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Accounting policies

Major launches during the year

Vista VX Tech, the advanced and dynamic premium hatchback, launched

Nano Twist launched

Bolt, a premium hatchback , displayed at Auto Expo 2014

Zest displayed at Auto Expo 2014

Magic Iris Electric displayed at the Auto Expo 2014

Tata Starbus Urban FE-Parallel Hybrid Bus displayed at Auto Expo 2014

Recovery Vehicle, showcased in DEFEXPO

Tata Armoured Personnel Carrier (APC) Left Hand Drive Xenon Crew Cab 4X4 Luxury launched

Prima KL3TXF 6X4 truck tractor and Ultra 812 truck revealed at Johannesburg International Motor Show 2013

Aria showcased in South Africa, Johannesburg Motorshow Nano CNG eMax launched

Aria, Vista and Safari Storme launched in Indonesia

Aria and Safari Storme launched in Tanzania

Xenon Pickup launched in Nepal

TATA Xenon XT launched in South Africa

Manza launched in Nigeria

Aria and Manza launched in

6 new models in the cargo segment (Prima LX 4928.S SRT, Prima LX 4928.S HRT, Prima LX 4028.S SR, Prima LX 4028.S HR, Prima LX 2523.T and Prima LX 3123.T)

4 new models in tippers (Prima LX 2523.K, Prima LX 2528.K, Prima LX 3123.K and Prima LX 3128.K), launched Magic Iris CNG, Ace Dicor (with Common Rail Engine)

Training and Development:

The Company is committed to building the competencies of its employees and improving their performance through training and development.

The Company focus is on identifying gaps in its employees’ competencies and preparing employees for changes in competitive environments, as well as to meet organizational challenges.

Some of the focus areas in training in the last year centered on leadership, innovation management and internationalization besides other training programs to drive a change in the Company’s employees’ outlook as it continue to develop as a global competitor.

Developmental initiatives for the Company’s senior leadership were undertaken through international programs at various premier institutions around the world.

Certain employees have also been selected for the Fulbright fellowships for leadership in management. In addition, in order to emphasize the sharing of skills across our locations and functions extensive technical training programs were organized in Pune, Jamshedpur and Lucknow.

The technical exposure was enhanced further through international training and participation at international seminars.

At Jamshedpur, Pune and Lucknow in India, the Company has also established training divisions that impart basic skills in various trades like milling, grinding and welding to its young apprentices.

“iTeach” which was created as an innovative practice of getting line managers to take ownership in sharing their knowledge and experience gained a lot of traction. The Company has switched to e-enabled learning through LMS (Learning Management System). Programs like “Autonova”, “Project Leap” were introduced.

The Company received the National Best Training Establishment award from the Government of India for the eighth time.

System followed for purchase of material

Tata Motors Sales, Distribution and Support :

The sales and distribution network in India as of March 31, 2013, comprises 2,609 sales contact points for the Passenger and Commercial Vehicle businesses.

The Company has deployed a Customer Relations Management (CRM) system at all our dealerships and offices across the country. The system is certified by Oracle as the largest Siebel deployment in the automotive market. The combined online CRM system supports users both within the Company and among the distributors in India and abroad.

The Company’s 100% subsidiary, TML Distribution Company Ltd (TDCL), acts as a dedicated distribution and logistics management company to support the sales and distribution operations of vehicles in India.

TDCL provides distribution and logistics support for vehicles manufactured at the Company’s facilities. TDCL helps us improve planning, inventory management, transport management and timely delivery.

The Company provides financing support through its wholly owned subsidiary, Tata Motors Finance Ltd (TMFL). (Refer discussion on TMFL).

In addition to dealer service workshops, the Company uses a network of service centers on highways and a toll-free customer assistance center to

provide 24-hour on-road maintenance (including replacement of parts) to vehicle owners.

The Company believes that the reach of the sales, service and maintenance network, provides us with a significant advantage over the competitors.

Jaguar Land Rover’s Sales & Distribution: JLR markets products in 178 countries, through a global network of 17 national sales companies (‘‘NSCs’’), 85 importers, 62 export partners and 2,485 franchise sales dealers, of which 689 are dealers for both Jaguar and Land Rover.

JLR has established robust business processes and systems to ensure that its production plans meet anticipated retail sales demand and to enable the active management of its inventory of finished vehicles and dealer inventory throughout its network.

