అకౌంట్స్ గమనికలుShrenuj & Company Ltd.

1. DERIVATIVE INSTRUMENTS

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.

In addition to the above, the Company has outstanding derivative instruments aggregating to Rs. 1,235.85 Million (Rs. 3,183.61 Million) whose fair value showed a net loss of Rs. 66.38 Million (P.Y. loss of Rs. 7.21 Million) and which is accounted for in the Profit and Loss Account.

As of balance sheet date, the Company has foreign currency exposures that are not hedged by a derivative instrument or otherwise amounting to Rs. 12,868 million (P.Y. Rs. 8,748.49 million) representing receivables and Rs. 25,468.64 million (previous year Rs. 20,932.79 million) representing payables.

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 Nil (P.Y. NIL). The MTM gain / (loss) of Nil (P.Y. NIL) has been accounted for in the Profit and Loss Account.

2 The Ministry of Corporate Affairs, Government of India vide its General Circular No. 2 and 3 dated 8th February, 2011 and 21st February, 2011 respectively has granted a general exemption from compliance with Section 212 of the Companies Act, 1956, subject to fulfilment 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.

3 Previous year''s figures have been reclassified / regrouped wherever necessary.

4 Segment Information for the year ended 31st March, 2014

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 Statements, 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.

Disclosure in respect of above.

1. Interest Received includes Received from Shrenuj DMCC Rs. 16.81 Mn. (Rs. 1.59 Mn.), Shenuj Mauritius Pvt. Ltd. Rs. 15.74 Mn.(Rs. 4.72 Mn.).

2. Other Services Received includes Received from Shrenuj Botswana Pty Ltd. Rs..20.06 Mn.(Rs. Nil), Simon Golub & Sons Rs. 1.33 Mn. (Rs. 18.80 Mn.), Shrenuj USA,LLC Rs. 0.98 Mn.(Rs. 4.84 Mn.),Uxolo Diamond Cutting Works Pvt. Ltd. Rs. 5.15 Mn. (Rs. Nil), Kiara Jewellery Pvt. Ltd. Rs. 6.04 Mn.(Rs. Nil).

3. Other Services Rendered includes paid to Shrenuj Jewellery (Far East Ltd.) Rs. Nil( Rs. 3.55 Mn.), Shrenuj GMBH Rs. 0.6 Mn. (Rs. Nil), Shrenuj Botswana Pty. Ltd. Rs. 4.39 Mn. (Rs. 12.93 Mn.), Kiara Jewellery Pvt. Ltd. Rs. 0.39 Mn. (Rs. 5.55 Mn), Prest Impex Pvt. Ltd. Rs. 1.20 Mn. (Rs. Nil).

4. Purchases includes Purchase from Shrenuj N.V. Rs. 3251.76 Mn.(Rs. 4198.37), Shrenuj DMCC Rs. 3339.91 Mn. (Rs. 1880.63 Mn.), Shrenuj Botswana Pty Ltd. Rs. 2211.25 Mn. (Rs. 1618.52), Kiara Jewellery Pvt Ltd. Rs. 22.42 Mn. (Rs. 69.28 Mn.), K.K. Doshi & Co. Rs. 231.75 Mn.(Rs. Nil).

5. Interest paid includes paid to Shrenuj Investment & Finance Pvt. Ltd. Rs. 77.69 Mn.(Rs. 79.11 Mn.), Prest Impex Pvt. Ltd. Rs. 18.89 Mn. (Rs. 18.83 Mn.)

6. Sales includes Sale to Shrenuj USA LLC Rs. 1151.55 Mn. (Rs. 1103.94 Mn), Shrenuj DMCC Rs. 3764.46 Mn. (Rs. 2046.40 Mn.), Shrenuj N.V. Rs. 3441.53 Mn. (Rs. 2281 Mn.) , Shrenuj Far East Ltd (Inter gems H.K. Ltd) Rs. 992.91 Mn. (Rs. 1047.75 Mn.), Kiara Jewellery Pvt Ltd Rs. 69.46 Mn. (Rs. 102.28 Mn).

