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ICICI Prudential Life Insurance Company

BSE: 540133|NSE: ICICIPRULI|ISIN: INE726G01019|SECTOR: Finance - General
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Notes to Accounts Year End : Mar '19

1. Corporate Information

ICICI Prudential Life Insurance Company Limited (‘the Company’) promoted by ICICI Bank Limited and Prudential Corporation Holdings Limited, incorporated on July 20, 2000 as a Company under the Companies Act, 2013 (‘the Act’). The Company is licensed by the Insurance Regulatory and Development Authority of India (‘IRDAI’) for carrying life insurance business in India. The license is in force as at March 31, 2019.

The Company carries on business of providing life insurance, pensions and health insurance products to individuals and groups. Riders providing additional benefits are offered under some of these products. The business is conducted in participating, non-participating and unit linked lines of businesses. These products are distributed through individual agents, corporate agents, banks, brokers, the Company’s proprietary sales force and the Company website.

Note:

1) As per IRDAI circular IRDA/F&A/CIR/Misc/l73/07/2017 dated July 25, 2017, unclaimed amount of policyholders with ageing more than 120 months transferred to Senior Citizens’ Welfare Fund (SCWF), amounting to Rs. 48,166 thousand, was shown as “Contingent Liability” at March 31, 2018. However, IRDAI via circular IRDA/F&A/CIR/Misc/105/07/2018 dated July 11, 2018 has withdrawn this disclosure requirement, with immediate effect. Hence amount transferred to SCWF is not reported in the above disclosure.

2) There has been a Supreme Court (SC) judgement dated February 28, 2019, relating to components of salary structure that need to be taken into account while computing the contribution to provident fund under the Employment Provident Fund Act. There are interpretative aspects related to the judgement including the effective date of application. The Company will continue to assess any further developments in this matter for their implications on financial statements, if any.

2.1 Actuarial method and assumptions

The actuarial liability in respect of both participating and non-participating policies is calculated using the gross premium method, using assumptions for interest, mortality, morbidity, expense and inflation and, in the case of participating policies, future bonuses together with allowance for taxation and allocation of profits to shareholders. These assumptions are determined as prudent estimates at the date of valuation with allowances for adverse deviations.

The liability for the unexpired portion of the risk for the non-unit liabilities of linked business and attached riders is the higher of liability calculated using discounted cash flows and unearned premium reserves.

An unexpired risk reserve and a reserve in respect of claims incurred but not reported is held for contracts wherein there is a possibility of lag of intimation of claims.

The unit liability in respect of linked business is the value of the units standing to the credit of policyholders, using the Net Asset Value (‘NAV’) prevailing at the valuation date.

A brief of the assumptions used in actuarial valuation is as below:

a) The interest rates used for valuing the liabilities are in the range of 4.44% to 6.48% per annum. The interest rates used at March 31, 2018 were in the range of 4.66% to 6.13% per annum.

b) Mortality rates used are based on the published “Indian Assured Lives Mortality (2006 - 2008) Ult.” mortality table for assurances and LIC (a) 96-98 table for annuities adjusted to reflect expected experience. Morbidity rates used are based on CIBT 93 table, adjusted for expected experience, or on risk rates provided by reinsurers.

c) Expenses are provided for at least at the current levels in respect of renewal expenses, with no allowance for any future improvement but with an allowance for any expected worsening.

d) Per policy renewal expenses are assumed to inflate at 4.19% per annum. The expense inflation assumption used at March 31, 2018 was 4.38%.

e) No allowance is made for expected lapses in the future.

f) The bonus rates for participating business to be declared in the future is consistent with the valuation assumptions.

g) The tax rate applicable for valuation at March 31, 2019 is 14.56% p.a.

Certain explicit additional provisions are made, which include the following:

a) Reserves for additional expenses that the Company may have to incur if it were to close to new business twelve months after the valuation date.

b) Reserves for guarantees available to individual and group insurance policies.

c) Reserves for cost of non-negative claw back additions.

d) Reserves for free look option given to policyholders calculated using a free look cancellation rate of 3.50%. The free look cancellation assumption used at March 31, 2018 was 2.10%.

e) Reserves for lapsed policies eligible for revivals.

