S. No.

Points 1 Dividend 2 3 4 5 6 Reimbursement Income and cost Revenue Recognition Gratuity Leave Encashment Depreciation

7 8 9 10 11 12

13 14 15

IPR Amortization Custom Duty Reclassification Service Tax Reclassification Withholding Tax deducted by others reclassified NEC (JV) and Axon Puerto Rico proportionate consolidation in IGAAP Cash Flow Hedge (Sell Forward Cover) impact recognised in revenue in Indian GAAP Cash Flow Hedge impact on options ESOP Diminution in Investment Value

Differences between USGAAP and IGAAP - As Identified Basis of Difference As per IGAAP, dividend to be account for in the period for which it pertains however as per UGAAP, it is to accounted for in the period when it is paid off. As per UGAAP, for reimbursements, both cost as well as income should be recorded. While as per IGAAP, neither the cost nor income should be accounted for. Finance Lease as per UGAAP & operating lease as per IGAAP - Not covered in sample Gratuity liability calculation is different as per both the GAAPs because of different rate of interest used for discounting the Present value of liability. As per IGAAP, Leave encashment liability should be on the basis of actuary report while as per UGAAP it should be on actual basis so leave encashment expense is different Land & Building purchased from Network Ltd & HCL Infosystem limited (Related company) - UGAAP requires that Land & Building acquired from related company should be recorded at the book value of transferor which results in to difference in depreciation vaue IPR is required to be amortized as per UGAAP and same is not allowed in IGAAP. Customs Duty is to be recorded in COGS as per IGAAP & in SG&A as per UGAAP Service tax is to be recorded in COGS as per IGAAP and in SG&A as per UGAAP Withholding Tax deducted by customer is classified in "Tax expense" in IGAAP whereas in "SG&A" in U-GAAP As per IGAAP, JV should be consolidated proportionately by line by line item addition while as per UGAAP it should be consolidated using the proportionate profit / Loss. Cash Flow Hedge impact to be recognised in revenue in IGAAP while it should be in Other Income as per UGAAP.

Option Premium to be recognised in revenue in IGAAP while it should be in Other Income as per UGAAP. Difference in Accounting of ESOP Cost - Not covered as separate audit was planned IGAAP recognize only permanent difference for accounting whereas under UGAAP temporary difference are also accounted for. - Not covered in Sample

Balance Sheet Differences

1 2 3 4 Gratuity Leave Encashment NEC (JV) and Axon Puerto Rico proportionate consolidation in IGAAP Goodwill / IPR Gratuity liability calculation is different as per both the GAAPs because of different rate of interest used for discounting the Present value of liability. As per IGAAP, Leave encashment liability should be on the basis of actuary report while as per UGAAP it should be on actual basis. As per IGAAP, JV should be consolidated proportionately by line by line item addition while as per UGAAP it should be consolidated using the proportionate profit / Loss. Goodwill and IPR recorded at the time of business acquisition under both GAAPs. IPR should be amortized over the estimated useful life. Goodwill is not being amortized in both of the GAAPs. ( As per IGAAP, practice of amortizing goodwill varies from no amortization to amortization in 10 years (Refer PWC Litrature) DTA / DTL impact due to IPR amortization

DTA / DTL