IDEA Celluar

Tone of the top:

2G scam: Aditya Birla group firm Idea Cellular also benefitted as it was provided with extra time to acquire eligibility. Idea Cellular had made application in August 2005 for grant of license for the Mumbai circle, while the LoI was issued in November 2006. "In the intervening period, time was extended to enable the applicant to acquire eligibility," it said.

BOARD OF DIRECTORS

COMMITTEES OF THE BOARD

A. Audit Committee Composition, Meetings and Attendance The composition of the Audit Committee as on March 31, 2009 and the attendance of the members at the meetings are as under:

Powers of Audit Committee

As enumerated in Clause 49 of the Listing Agreement, the Audit Committee has the following powers: 1. To investigate any activity within its terms of reference; 2. To seek information from any employee; 3. To obtain outside legal or other professional advice, and 4. To secure attendance of outsiders with relevant expertise, if it considers necessary

Code of Conduct for Board Members and Senior Management Introduction

This Code of Conduct (hereinafter referred to as "the Code") has been framed and adopted by Idea Cellular Limited (hereinafter referred to as "the Company") in compliance with the provisions of Clause 49 of the Listing Agreements entered into by the Company with the Stock Exchanges.

Applicability
The Code applies to the Members of Board of Directors (hereinafter referred to as "Board Members) and Members of the Senior Management Team of the Company viz. Management Committee Members and all other executives having similar or equivalent rank in the Company and the Company Secretary of the Company (hereinafter referred to as "Senior Managers"). The Company Secretary shall be the Compliance Officer for the purpose of this Code. The Code shall come into force with immediate effect and future amendments / modifications shall take effect from the date stated therein.

Code of conduct
The Board Members and Senior Managers shall observe the highest standards of ethical conduct and integrity and shall work to the best of their ability and judgment. The Board Members and the Senior Managers of the Company:

Shall maintain and help the Company in maintaining highest degree of Corporate Governance practices Shall act in utmost good faith and exercise due care, diligence and integrity in performing their office duties. Shall not seek, accept or receive, directly or indirectly, any gift, payments or favor in whatsoever form from Company's business associates, which can be perceived as being given to gain favor or dealing with the Company and shall ensure that the Company's interests are never compromised. Shall maintain confidentiality of information entrusted by the Company or acquired during performance of their duties and shall not use it for personal gain or advantage. Shall not commit any offences involving moral turpitude or any act contrary to law or opposed to the public policy. Shall not communicate with any member of press or publicity media or any other outside agency on matters concerning the Company, except through the designated spokespersons or authorized otherwise. Shall not, without the prior approval of the Board or Senior Management, as the case may be, accept employment or a position of responsibility with any other organization for remuneration or otherwise that are prejudicial to the interests of the Company and shall not allow personal interest to conflict with the interest of the Company. Shall in conformity with applicable legal provisions disclose personal and/ or financial interest in any business dealings concerning the Company and shall declare information about their relatives (spouse, dependent children and dependent parents) including transactions, if any, entered into with them.

Shall ensure compliance of the prescribed safety & environment related norms and other applicable codes, laws, rules, regulations and statutes, which if not complied with may, otherwise, disqualify him/ her from his/ her association with the Company. Shall ensure compliance with SEBI (Prohibition of Insider Trading) Regulations, 1992 as also other regulations as may become applicable to them from time to time

Human Resources
The Company through its participative work environment, skill development activities, and by championing the values of commitment, integrity, passion, seamlessness and speed, promotes strong bonding with its employees. During the year, it has again undertaken sharing of value creation by granting another tranche of employee stock options to the eligible Employees. The findings of Organization Health Study (OHS) have been analyzed, which are very encouraging, and concern areas are being suitably addressed. The employee strength on rolls stood at 6,481 as on March 31, 2009.