Future plans

More emphasis will be laid on the design, performance and styling of our products such that they meet the expectations of customers.

As a precursor to future launches, the Company would be shortly unveiling improved and enhanced vehicles across its key brands.

The Company continues its effort on developing new products and technologies to meet growing customer expectations. The existing products will be refreshed at regular intervals to suit upcoming trends. In the long term, the Company is focusing on improving driving comfort, fuel efficiency, performance and aesthetics.

Initiatives on technological changes with an emphasis on customer orientation will be sharpened.

The Company, in its constant endeavor to improve processes in design and planning in the manufacturing domain, has implemented integration of digital product data into digital manufacturing planning system.

The Company plans to export various vehicles in future considering socio-political and macro economic conditions worldwide.

The Company focused on introducing various products in new / existing markets of Indonesia, Myanmar, Bangladesh, Saudi Arabia and Tanzania.

JLR aims to establish new manufacturing facilities, assembly points and suppliers in selected markets. In China, joint venture with Cherry Automobiles has been formed.

JLR aims to increase its marketing and dealer network in emerging markets. In China, the presence in this key market and plans to increase the network of sales dealerships across the country.

The Defence business has increasing relevance in international markets, as well and the Company is now focusing on developing this business beyond India.

For providing prompt service to the customer, development of enterprise level vehicle diagnostics system for achieving speedy diagnostics of complex electronics of modern vehicles has been underway.

Marketing strategies

The Company has designed its products to suit the requirements of the Indian market based on specific customer needs such as safety, driving comfort, fuel efficiency and durability. The Company believes that its vehicles are suited to the general conditions of Indian roads, driving habits and the local climate.

The Company also offers a wide range of optional configurations to meet the specific needs of its customers. The Company is developing products to strengthen its product portfolio in order to meet customer expectations.

It has also stepped up significantly its “Office of the Customer initiative” as well as its branch network and infrastructure.

The Company is pursuing various quality improvement programmes, both internally and its suppliers’ operations, in an effort to enhance customer satisfaction and reduce future warranty costs.

Improve the relationship with the customer – the experience the customer has with the Company at each touch point from sale to service and replacement sales experiences.

This would include improving the physical look of the setup, setting up right processes and forums for speedy resolution of customer issues.

In order to remain relevant to our customers, we launched HORIZONEXT. An aggressive customer-focused strategy, HORIZONEXT aims to provide the best customer experience

o From best vehicle experience to superlative purchase experience

o Technology-intense after-market service support

In addition to improving our operational efficiencies, we enhanced customer engagement through focused marketing campaigns and refreshing showroom decor and the sales experience.

In our Passenger Vehicle segment attractive offers of select models such as the Manza Club Class and the Indica eV2 drove increased mindshare among customers.

Revamped the Concorde showrooms in Prabhadevi, Mumbai, and South Extension, New Delhi and Pune to engage our customers and improve their purchase experience.

The Company introduced a host of new products on existing and new platforms in existing and new markets and showcased its vehicles in major auto shows in strategically important markets.

With the objective of increasing its marketing and dealer networks in emerging markets, Jaguar Land Rover established a National Sales company in China in 2010 to expand its presence and has plans to increase its network of dealers in China. Similar plans of increasing its dealer network are also underway in India.

Manpower Planning

In line with the Human Resource strategy, the Company, in turn, has implemented various initiatives in order to build organizational capability that will enable the Company to sustain competitiveness in the global market place. The focus is to attract talent, retain the better and advance the best. Some of the initiatives to meet this objective include:

Extensive process mapping exercise to benchmark and align the human resource processes with global best practices.

Introduction of a globally benchmarked employee engagement programme.

Succession planning through identification of second level of managers for all units, locations, functions.

Restructuring the top level organization and creation of new verticals for greater functional focus and moving towards creating a matrix organization.

Creation of a powerful employer brand to attract talent - “Lead the Future” has become the Company’s Employee Value Proposition statement.

Driving cultural transformation - The Company has reframed the mission, vision, values and culture of the organization and introduced the concept of ACES - Accountability, Customer & Product focus, Excellence and Speed.

Extensive brand building initiatives at university campuses to increase recruiting from premium universities.

JLR launched a new “Team Talk Online” portal to its production workers, which provides them with business updates alongside information on employee benefits, training and development.

Employee appraisals and welfare

Implementation of a “Fast Track Selection Scheme”, which is a system for identifying potential talent in the areas of general, commercial and operations management and offering them opportunities for growth within the organization.

