Presidents/Executive Directors/Managing Directors
Of Stock Exchanges.

Dear Sir/Madam,

The SEBI Board in its meeting held on January 25, 2000 considered the recommendations of the Accounting Standards Committee relating to continuous disclosure requirements of the listed companies and has decided to make the following amendments to the listing agreement.

1. Amendment to Clause 32 (Cash Flow Statement)


Stock Exchanges were advised to amend Clause 32 of the Listing Agreement, vide our circular no. SMD-I(N)/JJ/2331/95 dated June 26, 1995,to provide that listed companies shall give a Cash Flow statement in the Annual Report and the following addition was made to the Clause 32 :

"The company will also give a Cash Flow Statement along with the Balance Sheet and Profit and Loss Account. The Cash Flow Statement will be prepared in accordance with the Annexure attached hereto".

With a view to harmonise the disclosure requirements under the Listing Agreement and the Accounting Standard issued by Institute of Chartered Accountants of India (ICAI), it has been decided that the Cash Flow Statement being disclosed in terms of Listing Agreement shall henceforth be prepared in accordance with the Accounting Standard on Cash Flow Statement (AS-3) issued by ICAI and the relevant portion of the Clause 32 shall be amended as follows :

"The Cash Flow Statement will be prepared in accordance with the Accounting Standard on Cash Flow Statement (AS-3) issued by the Institute of Chartered Accountants of India, and the Cash Flow Statement shall be presented only under the Indirect Method as given in AS-3".
 

2. Amendment to Clause 41 (Unaudited Financial Quarterly Results)

1. companies may be permitted to consider unaudited quarterly results in the meeting of a Sub-Committee of the Board of Directors consisting of not less than one-third of the total number of Directors
2. the notice period required for intimation to the stock exchanges of Board or its Sub-Committee meetings for consideration of financial results shall be reduced from 15 days to 7 days.
3. companies shall be required to announce the financial results after the Market Hours on the date of the Board Meeting or meeting of a Sub-Committee of Board of Directors.

3. Amendment to Clause 19 (Declaration of Dividend/Rights and Bonus etc.)

1. Prior intimation about the Board Meeting at which declaration of dividend is due to be considered must be made at least 7 days in advance.
2. The company shall give notice simultaneously to the stock exchanges in case the proposal for declaration of bonus is communicated to the Board of Directors of the company as part of the agenda papers.
3. No prior intimation is required about the Board Meeting in case the declaration of Bonus by the company is not on the agenda of the Board Meeting.

4. Amendment to Clauses 20 and 22 (Announcements after the Board Meetings)

It has also been decided that information furnished by the companies under continuous disclosure requirements, as specified in the Listing Agreement, shall be published on the web site of the exchange instantly and stock exchanges are advised to make immediate arrangement for display of the information furnished by the companies instantly on the web site.

Yours faithfully,
 

M D PATEL
EXECUTIVE DIRECTOR
SECONDARY MARKET DEPARTMENT �II

Encl: as above

Company agrees that it will furnish unaudited financial results on a quarterly basis with effect from the Quarter ending on March 31, 2000 in the following pro-forma within one month from the end of quarter (Quarter means 3 months only) to the Stock Exchange and will make an announcement to the stock exchanges where the company is listed, immediately after the market hours on the date of the Board Meeting or Meeting of a Sub Committee of Board of Directors (consisting of not less than one third of the Directors), in which the unaudited financial results are placed and also within 48 hours of the conclusion of the Board or its sub committee Meeting in at least one English daily newspaper circulating in the whole or substantially the whole of India and in one newspaper published in the language of the region, where the registered office of the Company is situated. The Board of Directors or its Sub Committee should take on record the unaudited quarterly results which shall be signed by the Managing Director/Director. The company shall inform the Stock Exchange where its securities are listed about the date of the board Meeting at least 7days in advance and shall also issue immediately a press release in at least one national newspaper and one regional language newspaper about the date of aforesaid Board or its Sub Committee Meeting.

The unaudited results should not substantially differ from the audited results of the company; If the sum total of the First, Second, Third and Fourth quarterly unaudited results in respect of any item given in the same pro-forma varies by 20 per cent when compared with the audited results for the full year the company shall explain the reasons to the Stock Exchanges.