2.2. Funds for Future Appropriations (‘FFA’)

The balance of unit-linked FFA at March 31, 2019 of Rs. 7,114 thousand (March 31, 2018: Rs. 8,036 thousand) and participating FFA of Rs. 10,336,955 thousand (March 31, 2018: Rs. 8,773,567 thousand) is not available for distribution to Shareholders. Such amount is classified under Funds for Future appropriations, in the Balance Sheet.

2.3. Claims settled and remaining unpaid

Claims settled and remaining unpaid for a period of more than six months at March 31, 2019 is Rs. 29,917 thousand (March 31, 2018: Rs. 16,769 thousand).

2.4. Reconciliation of unclaimed amounts of policyholders

Pursuant to IRDAI circular No. IRDA/F&A/CIR/CLD/114/05/2015 dated May 28, 2015 and IRDA/F&A/CIR/CPM/134/07/2015 dated July 24, 2015 on “Handling of unclaimed amounts pertaining to policyholders”, the Company has created a single segregated fund to manage all the unclaimed monies. The amount in such unclaimed fund has been invested in money market instruments and /or fixed deposit of scheduled banks with effect from April 01, 2016.

The amount in the unclaimed fund has been disclosed in schedule 12 as “Assets held for unclaimed amount of policyholders”. Investment income accruing to such unclaimed fund has been credited to the fund and disclosed as “Other Income” under linked life segment in the Revenue Account. Such investment income net of fund management charges (‘FMC’) is paid/ accrued as “interest on unclaimed amounts” in schedule 4 “Benefits paid”.

Reconciliation of unclaimed amounts of policyholders:

In accordance with master circular IRDA/F&I/CIR/CLD/173/07/2017 issued by the IRDAI on May 28, 2015, the details of unclaimed amounts and investment income at March 31, 2019 is tabulated as below:

2.5. Age wise analysis of unclaimed amount of policyholders

In accordance with circular IRDA/F&A/Misc/ 173/07/2017 issued by the IRDAI on July 25, 2017, the age wise analysis of unclaimed amount of the policyholders is tabulated as below:

The above unclaimed amount of policyholders does not include Rs. 245 Lacs having ageing beyond 120 months, which shall be transferred to Senior Citizens’ Welfare Fund (SCWF) on or before March 01, 2020 in accordance with IRDAI Master circular No. IRDA/F&A/CIR/Misc/173/07/2017 on “Unclaimed Amount of Policyholders” dated July 25, 2017 read with rule 3 (6) of Senior Citizens’ Welfare Fund Rules, 2016. For the previous year ended March 31, 2018 the above unclaimed amount of policyholders does not include Rs. 229 Lacs having ageing beyond 120 months paid on February 28, 2019.

2.6. Direct taxes

The current tax provision is determined in accordance with the provisions of Income Tax Act,1961. The provision for current tax for the year ended March 31, 2019 is Rs. 1,355,010 thousand (year ended March 31, 2018: Rs. 2,198,077 thousand).

The provision for current tax includes an amount of Rs. 1,131,829 thousand for the year ended March 31, 2019 (year ended March 31, 2018: Rs. 1,200,710 thousand) which has been charged on the total surplus of the participating line of business in Revenue Account, in line with the Company’s accounting policy. Further, tax expense amounting to Rs. 223,181 thousand for the year ended March 31, 2019 (year ended March 31, 2018: Rs. 997,367 thousand) pertaining to other than participating line of business has been charged to Profit and loss account.

Deferred tax asset is recognised on the linked funds for future appropriation to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax asset can be realised. The deferred tax position and the movement for the year ended March 31, 2019 is summarised below:

2.7. Operating lease commitments

The Company takes premises, motor vehicles, office equipment’s, computers, servers and modular furniture on operating lease. Certain lease arrangements provide for cancellation by either party and also contain a clause for renewal of the lease agreement. Lease payments on cancellable and non-cancellable operating lease arrangements are charged to the Revenue account and the Profit and Loss account over the lease term on a straight line basis. The total operating lease rentals charged for the year ended March 31, 2019 is Rs. 542,414 thousand (year ended March 31, 2018: Rs. 526,130 thousand).

