0.16
9. Remuneration to Key Management
Personnel
- Directors [See Schedule
19(xi)] 17.16 13.94
- Others 6.89 6.50
10. Rent Paid 0.11 0.25 0.57 0.72
11. Remuneration of Managers on
Deputation Reimbursed
12. Remuneration of Managers on
Deputation Recovered
13. Donations
14. Contributions to Employees'
Benefit Plans
15. Dividend Income
16. Dividend Payments 5.43 0.95
17. Expenses Recovered
18. Expenses Reimbursed
19. Loans Given
20. Receipt towards Loans
Repayment 0.21 0.25
21. Advances Given during the
year
22. Adjustment/Receipt towards
Refund of Advances
23. Advances Received during
the year
24. Adjustment/Payment towards
Refund of Advances
25. Receipt towards Refund of
Deposits 0.05 0.01 0.32
26. Balances as on 31st March:
i) Debtors/Receivables
ii) Advances Given
iii) Loans Given 0.46 0.65
iv) Deposits Given 0.03 0.08 0.29 0.29
v) Advances Taken
vi) Deposits Taken
vii) Creditors/Payables
viii) Investments in Non-
Convertible Debentures
27. Provision for subsidiary as
at 31st March
28. In addition, remuneration
of managers on deputation,
absorbed
(Rs. in Crores)
RELATED PARTY TRANSACTIONS Employee Trusts Total
SUMMARY
2011 2010 2011 2010
1. Sale of Goods/Services 188.35 177.71
2. Purchase of Goods/Services 501.34 474.65
3. Acquisition cost of Fixed Assets 1.39 19.39
4. Sale of Fixed Assets/Scraps 0.09 0.05
5. Investments Purchased from
Subsidiary* 387.31
6. Investments in Subsidiary 25.00 147.00
7. Acquisition of Investments 2.13
8. Interest Income 0.11 0.16
9. Remuneration to Key Management
Personnel:
- Directors [See Schedule
19(xi)] 17.16 13.94
- Others 6.89 6.50
10. Rent Paid 4.69 4.55
11. Remuneration of Managers on
Deputation Reimbursed 1.10 0.84
12. Remuneration of Managers on
Deputation Recovered 14.71 10.27
13. Donations 1.78 1.99
14. Contributions to Employees'
Benefit Plans 119.76 76.32 119.76 76.32
15. Dividend Income 71.07 76.85
16. Dividend Payments 998.21 368.28
17. Expenses Recovered 14.57 12.30
18. Expenses Reimbursed 1.87 2.06
19. Loans Given 239.61 809.45
20. Receipt towards Loans Repayment 201.46 905.40
21. Advances Given during the year 1.27 10.78
22. Adjustment/Receipt towards
Refund of Advances 5.11 122.12
23. Advances Received during the year 102.69 121.10
24. Adjustment/Payment towards
Refund of Advances 97.74 83.03
25. Receipt towards Refund of
Deposits 0.05 0.33
26. Balances as on 31st March:
i) Debtors/Receivables 22.27 22.40
ii) Advances Given 25.95 24.92 51.92 54.73
iii) Loans Given 182.25 144.08
iv) Deposits Given 2.98 3.03
v) Advances Taken 54.34 49.39
vi) Deposits Taken 0.06 0.06
vii) Creditors/Payables 2.66 24.09 14.26 36.82
viii) Investments in Non-
Convertible Debentures 15.00 15.00
27. Provision for subsidiary as
at 31st March 47.55 47.55
28. In addition, remuneration
of managers on deputation,
absorbed 2.08 4.12
* Investments have been purchased in 2010 from subsidiary at cost, the
market value of such shares on date of acquisition was Rs. 1030.06 Crores.
