Exhibit 19.1

WIPRO LIMITED

CONSOLIDATED BALANCE SHEET

(Rs. in ‘000s)

						As of September 30,				As of March 31,
				Schedule		2003		2002		2003
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital					1		465,133		464,992		465,128
Share application money pending allotment							—		6,516		1,222
Reserves and Surplus					2		38,602,239		29,937,420		34,307,985
							39,067,372		30,408,928		34,774,335
Loan Funds
Secured loans					3		424,765		510,115		525,562
Unsecured loans					4		94,243		61,197		65,449
Minority Interest							93,223		111,120		2,229
							612,231		682,432		593,240
			Total				39,679,603		31,091,360		35,367,575
APPLICATION OF FUNDS
Fixed Assets
Goodwill (refer note 1)							5,324,431		3,727,397		5,007,243
Gross block					5		14,080,996		11,170,553		12,853,110
Less : Depreciation							6,604,112		5,624,541		6,330,715
		Net Block					12,801,315		9,273,409		11,529,638
Capital work-in-progress and advances							998,243		1,358,835		1,011,471
							13,799,558		10,632,244		12,541,109
Investments					6		15,757,544		7,503,315		8,396,102
Deferred Tax Assets (refer note 7)							465,909		440,609		465,909
Current assets, loans and advances
Inventories					7		1,241,909		897,648		1,010,527
Sundry Debtors					8		8,824,500		7,687,792		8,602,642
Cash and Bank balances					9		2,198,493		5,028,701		4,210,079
Loans and advances					10		5,398,642		5,371,507		7,257,622
							17,663,544		18,985,648		21,080,870
Current liabilities and provisions
Liabilities					11		7,314,733		5,945,937		6,333,268
Provisions					12		693,194		525,576		784,124
							8,007,927		6,471,513		7,117,392
	Net Current Assets						9,655,617		12,514,135		13,963,478
	Miscellaneous expenditure (to the extent not written off or adjusted)						975		1,057		977
			Total				39,679,603		31,091,360		35,367,575
Significant accounting policies and notes to accounts					19

As per our report attached	For and on behalf of the Board of Directors
For N.M. Raiji & Co.,
Chartered Accountants
	Azim Hasham Premji	N. Vaghul	P. M. Sinha
	Chairman and Managing Director	Director	Director
J.M. Gandhi
Partner		V. Ramachandran
	Suresh C. Senapaty	Company Secretary
	Corporate Executive Vice President – Finance
Mumbai, October 17, 2003		Bangalore, October 17, 2003

WIPRO LIMITED

CONSOLIDATED PROFIT AND LOSS ACCOUNT

(Rs. in ’000s)

					Six months ended September 30,						Year ended March 31
			Schedule		2003			2002			2003
INCOME
Gross Sales and Services						26,114,435			19,922,992			43,572,657
Less: Excise Duty						603,126			351,397			707,169
Net Sales and Services						25,511,309			19,571,595			42,865,488
Other Income				13		580,312			671,501			1,181,962
						26,091,621			20,243,096			44,047,450
EXPENDITURE
Cost of goods sold				14		16,732,630			12,470,886			27,438,729
Selling, general and administrative expenses				15		4,330,277			3,040,998			6,442,577
Interest				16		11,378			13,962			30,245
						21,074,285			15,525,846			33,911,551
PROFIT BEFORE TAXATION:
Continuing Operations						5,017,336			4,885,606			10,317,484
Discontinuing Operations						—			(168,356	)		(181,585	)
Total						5,017,336			4,717,250			10,135,899
PROVISION FOR TAXATION: (Refer note 8)
Continuing Operations						592,157			610,812			1,342,752
Discontinuing Operations						—			(61,871	)		(66,733	)
Total						592,157			548,941			1,276,019
PROFIT FOR THE PERIOD BEFORE EXTRAORDINARY ITEMS:
Continuing Operations						4,425,179			4,274,794			8,974,732
Discontinuing Operations						—			(106,485	)		(114,852	)
Total						4,425,179			4,168,309			8,859,880
Loss on discontinuance of ISP business				18		—			(383,144	)		(352,195	)
Tax benefit on above						—			94,364			89,503
Net loss on discontinuance of ISP business						—			(288,780	)		(262,692	)
PROFIT FOR THE PERIOD BEFORE MINORITY INTEREST / EQUITY IN EARNINGS OF AFFILIATES:						4,425,179			3,879,529			8,597,188
Minority Interest						(14,477	)		(23,591	)		(36,908	)
Equity in earnings / (losses) of affiliates						(47,941	)		(210,933	)		(355,260	)
PROFIT FOR THE PERIOD						4,362,761			3,645,005			8,205,020
Appropriations
Proposed Dividend on equity shares						—			—			232,564
Tax on distribution of Dividend						—			—			29,797
Transfer to balance sheet						4,362,761			3,645,005			7,942,659
Earnings per share (in Rs.)
	Basic
	On profit for the period from continuing operations					19.14			18.49			38.83
	On losses of discontinued ISP business					—			(0.46	)		(0.50	)
	On extraordinary items					—			(1.25	)		(1.14	)
	On equity in earnings of affiliates / minority interest					(0.27	)		(1.01	)		(1.70	)
	On profit for the period					18.87			15.77			35.49
	Diluted
	On profit for the period from continuing operations					19.14			18.46			38.75
	On losses of discontinued ISP business					—			(0.46	)		(0.50	)
	On extraordinary items					—			(1.25	)		(1.13	)
	On equity in earnings of affiliates / minority interest					(0.27	)		(1.01	)		(1.69	)
	On profit for the period					18.87			15.74			35.43
	Number of shares
		Basic				231,260,944			231,171,372			231,204,325
		Diluted				231,277,644			231,526,775			231,572,448
		Significant accounting policies and notes to accounts		19

