ICICI Bank 2006 Annual Report Download - page 109

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F50
forming part of the Consolidated Accounts (Contd.)
schedules
SCHEDULE 18
Significant accounting policies and notes to accounts
Overview
ICICI Bank Limited (”ICICI Bank” or ”the Bank”) together with its subsidiaries, joint ventures and associates (collectively, “the
Company”) is a diversified financial services group providing a wide range of banking and financial services including retail
banking, project and corporate finance, working capital finance, insurance, venture capital and private equity, investment banking,
broking and treasury products and services.
The Bank was incorporated in Vadodara, India and is a publicly held banking company governed by the Banking Regulation Act,
1949.
Principles of consolidation
The consolidated financial statements include the financials of ICICI Bank, its subsidiaries, associates and joint ventures.
The Company consolidates subsidiaries in which it holds, directly or indirectly, more than 50% of the voting rights or where it
exercises control. Entities where the Company holds 20% to 50% of the voting rights and /or has the ability to exercise significant
influence, other than investments of designated venture capital subsidiaries, are accounted for under the equity method of
accounting, and the pro-rata share of their income / (loss) is included in the profit and loss account. Assets, liabilities, income and
expenditure of the jointly controlled entities are consolidated using the proportionate consolidation method. Under the proportionate
consolidation method the Company’s share of each of the assets, liabilities, income and expenses of a jointly controlled entity is
reported as separate line items in the consolidated financial statements. The total assets at March 31, 2006 and total income for
the year ended March 31, 2006 of the entities consolidated by the proportionate consolidation method was Rs. 39.7 million and
Rs. 3.7 million respectively The Company does not consolidate entities where control is intended to be temporary. All significant
inter-company accounts and transactions are eliminated on consolidation.
Basis of preparation
The accounting and reporting policies of the Company used in the preparation of these consolidated financial statements reflect
general industry practices and conform with the generally accepted accounting principles in India (Indian GAAP) including the
extant Accounting Standards (“AS”) issued by Institute of Chartered Accountants of India (“ICAI”), guidelines issued by Reserve
Bank of India (”RBI”), Insurance Regulatory and Development Authority (”IRDA”) and National Housing Bank (”NHB”) as applicable
to relevant companies.
The Company follows the accrual method of accounting except where otherwise stated and historical cost convention. In case
the accounting policies followed by a subsidiary, joint venture or associate are different from those followed by the Bank, the
same have been disclosed separately.
The preparation of consolidated financial statements requires management to make estimates and assumptions considered in
the reported amounts of assets and liabilities (including contingent liabilities) as of the date of the consolidated financial statements
and the reported income and expenses during the reporting period. Management believes that the estimates used in the preparation
of the consolidated financial statements are prudent and reasonable. Actual results could differ from these estimates.
The consolidated financial statements include the results of the following entities:
Sr. Name of the company Country/ Relation Activity Ownership
No. residence interest
1 ICICI Securities Limited India Subsidiary Investment banking 99.90%
2 ICICI Brokerage Services Limited India Subsidiary Securities broking 99.90%
3 ICICI Securities Inc. USA Subsidiary Investment banking
& securities broking 99.90%
4 ICICI Securities Holdings Inc. USA Subsidiary Investment banking 99.90%
5 ICICI Venture Funds
Management Company Limited India Subsidiary Venture fund management 100.00%
6 ICICI Home Finance Company Limited India Subsidiary1Housing finance 100.00%
7 ICICI Trusteeship Services Limited India Subsidiary Trusteeship services 100.00%
8 ICICI Investment
Management Company Limited India Subsidiary Investment management 100.00%
9 ICICI International Limited Mauritius Subsidiary Offshore fund management 100.00%
10 ICICI Bank UK Limited United
Kingdom Subsidiary Banking 100.00%
11 ICICI Bank Canada Canada Subsidiary Banking 100.00%
12 ICICI Bank Eurasia Limited
Liability Company (formerly Investment
Credit Bank Limited Liability Company) Russia Subsidiary2Banking 100.00%
13 ICICI Property Trust India Direct holding Assets and investments management 100.00%