4. INFORMATION REGARDING SIGNIFICANT TRANSACTIONS/BALANCES:
(Rs. in Crores)
RELATED PARTY TRANSACTIONS SUMMARY 2011 2010
1. Sale of Goods/Services:
Surya Nepal Private Limited 140.25 112.92
Wimco Limited 11.55 23.99
King Maker Marketing, Inc. 22.17 26.26
2. Purchase of Goods/Services:
ITC Infotech India Limited 91.67 79.35
Wimco Limited 184.08 205.84
International Travel House Limited 59.23 45.83
ITC Filtrona Limited 131.41 119.46
3. Acquisition Cost of Fixed Assets:
Wimco Limited 1.39 19.34
4. Sale of Fixed Assets/Scraps:
ATC Limited 0.09 0.05
5. Investments Purchased from Subsidiary:
Russell Credit Limited - 387.31
6. Investment in Subsidiary:
Landbase India Limited 25.00 147.00
7. Acquisition of Investments:
Espirit Hotels Private Limited 2.13 -
8. Interest Income:
Mr. K. Vaidyanath 0.04 0.01
Mr. T.V. Ramaswamy 0.04 -
Mr. N. Anand 0.01 0.01
Mr. A. Singh - 0.04
Mr. A. Nayak - 0.06
9. Remuneration to Key Management
Personnel - Directors & Others:
Mr. Y.C. Deveshwar 9.83 7.59
Mr. K. Vaidyanath 2.47 2.54
Mr. A. Singh 1.18 2.92
10. Rent Paid:
Bay Islands Hotels Limited 1.00 0.84
Russell Credit Limited 0.84 0.52
Wimco Limited 0.51 0.71
BFIL Finance Limited 0.44 0.14
Technico Agri Sciences Limited 0.95 0.95
Mrs. B. Deveshwar 0.54 0.54
11. Remuneration of Managers
on Deputation Reimbursed:
Bay Islands Hotels Limited 0.74 0.64
ITC Infotech India Limited 0.11 -
International Travel House Limited 0.19 0.15
12. Remuneration of Managers
on Deputation Recovered:
Srinivasa Resorts Limited 3.36 2.69
Fortune Park Hotels Limited 2.79 2.66
ITC Infotech India Limited 2.29 1.74
Maharaja Heritage Resorts Limited 1.13 0.94
ATC Limited 2.14 -
13. Donations:
ITC Rural Development Trust 1.78 1.99
14. Contributions to Employees'
Benefit Plans:
IATC Provident Fund 17.60 14.72
ITC Management Staff Gratuity Fund 7.98 6.76
ITC Pension Fund 67.46 34.88
15. Dividend Income:
Surya Nepal Private Limited 66.91 72.78
16. Dividend Payments:
Tobacco Manufacturers (India)
Limited, UK 992.78 367.33
17. Expenses Recovered:
Wimco Limited 3.90 4.30
ITC Infotech India Limited 4.80 3.83
Srinivasa Resorts Limited 1.61 1.20
18. Expenses Reimbursed
Srinivasa Resorts Limited 0.36 0.39
ITC Infotech India Limited 0.38 0.35
Surya Nepal Private Limited 0.49 0.52
ATC Limited 0.22 0.36
Fortune Park Hotels Limited 0.14 0.11
19. Loans Given:
ITC Infotech India Limited 239.61 148.25
Russell Credit Limited - 661.00
20. Receipt towards Loans Repayment:
ITC Infotech India Limited 201.25 199.40
Russell Credit Limited - 665.30
21. Advances Given during the year:
Landbase India Limited - 6.68
Wimco Limited 1.27 4.00
22. Adjustment/Receipt towards
Refund of Advances:
Wimco Limited 3.31 14.00
ATC Limited 1.80 2.40
Landbase India Limited - 105.14
International Travel House Limited - 0.58
23. Advances Received during the year:
Surya Nepal Private Limited 102.69 121.10
24. Adjustment/Payment towards
Refund of Advances:
Surya Nepal Private Limited 97.74 83.03
25. Receipt towards Refund of Deposits:
Mr. Y.C. Deveshwar 0.05 -
26. Balances as on 31st March:
i) Debtors/Receivables:
Surya Nepal Private Limited 10.39 10.19
Maharaja Heritage Resorts Limited 5.79 3.66
Wimco Limited 1.28 5.01
ii) Advances Given:
Wimco Limited 25.67 27.71
Employee Trust - Gratuity Funds 25.95 24.92
iii) Loans Given:
ITC Infotech India Limited 149.24 110.88
BFIL Finance Limited 32.55 32.55
iv) Deposits Given:
Greenacre Holdings Limited 2.20 2.20
v) Advances Taken:
Surya Nepal Private Limited 54.34 49.39
vi) Deposits Taken:
International Travel House Limited 0.06 0.06
vii) Creditors/Payables:
ITC Infotech India Limited 1.76 -
International Travel House Limited 4.46 5.16
ITC Filtrona Limited 1.96 1.27
Surya Nepal Private Limited 0.56 2.02
Employee Trust - Pension Funds 2.66 24.09
viii) Investments in Non-Convertible
Debentures:
BFIL Finance Limited 15.00 15.00
27. Provision for Subsidiary as on 31st
March:
BFIL Finance Limited - Debts 47.55 47.55
28. In addition, Remuneration of
Managers on Deputation, Absorbed:
ATC Limited - 1.62
ITC Infotech India Limited 1.24 1.59
Classic Infrastructure & Development
Limited 0.41 0.36
ITC Sangeet Research Academy 0.21 0.27
III. Significant Accounting Policies:
IT IS CORPORATE POLICY:
Convention:
To prepare financial statements in accordance with applicable Accounting
Standards in India. A summary of important accounting policies is set out
below. The financial statements have also been prepared in accordance with
relevant presentational requirements of the Companies Act, 1956.