Lease rentals pertaining to non-cancellable leases charged to the Revenue account and the Profit and Loss account for the year ended March 31, 2019 is Rs. 31,540 thousand (year ended March 31, 2018: Rs. 32,297 thousand). The future minimum lease payments in respect of these non-cancellable leases at the Balance Sheet date are summarised below:

2.8. Assets given on operating lease

The Company has entered into an agreement in the nature of leave and license for leasing out the investment property. This is in the nature of operating lease and lease arrangement contains provisions for renewal. There are no restrictions imposed by lease arrangement and the rent is not determined based on any contingency. The total lease payments received in respect of such lease recognised in Revenue account and Profit and Loss account for the year ended March 31, 2019 is Rs. 167,973 thousand (year ended March 31, 2018: Rs. 179,305 thousand).

2.9 Fund Balance Sheet at March 31, 2019

Fund Balance Sheet for each segregated linked fund is annexed herewith - Refer Annexure 1.

2.10. Fund Revenue Account for the year ended March 31, 2019

Fund Revenue Account for each segregated linked fund is annexed herewith - Refer Annexure 2.

2.11. Annexure to the Revenue account and Additional uLIP Disclosures

Additional disclosure in respect of Unit linked portfolio as prescribed by IRDAI vide circulars 054/IRDA/F&A/FEB-07 dated February 20, 2007 and IRDA/ F&A/001/APR-07 dated April 16, 2007 - Refer Annexure 3.

2.12. Employee benefits

Provision for staff benefits as per AS 15 (Revised):

(a) Defined contribution plans

The following has been recognised as an expense during the year under defined contribution plans:

(ii) Provident fund

Provident fund benefits are aimed at providing security to staff members and their dependents on retirement, disability or death. Both employee and the company contribute an equal percentage of the basic salary, a part of which is towards government administered pension fund and balance portion is contributed to the fund administered by trustees. The provident fund is managed by ICICI Prudential Life Insurance Company Employees’ Provident Fund Trust.

The minimum rate at which the annual interest is payable by the trust to members is prescribed by the government. The Company has an obligation to make good the shortfall, if any, between the government prescribed rate and actual return earned by the provident fund.

(c) Other long term benefits

(i) Long term incentive scheme:

The amount recognised as an expense during the year ended March 31, 2019 is Rs. 148,796 thousand (year ended March 31, 2018: Rs. 143,577 thousand)

Liability for the scheme is determined based on actuarial valuation which has been carried out using the projected accrued benefit method which is same as the projected unit credit method in respect of past service. The assumptions used for valuation are:

(ii) Compensated absence:

The amount recognised as an expense during the year ended March 31, 2019 is Rs. 96,014 thousand (year ended March 31, 2018: Rs. 80,893 thousand).

Liability for compensated absence for employees is determined based on actuarial valuation which has been carried out using the projected accrued benefit method which is same as the projected unit credit method in respect of past service. The assumptions used for valuation are:

2.13. Employee Stock Option Scheme (“ESOS”)

The Company Employees Stock Option Scheme (2005) (“ESOS 2005”) has six tranches namely Founder, 2004-05, 2005-06, 2006-07, Founder II and 2007-08. ESOS 2005 permits the grant of share options up to 3% of the issued capital of Company. The Board of Directors have approved the amendment of ESOS 2005 (ESOS 2005 (Revised)). As per the ESOS 2005 (Revised), the aggregate number of shares issued or issuable since March 31, 2016 pursuant to the exercise of any options granted to the eligible employees issued pursuant to the scheme or any other stock option scheme of the Company, shall not exceed a figure equal to 2.64% of the number of shares issued as on March 31, 2016. The maximum number of options that can be granted to any eligible employee is restricted to 0.1% of the issued shares of the Company at the time of grant of options. The exercise price shall be determined by the Board Nomination & Remuneration Committee in concurrence with the Board of Directors of the Company on the date the options are granted and shall be reflected in the award confirmation. These changes (ESOS 2005 (Revised)) were approved by the shareholders of the Company in the Annual General Meeting held on July 17, 2017. Further the company granted options in four more tranches FY2018 and FY2019 under ESOS 2005 (Revised), namely 2017-18, 2018-19, 2018-19 Special Options, 2018-19 Joining Options.

The Company follows intrinsic value method and hence there was no charge in the Revenue Account and Profit and Loss account on account of new grants during the year.