7. Purchase of Fixed Assets includes Purchase from Simon Golub & Sons Rs. 0.65 Mn.(Rs. Nil).

8. Sale of Fixed Assets includes Sale to Shrenuj Botswana Pty Ltd Rs. 0.50 Mn. (Rs. 0.86 Mn.).

9. Guarantee includes Shrenuj N.V Rs. 5500.66 Mn(Rs. 4984.75 Mn), Shrenuj DMCC Rs. 4272.30 Mn.(Rs. 3192.80 Mn.), Shrenuj Far East Ltd (Intergems H K Ltd) Rs. 1653.79 Mn.(Rs. 1498.70 Mn.), Kiara Jewellery Pvt Ltd Rs. 179.76 Mn. (Rs. 162.90 Mn.), Simon Golub & Sons Rs. 1659.78 Mn.(Rs. 1504.10 Mn.).

10. Outstanding Receivable includes Shrenuj USA LLC Rs. 865.93 Mn. (Rs. 729.68 Mn), Shrenuj NV Rs. 1781.51 Mn. (Rs. 1129.27 Mn.), Shrenuj DMCC Rs. 2507.13 Mn.(Rs. 1292.65 Mn.),Copem & Shrenuj Rs.13.32 Mn.(Rs. Nil), SWA Trading Co Ltd Rs. 3.35 Mn. (Rs. 3.82 Mn), Kiara Jewellery Pvt Ltd Rs. 5.64 Mn (Rs. 4.21 Mn.).

11. Goods sent on Consignment includes Shrenuj N.V.Rs. 50.63 Mn.(Rs. Nil),Shrenuj DMCC Rs. 110.92 Mn.(Rs. 34.62 Mn.), Shrenuj Far East Ltd. (Intergems H K Ltd) Rs. 76.99 Mn. (Rs. Nil), Shrenuj Lifestyle Ltd Rs. 188.41 Mn.(Rs. Nil).

12. Outstanding Payable includes Payable to Shrenuj N V Rs..1985.83 Mn.(Rs. 2691.80 Mn.), Shrenuj DMCC Rs. 2017.48 Mn. (Rs. 1592.26 Mn), Shrenuj Botswana Pty Ltd Rs. 1544.91 Mn.(Rs. 843.86 Mn.), Kiara Trading Ltd Rs. 8.51 Mn. (Rs. 9.47 Mn.), SWA Trading Ltd Rs. 3.35 Mn. (Rs. 3.04 Mn.), SHL Gems Limited Rs. 1.33 Mn. (Rs. 1.43 Mn.).

1. DERIVATIVE INSTRUMENTS

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.

In addition to the above cash flow hedges, the Company has outstanding derivative instruments aggregating to Rs. 3183.61 Million (Rs. 6304.88 Million) whose fair value showed a net loss of Rs. 7.21 Million (P.Y. loss of Rs. 169.05 Million) and which is accounted for in the Profit and Loss Account.

As of balance sheet date, the Company has foreign currency exposures that are not hedged by a derivative instrument or otherwise amounting to Rs. 8748.49 million (P.Y. Rs. 5,261.01 million) representing receivables and Rs. 20932.79 million (previous year Rs. 13,161.35 million) representing payables.

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 Nil (P.Y. NIL). The MTM gain / (loss) of Nil (P.Y. NIL) has been accounted for in the Profit and Loss Account.

2 The Ministry of Corporate Affairs, Government of India vide its General Circular No. 2 and 3 dated 8th February 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.

3 Previous year''s figures have been reclassified / regrouped wherever necessary.

4 Segment Information for the year ended 31st March, 2013

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.

5 RELATED PARTY TRANSACTIONS:

As per the Directors

1) Parties where control exists:

