1. In terms of the Scheme of Arrangement (Scheme) sanctioned by the
 order dated 1st October 2010 of the Hon''ble High Court of Bombay,
 Shrenuj Diajewels Limited and Shrenuj Gems & Jewellery Limited, wholly
 owned subsidiaries, have been amalgamated with the Company w.e.f.
 01-04-2010.
 
 a) In accordance with the said Scheme:
 
 (i) The asset and liabilities of the transferor companies are taken
 over at fair value under Purchase method of accounting for Amalgamation
 and the excess of fair value of assets over liabilities amounting to
 Rs.5,466.63 Lacs has been credited to the Amalgamation Reserve.
 
 (ii) As per the scheme, some of the fixed assets of the transferee
 Company have also been revalued and an amount of Rs.13,511.14 Lacs is
 credited to Revaluation Reserve.
 
 (iii) Consequent to the above, there is an additional charge for
 depreciation of Rs. 211.17 lacs for the year ended 31st March 2011. An
 amount of Rs. 138.38 lacs on the revalued assets of the transferee
 Company has been withdrawn from Revaluation Reserve and an amount of
 Rs. 72.79 lacs on the excess of fair value over book value of the
 assets of the transferor Companies has been withdrawn from Amalgamation
 Reserve as provided in the Scheme. This has no impact on the profit for
 the period.
 
 b) Pursuant to the scheme, 60,22,525 equity shares of Rs. 2/- each were
 allotted on 27th October 2010 to the lenders of Unsecured loans at a
 price of Rs. 46.33 per share on conversion of the said loans into
 equity and accordingly a sum of Rs.2,669.79 lacs has been credited to
 Securities Premium Account.
 
 c) The expenses including stamp duty on amalgamation amounting to Rs.
 51.15 lacs have been charged to Amalgamation Reserve account.
 
 d) With effect from effective date, the authorised capital of the
 Company has increased to Rs. 4,500 Lacs.
 
 e) The Figures of current year include figures of amalgamating
 companies as explained above and are therefore to that extent not
 comparable with those of the previous year.
 
 2 A (i) As in the previous year, the Company has continued to adopt the
 principles of AS – 30, Financial Instruments: Recognition &
 Measurement in respect of hedge accounting. Accordingly, in respect of
 derivative financial instruments which are entered into to hedge
 foreign currency risks of firm commitments or highly probable forecast
 transactions and which are effective cash flow hedges, the net notional
 gain on these instruments outstanding as at 31st March, 2011, amounting
 to Rs. 70.97 lacs (previous year notional gain Rs. 603.88 lacs) is
 reflected in the Hedging Reserve account.
 
 (ii) The Company, in accordance with its risk management policies and
 procedures, enters into derivative instruments (option contracts &
 forward contracts) to manage its exposure to foreign exchange rates.
 The counter party is generally a bank.
 
 Subsequent to the balance sheet date (before finalising the accounts),
 the Company has utilised / cancelled forward contracts of USD 8.00
 million (USD 12.40 million) without incurring any loss. The notional
 Mark to Market gain of Rs. 68.51 lacs (P.Y. Rs. 184.17 lacs) on such
 contracts as on 31st March is therefore not reflected in the Hedging
 Reserve. The balance net Mark to Market gain / (loss) of Rs. 70.97 lacs
 (P.Y. Rs. 603.88 lacs) has been reflected in the Hedging Reserve.
 
 In addition to the above cash flow hedges, the Company has outstanding
 derivative instruments aggregating to Rs. 24,576.79 lacs (Rs.
 104,722.00 lacs) whose fair value showed a net gain of Rs. 269.78 lacs
 (P.Y. loss Rs. 764.85 lacs), and which is accounted for in the Profit
 and Loss Account.
 
 As of balance sheet date, the Company has net foreign currency
 exposures that are not hedged by a derivative instrument or otherwise
 amounting to Rs. 19,593.30 lacs (P.Y. Rs. Nil) representing receivables
 and Rs. 75,814.39 lacs (previous year Rs. 15,448.27 lacs) representing
 payables.
 
 B.  Commodity Hedging:
 
 The Company enters into Gold Futures and Options contracts to hedge its
 commodity related risk. The net outstanding position at the end of the
 year is 40,800 grams (P.Y. 1,000 grams.). The MTM gain of Rs. 18.89
 lacs has been accounted for in the Profit and Loss Account.
 
 3. Suppliers/Service providers covered under Micro, Small Medium
 Enterprises Development Act 2006, have not furnished the information
 regarding filing of necessary memorandum with the appropriate
 authority. In view of this, information required to be disclosed u/s 22
 of the said Act is not given.
 
                                               2010-2011     2009-2010
 
                                            (Rs. in Lacs) (Rs. in Lacs)
 
 4.  Contingent Liabilities not provided 
 for in respect of:
 
 a) Guarantees given by the Company on 
 behalf of Subsidiaries and Associates In 
 respect of Advances granted by Banks          73,330.90     54,102.00
 
 b) Disputed Income Tax Liabilities not 
 provided for                                     136.04        112.52
 
 c) Disputed Sales Tax Liabilities not 
 provided for                                       3.76          3.76
 
 d) Corporate Guarantee executed in favor of 
 Third Party                                      238.16          7.00
 
 e) Bond executed for import of Capital goods     164.89        137.50
 
 f) Letter of Credit against import of goods   15,424.74     12,080.05
 
 5.  Previous year''s figures have been re-grouped and/or rearranged
 wherever necessary.
 
 6.  The Ministry of Corporate Affairs, Government of India vide its
 General Notification No. S.O.301(E) dated 8th Februrary 2011 issued
 under Section 211 (3) of the Companies Act, 1956 has exempted certain
 class of Companies from disclosing certain information in their Profit
 and Loss Account. The Company being an export oriented company is
 entitled to the exemption. Accordingly, disclosures mandated by
 paragraphs 3(i)(a), 3 (ii) (a), 3(ii) (b) and 3(ii) (d) of Part II,
 Schedule VI to the Companies Act, 1956 have not been provided.
 
