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30 years of Infosys
Annual Report 2010-11

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30 years of Infosys
Infosys Annual Report 2010-11
Posterity will not excuse you if you did not dream big. You owe it to your
customers, your colleagues, your investors, and the society. Every major
civilization, every great advance in science and technology, and every
great company is built on a big dream.
N. R. Narayana Murthy
Chairman and Chief Mentor
30 years of Infosys
Turning thirty is a good time to reminisce. And reflect. And look
ahead.
Thirty is one of those rare junctures when you have both youth
and experience on your side. Thus, as Infosys completes thirty, we
talk about the pleasures and pains of starting small; the genesis
of a value-based organization culture; personal goals turning
into company milestones; sharing wealth and caring for society;
learning and educating; building infrastructure for one and all;
agreeing to disclose and refusing to compromise on quality; and
above all, believing in a vision and leading by example to see it
become reality.
Thirty is also the time to break new ground.
This Annual Report is printed on 100% recycled paper as certified by the U.K.-based National Association of Paper Merchants (NAPM) and France-based Association des Producteurs et
des Utilisateurs des papiers et cartons Recycls (APUR).
30 years of Infosys
Sitting on a high
stool at the NASDAQ
headquarters in New York
in front of the scorching
lights of TV cameras, I
borrowed the words of
Neil Armstrong to tell the
world how important it was
for an Indian company to be
listed on the NASDAQ.
Goodbye, folks. March on with values...
30 years of Infosys
It was on one of those rare nights at home during the late eighties.
I was huddling with my young children, Rohan and Akshata, when
Rohan, the most mischievous child I have ever come across, asked
innocently whether I loved Infosys more than him and his sister.
I got away from that embarrassing situation by saying that I loved
my children much more than anything else. However, even today,
when we reminisce about the incident, my children are not fully
convinced that I was telling them the truth. When I was busy
overseeing every detail of the strategy and the operations of the
company from designing the company logo, the company song
and the presentation materials, signing off on every drawing and
material used in every building on our campuses around the world
and coming home late at night it was difficult to argue with the
innocent but correct logic of my children. When I was spending
16-hour days in the office and was away from home for as many
as 330 days in a year, it was hard for my children to believe in my
commitment to the family.
There is no doubt that the Infosys journey has been an integral part
of my life. Most of my colleagues say that Infosys is an inseparable
part of me and I am an inseparable part of Infosys. I have been the
Number One actor in every major decision taken in the company.
I have rejoiced in every significant milestone of the company.
I have commiserated in every false step that this company has
taken. The best analogy that I can think of for this separation
between Infosys and me is that of ones daughter getting married
and leaving her parents home. Yes, the parents will be there when
she needs them and they will be happy that she is starting a new life
in an exciting new environment.
It is not easy for me to write my last article in the Annual Report
of the company. As I write this, a mosaic of images from the past
whizzes through my mind. The list seems endless and it would be
difficult to narrate them all in this article. So let me highlight a few
of them. The day we assembled in my tiny apartment in Mumbai to
decide that respect from every stakeholder was the most valuable
thing for us. The day we convinced our first US customer to close
his own operations at SEEPZ and hitch his future with ours was a
significant milestone for us. The day we won the MICO data center
contract, starting as an underdog and going on to differentiate
ourselves based on our advanced mathematical modeling
competence, was a day that boosted our confidence as engineers.
The day we inaugurated Indias first software campus is still vivid in
my memory. Distributing 27% of the companys equity among our
employees was a proud moment for those of us who have always
considered the idea of sharing wealth to be an important part of our
social responsibility.
Listing in India in 1993 pushed us to become leaders in corporate
governance. The joy of being Indias first software company to
be certified at Level 4 of the Capability Maturity Model of the
Software Engineering Institute at Carnegie Mellon was clearly what
enhanced our own belief in quality. Sitting on a high stool at the
NASDAQ headquarters in New York in front of the scorching lights
of TV cameras, I borrowed the words of Neil Armstrong to tell the
world how important it was for an Indian company to be listed
on the NASDAQ. Opening our ultra-modern offices in London,
Paris, New York, Melbourne, Shanghai and Tokyo heralded our
aspirations to be a global company.
The inauguration of the first education center at Mysore by Prime
Minister Manmohan Singh and the second one by Mrs. Sonia
Gandhi, the President of the Indian National Congress, were both
sound reaffirmations of our long-held belief in the importance of
education and research. Participating in the Billion Dollar Day
function, declaring several special dividends and bonus shares,
becoming part of NASDAQ-100, starting our banking group,
creating Infosys Consulting and Infosys BPO, building more than
28 million sq. ft. of world-class development centers, winning
several prestigious global awards, and establishing the Infosys
Foundation are milestones that brought us great pride.