1 Shrenuj Lifestyle Limited Wholly owned subsidiary

2 Shrenuj Overseas Ltd Wholly owned subsidiary

3 Shrenuj DMCC Wholly owned subsidiary

4 Shrenuj Japan Corporation Wholly owned subsidiary

5 Shrenuj (Mauritius) Pvt. Ltd. Wholly owned subsidiary

6 Shrenuj Jewellery (Far East) Ltd. Wholly owned subsidiary

7 Shrenuj Botswana (Pty.) Ltd Wholly owned subsidiary

8 Shrenuj South Africa (Pty) Ltd. Wholly owned subsidiary

9 Shrenuj N.V. Wholly owned subsidiary

10 Shrenuj GmbH Wholly owned subsidiary

11 Shrenuj Australia Pty. Ltd. Wholly owned subsidiary

12 Lume Group AG Wholly owned subsidiary

13 Astral USA, INC. Wholly owned subsidiary

14 Shrenuj USA, LLC Wholly owned subsidiary

15 Astral Jewels LLC Wholly owned subsidiary

16 Astral Holding INC Wholly owned subsidiary

17 Alija International Pty Ltd Wholly owned subsidiary

18 Global Marine Diamonds Company Wholly owned subsidiary

19 Ithemba Diamonds (Pty) Ltd Wholly owned subsidiary

20 Uxolo Diamond Cutting Works (Pty) Limited Wholly owned subsidiary

21 Simon Golub & Sons INC Wholly owned subsidiary

22 Daily Jewellery Ltd.Hong Kong Subsidiary

23 Intergems H.K. Ltd. Subsidiary

24 Shrenuj Shanghai Diamonds Co. Pvt. Ltd. Subsidiary

25 Bernies International, LLC Subsidiary

2) Associates :

1 Kiara Jewellery Pvt. Ltd.

2 Arisia Jewellery Pvt. Ltd.

3 Jomard SAS

4 SWA Trading Ltd.

5 Copem & Shrenuj

6 Trapz, LLC

7 SHL Gems & Jewellery Ltd.

8 K. K. Doshi & Co.

9 Shrenuj Investments & Finance Pvt. Ltd.

10 Prest Impex Pvt Ltd.

3) Key Management Personnel and their relatives:

1 Shri Shreyas K. Doshi

2 Shri Nihar N. Parikh

3 Shri Vishal S. Doshi

4 Mrs. Anjali P. Mehta

Notes:

1 a) Of the above Equity shares:

i) 14,122,325 shares were issued pursuant to the scheme of amalgamation without payment being received in cash.

ii) 6,692,070 shares were issued pursuant to the exercise of option by the holders of Foreign Currency Convertible Bonds.

b) The Company has reserved 3,131,527 Equity shares of Rs. 2/- each to be issued to eligible employees of the Company and its subsidiary companies under Employee Stock Option Scheme. Upto 31st Mar'12, the Company has granted 1,565,763 (P.Y. 1,565,763) options to the eligible employees for subscribing to equivalent numbers of fully paid up equity shares of the Company at a price of Rs. 21/- per share. The option would vest over a period of three years from the date of grant based on specified criteria. During the year, 424,600 (P.Y. 639,850) equity shares have been allotted to eligible employees / Directors of the Company and its subsidiaries on exercise of options. The cumulative options exercised 1,064,450, upto 31st March 2012.

Note:

2a) The Company had revalued / fair valued its Land and Buildings situated at Mumbai and consequently, there is an additional charge for depreciation of Rs. 13.84 million for the year ended 31st March, 2012 (Rs. 13.84 million) and an amount of Rs. 7.28 million (Rs. 7.28 million) has been withdrawn from Revaluation Reserve and Amalgamation Reserve respectively as per the scheme sanctioned by the Hon'ble High Court of Judicature at Bombay vide order dated 1st October, 2010. This has no impact on the profit for the year.

2b) 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 loss on these instruments outstanding as at 31st March 2012, amounting to Rs. 6.92 million (PY notional gain Rs. 7.10 million) is reflected in the Hedging Reserve account.

3a) Term Loan from Banks includes:

(i) Rs. Nil (P.Y. Rs. 291.43 million) secured by way of second charge on all the Assets, present and future, of the company, excluding assets of Unit I and Unit II of Jewellery Division at Seepz . The loan is collaterally secured by pledge of Company's investment in Astral Holding Inc. and Simon Golub & Sons Inc. These are further guaranteed by some of the Directors in their personal capacity. It carried interest @12.5% p.a.

(ii) Rs. 47.42 million (P.Y. Rs. 66.79 million) secured by way of first charge on all assets, both present and future, of Unit I of Jewellery Division at Seepz .

It carries interest @ 6 month Libor 225 bps p.a. The loan is repayable in 18 quarterly installments of USD 0.19 million each along with interest, from December 2008 to March 2013.

(iii) Rs. 6.59 million (P.Y. Rs. 6.91 million) is secured by hypothecation of specific vehicles.

3b) Working Capital Term Loan from Banks include:

(i) Rs. 71.60 million (P.Y. Rs. 357.20 million) secured by way of second charge on all the Fixed Assets, present and future, of the company, excluding assets situated at MIDC Andheri and Seepz unit of the Company. The loan is collaterally secured by pledge of shares standing in name of Promoter group in the Company. These are further guaranteed by some of the Directors in their personal capacity.