As per our report attached	For and on behalf of the Board of Directors
For N.M. Raiji & Co.,
Chartered Accountants
	Azim Hasham Premji	N. Vaghul	P. M. Sinha
	Chairman and Managing Director	Director	Director
J.M. Gandhi
Partner	Suresh C. Senapaty	V. Ramachandran
	Corporate Executive Vice President - Finance	Company Secretary
Mumbai, October 17, 2003		Bangalore, October 17, 2003

WIPRO LIMITED

(Rs. in ’000s, except share numbers)

SCHEDULE 1 : SHARE CAPITAL

	As of September 30,				As of March 31,
	2003		2002		2003
Authorised
375,000,000 (2003: 375,000,000; 2002: 375,000,000) Equity shares of Rs 2 each		750,000		750,000		750,000
2,500,000 (2003: 2,500,000; 2002: 2,500,000) 10.25 % Redeemable Cumulative Preference Shares of Rs.100 each		250,000		250,000		250,000
		1,000,000		1,000,000		1,000,000
Issued, subscribed and paid-up
232,567,137 (2003: 232,563,992; 2002: 232,496,246) equity shares of Rs 2 each		465,133		464,992		465,128
		465,133		464,992		465,128

Notes:

1. Of the above equity shares:

a.	226,905,825 equity shares (2003: 226,905,825; 2002: 226,905,825) have been allotted as fully paid bonus shares by capitalization of Share Premium of Rs. 32,639 and General Reserves of Rs. 421,173.
b.	1,325,525 equity shares (2003: 1,325,525; 2002: 1,325,525) have been allotted as fully paid-up, pursuant to a scheme of amalgamation, without payment being received in cash.
c.	3,162,500 shares representing 3,162,500 American Depository Receipts issued during 2000-2001 pursuant to American Depository offering by the Company.
d.	248,287 (2003: 245,142; 2002: 177,396) equity shares issued pursuant to Employee Stock Option Plan.

SCHEDULE 2 : RESERVES AND SURPLUS

	As of April								As of Sept
	1, 2003			Additions			Deductions		30, 2003
Capital Reserves		9,500						—		9,500
		9,500			—			—		9,500
		9,500			—			—		9,500
Capital Redemption Reserve		250,038			—			—		250,038
		250,038								250,038
		250,038			—			—		250,038
Share Premium		6,492,847			3,409	(a)		—		6,496,256
		6,386,235			33,133					6,419,368
		6,386,235			106,612			—		6,492,847
Translation Reserve		(568	)		(67,515	)  (b)		—		(68,083	)
		—			—			—		—
		—			(568	)		—		(568	)
Deferred Stock Compensation		4,401			—			4,401		—
		—			—			—		—
		—			4,401			—		4,401
Profit & Loss account					4,362,761					4,362,761
					3,684,605					3,684,605
General Reserve		27,551,767			—			—		27,551,767
		18,814,390			794,718					23,254,113
		18,814,390			8,737,377	(c)		—		27,551,767
		34,307,985			4,298,655			4,401		38,602,239
		25,460,163			4,477,257			—		29,937,420
		25,460,163			8,848,390			—		34,307,985

Corresponding figures for 2003 and 2002 are given below current year’s figures

a) Rs. 3,409 (2003: 106,612; 2002: 33,133) pursuant to issue of shares under Employee Stock Option Plan.

b) Translation reserves arising on account of translation of assets and liabilities of foreign subsidiaries which are considered as non - integral operations.

c) Additions to General Reserves includes:

	September 30, 2003		September 30, 2002		March 31, 2003
Transfer from profit and loss account		—		—		7,942,659
Equity in earnings of affiliates as of March 31, 2002:
Wipro GE medicals systems Ltd.		—		771,849		771,849
WeP Peripherals Ltd.		—		22,869		22,869
Total		—		794,718		8,737,377

WIPRO LIMITED

(Rs. In 000s)