There have been some moments of great dilemmas and sadness
too. Bidding goodbye to perhaps the brightest of my co-founder
colleagues early in the journey was disheartening. Refusing to
accept unreasonable terms and walking away from business with
a Fortune-10 company was a test of our resolve. Accepting the
resignation of a senior colleague and dealing with the instance
where our code of ethics was jeopardized were tests of adherence
to our values. Deliberating all alone on the resignation offer of a
co-founder is not something I would wish even upon my enemy.
Being accused of violating our own high standard of business ethics
recently made me lose several nights of sleep. Occasional incidents
of the organization turning bureaucratic, the inability of some of
our leaders to take quick and firm decisions, and the government-
company interface becoming less business-friendly from time to
time are things that make me sad. But then, this tapestry of happy
and not-so-happy incidents is normal and keeps life exciting.
What have been the lessons from this extraordinary marathon?
Assembling a team of extraordinary people who have displayed
outstanding capabilities through their value system, competence,
low ego and high energy is crucial to the progress of any institution.
The differentiation comes from ideas, and ideas come from bright
minds. Therefore, good people are the primary assets of a great
organization. It is essential to realize that even the best people may
not be able to run the entire marathon. Different people run out
of endurance and intellectual horsepower at different points of
time. Some people drop out of the marathon since they do not see
any value in an organization when their own time under the arc
light is over. A leaders responsibility is to recognize this, provide
them opportunities outside the organization, and usher in suitable
replacements. Infosys journey is replete with many such examples.
Many intelligent people possess a high ego and low patience to deal
with people less capable than themselves. Leaders have to manage
this anomaly very carefully, counsel these errant people from time
to time, and allow them to operate as long as they do not become
dysfunctional and start harming the organization. If they do cross
the threshold, it takes courage to inform the individuals that
their time in the organization is over and that they have to leave.
However, one aspect that marks out a truly superior organization is
the ability of its employees at all levels to be driven by values and
to ensure adherence and compliance under any circumstance. No
individual is high or important enough for an organization to put
up with non-compliance.
Leadership by example is what creates trust in people to follow a
leader. As long as a leader is able to show his or her sacrifice and
commitment to a cause, others will follow him or her. I am glad we
decided on respect from our stakeholders (customers, employees,
investors, vendor-partners, government of the land and the society)
as the primary objective of the company. I have seen hundreds of
instances of such leadership-by-example at Infosys.
A sense of ownership among employees is extremely important
to build a long-term future for a corporation. Such ownership
comes from fair, merit-based and generous sharing of wealth
and perquisites among each member of the company. This is my
answer to many of my friends, who wonder why, when Infosys was
founded, I took a small percentage of my earlier salary while every
other co-founders salary was increased by at least 10%.
30 years of Infosys
The same friends tell me that they do not know of any other
instance where as much as 10% to 15% of the company equity
was given to co-founders who had just 12 to 18 months of work
experience.
I do not know of any Indian company that has given away as much
as R 50,000 crore (at current stock prices) of stock options to
employees. Today, every Indian employee at every level who joined
us on or before March 2010 is a stockholder of Infosys. The point
I would like to make is that such acts demonstrate that our leaders
walked the talk in sacrifice and commitment.
Strategy is about ensuring sustained differentiation in a changing
environment for better net income margins. Differentiation
without better net income margins is meaningless. In my opinion,
operating margins and earnings before taxes, depreciation and
amortization (EBITDA) are not appropriate measures. In fact,
the best measure of differentiation is the per-capita free cash flow
generated. Such cash flows bring cash
to invest in better people, research and
development, infrastructure, training,
and better customer and employee
confidence. The famous Harvard
historian, Niall Ferguson, says in his
book, Civilization : the West and the Rest,
that the six attributes that have made
Western civilization dominant during the
last five hundred years are: competition,
science, property rights, medicine,
consumption and a good work ethic.
I have been saying for many years now that
the factors that differentiate a corporation
from its competitors are : an enduring
value system, open-mindedness, a
pluralistic and meritocratic approach,
and practicing speed, imagination and
excellence in execution. Leaders have to
focus on creating such an environment.
Leadership is about taking bold and firm
decisions with incomplete information in
an environment of uncertainty. Leaders
who waffle do not inspire confidence
in their people. It is important to use
as much data and modeling as possible
to eliminate clearly bad decisions.