Exercise price of all the options outstanding for all years for 2006-07 scheme, Founder II, 2007-08, 2017-18, 2018-19, 2018-19 Special Options and 201819 Joining Options scheme is Rs. 130, Rs. 130, Rs. 400 ,Rs. 468.6, Rs. 388.4, Rs. 388.4 and Rs. 351.65 respectively.

A summary of status of Company’s Employee Stock Option Scheme in terms of options granted, forfeited and exercised is given below:

Out of the total outstanding ESOS of the previous year, 188,220 options are vested during the year ended March 31, 2019 and Rs. 47,039 thousand was realised by exercise of options during the year ended March 31, 2019. During the year ended March 31, 2019 the Company has recognised a compensation cost of Rs. nil (year ended March 31, 2018: Rs. nil) as the intrinsic value of the options.

Had the company followed fair value method based on binomial tree model valuing its options compensation cost for the year ended would have been higher by Rs. 316,760 thousand (March 31, 2018: Rs. 39,667 thousand) and the proforma profit after tax would have been Rs. 11,089,702 thousand (March 31, 2018: Rs. 16,158,590 thousand). On a proforma basis, the company’s basic and diluted earnings per share would have been Rs. 7.72 (March 31, 2018: Rs. 11.26) and Rs. 7.72 (March 31, 2018: Rs. 11.25) respectively.

ICICI Bank Limited (“Holding company”) has granted their options to certain employees of the Company. Holding company follows an intrinsic value method and has recognised a cost of Rs. nil for the year ended March 31, 2019, for the options granted to employees of the Company (year ended March 31, 2018: Rs. nil).

2.14. Foreign exchange gain/loss

Transactions in foreign currencies are recorded at exchange rate prevailing on the date of transaction. The exchange difference between the rate prevailing on the date of transaction and on the date of settlement is recognised as income or expense, as the case may be. The net foreign exchange fluctuation loss debited to Revenue account for the year ended March 31, 2019 is Rs. 2,157 thousand (year ended March 31, 2018: Rs. 1,367 thousand).

(refer note 2.17 of schedule 16 for accounting policy on foreign exchange transactions)

2.15. Managerial Remuneration

IRDAI has issued guidelines on August 05, 2016 on remuneration of NonExecutive Directors and Managing Director (‘MD’) /Chief Executive Officer (‘CEO’) /Whole Time Directors (‘WTD’), which have prescribed certain qualitative and quantitative disclosures. The disclosures for year ended March 31, 2019 are given below:

Remuneration to MD/CEO/WD:

Qualitative disclosures:

A) Information relating to the bodies that oversee remuneration. Name, composition and mandate of the main body overseeing remuneration:

The Board Nomination and Remuneration Committee (BNRC /Committee) is the body which oversees the remuneration aspects. The functions of the Committee include recommending appointments of Directors to the Board, identifying persons who are qualified to become Directors and who may be appointed in Senior Management in accordance with the criteria laid down and recommending to the Board their appointment and removal, formulate a criteria for the evaluation of the performance of the wholetime/independent directors and the Board and to extend or continue the term of appointment of Independent Director on the basis of the report of performance evaluation of independent Directors, recommending to the Board a policy relating to the remuneration for the Directors, Key Managerial Personnel and other employees, recommending to the Board the remuneration (including performance bonus and perquisites) to wholetime Directors (WTDs), commission and fee payable to nonexecutive Directors subject to applicable regulations, approving the policy for and quantum of bonus payable to the members of the staff including senior management and key managerial personnel, formulating the criteria for determining qualifications, positive attributes and independence of a Director, framing policy on Board diversity, framing guidelines for the Employees Stock Option Scheme (ESOS) and decide on the grant of the Company’s stock options to employees and WTDs of the Company.

External consultants whose advice has been sought, the body by which they were commissioned and in what areas of the remuneration process:

The Company did not take advice from an external consultant on any area of remuneration during the year ended March 31, 2019.

Scope of the Company’s remuneration policy (e.g. by regions, business lines), including the extent to which it is applicable to foreign subsidiaries and branches:

The Compensation Policy of the Company as last amended and approved by the BNRC and the Board at its Meeting held on April 25, 2017, which covers all employees of the Company.

Type of employees covered and number of such employees:

All employees of the Company are governed by the compensation policy. The total number of permanent employees governed by the compensation policy of the Company at March 31, 2019 was 14,099.

