EXHIBIT 19.1

WIPRO LIMITED

CONSOLIDATED BALANCE SHEET

					(Rs. in ’000s)
					As of December 31,				As of March 31,
			Schedule		2003		2002		2003
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital				1		465,257		465,094		465,128
Share application money pending allotment						—		—		1,222
Reserves and Surplus				2		41,406,508		32,298,548		34,307,985
						41,871,765		32,763,642		34,774,335
Loan Funds
Secured loans				3		1,617,553		50,398		525,562
Unsecured loans				4		101,354		61,395		65,449
						1,718,907		111,793		118,005
Minority Interest						139,961		85,891		2,229
		Total				43,730,633		32,961,326		35,367,575
APPLICATION OF FUNDS
Fixed Assets
Goodwill (refer note 1)						5,295,797		4,833,992		5,007,243
Gross block				5		14,680,064		11,777,947		12,853,110
Less : Depreciation						7,098,505		6,018,090		6,330,715
	Net Block					12,877,356		10,593,849		11,529,638
Capital work-in-progress and advances						1,334,026		1,266,854		1,011,471
						14,211,382		11,860,703		12,541,109
Investments				6		19,937,361		9,130,903		8,396,102
Deferred Tax Assets (refer note 7)						465,909		441,152		465,909
Current assets, loans and advances
Inventories				7		1,257,053		956,765		1,010,527
Sundry Debtors				8		9,877,929		7,414,764		8,602,642
Cash and Bank balances				9		1,835,145		5,305,009		4,210,079
Loans and advances				10		5,163,551		4,504,505		7,257,622
						18,133,678		18,181,043		21,080,870
Current liabilities and provisions
Liabilities				11		8,165,339		6,044,330		6,333,268
Provisions				12		852,358		609,202		784,124
						9,017,697		6,653,532		7,117,392
Net Current Assets						9,115,981		11,527,511		13,963,478
Miscellaneous expenditure (to the extent not written off or adjusted)						—		1,057		977
		Total				43,730,633		32,961,326		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
	/s/ Azim Hasham Premji Azim Hasham Premji	/s/ N. Vaghul N. Vaghul	/s/ P. M. Sinha P. M. Sinha
	Chairman and Managing Director	Director	Director
/s/ J.M. Gandhi J.M. Gandhi
Partner
		/s/ V. Ramachandran V. Ramachandran
	/s/ Suresh C. Senapaty Suresh C. Senapaty	Company Secretary
	Corporate Executive Vice President – Finance
Mumbai, January 21, 2004		Bangalore, January 21, 2004

WIPRO LIMITED

CONSOLIDATED PROFIT AND LOSS ACCOUNT

				(Rs. in ‘000s)
		Schedule		Nine months ended December31,						Year ended March 31
				2003			2002			2003
INCOME
Gross Sales and Services					41,207,006			31,062,551			43,572,657
Less: Excise Duty					541,131			506,920			707,169
Net Sales and Services					40,665,875			30,555,631			42,865,488
Other Income			13		840,217			995,015			1,181,962
					41,506,092			31,550,646			44,047,450
EXPENDITURE
Cost of goods sold			14		27,019,603			19,471,268			27,438,729
Selling, general and administrative expenses			15		6,389,478			4,634,203			6,442,577
Interest			16		28,172			18,232			30,245
					33,437,253			24,123,703			33,911,551
PROFIT BEFORE TAXATION:
Continuing Operations					8,068,839			7,609,186			10,317,484
Discontinuing Operations					—			(182,243	)		(181,585	)
Total					8,068,839			7,426,943			10,135,899
PROVISION FOR TAXATION: (Refer note 8)
Continuing Operations					922,157			960,756			1,342,752
Discontinuing Operations					—			(66,974	)		(66,733	)
Total								893,782			1,276,019
PROFIT FOR THE PERIOD BEFORE EXTRAORDINARY ITEMS:
Continuing Operations					7,146,682			6,648,430			8,974,732
Discontinuing Operations					—			(115,269	)		(114,852	)
Total					7,146,682			6,533,161			8,859,880
Loss on discontinuance of ISP business			18		—			(378,199	)		(352,195	)
Tax benefit on above					—			89,261			89,503
Net loss on discontinuance of ISP business					—			(288,938	)		(262,692	)
PROFIT FOR THE PERIOD BEFORE MINORITY INTEREST / EQUITY IN EARNINGS OF AFFILIATES:					7,146,682			6,244,223			8,597,188
Minority Interest					(35,306	)		(34,679	)		(36,908	)
Equity in earnings / (losses) of affiliates					(4,501	)		(258,630	)		(355,260	)
PROFIT FOR THE PERIOD					7,106,875			5,950,914			8,205,020
Appropriations
Proposed Dividend on equity shares					—			—			232,564
Tax on distribution of Dividend					—			—			29,797
Transfer to balance sheet					7,106,875			5,950,914			7,942,659
Earnings per share (in Rs.)
	Basic
	On profit for the period from continuing operations				30.90			28.76			38.83
	On losses of discontinued ISP business				—			(0.50	)		(0.50	)
	On extraordinary items				—			(1.25	)		(1.14	)
	On equity in earnings of affiliates / minority interest				(0.17	)		(1.27	)		(1.70	)
	On profit for the period				30.73			25.74			35.49
	Diluted
	On profit for the period from continuing operations				30.89			28.71			38.75
	On losses of discontinued ISP business				—			(0.50	)		(0.50	)
	On extraordinary items				—			(1.25	)		(1.13	)
	On equity in earnings of affiliates / minority interest				(0.17	)		(1.27	)		(1.69	)
	On profit for the period				30.71			25.69			35.43
	Number of shares
	Basic				231,267,063			231,186,761			231,204,325
	Diluted				231,393,738			231,567,521			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, January 21, 2004		Bangalore, January 21, 2004