SCHEDULE 3 : SECURED LOANS

			As of September 30,				As of March 31,
	Note
	Reference		2003		2002		2003
From Banks
Cash credit facility		a		394,890		460,240		495,687
From Financial Institutions
Asset Credit Scheme		b		28,200		48,200		28,200
Development loan from Government of Karnataka		c		1,675		1,675		1,675
				424,765		510,115		525,562

Notes:

a.	Secured by hypothecation of stock-in trade, book debts, stores and spares and secured / to be secured by a second mortgage over certain immovable properties.
b.	Secured by hypothecation of specific machinery / assets.
c.	Secured by a pari-passu second mortgage over immovable properties at Mysore and hypothecation of movable properties other than inventories, book debts and specific equipments referred to in ‘Note a’ above.

SCHEDULE 4 : UNSECURED LOANS

	As of September 30,				As of March 31,
	2003		2002		2003
Interest free loan from Government		92,993		59,947		64,199
Loans from state financial institutions		1,250		1,250		1,250
		94,243		61,197		65,449

WIPRO LIMITED

(Rs. in 000s)

SCHEDULE 5: FIXED ASSETS

	GROSS BLOCK
							As of
	As of				Deductions /		September 30,
Particulars	April 1, 2003		Additions		adjustments		2003
Land		744,874		—		—		744,874
Buildings		2,123,840		527,856		—		2,651,696
Plant & Machinery		7,834,182		1,012,554		665,241		8,181,495
Furniture, Fixture and Equipments		1,571,088		200,660		1,405		1,770,343
Vehicles		566,714		118,218		16,446		668,486
Technical know-how		10,378		—		—		10,378
Patents and trade marks		2,034		51,691		—		53,724
		12,853,110		1,910,978		683,092		14,080,996

[Additional columns below]

[Continued from above table, first column(s) repeated]

	PROVISION FOR DEPRECIATION								NET BLOCK
							As of		As of		As of
	As of April 1,		Depreciation for		Deductions /		September 30,		September 30,		March 31,
Particulars	2003		the period		adjustments		2003		2003		2003
Land		9,047		1,769		—		10,816		734,058		735,827
Buildings		173,707		42,461		—		216,168		2,435,528		1,950,133
Plant & Machinery		5,055,829		644,964		559,816		5,140,977		3,040,518		2,778,353
Furniture, Fixture and Equipments		820,979		128,019		33,369		915,629		854,714		750,108
Vehicles		259,616		62,729		16,326		306,019		362,467		307,099
Technical know-how		10,378		—		—		10,378		—		—
Patents and trade marks		1,159		2,966		—		4,125		49,599		875
		6,330,715		882,908		609,511		6,604,112		7,476,885		6,522,395

a.	Land includes leasehold land Rs. 9,978 (2003: 9,978; 2002: 9,978)
b.	Buildings

i)	include shares worth Rs. 2 (2003: Rs. 2; 2002: Rs. 2)
ii)	include leasehold land / property Rs. 4,241 (2003: 4,241; 2002: Rs. 4,241) and
iii)	is net of depreciation during construction period.

WIPRO LIMITED (Rs. in ‘000s)

SCHEDULE 6 : INVESTMENTS

(Rs. In 000s except share numbers and face value)		As of September 30,						As of March 31,
All shares are fully paid up unless otherwise stated		Number		2003		2002		2003
Investments - Long Term (at cost)
Investment in Affiliates
Wipro GE Medical Systems Ltd #					344,267		559,671		400,599
WeP Peripherals Ltd					136,908		118,715		133,460
					481,175		678,386		534,059
Investments in equity shares of other companies
Quoted					121		208		208
- Unquoted					458		486		477
Other Investments (unquoted)					6		50,460		47,958
Investments in Short Term and money market mutual funds
Alliance Capital Mutual Fund					—		261,590		—
Pioneer ITI Mutual Fund					—		511,580		741,000
Prudential ICICI Mutual Fund (77,524,134 units redeemed during the year)			227,635,303		2,556,123		1,377,660		1,458,900
HDFC Mutual Fund (47,355,903 units redeemed during the year)			154,570,034		1,711,481		1,574,825		1,424,000
Standard Chartered Mutual Fund (22,569,142 units redeemed during the year)			181,206,478		1,884,177		647,630		1,007,400
Reliance Mutual Fund (16,765,754 units redeemed during the year)			85,493,959		1,023,744		675,740		626,100
Zurich India Mutual Fund (21,642,578 units redeemed during the year)			43,520,989		455,774		1,012,500		515,900
Franklin Templeton India Mutual Fund			12,991,004		1,722,237		221,570		252,800
Kotak Mutual Fund			113,693,531		1,143,373		145,350		541,500
J M Mutual Fund			20,107,114		871,423		—		361,300
DSP Merrill Lynch Mutual Fund			87,268,693		260255		—		182,500
SBI Insta Cash			19,613,007		206,266		—		63,000
Birla Mutual Fund (2860412 units redeemed during the year)			115,405,832		1,222,897		345,330		639,000
IL & FS Mutual Fund			45,284,426		452,844		—		—
H S B C Mutual Fund			47,050,674		479,290		—		—
Deutsche Mutual Fund			50,215,233		511,252		—		—
ING Mutual Fund			26,296,608		282,944		—		—
Sundaram Mutual Fund			25,972,840		205,300		—		—
Tata Mutual Fund			21,314,782		237,675		—		—
HSBC Cash Fund			4,823,522		48,729
					15,275,784		6,773,775		7,813,400
	Total				15,757,544		7,503,315		8,396,102