B) Information relating to the design and structure of remuneration process.

Key features and objectives of remuneration policy:

The Company has under the guidance of the Board and the BNRC, followed compensation practices intended to drive meritocracy within the framework of prudent risk management. This approach has been incorporated in the Compensation Policy, the key elements of which are given below:

Effective governance of compensation:

The BNRC has oversight over compensation. The Committee defines Key Performance Indicators (KPIs) for the Organisation and the performance threshold for the bonus based on the financial and strategic plan approved by the Board. The KPIs include both quantitative and qualitative aspects. The BNRC assesses organisational performance as well as the individual performance of WTDs and equivalent positions. Based on its assessment, it makes recommendations to the Board regarding compensation for WTDs and equivalent positions and bonus for employees, including senior management and key management personnel.

Alignment of compensation philosophy with prudent risk taking:

The Company seeks to achieve a prudent mix of fixed and variable pay, with a higher proportion of variable pay at senior levels. Compensation is sought to be aligned to both financial and non-financial indicators of performance including aspects like risk management and customer service. In addition, the Company has an employee stock option scheme aimed at aligning compensation to long term performance through stock option grants that vest over a period of time.

Whether the Remuneration Committee reviewed the firm’s remuneration policy during the past year, and if so, an overview of any changes that were made:

The Compensation & Benefits Policy on remuneration of Non-executive Directors and Managing Director/Chief Executive Officer/Whole Time Directors of Insurers was reviewed, amended and approved by the Board of Directors held April 25, 2017. No amendment was made to this policy during FY2019.

C) Description of the ways in which current and future risks are taken into account in the remuneration processes.

To ensure effective alignment of compensation with prudent risk taking, the Company shall take into account adherence to the risk framework to ensure remuneration is adjusted for all types of risks in conjunction with other pre-defined performance objectives. Remuneration payout shall be sensitive to the time horizon of the risks involved and symmetric to risk outcomes.

- Compensation is aligned to both financial and non-financial indicators of performance including controls like risk management, process perspective, customer perspective and others.

- Prudent behavior is assessed through a Good Order Index for senior management level employees.

- These business objectives are balanced in nature, and comprise a holistic mix of financial, customer, people, and process/quality and compliance objectives.

- Acts of gross negligence and integrity breach are covered under the purview of the compensation policy.

- The deferred part of the variable pay (performance bonus) will be subject to malus, under which, the Company will prevent vesting of all or part of the variable pay in the event of an enquiry determining gross negligence or integrity breach.

- The quantum of bonus does not exceed a certain percentage (as stipulated in Compensation policy) of total fixed pay in a year, for Whole time Directors if the quantum of bonus exceeds a pre-defined threshold percentage of the total fixed pay, a part of the bonus is deferred and paid over a period.

D) Description of the ways in which the Company seeks to link performance during a performance measurement period with levels of remuneration.

The Company follows a philosophy of meritocracy, which is the relative differentiation of employees based on performance delivered. The design of the variable pay is linked to the individual employee’s performance rating which is arrived at basis assessment of performance delivered against a set of predefined performance objectives. These objectives are balanced in nature, and comprise a holistic mix of financial, customer, people, and process/quality and compliance objectives. To ensure effective alignment of compensation with prudent risk parameters, the Company will take into account various risk parameters along with other pre-defined performance objectives of the Company. Prudent behavior is assessed through a Good Order Index for middle and senior management level employees.

Perquisites (evaluated as per Income-Tax rules wherever applicable and otherwise at actual cost to the Company) such as the benefit of the gas, electricity, furnishing, club fees, group insurance, use of car and telephone at residence or reimbursement of expenses in lieu thereof, medical reimbursement, leave and leave travel concession, education benefits, provident fund, superannuation fund and gratuity, exercise of stock options were provided in accordance with the scheme(s) and rule(s) applicable from time to time.

2.16. Commitments

Commitments made and outstanding (net of advances) for Company’s investment in Real estate (Investment property) is Rs. nil (March 31, 2018 Rs. nil). Estimated amount of contracts remaining to be executed on fixed assets to the extent not provided for (net of advance) is Rs. 150,970 thousand (March 31, 2018: Rs. 346,179 thousand)

There are no loan commitments made by the Company (March 31, 2018 Rs. nil).