WIPRO LIMITED

SCHEDULE 1 : SHARE CAPITAL

	(Rs. in ’000s, except share numbers)
	As of December 31,				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
232,628,559 (2003: 232,563,992; 2002: 232,547,145) equity shares of Rs 2 each		465,257		465,094		465,128
		465,257		465,094		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.	309,709 (2003: 245,142; 2002: 228,295) equity shares issued pursuant to Employee Stock Option Plan.

SCHEDULE 2 : RESERVES AND SURPLUS

	As of										As of
	April										December 31,
	1, 2003			Additions					Deductions		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			70699		(a	)		—		6,563,546
		6,386,235			88,352							6,474,587
		6,386,235			106,612					—		6,492,847
Translation Reserve		(568	)		(74,650	)	(b	)				(75,218	)
		—			—					—		—
		—			(568	)				—		(568	)
Deferred Stock Compensation		4,401			—					4,401		—
		—			4,401					—		4,401
		—			4,401					—		4,401
Profit & Loss account					7,106,875							7,106,875
					5,950,914							5,950,914
General Reserve		27,551,767			—					—		27,551,767
		18,814,390			794,718							19,609,108
		18,814,390			8,737,377		(c	)		—		27,551,767
		34,307,985			7,102,924					4,401		41,406,508
		25,460,163			6,838,385					—		32,298,548
		25,460,163			8,847,822					—		34,307,985

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

a)	Rs. 70,699 (2003: 106,612; 2002: 88352) 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:

	December 31, 2003		December 31, 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

SCHEDULE 3 : SECURED LOANS

			(Rs. In 000s)
			As of December 31,				As of March 31,
	Note
	Reference		2003		2002		2003
From Banks
Cash credit facility		A		1,587,678		20,523		495,687
From Financial Institutions
Asset Credit Scheme		B		28,200		28,200		28,200
Development loan from Government of Karnataka		C		1,675		1,675		1,675
				1,617,553		50,398		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 December 31,				As of March 31,
	2003		2002		2003
Interest free loan from Government		100,104		60,145		64,199
Loans from state financial institutions		1,250		1,250		1,250
		101,354		61,395		65,449

