Kingfisher saves Rs 744 cr; thanks to accounting changes

Private carrier Kingfisher Airlines saved close to Rs 744 crore during the six-month period ended September 30, due to some changes in accounting methods, in absence of which the losses sufferred by the Vijay Mallya-promoted company would have been about Rs 1,400 crore.

The company informed the Bombay Stock Exchange about the impact of "change in the method of accounting" in a "Limited Review Report" prepared by its chartered accountants that the bourse has put on its website.

"But for the change in the method of accounting... The loss for the quarter ended September 30, 2008 would have been more by Rs 129.5 crore and for the half-year ended on that date would have been more by Rs 744.23 crore," Chartered Accountant B K Ramadhyani & Company said in their report to the board of directors of Kingfisher Airlines.

The company had reported a net loss of Rs 483.25 crore for the quarter ended September 30, and a loss of Rs 157.87 crore for the quarter ended June 30, 2008 -- resulting in a net loss of about Rs 641 crore for the six-month period ended September.

In its review report for the quarter ended September 30, the company also informed BSE that it has obtained approval of the shareholders through postal ballot for a proposal to hike its borrowing limit to Rs7,500 crore.

Company officials were, however, not immediately available for comments.

The financial details under the review report were subject to certain clarifications listed in the footnotes, which are not available on the BSE website.

"Maintenance deposits placed with certain lessors and outstanding as on September 30, 2008 referred to in footnote 5 aggregating to Rs 70,468 lakh are subject to confirmation from the concerned lessors," according to the communique.

The chartered accountant (CA) also said the management has informed him that the earnings per share (both basic and diluted) (both before and after exceptional items) for the quarter and the half-year ended September 30 should be read as Rs 21.52 and Rs 35.78 instead of Rs 32.11 and Rs 50.81 per share, respectively, as reported.

The CA also said that the aggregate borrowings of the company, apart from temporary loans obtained from its bankers in the ordinary course of business as on September 30, exceeded the aggregate limit approved by its members at the extraordinary general meeting held on November 4, 2005, as per the terms of the Companies Act.