2.17. Investments

a. The investments are made from the respective funds of the Policyholders’ or Shareholders’ and investment income thereon has been accounted accordingly.

b. All investments are performing investments.

2.18. valuation of Investment property

In accordance with the IRDAI Regulations, 2002 (Preparation of Financial Statements and Auditors’ Report of Insurance Companies), the Company’s investment property has been revalued. The Company has revalued all its investment properties held for more than one year and market value for such properties is based on valuation performed by an independent valuer at March 31, 2019. The opinion on market value by the independent valuer, is prepared in accordance with the “The RICS Valuation Standards” published by the Royal Institution of Chartered Surveyors (“RICS”), subject to variation to meet local established law, custom, practice and market conditions. The methods used in valuation of property includes “Direct comparable approach”. The real estate investment property is accordingly valued at Rs. 4,717,875 thousand at March 31, 2019 (March 31, 2018: Rs. 4,666,000 thousand). The historical cost of the property is Rs. 3,836,532 thousand (March 31, 2018: Rs. 3,836,532 thousand).

2.19. Impairment of investment assets

In accordance with the impairment policy of the Company, diminution in the value of investments has been recognised under the head “Provision for diminution in the value of investments (Net)” in the Revenue account and the Profit & Loss account. The total impairment loss recognised for the year ended March 31, 2019 is Rs. nil (year ended March 31, 2018: Rs. 50,872 thousand).

2.20. Encumbrances of assets

The assets of the Company are free from all encumbrances except to the extent assets or monies are required to be deposited as margin contributions for investment trade obligations of the Company or as mandated by the court, as detailed below:

a. Assets deposited with National Securities Clearing Corporation Limited (NSCCL) and Indian Clearing Corporation Limited (ICCL)

Fixed deposit of Rs. 1,000,000 thousand (March 31, 2018: Rs. 1,000,000 thousand) and Rs. 100,100 thousand (March 31, 2018: Rs. 100,000 thousand) has been deposited with NSCCL and ICCL respectively towards margin requirement for equity trade settlement.

Terms of pledge: Physical custody of the fixed deposits are with respective clearing houses, however the income accrued on these deposits shall be passed on to the Company on the maturity of the deposits. These deposits can be invoked by the clearing houses in case of any default by the Company in settlement of equity transactions.

Terms of pledge: Physical custody of the securities is maintained with the CCIL, however interest accrued on these securities is received by the Company. The Company is not entitled to any interest income on the money deposited with the CCIL towards margin requirements. These deposits, both securities and cash, can be invoked by CCIL in case of any default by the Company in settlement of trades in securities and TREPS & CBLO segment.

c. Other encumbrances

The Company has placed fixed deposits with banks for issuing bank guarantee/ based on the directive from the Court as follows:

2.21. Assets to be deposited under local laws

There are no assets required to be deposited by the Company under any local laws or otherwise encumbered in or outside India at March 31, 2019 (March 31, 2018: Rs. nil) except the assets disclosed in the note 3.26.

2.22. Securities Lending and Borrowing Scheme (SLB)

Equity shares transferred under SLB continue to be recognised on the Balance Sheet as the Company retains all the associated risks and rewards of these securities.

The value of equity shares lent by the Company under SLB and outstanding at March 31, 2019 is Rs. 1,485,599 thousand (March 31, 2018: Rs. 1,044,030 thousand).

2.23. Disclosure on fines and penalties

The additional disclosures with respect to fines and penalties for penal actions pursuant to the IRDAI circular no. IRDA/F&A/CIR/232/12/2013 dated December 11, 2013 paid during the year ended March 31, 2019 have been detailed below:

2.24. Discontinued Policy fund

Pursuant to the IRDAI circular number IRDA/Reg/2/52/2010 dated July 1, 2010, the following details are disclosed with respect to policies discontinued either on customer request or for non-payment of premium amount within the grace period

a) Movement in funds for discontinued policies:

b) Number of policies discontinued during the year ended March 31, 2019 is 153,836 (year ended March 31, 2018: 127,524).

c) Percentage of discontinued to total policies (product wise):

2.25. Extra allocation

As per the product filing for Group Unit Linked Superannuation and Group Unit Linked Employee Benefit Plan, extra allocation of units made and total extra allocation recovered is disclosed as below.