# Equity investments in this company carry certain restrictions on transfer of shares that is normally provided for in joint venture Agreement.

WIPRO LIMITED

(Rs. in ’000s)

SCHEDULE 7 : INVENTORIES

	As of September 30,				As of March 31,
	2003		2002		2003
Stores and Spares		32,239		34,485		25,952
Raw Materials		411,069		356,960		398,216
Stock-in-process		144,250		137,569		119,028
Finished goods		654,351		368,634		467,331
		1,241,909		897,648		1,010,527
Basis of stock valuation : a) Raw materials, stock-in-process and stores and spares at or below cost. b) Finished products at cost or net realisable value, whichever is lower.
SCHEDULE 8 : SUNDRY DEBTORS (Unsecured)
Over Six Months
Considered good		683,132		669,742		694,372
Considered doubtful		752,516		570,298		643,921
		1,435,648		1,240,040		1,338,293
Others
Considered good		8,141,368		7,018,050		7,908,270
Considered doubtful		—		375		17,648
		8,141,368		7,018,425		7,925,918
Less: Provision for doubtful debts		752,516		570,673		661,569
		8,824,500		7,687,792		8,602,642
SCHEDULE 9 : CASH AND BANK BALANCES
Cash and Cheques on Hand		267,360		234,147		498,387
Balances with scheduled banks
On Current account		849,536		926,751		169,506
In Deposit account		107,931		1,142,806		1,468,034
Balances with other banks in current account
Midland Bank, U K		117,314		105,908		428,915
Wells Fargo, U S A		711,406		282,563		1,575,159
Societe General				145,140		—
Bank of America		121,561		52,785		44,068
Standard Chartered Bank		4,442		339		312
Shanghai C&S Bank		—		760		1,181
Danske Bank		—		299,569
National City Bank		—		628,940
FCC National bank		1918
Bank of Scotland		—		145,140
Suntrust bank		—		483,800
South trust Bank		—		512,538		2,800
Hong Kong & Shanghai Bank		17,002		6,306		13,462
Bank of Tokyo		—		61,184		8,230
Great Western Bank		23		25		25
		2,198,493		5,028,701		4,210,079
Maximum balances during the year
Midland Bank, U K						780,682
Wells Fargo, U S A						2,396,512
Nations Bank						97,627
Deutsche Bank						487,942
Societe General						460,378
Bank of America						97,397
Standard Chartered Bank						5,276
Shanghai C&S Bank						3,655
South trust Bank						2,800
Hong Kong & Shanghai Bank						13,462
Bank of Tokyo						8,230
First Chicago						979
Citibank						1,949
FCC National Bank						976
Chase Manhattan						1,025
Great Western Bank						25

WIPRO LIMITED

(Rs. in ’000s)

SCHEDULE 10 : LOANS AND ADVANCES
(Unsecured, considered good unless otherwise stated)

		As of September 30,				As of March 31,
		2003		2002		2003
Advances recoverable in cash or in kind or for value to be received
Considered good			1,787,066		1,202,359		1,726,893
Considered doubtful			76,847		70,596		72,694
			1,863,913		1,272,955		1,799,586
Less: Provision for doubtful advances			76,847		70,596		72,694
			1,787,066		1,202,359		1,726,893
Certificate of deposits with foreign banks			—		1,317,032		2,463,056
Inter Corporate Deposits:
	GE Capital Services India		25,411		570,540		258,803
	Citicorp Financial services Limited		—		35,335		27,000
			25,411		605,875		285,803
Other Deposits (Refer Note a.)			660,438		600,099		637,206
Advance income-tax (net of provision)			753,941		505,685		747,021
Balances with excise and customs			15,279		8,207		16,699
Unbilled Services			2,156,508		1,132,250		1,380,944
			5,398,642		5,371,507		7,257,622
Note:    a. Other Deposits include Rs 25,000 (2002: Rs. 25,000) security deposits for premises with a firm in which a director is Interested
SCHEDULE 11 : LIABILTIES
Sundry Creditors			2,208,443		2,229,974		2,295,755
Unclaimed dividends			1,491		1,588		1,588
Advances from customers			745,640		795,051		755,942
Other liabilities			3,960,689		2,658,735		2,919,905
Unbilled Services			398,470		260,307		359,902
Interest accrued but not due on loans			—		282		176
			7,314,733		5,945,937		6,333,268
SCHEDULE 12 : PROVISIONS
Employee retirement benefits			693,194		525,576		521,763
Proposed dividend					—		232,564
Tax on proposed dividend					—		29,797
			693,194		525,576		784,124