WIPRO LIMITED

SCHEDULE 5: FIXED ASSETS

									(Rs. in 000s)
	GROSS BLOCK								PROVISION FOR DEPRECIATION
							As of								As of
	As of				Deductions /		December		As of April 1,		Depreciation for		Deductions /		December
Particulars	April 1, 2003		Additions		adjustments		31, 2003		2003		the period		adjustments		31, 2003
Land		744,874		114,605		—		859,479		9,047		2,653		—		11,700
Buildings		2,123,840		580,514		—		2,704,354		173,707		69,143		—		242,850
Plant & Machinery		7,834,182		1,368,136		608,070		8,594,248		5,055,829		1,018,052		569,705		5,504,176
Furniture, Fixture and Equipments		1,571,088		216,302		42,546		1,744,844		820,979		202,224		33,700		989,503
Vehicles		566,714		189,987		41,631		715,070		259,616		98,849		24,221		334,244
Technical know-how		10,378		—		—		10,378		10,378		—		—		10,378
Patents and trade marks		2,034		51,691		2,034		51,691		1,159		4,495		—		5,654
		12,853,110		2,521,235		694,281		14,680,064		6,330,715		1,395,416		627,626		7,098,505

[Additional columns below]

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

	(Rs. in 000s)
	NET BLOCK
	As of		As of
	December 31,		March 31,
Particulars	2003		2003
Land		847,779		735,827
Buildings		2,461,504		1,950,133
Plant & Machinery		3,090,072		2,778,353
Furniture, Fixture and Equipments		755,341		750,108
Vehicles		380,826		307,099
Technical know-how		—		—
Patents and trade marks		46,037		875
		7,581,559		6,522,395

WIPRO LIMITED

SCHEDULE 6 : INVESTMENTS

									(Rs. in ’000s)
					As of December 31,				As of March 31,
( Rs. in 000s except share numbers and face value)
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 #					371,707		513,219		400,599
	WeP Peripherals Ltd					152,908		117,470		133,460
						524,615		630,689		534,059
Investments in equity shares of other companies
	Quoted					121		208		208
	Unquoted					456		482		477
	Other Investments (unquoted)					6		50,458		47,958
Investments in Short Term and money market mutual funds
Alliance Capital Mutual Fund				42,405,419		424,054		265,565		—
Pioneer ITI Mutual Fund								—		741,000
Prudential ICICI Mutual Fund (170,413,918 units redeemed during the year)				231,805,367		2,576,411		1,527,520		1,458,900
HDFC Mutual Fund (16,156,006 units redeemed during the year)				215,142,932		2,417,469		1,791,620		1,424,000
Standard Chartered Mutual Fund (78,060,002 units redeemed during the year)				185,824,131		1,930,775		980,800		1,007,400
Reliance Mutual Fund (53,511,548 units redeemed during the year)				115,126,880		1,346,809		788,100		626,100
Zurich India Mutual Fund (43,928,303 units redeemed during the year)				—				1,069,900		515,900
Franklin Templeton Mutual Fund (402,058 units redeemed during the year)				1,651,449		1,951,472		681,700
Franklin Templeton India Mutual Fund (192,622 units redeemed during the year)				11,336,635		114,854		249,300		252,800
Kotak Mutual Fund (118,141,895 units redeemed during the year)				105,093,523		1,184,895		515,165		541,500
JM Mutual Fund (4,959,235 units redeemed during the year)				154,715,210		1,549,628		87,700		361,300
DSP Merrill Lynch Mutual Fund				63,675,136		639,585		80,600		182,500
SBI Insta Cash				55,993,922		589,321		—		63,000
Birla Mutual Fund (9,272,223 units redeemed during the year)				128,284,927		1,350,976		411,096		639,000
IL & FS Mutual Fund				45,744,154		457,442		—		—
H S B C Mutual Fund (20,633,733 units redeemed during the year)				84,775,844		872,756		—		—
Deutsche Mutual Fund				74,624,143		759,485		—		—
ING Mutual Fund				34,295,825		369,113		—		—
Sundaram Mutual Fund (20,522,405 units redeemed during the year)								—		—
Tata Mutual Fund (17,921,147 units redeemed during the year)				20,809,809		231,889		—		—
Can Liquid				26,116,396		262,402
Chola Mutual Fund				6,526,582		65,266
Principal Mutual Fund				31,753,665		317,561
						19,412,163		8,500,214		7,813,400
		Total				19,937,361		9,130,903		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