Basis of Accounting:
To prepare financial statements in accordance with the historical cost
convention modified by revaluation of certain Fixed Assets as and when
undertaken as detailed below.
Fixed Assets:
To state Fixed Assets at cost of acquisition inclusive of inward freight,
duties and taxes and incidental expenses related to acquisition. In respect
of major projects involving construction, related pre-operational expenses
form part of the value of assets capitalised. Expenses capitalised also
include applicable borrowing costs, if any.
To capitalise software where it is expected to provide future enduring
economic benefits. Capitalisation costs include licence fees and costs of
implementation/system integration services. The costs are capitalised in
the year in which the relevant software is implemented for use.
To charge off as a revenue expenditure all upgradation / enhancements
unless they bring similar significant additional benefits.
Depreciation:
To calculate depreciation on Fixed Assets and Intangible Assets in a manner
that amortises the cost of the assets after commissioning, over their
estimated useful lives or, where specified, lives based on the rates
specified in Schedule XIV to the Companies Act, 1956, whichever is lower,
by equal annual instalments. Leasehold properties are amortised over the
period of the lease.
To amortise capitalised software costs over a period of five years.
Revaluation of Assets:
As and when Fixed Assets are revalued, to adjust the provision for
depreciation on such revalued Fixed Assets, where applicable, in order to
make allowance for consequent additional diminution in value on
considerations of age, condition and unexpired useful life of such Fixed
Assets; to transfer to Revaluation Reserve the difference between the
written up value of the Fixed Assets revalued and depreciation adjustment
and to charge Revaluation Reserve Account with annual depreciation on that
portion of the value which is written up.
Impairment of Assets:
To provide for impairment loss, if any, to the extent, the carrying amount
of assets exceed their recoverable amount. Recoverable amount is higher of
an asset's net selling price and its value in use. Value in use is the
present value of estimated future cash flows expected to arise from the
continuing use of an asset and from its disposal at the end of its useful
life.
Impairment losses recognised in prior years are reversed when there is an
indication that the impairment losses recognised no longer exist or have
decreased. Such reversals are recognised as an increase in carrying amounts
of assets to the extent that it does not exceed the carrying amounts that
would have been determined (net of amortisation or depreciation) had no
impairment loss been recognised in previous years.
Investments:
To state Current Investments at lower of cost and fair value; and Long Term
Investments, including in Joint Ventures and Associates, at cost. Where
applicable, provision is made to recognise a decline, other than temporary,
in valuation of Long Term Investments.
Inventories:
To state inventories including work-in-progress at lower of cost and net
realisable value. The cost is calculated on weighted average method. Cost
comprises expenditure incurred in the normal course of business in bringing
such inventories to its location and includes, where applicable,
appropriate overheads based on normal level of activity. Obsolete, slow
moving and defective inventories are identified at the time of physical
verification of inventories and, where necessary, provision is made for
such inventories.
Sales:
To recognise Gross Sales at the time of delivery of goods and rendering of
services net of trade discounts to customers and Sales Tax/Value Added Tax
recovered from customers but including excise duty on goods and taxes
relating to services, payable by the Company. Net sales are stated after
deducting such excise duty and taxes.
