ICICI Bank 2007 Annual Report Download - page 124

F54
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” or “the Group”) is a diversified financial services group providing a wide range of banking and financial services
including commercial banking, 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 and joint ventures.
The Bank consolidates subsidiaries in which it holds, directly or indirectly, more than 50% of the voting rights or where it exercises
control. Entities where the Bank 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 consolidated profit and loss account. Assets, liabilities, income
and expenditure of jointly controlled entities are consolidated using the proportionate consolidation method. Under this method,
the Bank’s share of each of the assets, liabilities, income and expenses of the jointly controlled entity are reported in separate
line items in the consolidated financial statements. The total assets at March 31, 2007 and total income for the year ended
March 31, 2007 of the entities consolidated by the proportionate consolidation method is Rs. 128.2 million and Rs. 9.6 million
respectively. The Bank 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 conform
to generally accepted accounting principles in India (Indian GAAP), guidelines issued by Reserve Bank of India (“RBI”), Insurance
Regulatory and Development Authority (“IRDA”) and National Housing Bank (“NHB”) from time to time and as applicable to
relevant companies and practices generally prevalent within the banking industry in India.
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 or joint venture 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 as of the date of the consolidated financial statements and the reported income and
expenses during the reporting period. The 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 of Nature of Nature of Ownership
No. incorporation Relationship business interest
1 ICICI Securities Primary
Dealership Limited
(formerly ICICI Securities Limited)1 India Subsidiary Investment banking 99.94%
2 ICICI Securities Limited
(formerly ICICI Brokerage
Services Limited)2,3,4 India Subsidiary Securities broking 99.94%
3 ICICI Securities Inc. USA Subsidiary Investment banking and 99.94%
securities broking
4 ICICI Securities Holdings Inc. USA Subsidiary Investment banking 99.94%
5 ICICI Venture Funds Management
Company Limited India Subsidiary Venture fund management 100.00%
6 ICICI Home Finance Company Limited5 India Subsidiary Housing 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 PLC. United
(formerly ICICI Bank UK Limited) Kingdom Subsidiary Banking 100.00%
11 ICICI Bank Canada10 Canada Subsidiary Banking 100.00%