WIPRO LIMITED

(Rs. in ’000s)

SCHEDULE 13 : OTHER INCOME

		Six months ended September 30,						Year ended March 31,
		2003			2002			2003
Dividend from mutual funds			363,354			20,737			26,560
Interest on debt instruments			17,587			126,262			172,603
Interest on Income tax refund			—			—			54,120
Rental Income			20,744			12,772			25,266
Profit on Sale of Investments			(25,357	)		174,102			410,360
Profit on disposal of fixed assets			—			2,819			7,243
Difference in exchange			148,985			243,035			297,085
Brand fees			22,040			26,508			53,016
Royalty			—			5,000			19,000
Provision no longer required written back			942			21,494			69,687
Miscellaneous Income			32,017			38,772			47,022
			580,312			671,501			1,181,962
Notes: Tax deducted at source Rs. 7724 (2003: 119,430; 2002: Rs. 49,282)
SCHEDULE 14 : COST OF GOODS SOLD
Raw materials, Finished and Process Stocks (Refer schedule 17)			3,509,847			3,867,118			7,767,033
Stores & Spares			92,073			83,179			172,383
Power and Fuel			223,632			171,533			336,840
Salaries, wages and bonus			3,368,079			2,099,490			5,288,348
Contribution to provident and other funds			129,627			82,572			191,756
Gratuity and pension			125,359			95,113			173,594
Workmen and Staff welfare			111,891			59,930			148,538
Insurance			20,651			11,449			25,423
Repairs to factory buildings			3,869			4,798			11,986
Repairs to Plant & Machinery			173,953			180,954			421,170
Rent			127,984			98,956			217,650
Rates & Taxes			(801	)		16,463			30,746
Packing			37,983			44,216			82,661
Travelling and allowances			5,669,785			3,906,935			8,472,040
Depreciation			712,382			504,501			1,180,833
Technical fees			161,559			80,991			207,290
Miscellaneous			2,351,969			1,233,057			2,866,433
Less: Capitalized			(87,214	)		(70,369	)		(155,995	)
			16,732,630			12,470,886			27,438,729
SCHEDULE 15 : SELLING GENERAL AND ADMINISTRATIVE EXPENSES
Salaries, wages and bonus			837,731			597,775			1,294,086
Contribution to provident and other funds			23,998			19,188			38,629
Gratuity and pension			32,668			27,989			38,876
Workmen and Staff welfare			86,174			56,800			146,407
Insurance			5,488			2,979			10,385
Repairs to buildings			3,017			6,469			3,943
Rent			60,585			70,904			128,248
Rates and taxes			28,236			36,462			66,624
Carriage and freight			66,559			53,653			116,466
Commission on sales			41,525			25,336			67,756
Auditors’ remuneration and expenses
	Audit fees		3,326			1,669			6,567
	For certification including tax audit		438			—			1,410
	Reimbursement of expenses		370			122			505
Advertisement and sales promotion			276,344			184,382			405,804
Loss on sale of fixed assets			6,220			2,392			6,470
Directors’ fees			110			40			128
Depreciation			170,525			189,083			391,417
Travelling and allowances			1,692,714			1,113,188			2,554,828
Communication			69,892			131,958			221,399
Provision/write off of bad debts			125,597			102,120			180,046
Miscellaneous			798,759			418,489			762,583
			4,330,277			3,040,998			6,442,577

WIPRO LIMITED

(Rs. in 000s)

SCHEDULE 16 : INTEREST

		Six months ended September 30,						Year ended March 31,
		2003			2002			2003
On fixed loans			1,940			3,425			6,022
Others			9,438			10,537			24,223
			11,378			13,962			30,245
SCHEDULE 17 : RAW MATERIALS, FINISHED AND PROCESS STOCKS Consumption of Raw Materials and Bought Out Components
Opening stocks			398,216			439,930			439,930
Add: Purchases			2,311,576			2,154,470			4,688,657
Less: Closing stocks			411,069			356,960			398,216
			2,298,723			2,237,440			4,730,371
Purchase of Finished Products for sale			1,423,366			1,685,724			3,172,864
(Increase) / Decrease in Finished and Process Stocks
Opening stock	: In process		119,028			84,722			84,722
	: Finished Products		467,331			365,435			365,435
Less: Closing stocks	: In process		144,250			137,569			119,028
	: Finished Products		654,351			368,634			467,331
			(212,242	)		(56,046	)		(136,202	)
			3,509,847			3,867,118			7,767,033
SCHEDULE 18 : NON - RECURRING / EXTRAORDINARY ITEMS
Loss of discontinued ISP business			—			383,144			352,195
			—			383,144			352,195

     WIPRO LIMITED

SCHEDULE –19 SIGNIFICANT ACCOUNTING POLICIES

Accounting convention

The preparation of consolidated financial statements in conformity with Indian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and disclosure of contingent assets and liabilities. Actual results could differ from these estimates.