Total extra allocation made with respect to group products (Group Unit Linked Superannuation and Group Unit Linked Employee Benefit Plan) for the year ended March 31, 2019 is Rs. 1,200 thousand (for year ended March 31, 2018: Rs. nil).

The amount of recovery towards extra allocation for the year ended March 31, 2019 is Rs. 7,089 thousand (year ended March 31, 2018: Rs. 7,733 thousand).

2.26. Dividend

Interim dividend appropriation for the year ended March 31, 2019 is Rs. 2,769,077 thousand (year ended March 31, 2018: Rs. 5,874,239 thousand) including dividend distribution tax of Rs. 472,142 thousand (year ended March 31, 2018: Rs. 993,586 thousand).

The Board of Directors have also proposed a final dividend of Rs. 2,225,466 thousand (year ended March 31, 2018: Rs. 4,737,332 thousand). The dividend distribution tax on the same amounts to Rs. 457,451 thousand (year ended March 31, 2018: Rs. 973,773 thousand)

Unclaimed dividend of Rs. 6,435 thousand at March 31, 2019 (at March 31, 2018: Rs. 4,768 thousand) represents dividend paid but not claimed by shareholders, and are represented by a bank balance of an equivalent amount.

2.27. Pending litigations

The Company’s pending litigations comprise of claims against the Company primarily by the customers and proceedings pending with Tax Authorities. The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its standalone financial statements. The Company does not expect the outcome of these proceedings to have a material adverse effect on its financial results at March 31, 2019. Refer note 3.1 for details on contingent liabilities.

In respect of litigations, where the management assessment of a financial outflow is probable, the Company has made a provision of Rs. 339,075 thousand at March 31, 2019 (At March 31, 2018: Rs. 301,244 thousand).

2.28. Long term contracts

The Company has a process whereby periodically all long term contracts are assessed for material foreseeable losses. At the year end, the Company has reviewed and ensured that adequate provision as required under any law / accounting standards for material foreseeable losses on such long term contracts including derivative contracts has been made in the financial statements.

For insurance contracts, actuarial valuation of liabilities for policies is done by the Appointed Actuary of the Company. The methods and assumptions used in valuation of liabilities are in accordance with the regulations issued by the Insurance Regulatory and Development Authority of India (“IRDAI”) and actuarial practice standards and guidance notes issued by the Institute of Actuaries of India.

2.29. Corporate Social Responsibility

The amount required to be spent by the Company on Corporate Social Responsibility (CSR) related activities during the year ended March 31, 2019 was Rs. 225,283 thousand (year ended March 31, 2018: Rs. 230,288 thousand).

The following table sets forth, for the periods indicated, the amount spent by the Company on CSR related activities:

Amounts of related party transactions with ICICI Foundation for Inclusive Growth pertaining to CSR related activities for year ended March 31, 2019 was Rs. 172,575 thousand (year ended March 31, 2018: Rs. 172,769 thousand).

The following table sets forth, for the periods indicated, the details of movement of amounts yet to be paid for CSR related activities.

Note: CSR expenditure as shown in Schedule 3A also includes amount paid to Kerala relief fund amounting to Rs. 5,503 thousand which is not qualified as CSR u/s 135 of the Companies Act, 2013.

2.30. Loans and advances to subsidiaries, associates and related entities

Pursuant to Securities and Exchange Board of India (Listing obligations and disclosure requirements) Regulations, 2015, disclosures pertaining to loans and advances given to subsidiaries, associates and related entities are given below:

There are no loans and advances given to subsidiaries, associates and firms/companies in which directors are interested except for advances which are in the normal course of business but not in the nature of loans (year ended March 31, 2018: Rs. nil)

There are no investments by the loanee in the shares of the Company.

2.31. specified Bank Notes

Being an insurance company, Schedule III of the Companies Act, 2013 is not applicable and hence the disclosure requirements for the details of specified bank notes (SBNs) as envisaged in Notification G.S.R. 308(E) date March 30, 2017 issued by the Ministry of Corporate Affairs (MCA) is not provided.

2.32 Previous year comparatives

Previous year’s figures have been regrouped and reclassified wherever necessary to conform to current year’s presentation.

Source : Dion Global Solutions Limited
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