SCHEDULE 7 : INVENTORIES

					(Rs. in ‘000s)
	As of December 31,				As of March 31,
	2003		2002		2003
Stores and Spares		28,404		32,707		25,952
Raw Materials		363,429		368,049		398,216
Stock-in-process		130,678		138,729		119,028
Finished goods		734,542		417,280		467,331
		1,257,053		956,765		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	626,189	799,262	694,372
Considered doubtful	749,138	640,335	643,921
	1,375,327	1,439,597	1,338,293
Others
Considered good	9,251,740	6,615,502	7,908,270
Considered doubtful	—	—	17,648
	9,251,740	6,615,502	7,925,918
Less: Provision for doubtful debts	749,138	640,335	661,569
	9,877,929	7,414,764	8,602,642

SCHEDULE 9 : CASH AND BANK BALANCES

Cash and Cheques on Hand	212,088	185,787	498,387
Balances with scheduled banks
On Current account	812,452	738,369	169,506
In Deposit account	90,963	2,240,025	1,468,034
Balances with other banks in current account
Midland Bank, U K	98,097	—	428,915
Wells Fargo, U S A	398,900	97,827	1,575,159
Societe General			—
Bank of America	157,329	11,357	44,068
Standard Chartered Bank		4,123	312
Shanghai C&S Bank		126	1,181
Danske Bank		480,000
National City Bank		84,336
Allied Irish Banks		240,000
American Express centurion		480,000
Svenska Handelsbanken		240,000
Chase Manhatten	16,591
FCC National bank	25,569
Bank of Scotland		480,000
Suntrust bank
South trust Bank			2,800
Hong Kong & Shanghai Bank	17,479	716	13,462
Bank of Tokyo		22,318	8,230
Great Western Bank	5,677	25	25
	1,835,145	5,305,009	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

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

						(Rs. in ’000s)
		As of December 31,				As of March 31,
		2003		2002		2003
Advances recoverable in cash or in kind or for value to be received
Considered good			1,742,405		1,416,673		1,726,893
Considered doubtful			89,167		71,692		72,694
			1,831,572		1,488,365		1,799,586
Less: Provision for doubtful advances			89,167		71,692		72,694
			1,742,405		1,416,673		1,726,893
Certificate of deposits with foreign banks			—		481,609		2,463,056
Inter Corporate Deposits:
	GE Capital Services India		—		200,741		258,803
	Citicorp Financial services Limited		8,081		35,497		27,000
			8,081		236,238		285,803
Other Deposits (Refer Note a.)			719,800		633,517		637,206
Advance income-tax (net of provision)			723,599		496,273		747,021
Balances with excise and customs			12,439		9,735		16,699
Unbilled Services			1,957,227		1,230,460		1,380,944
			5,163,551		4,504,505		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	2,234,393	1,891,601	2,295,755
Unclaimed dividends	1,491	1,588	1,588
Advances from customers	795,855	756,996	755,942
Other liabilities	4,782,972	3,096,338	2,919,905
Unbilled Services	350,628	297,621	359,902
Interest accrued but not due on loans	—	186	176
	8,165,339	6,044,330	6,333,268

SCHEDULE 12 : PROVISIONS

Employee retirement benefits	852,358	609,202	521,763
Proposed dividend		—	232,564
Tax on proposed dividend		—	29,797
	852,358	609,202	784,124

WIPRO LIMITED

SCHEDULE 13 : OTHER INCOME

						(Rs. in ’000s)
	Nine months ended December 31,					Year ended March 31,
	2003			2002		2003
Dividend from mutual funds		572,511			20,737		26,560
Interest on debt instruments		21,902			207,637		172,603
Interest on Income tax refund							54,120
Rental Income		27,800			19,453		25,266
Profit / (loss) on Sale of Investments		(44,328	)		315,819		410,360
Profit on disposal of fixed assets		(478	)		2,959		7,243
Difference in exchange (Net)		199,833			321,687		297,085
Brand fees		22,050			40,242		53,016
Royalty		—			5,000		19,000
Provision no longer required written back		1,235			21,291		69,687
Miscellaneous Income		39,692			40,190		47,022
		840,217			995,015		1,181,962

Notes: Tax deducted at source Rs. 9413 (2003: 119,430; 2002: Rs. 104,805)