The Company’s human resources team has been invited to replicate this system in other Tata Companies.

The Company “Talent Management Scheme” which includes the identification of high performers and high potentials through various routes such as our Performance Management System and Development Centers. Subsequent to the identification process, we provide them with challenging assignments for faster development.

Introduction of performance rating based salary review and quality linked variable payment for supervisory category of employees.

The variability in wage settlements was built in by introducing vehicles and profit linked payment scheme based on the index of various parameters such as quality, productivity, operating profit and individual’s performance and attendance.

The business has continued its programme of proactive health promotion events for employees and has launched several Wellbeing Centres to aid in worker assessment, rehabilitation and piloted electronic ‘WellPoint’ kiosks

to allow employees to monitor their own health data and seek further advice.

At Jaguar Land Rover, the health and safety management system is based on the UK Health and Safety Executive’s guidance for Health and Safety Management

The Company launched health brand logo ‘HealthPlus’ - Because you matter!’ to drive employee health initiatives. Series of initiatives like awareness sessions, mailers, etc. have been conducted under this initiative.

Employee benefit scemes:

GratuityThe Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount equivalent to 15 to 30 days salary payable for each completed year of service.

SuperannuationThe Company has two superannuation plans, a defined benefit plan and a defined contribution plan. An eligible employee on April 1,1996 could elect to be a member of either plan. Employees who are members of these plans are entitled to benefits depending on the years of service and salary drawn.The Company maintains a separate irrevocable trust for employees covered and entitled to benefits. The Company contributes up to 15% of the eligible employees’ salary to the trust every year. The Company recognizes such contributions as an expense when incurred. The Company has no further obligation beyond this contribution.

Bhavishya Kalyan Yojana (BKY)

Bhavishya Kalyan Yojana is an unfunded defined benefit plan for employees of the Company. The benefits of the plan include pension in certain case, payable up to the date of normal superannuation had the employee been in service, to an eligible employee at the time of death or permanent disablement, while in service, either as a result of an injury or as certified by the appropriate authority. The monthly payment to dependents of the deceased / disabled employee under the plan equals 50% of the salary drawn at the time of death or accident or a specified amount, whichever is higher.

Post-retirement medicare schemeUnder this scheme, employees of the Company receive medical benefits subject to certain limits of amount, periods after retirement and types of benefits, depending on their grade and location at the time of retirement. Employees separated from the Company as part of Early Separation Scheme, on medical grounds or due to permanent disablement are also covered under the scheme.

Provident fundThe eligible employees of the Company are entitled to receive benefits in respect of provident fund, a defined contribution plan, in which both employees and the Company make monthly contributions at a specified percentage of the covered employees’ salary (currently 12% of employees’ salary). The contributions as specified under the law are made to the provident fund and pension fund set up as irrevocable trust by the Company .

Severance indemnityTata Daewoo Commercial Vehicle Co. Ltd., and Tata Daewoo Commercial Vehicle Sales and Distribution Co. Ltd., subsidiary companies incorporated in Korea has an obligation towards severance indemnity, a defined benefit retirement plan, covering eligible employees. The plan provides for a lump sum payment to all employees with more than one year of employment equivalent to 30 days’ salary payable for each completed year of service.

Post-retirement medicare schemeUnder this scheme, employees of the Company and some of its subsidiaries get medical benefits subject to certain limits of amount, periods after retirement and types of benefits, depending on their grade and location at the time of retirement. Employees separated from the Company as part of Early Separation Scheme, on medical grounds or due to permanent disablement are also covered under the scheme.

Provident fund and family pensionThe eligible employees of the Company and some of its subsidiaries are entitled to receive benefits in respect of provident fund, a defined contribution plan, in which both employees and the company/subsidiaries make monthly/annual contributions at a specified percentage of the covered employees’ salary (currently 12% of employees’ salary). The contributions, as specified under the law, are made to the provident fund and pension fund set up as irrevocable trust by the Company and its subsidiaries or to respective Regional Provident Fund Commissioner and the Central Provident Fund under the State Pension scheme.

Compensated absencesThe Company and some of its subsidiaries provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number of days of unutilized leave at each balance sheet date on basis of an independent actuarial valuation as at Balance Sheet date.

Financial highlights of TATA Motors

Summarized statement of profit and loss (TATA motors group)

Financial Performance (TATA Motors)