ICICI Bank 2008 Annual Report Download - page 134

F60
SCHEDULE 18
Significant accounting policies
Overview
ICICI Bank Limited (“ICICI Bank” or “the Bank”) together with its subsidiaries, joint ventures and associates (collectively, “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, associates and joint ventures.
The Bank consolidates entities 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, 2008 and total income for the year ended
March 31, 2008 of the entities consolidated by the proportionate consolidation method is Rs. 240.9 million and Rs. 82.0 million
respectively. The Bank does not consolidate entities where control is intended to be temporary or where the Bank holds 20%
to 50% of the voting rights and the investments in those entities in the books of the bank have been written down to Re. 1. All
significant inter-company accounts and transactions are eliminated on consolidation.
Basis of preparation
The accounting and reporting policies of the Group 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. In the case of the foreign subsidiaries,
the generally accepted accounting principles as applicable to the foreign subsidiaries are followed.
The Group follows the accrual method of accounting except where otherwise stated. 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.
no. Name of the entity Country of incorporation Nature of relationship Nature of business Ownership interest
1 ICICI Securities Limited India Subsidiary Securities broking &
merchant banking 100.00%
2 ICICI Securities Inc. USA Subsidiary Securities broking 100.00%
3 ICICI Securities Holdings Inc. USA Subsidiary Holding company 100.00%
4 ICICI Securities Primary
Dealership Limited India Subsidiary Securities investment, trading and underwriting 100.00%
5 ICICI Venture Funds
Management Company Limited India Subsidiary Asset management 100.00%
6 ICICI Home Finance Company
Limited 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 Asset management 100.00%
9 ICICI International Limited Mauritius Subsidiary Asset management 100.00%
forming part of the Consolidated Accounts (Contd.)
schedules
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