Basis of preparation of financial statements :-

The accompanying consolidated financial statements have been prepared in accordance with Accounting Standard 21 ‘Consolidated Financial Statements’ and Accounting Standard 23 ‘Accounting for Investments in Associates in Consolidated Financial Statements.

Principles of consolidation :-

The consolidated financial statements include the financial statements of Wipro and all of its subsidiaries, which are more than 50% owned and controlled and its affiliates where the Company holds more than 20% control. All material inter-company accounts and transactions are eliminated on consolidation. The company accounts for investments by the equity method where its investment in the voting stock gives it the ability to exercise significant influence over the investee.

Revenue recognition

• Sales include applicable sales tax unless separately charged, export incentives, and are net of discounts.

• Sales are recognized on despatch, except in the following cases:

– Consignment sales are recognized on receipt of statement of account from the agent

– Sales, which are subject to detailed acceptance tests, revenue is reckoned based on milestones for billing, as provided in the contracts

– Revenue from software development services includes revenue from time and material and fixed price contracts. Revenue from time and material contracts are recognized as related services are performed. With reference to fixed price contracts revenue is recognized in accordance with percentage of completion method of accounting

• Export incentives are accounted on accrual basis and include estimated realizable values/benefits from special import licenses and Advance licenses.

• Agency commission is accrued on shipment of consignment by principal.

• Maintenance revenue is considered on acceptance of the contract and is accrued over the period of the contract.

• Other income is recognized on accrual basis.

Fixed Assets and Depreciation

Fixed assets are stated at historical cost less depreciation.

Interest on borrowed money allocated to and utilized for fixed assets, pertaining to the period up to the date of capitalization is capitalized. Assets acquired on hire purchase are capitalized at the gross value and interest thereon is charged to Profit and Loss account. Renewals and replacement are either capitalized or charged to revenue as appropriate, depending upon their nature and long-term utility.

In respect of leased assets, lease rentals payable during the year is charged to Profit and Loss account.

Depreciation is provided on straight line method at rates specified in Schedule XIV to the Companies Act, 1956, except on computers, furniture and fixture, office equipment, electrical installations (other than those at factories) and vehicles for which commercial rates are applied. In Wipro Inc, Enthink Inc and Wipro Japan KK depreciation is provided on Written Down Value method.

Intangible Assets

Intangible assets are stated at cost less accumulated amortization. Intangible assets are amortized over their estimated useful life ranging between 5 years to 20 years.

Investments

Long term Investments are stated at cost and short term investments are valued at lower of cost and net realizable value. Diminution in value is provided for where the management is of the opinion that the diminution is of permanent nature.

Inventories

Finished goods are valued at cost or net realizable value, whichever is lower. Other inventories are valued at cost less provision for obsolescence. Indigenously developed software products are valued at cost, which reflects their remaining economic life. Small value tools and consumables are charged to consumption on purchase. Cost is computed on weighted average basis.

Provision for retirement benefits

For employees covered under group gratuity scheme of LIC, gratuity charged to Profit and Loss account is on the basis of premium demanded by LIC. Provision for gratuity (for certain category of employees) and leave benefit for employee’s is determined as per actuarial valuation at the year-end. Defined contributions for provident fund and pension are charged to the Profit and Loss account based on contributions made in terms of applicable schemes, after netting off the amounts rendered surplus on account of employees separated from the Company.

Deferred Tax

Tax expenses charged to Profit and Loss account is after considering deferred tax impact for the timing difference between accounting income and tax income. Deferred tax assets are recognized when there is a reasonable certainty that they will be realized. Deferred tax asset relating to unabsorbed business losses are recognized when there is a virtual certainty that there will be sufficient taxable profits to utilize them.

Foreign currency transactions

Foreign currency transactions are recorded at the spot rate at the beginning of the concerned month. Period-end balances of foreign currency assets and liabilities are restated at the closing rate / forward contract rate, as applicable. Resultant differences in respect of liabilities relating to acquisition of fixed assets are capitalized. Other differences on restatement or payment are adjusted to revenue account.

Forward premium in respect of forward exchange contracts are recognized over the life of the contract, except that premium relating to foreign currency loans for the acquisition of fixed assets are capitalized.

In respect of non-integral operations assets and liabilities are translated at the exchange rate prevailing at the date of the balance sheet. The items in the profit & loss account are translated at the average exchange rate during the period. The differences arising out of the translation are included in translation reserve.

