As-20 ca final

convertinle denemture are nothing but prospective equity shares. right now no euity shares from convertible debentures.

so while calculation of basic EPS should not be consider the convetible debentures. if convertion happens before closing the financial year, we should consider (because of by the end of the year debenture were conveted as equity shares)

where as IN diluted EPS, convertion was not done by ending of financial year these convetible debentures are prospective shares. 

Basic EPS = PAES / WANES

when convertion occurs no increase in resources of the entity. so same earning will get in future.

but number of equity shares will increase ( because of convertion)

so in future Our Basic EPS will get diluted (because of convertion of debentures)

 while calculation of diluted EPS we should consider all the chances to allot future equity shares. (like convetible debentures and convertible preference shares etc....)