In addition, the Company shall prepare the half yearly results in the same pro-forma with effect from half year ending on March 31, 2000 and the same shall be approved by the Board of Directors and subjected to a "Limited Review" by the Auditors of the Company and a copy of the Review Report shall be submitted to the Stock Exchanges within 2 months after the close of the half year . For the purpose of this Review half year shall be construed as consisting of the first two quarters of the Company�s Financial Year. If the sum total of First and Second quarterly un-audited results in respect of any item given in the same pro-forma format varies by 20% or more from the respective half yearly results as determined after the "Limited Review" by the Auditors, the Company shall send a statement (approved by the Board of Directors) explaining the reasons to the Stock Exchanges along with Review Report

In respect of results for the last quarter of the financial year, if the company intimates in advance to the stock exchange/s that it will publish audited results within a period of 3 months from the end of the last quarter of the financial year, in such a case unaudited results for the last quarter need not be published/given to the stock exchange/s.

The quarterly results shall be prepared on the basis of accrual accounting policy and in accordance with uniform accounting practices adopted for all the periods on quarterly basis.

UNAUDITED FINANCIAL RESULTS FOR THE THREE MONTHS ENDED

                                                                                                    (Rs. In Lakhs)

		(1) 3 MONTHS ENDED	(2) Corres-ponding 3 Months in the Previous year.		(3) Year To date Figures for current period	(4) Year to date Figures for the Previous year		(5) Previous Accounting Year.
Net Sales/Income  from Operations  Other Income Total Expenditure Increase/decrease in stock in trade Consumption of raw materials Staff cost  Other expenditure (Any item exceeding 10% of the total expenditure to be shown separately). Interest  Depreciation  Profit (+)/Loss(-) before tax (1+2-3-4-5) Provision for taxation  Net Profit (+)/Loss (-) (6-7) Paid-up equity share capital Reserves excluding revaluation reserves (as per balance sheet) of previous accounting year to be given in column (5)  Basic and diluted EPS for the period, for the year to date and for the previous year (not to be annualised)

Notes :

1. Any event or transaction that is material to an understanding of the results for the quarter including completion of expansion and diversification programes, strikes, lock-outs, change in management, change in capital structure etc, shall be disclosed. Similar material event or transactions subsequent to the end of the quarter, the effect whereof is not reflected in the results for the quarter shall also be disclosed.
2. All material non-recurring/abnormal income/gain and expenditure/loss and effect of all changes in accounting practices affecting the profits materially must be disclosed separately.
3. In case of companies whose revenues are subject to material seasonal variations, they shall disclose the seasonal nature of their activities and may also supplement their unaudited financial results with information for 12 month periods ended at the interim date (last day of the quarter) for the current and preceding years on a rolling basis.
4. Company shall give the following information in respect of dividend paid or recommended for the year including interim dividends declared :

1. Amount of Dividend distributed or proposed distinguishing between different classes of shares and Dividend per share also indicating nominal value per share.
2. Where Dividend is paid or proposed pro-rata for shares allotted during the year, the date of allotment, number of shares allotted pro-rata amount of dividend per share and the aggregate amount of dividend paid or proposed on pro-rata basis.

5. The effect of changes in composition of the company during the quarter, including business combinations, acquisitions or disposal of subsidiaries and long term investments, restructuring and discontinuing operations shall be disclosed.

6. If there is any qualifications by the Auditors, in respect of the Audited Accounts of the previous accounting year which has a material impact on the profit disclosed in such accounts, then the company shall disclose the same along with the unaudited quarterly results and give explanation as to how such qualifications has been addressed in the unaudited financial results.
7. If the company is yet to commence commercial production, then instead of the quarterly results, the company should give particulars of the status of the project, its implementation and the expected date of commissioning of the project.
8. The un-audited results sent to Stock Exchange/s and published in newspapers should be based on the same set of accounting policies as those followed in the previous year. In case, there are changes in the accounting policies, the results of previous year will be recast as per the present accounting policies, to make it comparable with current year results.
9. If the period of the Financial Year is more than 12 months and not exceeding 15 months there will be 5 Quarters and is more than 15 months but not exceeding 18 months there will be 6 Quarters and the financial results will be intimated to the Exchange and published in the News papers accordingly. Half yearly results which are required to be subjected to the "Limited Review" by the Auditors shall be prepared for the first two quarters where the Financial Year does not exceed 15 months and for the first two quarters and also separately for the third and fourth quarters where the Financial Year exceeds 15 months.