INDIA BUSINESS WORLD - FEBRUARY 2006
THE MONTH THAT WAS

Reliance Infocomm and Reliance Communications Infrastructure, the two major operating companies under Reliance Communications Ventures (RCVL), have approved writeoffs and provisions aggregating approximately Rs 4,500 crore, according to a release issued by Reliance Infocomm on Monday. Post write-offs and provisions, the Performa consolidated networth of RCVL stands at approximately Rs 11,000 crore, added the release.

The write-offs and provisions relate to the period up to March 31, 2005, prior to the restructuring and demerger of Reliance group. The write-offs and provisions are based on an independent report by a leading international accounting firm, and other relevant material, and relate to, inter alia, the following heads: liabilities relating to regulatory and taxation matters; bad debts and irrecoverable amounts; obsolete and slow-moving inventories; impairment of assets; miscellaneous other items .

“Reliance Infocomm and Reliance Communications Infrastructure propose to appropriately recast their accounts for the year ended March 31, 2005, subject to regulatory and other approvals, to reflect a true and fair view of the state of affairs in that period,” the statement added. This disclosure is being made in the interests of transparency and fairness, for the benefit of over 22 lakh Reliance shareholders, who have become shareholders of RCVL, based on the demerger scheme approved by the Hon'ble High Court of Judicature, Bombay in December 2005, the announcement said.

Necessary disclosures in this regard will also be made in the information memorandum proposed to be filed with the stock exchanges shortly by RCVL. RCVL is proposed to be listed on BSE and NSE in the week of March 6, 2006.