It carries interest @12.75% p.a. The loan is repayable in 7 equal quarterly installments of Rs. 71.40 million each along with interest, commencing from 15 months after first drawdown.

(ii) Rs. Nil (P.Y. Rs. 147.47 million) secured by hypothecation of stock in trade and book debts of Unit II of Jewellery Division at Seepz . It carried interest @ 8% p.a.

3c) Term loan from a company was secured by hypothecation of a specific vehicle.

3d) Unsecured loans from Directors and Companies are payable over a period of 7 to 10 years. Loan from Directors carry interest of 8% and Inter Corporate Deposits carry interest ranging from 8% to 16.25%.

1(a) 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.16.64 million (Rs. 10.41 million) for Provident Fund and Rs.1.09 million (Rs 1.20 million ) 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.

The Company has made an arrangement with an Insurer for meeting its Gratuity Liability payable at the time of retirement of its employees and a sum of Rs. 0.05 million (Rs 5.26 million) has been paid as advance against the premium and the same is adjusted against the provision for gratuity.

Subsequent to the balance sheet date (before finalising the accounts), the Company has utilised / cancelled forward contracts of USD Nil (USD 8.00 million) without incurring any loss. The notional Mark to Market gain of Rs. Nil (P.Y. Rs. 6.85 million) 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. (6.92) million (P.Y. Rs. 7.09 million) has been reflected in the Hedging Reserve.

In addition to the above cash flow hedges, the Company has outstanding derivative instruments aggregating to Rs. 6304.88 million (Rs. 2457.68 million) whose fair value showed a net loss of Rs. 169.05 million (P.Y. gain of Rs 26.98 million) 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. 5,261.01 million (P.Y. Rs. 1,959.33 million) representing receivables and Rs. 13,161.35 million (P.Y. Rs. 7,581.44 million) representing payables.

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 Nil (P.Y. 40,800 grams). The MTM gain / (loss) of Nil (P.Y. gain of Rs. 1.89 million) has been accounted for in the Profit and Loss Account.

2 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.

3 Presentation and disclosure of financial statements:

During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company, for preparation and presentation of its financial statements. The Company has also reclassified / regrouped previous year figures in accordance with the requirements applicable in the current year.

4 Segment Information for the year ended 31st March 2012

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.

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

1. (a) As in the previous year, the Company has continued to adopt the principles of AS – 30, "Financial Instruments: Recognition & Measurement" inrespect of hedge accounting. Accordingly, in respect of derivative financial instruments which are entered into 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, 2010, amounting to Rs. 603.88 lacs (previous year notional loss Rs. 3270.87 lacs) is reflected in the Hedging Reserve account. (b) The company, in accor - dance 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. The Company has following outstanding derivative instruments as on 31st March, 2010:

Subsequent to the balance sheet date (before finalising the accounts), the Company has utilised/cancelled forward contracts of USD 12.400 million (USD 67.125 million) without incurring any loss. The notional Mark to Market gain/(loss) of Rs. 184.17 lacs (p.y. loss of Rs. 1172.69 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. 603.88 lacs (p.y. loss of Rs. 3270.87 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. 104722 lacs (Rs. 37779.06 lacs) whose fair value showed a net loss of Rs. 764.85 lacs (Rs. 1693.51 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. Nil (Previous year Rs. 790.41 lacs) representing receivables and Rs.15448.27 lacs (previous year Rs. 13841.37 lacs) representing payables.

3. 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 1,000 grams.

4. 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.

Note: The Remuneration Committee of the Board of Directors have resolved not to pay commission for the year to all the whole-time directors to preserve the resources of the Company, hence no provision for commission has been made.

5 Licensed and Installed Capacity and Production:

A. Information in respect of goods manufactured:

Processed polished diamonds and studded jewellery

6. Value of imported and indigenous Consumption:

Diluted Rs. 2.21 1.91

7. Previous year’s figures have been re-grouped and/or rearranged wherever necessary.

8. Segment Information for the year ended 31st March 2010

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. 62.95 lacs (Rs. 106.40 lacs) for Provident Fund and Rs. 9.15 lacs (Rs 11.21 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.

The Company has made an arrangement with an Insurer for meeting its Leave Encashment Liability payable at the time of retirement of its employees and a sum of Rs. 55 lacs has been paid as advance against the premium and the same is adjusted against the provision for leave encashment.