Risk Management
The Risk Management framework of the Company ensures, amongst others, compliance with the requirements of Clause 49 of the Listing Agreement. The framework establishes risk Management across all service areas and functions of the Company, and has in place procedures to inform the Board Members about the risk assessment and minimization process. These processes are periodically reviewed to ensure that the Management of the Company controls risks through a defined Framework. The various risks, including the risks associated with the economy, regulations, competition, foreign exchange, interest rate etc., are monitored and managed effectively.

Internal Control Systems

The Company has appropriate internal control systems for business processes, covering operations, financial reporting and compliance with applicable laws and regulations. Clearly defined roles and responsibilities for all managerial positions drive adherence of defined processes. Operating parameters are

Monitored and controlled. Regular internal audits and checks ensure that responsibilities are executed effectively. The audit committee of the Board of Directors actively reviews the adequacy and effectiveness of internal control systems and suggests improvement for strengthening them, as appropriate.

Opportunities, Risks, Concerns and Threats

The strong growth in the sector continues, mainly due to expansion of telecom networks to rural India, the reduced cost of entry and the reduced cost of handsets. Low penetration, more particularly in rural India, provides opportunity for further growth, and your company, an incumbent GSM player with 900 MHz spectrum in about half of India, is well positioned to tap this opportunity. The telecom sector has witnessed increasing competition towards the end of financial year 2008-09 and the first half of financial year 2009-10. New launches are coming both from CDMA operators with crossover spectrum, and new licensees. These new launches, along with the expansion of some regional players, have created major overcapacity in the sector, which in turn has lowered tariffs. However, your company, based on the inherent advantage of spectrum and scale, brand strength and sophisticated management processes, is in a position to emerge even stronger through this phase of hyper competition and sector overcapacity. The telecom sector is characterized by change in technology. Competition from new technologies is an inherent threat.

Corporate Social Responsibility

The Company is a responsible corporate citizen, and strives to give back to the community it operates in. The Corporate Social initiatives, which the Company has identified and implemented are as under: Ahmadabad Idea Telecom Centre of Excellence Your Directors wish to inform that, your Company has entered into a tripartite agreement with the Indian Institute of Management, Ahmadabad (IIMA) and the Department of Telecommunications (DoT), to set-up a Telecom Centre of Excellence at the campus of IIMA known as IIMA Idea Telecom Center of Excellence (IITCOE). This Centre of Excellence focuses on the areas of telecom policies, governance, regulation and management, especially marketing and customer care. IITCOE will Identify and capture best practices across countries; will enhance human capital through training and teaching programs for policy makers, regulators and the industry; will bring fresh insights from other countries in telecom and in related sectors, and will find solutions to Indias specific situation, especially in the development of rural telephony.
IIM Pocket

PCO project Your Company along with International Finance Corporation (IFC), a member of The World Bank Group, has taken an initiative for designing and implementing a Pocket PCO program in India. Idea Pocket PCO is easy to use mobile phone that comes with a special Idea SIM having PCO software embedded in it. The device can be used by the individual as a mobile phone for personal use and as a PCO for business opportunity. The project will help rural micro-entrepreneurs to create pocket Public Call Offices (PCOs) in Indias under-served areas. The focus is to provide access to telephony services in rural communities, while creating income generating opportunities. Your company is committed to help people to improve their lives by providing high quality access to telecommunications.
FICCI-Aditya

Birla CSR Centre for Excellence For the purposes of creating greater awareness and promoting Corporate Social Responsibility (CSR), as a part of the corporate mission and values, the Federation of Indian Chambers of Commerce and Industry (FICCI), your Company and other group companies of the Aditya Birla Group, viz., Hindalco Industries Limited, Grasim Industries Limited, Aditya Birla Nuvo Limited and Essel Mining and Industries Limited have set-up a CSR Centre called as FICCI-Aditya Birla CSR Centre for Excellence. The object of setting-up the Centre, amongst others, is to create and develop the culture and concept of CSR among corporates, businesses, industries, organizations as well as other institutions, which benefit employees, their families and the society at large through welfare and training programs.