Investment Income:
To account for Income from Investments on an accrual basis, inclusive of
related tax deducted at source.
Proposed Dividend:
To provide for Dividends (including income tax thereon) in the books of
account as proposed by the Directors, pending approval at the Annual
General Meeting.
Employee Benefits:
To make regular monthly contributions to various Provident Funds which are
in the nature of defined contribution scheme and such paid /payable amounts
are charged against revenue. To administer such Funds through duly
constituted and approved independent trusts with the exception of Provident
Fund and Family Pension contributions in respect of Unionised Staff which
are statutorily deposited with the Government.
To administer through duly constituted and approved independent trusts,
various Gratuity and Pension Funds which are in the nature of defined
benefit /contribution schemes. To determine the liabilities towards such
schemes, as applicable, and towards employee leave encashment by an
independent actuarial valuation as per the requirements of Accounting
Standard - 15 (revised 2005) on 'Employee Benefits'. To determine actuarial
gains or losses and to recognise such gains or losses immediately in Profit
and Loss Account as income or expense.
To charge against revenue, actual disbursements made, when due, under the
Workers' Voluntary Retirement Scheme.
Lease Rentals:
To charge Rentals in respect of leased premises and equipment to the Profit
and Loss Account.
Research and Development:
To write off all expenditure other than capital expenditure on Research and
Development in the year it is incurred.
Capital expenditure on Research and Development is included under Fixed
Assets.
Taxes on Income:
To provide Current tax as the amount of tax payable in respect of taxable
income for the period, measured using the applicable tax rates and tax
laws.
To provide Deferred tax on timing differences between taxable income and
accounting income subject to consideration of prudence, measured using the
tax rates and tax laws that have been enacted or substantially enacted by
the Balance Sheet date.
Not to recognise Deferred tax assets on unabsorbed depreciation and carry
forward of losses unless there is virtual certainty that there will be
sufficient future taxable income available to realise such assets.
Foreign Currency Translation:
To account for transactions in foreign currency at the exchange rate
prevailing on the date of transactions. Gains / Losses arising out of
fluctuations in the exchange rates are recognised in the Profit and Loss
Account in the period in which they arise.
To account for differences between the forward exchange rates and the
exchange rates at the date of transactions, as income or expense over the
life of the contracts.
To account for profit/loss arising on cancellation or renewal of forward
exchange contracts as income/expense for the period.
To account for premium paid on currency options in the Profit and Loss
Account at the inception of the option.
To account for profit/loss arising on settlement or cancellation of
currency option as income /expense for the period.
To recognise the net mark to market losses in the Profit and Loss Account
on the outstanding portfolio of options / forwards / swaps as at the
Balance Sheet date, and to ignore the net gain, if any.
To account for gains/losses in the Profit and Loss Account on foreign
exchange rate fluctuations relating to monetary items at the year end.
Claims:
To disclose claims against the Company not acknowledged as debts after a
careful evaluation of the facts and legal aspects of the matter involved.
Segment Reporting:
To identify segments based on the dominant source and nature of risks and
returns and the internal organisation and management structure.
To account for inter-segment revenue on the basis of transactions which are
primarily market led.
To include under 'Unallocated Corporate Expenses' revenue and expenses
which relate to initiatives/costs attributable to the enterprise as a whole
and are not attributable to segments.
Financial and Management Information Systems:
To practise an Integrated Accounting System which unifies both Financial
Books and Costing Records. The books of account and other records have been
designed to facilitate compliance with the relevant provisions of the
Companies Act on one hand, and meet the internal requirements of
information and systems for Planning, Review and Internal Control on the
other. To ensure that the Cost Accounts are designed to adopt Costing
Systems appropriate to the business carried out by the Division with each
Division incorporating into its Costing System, the basic tenets and
principles of Standard Costing, Budgetary Control and Marginal Costing as
appropriate.
On behalf of the Board
P.V. DHOBALE Director
R. TANDON Chief Financial Officer
Y.C. DEVESHWAR Chairman
B.B. CHATTERJEE Secretary
Place: Kolkata
Dated: 20th May, 2011
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