SCHEDULE 14 : COST OF GOODS SOLD

Raw materials, Finished and Process Stocks (Refer schedule 17)	5,664,063		5,590,272		7,767,033
Stores & Spares	138,869		124,841		172,383
Power and Fuel	346,464		265,824		336,840
Salaries, wages and bonus	5,940,665		3,604,233		5,288,348
Contribution to provident and other funds	212,624		133,483		191,756
Gratuity and pension	228,488		149,764		173,594
Workmen and Staff welfare	167,779		111,692		148,538
Insurance	43,488		18,060		25,423
Repairs to factory buildings	7,674		6,361		11,986
Repairs to Plant & Machinery	326,250		282,526		421,170
Rent	228,070		161,792		217,650
Rates & Taxes	566		22,887		30,746
Packing	62,752		49,033		82,661
Travelling and allowances	8,996,797		6,119,361		8,472,040
Depreciation	1,120,609		824,056		1,180,833
Technical fees	206,416		126,881		207,290
Miscellaneous	3,420,056		1,981,456		2,866,433
Less: Capitalized	(92,027	)	(101,254	)	(155,995	)
	27,019,603		19,471,268		27,438,729

SCHEDULE 15 : SELLING GENERAL AND ADMINISTRATIVE EXPENSES

Salaries, wages and bonus		1,418,526	881,474	1,294,086
Contribution to provident and other funds		33,769	28,074	38,629
Gratuity and pension		41,521	36,283	38,876
Workmen and Staff welfare		148,282	99,772	146,407
Insurance		20,124	6,845	10,385
Repairs to buildings		3,213	3,817	3,943
Rent		133,489	99,344	128,248
Rates and taxes		51,280	53,108	66,624
Carriage and freight		105,481	97,989	116,466
Commission on sales		57,749	31,341	67,756
Auditors’ remuneration and expenses
	Audit fees	4,692	4,738	6,567
	For certification including tax audit	439	114	1,410
	Reimbursement of expenses	402	227	505
Advertisement and sales promotion		416,128	295,324	405,804
Loss on sale of fixed assets		6,371	2,794	6,470
Directors’ fees		110	62	128
Depreciation		274,807	281,037	391,417
Travelling and allowances		2,493,899	1,777,559	2,554,828
Communication		125,416	176,348	221,399
Provision/write off of bad debts		142,045	155,895	180,046
Miscellaneous		911,735	602,058	762,583
		6,389,478	4,634,203	6,442,577

WIPRO LIMITED

SCHEDULE 16 : INTEREST

								(Rs. in 000s)
		Nine months ended December 31,						Year ended March 31,
		2003			2002			2003
On fixed loans			3,680			5,031			6,022
Others			24,492			13,201			24,223
			28,172			18,232			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			3,544,287			3,293,839			4,688,657
Less: Closing stocks			363,429			368,049			398,216
			3,579,074			3,365,720			4,730,371
Purchase of Finished Products for sale			2,363,850			2,330,404			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			130,678			138,729			119,028
	: Finished Products		734,542			417,280			467,331
			(278,860	)		(105,852	)		(136,202	)
			5,664,063			5,590,272			7,767,033
SCHEDULE 18 : NON - RECURRING / EXTRAORDINARY ITEMS
Loss of discontinued ISP business			—			378,199			352,195
			—			378,199			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			3,726,185
Wipro Healthcare IT Limited			175,012
Energy Utility Practice			991,281
Wipro Nervewire			385,048
	Total		5,295,797

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 the nine months ended December 31, 2003 Wipro Spectramind e Services Limited allotted 4,164,505 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 93% 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. 49,355 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. 7,015.
7.	The break-up of net deferred tax asset is given below:

						(Rs. in 000s)
		December 31,		December 31,
		2003		2002		March 31, 2003
Deferred tax assets:
	Allowance for doubtful debts		87,070		102,364		87,070
	Property plant and equipment		74,272		116,743		74,272
	Employee stock incentive plan		38,902		38,902		38,902
	Accrued expenses		103,133		42,192		103,133
	Business losses carried forward		162,532		140,951		162,532
			465,909		441,152		465,909

8. Provision for taxation comprises of following:

(i)	Rs. 514,749 (2003: 556,117; 2002: Rs. 418,570) in respect of foreign taxes
(ii)	Rs. 405,158 (2003: 627,899; 2002: 383,701) 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. 18,542 (2003: 200,850; 2002: Rs. 193,612).
(iii)	Rs. 2250 (2003: 2,500; 2002: Rs. 2250) 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 (P) Limited	India		93	%
		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	%
		Wipro Consumer Care Limited	India		100	%
b) Wipro Equity Reward Trust			India		Fully controlled trust
c) Grantor Trust			USA		Fully controlled trust
d) 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; Energy & Utilities Practice with effect from January 2003 and Wipro Nerve wire (IT consulting business) with effect from May 2003.

