Bharti TeleVentures clarifies on media report on restatement of results

29 December 2005

Bharti TeleVentures Ltd has clarified to the BSE on the report aired by a TV channel on December 27, 2005, pointing out the difference arising out of "restatement" of its results under US GAAP for and up to year ended March 31, 2004, based on the audit reports and material on the Bharti website for the past few months.

Bharti has stated that the differences were purely non-cash and technical in nature as they pertained to a switch over from the Indian accounting norms to the more stringent US GAAP norms as a prelude to its proposed ADR issue, which was subsequently cancelled. The company has reiterated that there is "no bearing on operational performance or cash flow of the company either in (the) past or on an ongoing basis." Reproduced below is the verbatim clarification"

"Before the company go into the specific questions raised and its response / clarifications thereto, it may be pertinent to point out the background which led to these changes.

1. Till 2004, the company used to prepare and present it''s accounts under IFRS, in addition to the statutory IGAAP accounts. These IFRS results also reflected the reconciliation of net income / loss and total shareholders equity to US GAAP.

2. Early this year, as is publicly known, the company planned a sponsored ADR for US Listing. As a part of preparation for the same, company decided to move to US GAAP, which is the most stringent and preferred accounting standard internationally.

3. The company subsequently dropped the ADR plan due to lack of sponsorship by its principal shareholders, but decided to anyway shift to US GAAP in line with its commitment to highest standards of corporate governance, disclosures and transparency.