Research and Development

Revenue expenditure on research and development is charged to Profit and Loss account and capital expenditure is shown as addition to fixed assets.

NOTES TO ACCOUNTS
(All figures are reported in rupees thousands, except data relating to share or unless stated otherwise)

1. Goodwill arising on account of acquisition of subsidiaries and affiliates is not being amortized. Goodwill in the balance sheet represents goodwill arising on acquisition of the following:

(Rs. in ‘000s)

Wipro Fluid Power Limited		18,271
Wipro Spectramind e Services Private Limited		3,748,350
Wipro Healthcare IT Limited		175,012
Global energy practice of AMS Inc.		995,750
Wipro Nervewire		387,048
	Total	5,324,431

2.	In May 2003, company acquired Nervewire Inc. a Massachusetts based business and IT consulting company, serving customers in the financial services sector, for a consideration of Rs. 791,038. In addition to that, at the time of acquisition the company has decided to restructure certain lease agreement entered into by Nervewire and in the process has made a provision for the estimated liability of Rs. 86,953. The amount of this liability is also considered in cost of acquisition.
3.	In April 2003, the company acquired Glucovita brand from Hindustan Lever Limited at a cost of Rs. 26,690, and also paid further Rs. 25,000 for non-compete agreement. Based on the performance of various other established brands in the market of similar products, the company estimates that the useful life of the brand is 20 years and the cost of the brand is accordingly amortized over 20 years. Payment for non-compete agreement is amortized over the period of agreement.
4.	The company has a 49% equity interest in Wipro GE Medical Systems Limited (WGE), a joint venture with General Electric, USA. The joint venture agreement provides specific rights to the joint venture partners. The rights conferred to Wipro are primarily protective in nature. Therefore, WGE is not considered as a joint venture and consolidation of financial statements are carried out as per equity method in terms of Accounting Standard 23 “Accounting for Investments in Associates in Consolidated Financial statements”.
	Investments in WeP Peripherals have been accounted for by equity method.
5.	In June 2003, Wipro Spectramind e Services Limited allotted 3,157,372 shares to its employees on the exercise of their right under employee stock options. On account of this, the ownership of Wipro Spectramind by the company stand reduced to 95% from earlier 100%. As the exercise price paid was higher than their proportionate share in the net assets of Wipro Spectramind, the excess of Rs. 27,343 has been adjusted from the Goodwill on consolidation.

6.	The company has re-estimated the economic life of moulds and dies to a lesser period and consequent to that with effect from 1st April 2003 moulds and dies are being depreciated at 25% instead of 11.31% followed hitherto. On account of the change in depreciation rate, profit for the period is lower by Rs. 4,413.
7.	The break-up of net deferred tax asset is given below:

		(Rs. In 000s)
		September 30, 2003		September 30,2002		March 31, 2003
Deferred tax assets:
	Allowance for doubtful debts		87,070		81,037		87,070
	Property plant and equipment		74,272		97,867		74,272
	Employee stock incentive plan		38,902		61,695		38,902
	Accrued expenses		103,133		43,877		103,133
	Business losses carried forward		162,532		156,133		162,532
			465,909		440,609		465,909

8. Provision for taxation comprises of following:

(i)	Rs. 307,357 (2003: 556,117; 2002: Rs. 215,098) in respect of foreign taxes
(ii)	Rs. 284,800 (2003: 627,899; 2002: 237,979) in respect of Indian Income Tax, net of tax benefit from discontinued business of Rs. Nil (2003: 156,236; 2002: 156,235) and write back of earlier years tax of Rs. 12,830 (2003: 200,850; 2002: Rs. 64,000).
(iii)	Rs. Nil (2003: 2,500; 2002: Rs. 750) in respect of Wealth Tax.

9. The details of subsidiaries and affiliates are as follows -

				Country of Incorporation		% Holding
a	)	Name of the subsidiary
			Wipro Fluid Power Limited		India		98	%
			Wipro Inc		USA		100	%
			Enthink Inc		USA		-	*
			Wipro Spectramind Inc		Bermuda		100	%
			Wipro Japan KK		Japan		100	%
			Wipro Prosper Limited		India		100	%
			Wipro Trademarks holding Limited		India		100	%
			Wipro Travel services Limited		India		100	%
			Wipro Healthcare IT Limited		India		100	%
			Wipro Spectramind eServices Limited		India		95	%
			Wipro Technology Inc.		USA		-	*
			Wipro Holdings Mauritius Limited		Mauritius		100	%
			Wipro Holdings UK Limited		UK		-	#
			Wipro Technology UK Limited		UK		-	@
			Wipro Nervewire Inc		USA		100	%
b	)	Wipro Equity Reward Trust			India	Fully controlled tru		st
c	)	Name of the affiliate
		Wipro GE Medical Systems Limited			India		49	%
		WeP Peripherals Limited			India		40	%

* Fully owned by Wipro Inc.