WIPRO LIMITED

CASH FLOW STATEMENT

										(Rs. in 000s)
				Nine months ended December 31,						Year ended March 31,
				2003			2002			2003
Cash flows from operating activities:
	Profit before tax from continuing operations				8,068,839			7,609,186			10,317,484
	Adjustments to reconcile Net profit before tax and non recurring items to net cash provided by operating activities:							—
		Depreciation and amortization			1,396,393			1,064,564			1,568,487
		Foreign currency translation gains			(191,650	)		(321,687	)		(297,085	)
		Minority Interest
		Equity in earnings of affiliates
		Retirement benefits provision			228,488			200,212			112,773
		Others						(298	)		—
		Interest on borrowings			28,172			18,232			30,245
		Dividend / interest			(594,413	)		(544,193	)		(633,398	)
		Loss / (Gain) on sale of property, plant and equipment			5,892			(2,959	)		6,470
Operating cash flow before changes in working capital					8,941,721			8,023,057			11,104,976
			Trade and other receivable		(1,448,273	)		(536,680	)		(1,919,285	)
			Loans and advances		(47,094	)		(469,931	)		(729,342	)
			Inventories		(246,526	)		(22,165	)		(75,927	)
			Trade and other payables		1,611,194			356,778			803,940
Net cash provided by operations					8,811,022			7,351,059			9,184,362
Direct taxes paid					(898,735	)		(1,123,339	)		(1,848,699	)
Net cash provided by continuing operations					7,912,287			6,227,720			7,335,663
Net cash provided by discontinuing operations					—			31,014			27,284
Net cash provided by operations					7,912,287			6,258,734			7,362,947
Cash flows from investing activities:
Expenditure on property, plant and equipment (including advances)					(2,823,922	)		(1,521,253	)		(2,523,048	)
Proceeds from sale of property, plant and equipment					67,686			84,634			103,530
Purchase of investments					(20,040,700	)		(30,243,692	)		(41,182,961	)
Inter Corporate deposits placed / matured					277,722			1,828,853			1,779,288
Certificate of Deposits with foreign banks					2,463,056			4,805,610			2,824,163
Sale / maturities on Investments					8,489,997			26,236,496			37,904,824
Payment for acquisition, net of cash acquired					(465,266	)		(5,085,443	)		(5,484,793	)
Divided received					582,397			69,737			75,560
Interest received (net)					(11,213	)		207,637			169,918
Net cash used in investing activities					(11,460,243	)		(3,617,421	)		(6,333,519	)
Cash flows from financing activities:
Proceeds from exercise of Stock Option Plan grants					70,828			88,515			106,809
Share application money pending allotment					(1,222	)		(2,399	)		(1,177	)
Proceeds from issuance of common stock by subsidiary					147,533
Dividends paid					(262,361	)		(232,466	)		(232,466	)
Proceeds from issuance / (repayment) of borrowings					1,127,896			(221,863	)		275,576
Net cash provided by/(used in) financing activities					1,082,674			(368,213	)		148,742
Net increase/ (decrease) in cash and cash equivalents during the year					(2,465,282	)		2,273,100			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					(3,817	)
Cash and cash equivalents at the end of the period					1,740,980			5,305,009			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
/s/ Azim Hasham Premji	/s/ N. Vaghul	/s/ P. M. Sinha
Azim Hasham Premji	N. Vaghul	P. M. Sinha
Chairman and Managing Director	Director	Director
/s/ Suresh C. Senapaty	/s/ V. Ramachandran
Suresh C. Senapaty	V. Ramachandran
Corporate Executive	Company Secretary
Vice President - Finance
	Bangalore, January 21, 2004

WIPRO LIMITED

AUDITOR’S CERTIFICATE

We have examined the above cash flow statement of Wipro Limited – consolidated for the period ended December 31, 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 December 31, 2003, covered by our report of even dated.

For N M Raiji & Co.,
Chartered Accountants

/s/ J M Gandhi
J M Gandhi
Partner

Mumbai, January 21, 2004