ICICI Bank 2003 Annual Report Download - page 108

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schedules
forming part of the Consolidated Accounts Continued
11. Staff benefits
For employees covered under group gratuity scheme and group superannuation scheme of LIC, gratuity and
superannuation charged to Profit and Loss Account is on the basis of premium charged by LIC. Provision for gratuity
and pension for other employees and leave encashment liability is determined as per actuarial valuation. Defined
contributions for Provident Fund are charged to the Profit and Loss Account based on contributions made in terms of
the scheme.
12. Income Tax
Income tax expense is the aggregate amount of current tax and deferred tax charge. Taxes on income are accrued
in the same period as the revenue and expenses to which they relate. Current period taxes are determined in
accordance with the Income Tax Act, 1961. Deferred tax adjustments comprise of changes in the deferred tax assets
or liabilities during the year.
Deferred tax assets and liabilities are recognised for the future tax consequences of temporary differences arising
between the carrying values of assets and liabilities and their respective tax basis and operating carry forward losses.
Deferred tax assets are recognised only after giving due consideration to prudence. Deferred tax assets and liabilities
are measured using tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.
The impact on account of changes in the deferred tax assets and liabilities is also recognised in the income statement.
Deferred tax assets are recognised based upon management’s judgement as to whether realisation is considered
reasonably certain.
13. Translation of the Financial Statements of Foreign Representative Offices
In accordance with the guidelines issued by the Reserve Bank of India, all assets, liabilities, income and expenditure
of the foreign representative offices of the Bank have been converted at the closing rate prevailing on the balance
sheet date.
B. NOTES FORMING PART OF THE ACCOUNTS
1. Preference Shares
Certain Government Securities amounting to Rs.1,244.8 million (2002 : Rs.1,304.6million) have been earmarked
against redemption of preference share capital, which falls due for redemption on April 20, 2018 as per the original
issue terms.
2. Employee Stock Option Scheme
In terms of Employee Stock Option Scheme, the maximum number of options granted to any Eligible Employee in a
financial year shall not exceed 0.05% of the issued equity shares of the Bank at the time of grant of the options and
aggregate of all such options granted to the Eligible Employees shall not exceed 5% of the aggregate number of the
issued equity shares of the Bank subsequent to the amalgamation of ICICI, I CAPS and I PFS with the Bank and the
issuance of equity shares by the Bank pursuant to the amalgamation of ICICI, I CAPS and I PFS with the Bank.
In terms of the Scheme, 12,610,275 options (2002 : 13,343,625 options) granted to eligible employees were outstanding
as at March 31, 2003.
Stock option activity
A summary of the status of the Bank’s option plan is presented below:
Year ended Year ended
March 31, 2003 March 31, 2002
Option shares Option shares
outstanding outstanding
Outstanding at the beginning of the year .............................................. 13,343,625 1,636,125
Add: Granted during the year ................................................................. —4,735,200
Options taken over on Amalgamation ........................................... —* 7,015,800
Less: Forfeited during the year ................................................................ 730,350 43,500
Exercised during the year .............................................................. 3,000 —
Outstanding at the end of the year ........................................................ 12,610,275 13,343,625
* Represents options granted to option holders of erstwhile ICICI Limited in the share swap ratio.