Edelweiss Capital

1 Segment reporting
 
 Income for each segment has been specifically identified. Expenditure,
 assets and liabilities are either specifically identifiable with
 individual segments or have been allocated to segments on a systematic
 basis.
 
 Based on such allocations, segmental balance sheet as at 31 March 2009
 and segmental profit and loss account for the year ended 31 March 2009
 have been prepared.
 
 Since the business operations of the Company are primarily concentrated
 in India, the Company is considered to operate only in the domestic
 segment.
 
 2 Disclosure pursuant to Accounting Standard 15 ( Revised } -
 Empioyee Benefits
 
 A) Defined contribution plan (Provident fund):
 
 Amount of Rs. 4,010,689 (previous year: Rs. 2,109,429) is recognised as
 expenses and included in  Employee Costs -Schedule 19 in the profit
 and loss account.
 
 B) Defined benefit plan (Gratuity):
 
 The following tables summarise the components of the net employee
 benefit expenses recognised in the profit and loss account, the fund
 status and amount recognised in the balance sheet for the gratuity
 benefit plan.
 
 Profit and loss account
 
 3 Operating leases
 
 The Company has taken various premises on operating lease. Gross rental
 expenses for the year ended 31 March 2009 aggregated to Rs. 36,934,273
 (Previous year: Rs. 25,720,950) which has been included under the head
 Operating expenses - Rent, in the profit and loss account,
 
 4 Employee stock option plans
 
 The Company has currently six Employee Stock Option Plans (Plans) in
 force. The Plans provide that the Companys employees and those of its
 subsidiaries are granted an option to acquire equity shares of the
 Company that vests in a graded manner. The options may be exercised
 within a specified period.
 
 The Company follows the intrinsic value method to account for its stock
 based compensation plans. Compensation cost is measured as the excess,
 if any, of the fair market value of the underlying share over the
 exercise price.
 
 During the previous year, the Company has issued ESOP 2007 Plan wherein
 stock options were granted to employees with a variable exercise price
 (i.e. the exercise price was linked to either a discount on market
 price at the time of exercise or a specified amount, whichever is
 higher). The stock options vested after fifteen days from the date of
 grant. For determination of compensation cost, the Company has assumed
 the exercise price to be the specified amount.
 
 During the year, the Company has issued ESOP 2008 Plan wherein stock
 options were granted to employees with a variable exercise price (i.e.
 the exercise price was linked to either a discount on market price at
 the time of exercise or a specified amount, whichever is higher). The
 stock options vested after one year from the date of grant. For
 determination of compensation cost, the Company has assumed the
 exercise price to be the specified amount.
 
 The shareholders of the Company also approved by a special resolution
 passed by postal ballot dated 30 March, 2009, the grant of 5 million
 options under the new Employee Stock Option Plan, ESOP 2009. No stock
 options have been granted under this plan upto the date of this balance
 sheet.
 
 With respect to stock options granted upto 31st March 2008, the fair
 market value of the underlying shares has been determined based on an
 independent valuers report as these stock options were granted by the
 Company to its employees when it was not listed on the stock exchanges.
 The fair value under stock options granted during the year is arrived
 as stipulated in the Guidance Note on Accounting for Employee Share
 Based Payments issued by The Institute of Chartered Accountants of
 India.
 
 The compensation cost recorded in the profit and loss account for the
 year is Rs. 6,804,788/- (Previous year: Rs. 3,494,278).
 
 5 Capital commitment
 
 Capital commitments (net of advances) - Rs. 39,000,000 (Previous year:
 Rs. 21,555,096)
 
 6 Contingent liability
 
 Taxation matters in respect of which appeal is pending - Rs. 1,747,928
 (Previous year: Rs. 15,858,396). The demand paid under protest in
 respect of disputed taxation matters pertaining to open assessments of
 earlier years is Rs. 1,747,928 (Previous year: Rs. 5,441,046).
 
 The Company has issued corporate guarantees to the extent of Rs.
 6,188,300,000 (Previous year: Rs. 7,310,000,000), in favour of banks to
 secure the credit facilities sanctioned by these banks to Edelweiss
 Securities Limited, EC Commodity Limited , Edelweiss Broking Limited
 and Edelweiss Commodities Limited (subsidiary companies).
 
 7 Loans and advances include
 
 i) Rs. 556,153 (Previous year: Rs, 30,612) due from Edelweiss Asset
 Reconstruction Company Limited (maximum amount due at
 any time during the year Rs. 556,153; Previous year: Rs. 30,612)
 
 ii) Rs. 5,774,114 (Previous year: Rs, 9,230,924) due from Edelweiss
 Real Estate Advisors Private Limited (maximum amount due at any time
 during the year Rs. 11,063,494; Previous year: Rs.  9,230,924)
 
 iii) Rs. 424,815,952 (Previous year: Rs, 223,165,952) due from
 Edelweiss Employees Welfare Trust (maximum amount due at any
 time during the year Rs. 424,815,952; Previous year: Rs. 223,165,952)
 
 8 Cost sharing
 
 Edelweiss Capital Limited, being the holding company within the
 Edelweiss Group incurs expenditure like common senior management
 compensation cost, rent expenditure, which is for the common benefit of
 itself and certain subsidiary companies. This cost so expended is
 recovered as reimbursement from the subsidiaries on the basis of number
 of employees, area occupied, time spent by employees for other
 companies, actual identifications etc. Accordingly, and as identified
 appropriately, these expenditure heads in Schedule 19 and Schedule 20
 are net of the reimbursements.
 
 9 Utilisation of proceeds from initial public offer
 
 The Company has fully utilised, as per the Objects of the issue, the
 net issue proceeds of Rs. 671.49 crores raised by the Initial Public
 Offering in the financial year 2007-08.
 
 10 Schedule VI disclosures
 
 Disclosures under Schedule VI to the Companies Act, 1956 has been made
 to the extent applicable to the Company.
 
 11 Prior period comparatives
 
 Previous year figures have been regrouped and rearranged wherever
 necessary.