# Fully owned by Wipro Holdings Mauritius Limited

@ Fully owned by Wipro Holdings UK Limited

10.	Diluted EPS is calculated based on treasury stock method for ESOP outstanding.
11.	Provision for retirement benefits are made on the estimated basis in the interim financial statement and acturial valuation is carried out at the year-end.
12.	Corresponding figures for previous periods presented have been regrouped, where necessary, to confirm to this period classification. Current period figures are not comparable with the previous period figures on account of acquisition of various business / subsidiaries in last one year i.e., Wipro Spectramind services Limited (BPO business) with effect from July 2002; Wipro Healthcare IT Limited with effect from August 2002; AMS Global energy business with effect from January 2002 and Wipro Nerve wire (IT consulting business) with effect from May 2003.

WIPRO LIMITED

CASH FLOW STATEMENT

				(Rs. In 000s)
				Six months ended September 30,						Year ended March 31,
				2003			2002			2003
Cash flows from operating activities:
	Profit before tax from continuing operations				5,017,336			4,885,606			10,317,484
	Adjustments to reconcile Net profit before tax and non recurring items to net cash provided by operating activities:							—
		Depreciation and amortization			882,908			655,577			1,568,487
		Foreign currency translation gains			(90,323	)		(243,035	)		(297,085	)
		Retirement benefits provision			171,431			44,291			112,773
		Others			—			—			—
		Interest on borrowings			11,378			13,962			30,245
		Dividend / interest			(355,584	)		(321,101	)		(633,398	)
		Loss / (Gain) on sale of property, plant and equipment			6,220			(2,819	)		6,470
Operating cash flow before changes in working capital					5,643,365			5,032,481			11,104,976
			Trade and other receivable		(692,444	)		(691,259	)		(1,919,285	)
			Loans and advances		(107,235	)		(371,871	)		(729,342	)
			Inventories		(231,382	)		36,952			(75,927	)
			Trade and other payables		752,646			156,964			803,940
Net cash provided by operations					5,364,949			4,163,267			9,184,362
Direct taxes paid					(527,077	)		(782,251	)		(1,848,699	)
Net cash provided by continuing operations					4,837,872			3,381,016			7,335,663
Net cash provided by discontinuing operations					—			45,071			27,284
Net cash provided by operations					4,837,872			3,426,087			7,362,947
Cash flows from investing activities:
Expenditure on property, plant and equipment (including advances)					(1,870,956	)		(959,863	)		(2,523,048	)
Proceeds from sale of property, plant and equipment					67,361			46,658			103,530
Purchase of investments					(11,550,394	)		(7,660,923	)		(41,182,961	)
Inter Corporate deposits placed / matured					260,392			1,459,216			1,779,288
Certificate of Deposits with foreign banks					2,463,056			3,970,187			2,824,163
Sale / maturities on Investments					4,136,068			5,019,220			37,904,824
Payment for acquisition, net of cash acquired					(465,267	)		(3,947,117	)		(5,484,793	)
Divided received					342,940			69,737			75,560
Interest received (net)					6,209			300,364			169,918
Net cash used in investing activities					(6,610,591	)		(1,708,521	)		(6,333,519	)
Cash flows from financing activities:
Proceeds from exercise of Stock Option Plan grants					3,414			33,194			106,809
Share application money pending allotment					(1,222	)		4,117			(1,177	)
Proceeds from issuance of common stock by subsidiary					99,305
Dividends paid					(262,361	)		—			(232,466	)
Proceeds from issuance / (repayment) of borrowings					(72,003	)		241,915			275,576
Net cash provided by/(used in) financing activities					(232,867	)		279,226			148,742
Net increase/ (decrease) in cash and cash equivalents during the year					(2,005,586	)		1,996,792			1,178,170
Cash and cash equivalents at the beginning of the period					4,210,079			3,031,909			3,031,909
Effect of translation on cash balance					(6,001	)
Cash and cash equivalents at the end of the period					2,198,493			5,028,701			4,210,079

Notes:

Figures for previous periods presented, have been regrouped wherever necessary, to confirm to this period classification.

For and on behalf of the Board of Directors
Azim Hasham Premji	N. Vaghul	P. M. Sinha
Chairman and Managing Director	Director	Director
Suresh C. Senapaty	V. Ramachandran
Corporate Executive	Company Secretary
Vice President - Finance
	Bangalore, October 17, 2003

WIPRO LIMITED

AUDITOR’S CERTIFICATE

We have examined the above cash flow statement of Wipro Limited – consolidated for the period ended September 30, 2003. This statement is based on and in agreement with the corresponding Profit and Loss Account and Balance Sheet of the Company for the period ended September 30, 2003, covered by our report of even dated.

For N M Raiji & Co.,  

Chartered Accountants    

J M Gandhi
Partner

Mumbai, October 17, 2003