 7.  The Ministry of Corporate Affairs, Government of India vide its
 General Circular No. 2 and 3 dated 8th Februrary 2011 and 21st February
 2011 respectively has granted a general exemption from compliance with
 Section 212 of the Companies Act, 1956, subject to fulfillment of
 conditions stipulated in the circular. The Company has satisfied the
 conditions stipulated in the circular and hence is entitled to the
 exemption. Necessary information relating to the subsidiaries has been
 attached to the Consolidated Financial Statements.
 
 8.  Segment Information for the year ended 31 March 2011:
 
 As per Accounting Standard 21 on Consolidated Financial Statements and
 Accounting Standard 23 on Accounting for Investment in Associates in
 consolidated financial statements issued by Institute of Chartered
 Accountants of India, the Company has presented consolidated financial
 Statement, including subsidiaries and associates. Accordingly segment
 information as required under Accounting Standard 17 on Segment
 reporting is included under the Notes to Consolidated financial
 statements.
 
 9. The Disclosure of employee benefit as defined in the accounting
 standard are given below:
 
 Defined Contribution Plan:
 
 The Company makes Provident Fund and Superannuation Fund contributions
 as defined contributions retirement benefit plans for qualifying
 employees. The Company''s provident fund is under the management of the
 statutory authorities. The Company has recognised Rs.104.06 lacs (Rs.
 62.95 lacs) for Provident Fund and Rs.12.04 lacs (Rs 9.15 lacs) for
 Superannuation contributions in Profit and Loss account. The
 Contributions payable to this plans by the Company are at rates
 specified in the rules of the scheme.
 
 Defined Benefit Plan:
 
 The employees Gratuity Fund scheme managed by a trust is a funded
 defined benefit plan. The present value of obligation is determined
 based on the actuarial valuation using Projected Unit Credit Method,
 which recognises each period of service as giving rise to additional
 unit of employee benefit entitlement and measures each unit separately
 to build up the final obligation.
 
 10. Related Party transactions:
 
 As per the Directors
 
 1) Parties where control exists:
 
 Shrenuj Diajewels Limited* Wholly owned subsidiary
 
 Shrenuj Gems & Jewellery Ltd.* Wholly owned subsidiary
 
 Shrenuj Lifestyle Limited Wholly owned subsidiary
 
 Shrenuj Overseas Ltd Wholly owned subsidiary
 
 Shrenuj DMCC Wholly owned subsidiary
 
 Shrenuj Japan Corporation Wholly owned subsidiary
 
 Shrenuj (Mauritius) Pvt. Ltd.  Wholly owned subsidiary
 
 Shrenuj Jewellery (Far East) Ltd.  Wholly owned subsidiary
 
 Shrenuj Botswana (Pty.) Ltd Wholly owned subsidiary
 
 Shrenuj South Africa (Pty) Ltd.  Wholly owned subsidiary
 
 Shrenuj N.V.  Wholly owned subsidiary
 
 Shrenuj GmbH Wholly owned subsidiary
 
 Shrenuj Australia Pty. Ltd.  Wholly owned subsidiary
 
 Lume Group AG Wholly owned subsidiary
 
 Astral USA, INC.  Wholly owned subsidiary
 
 Shrenuj USA, LLC Wholly owned subsidiary
 
 Astral Jewels LLC Wholly owned subsidiary
 
 Astral Holding INC Wholly owned subsidiary
 
 Alija International Pty Ltd Wholly owned subsidiary
 
 Global Marine Diamonds Company Wholly owned subsidiary
 
 Ithemba Diamonds (Pty) Ltd Wholly owned subsidiary
 
 Uxolo Diamond Cutting Works (Pty) Limited Wholly owned subsidiary
 
 Simon Golub & Sons INC Subsidiary
 
 Daily Jewellery Ltd.Hong Kong Subsidiary
 
 Intergems H.K. Ltd.  Subsidiary
 
 Shrenuj Shanghai Diamonds Pvt. Ltd.  Subsidiary
 
 Bernies International, LLC Subsidiary
 
 2) Associates :
 
 Kiara Jewellery Pvt. Ltd.
 
 Arisia Jewellery Pvt. Ltd.
 
 Jomard SAS
 
 SWA Trading Ltd.
 
 Copem & Shrenuj
 
 Trapz, LLC
 
 SHL Gems & Jewellery Ltd.
 
 K. K. Doshi & Co.
 
 Shrenuj Investments & Finance Pvt. Ltd.
 
 3) Key Management Personnel and their relatives:
 
 Shri Shreyas K. Doshi Chairman and Managing Director
 
 Shri Nihar N. Parikh Executive Director
 
 Shri Vishal S. Doshi Group Executive Director
 
 Mrs. Anjali P. Mehta Relative