My decision to walk away from a
Fortune-10 company when they
contributed 25% of our revenue was one
such example of decision making under uncertainty. It was a tough
decision that was taken so calmly and firmly that the head of sales
at Infosys at that time thought I was not bothered about the future
of the company! I had to explain to him that I did indeed agonize
over it but that, as a leader, I could not be driven by panic since
such an important decision required a calm and composed mind.
Every leader must have a mental model of his or her business with
at best five to seven parameters that determine sensitivity to revenue
and net-income. It is important to update that model suitably as
the business landscape changes. Any leader who cannot quickly
do such sensitivity calculation would not be able to take quick and
bold decisions. Even today, I carry and update the mental model of
our business in my mind.
Generosity is an essential part of a leader. It is the foundation on
which teamwork is built. The ability to share the limelight with
ones colleagues, the ability to step aside and give opportunity to
younger people when they want that fame, power and glory, and
the ability to provide a safety net of advice for them is an important
aspect of strengthening the future of an organization. It is not easy
to give up power, particularly when you have been the object of
so much adulation. I must say that Infosys has done a good job
in bringing two such transitions before I leave the portals of this
company.
Scalability is the true test of the endurance of an organization.
The ability to grow successfully without losing quality, productivity,
employee, investor and customer satisfaction and the spirit of a
small company is what makes Infosys a great company. We have
grown from 50 customers to 620 customers, from 10 projects
to 6,500 projects, from 100 employees to 1,30,820 employees,
from 100 sq. ft. to 28 million sq. ft. of
built-up space, and from 100 investors
to over 4,50,000 investors. Such a
scalability exercise has been successful,
thanks to our PSPD model of operation.
PSPD stands for Predictability of revenues,
Sustainability of such predictability,
Profitability of such realized revenues,
and Derisking. Predictability happens
because of a good forecasting system that
derives realistic data from the trenches
and tempers it with the wisdom of senior
business leaders. Sustainability refers to
the systems that help the efforts of sales
people beating the pavement and meeting
customers to make the prediction true,
the efforts of our delivery people to
deliver quality products on time within
budgets, and to the efforts of our finance
people raising the invoice on time and
collecting money on time. Profitability
refers to the systems that help our people
make value-based sales, follow rigorous
budgeting exercises, control costs, get
best value for money and ensure the
agreed-upon profitability. Derisking
refers to systems that identify risks in
various dimensions of our operations
people, geographies, technologies,
application areas and services collect
periodic data, review the risk levels and
take suitable actions to mitigate them.
Innovation is the best instrument for creating sustained
differentiation. However, it must be accepted that revenues for
a corporation come from well-understood ideas and business
models. For example, most of a banks revenues will come from
borrowing money at a certain rate and lending it at a higher rate.
Part of the profits from such models will be used for research and
development to generate new ideas. A few of these ideas will be
seeded and some of them will become mainstream revenue earners.
Therefore, it is very important for a leader to focus on innovation,
particularly, when the times are good.
We have
demonstrated that
businesses can be run
legally and ethically; that
it is possible for an Indian
company to benchmark
with the global best; and
that any set of youngsters
with values, hard work,
team work and a little
bit of smartness can
indeed be successful
entrepreneurs.
30 years of Infosys
Customers put food on our table. Therefore, we have to have a
laser focus on exceeding their expectations, being open and honest
with them, and ensuring that they look good in front of their
customers. Employees are the only instruments we have to make
our customers and investors succeed. Therefore, we have to create
an environment of openness, meritocracy, fairness, transparency,
honesty and accountability amongst our employees.
Our investors understand that businesses will have their share of
ups and downs. They want us, the management, to level with them
at all times. Therefore, when in doubt, please disclose is a good
policy for a corporation. Society provides customers, employees,
investors, bureaucrats and politicians. Therefore, earning the
goodwill of every society that we operate in is extremely important
for us. Global benchmarking is a powerful instrument that helps
us to improve our self-confidence, compete with the best global
competitors, and serve our customers better.
We Indians must recognize, as we have done at Infosys, that we
are our own enemies. There is no external enemy. Our failures are
because of our lack of commitment to our cause, our inability to
accept meritocracy, and our indifference to honesty and want of a
good work ethic amongst our leaders. Performance alone is the key
differentiator. This stems from my belief that performance leads to
recognition, recognition brings respect and respect brings power.
Therefore, if India wants to be a superpower as we keep hoping, the
only instrument we have is performance.
We have demonstrated that businesses can be run legally and
ethically; that it is possible for an Indian company to benchmark
with the global best; and that any set of youngsters with values,
hard work, team work and a little bit of smartness can indeed be
successful entrepreneurs. This way, we have enthused millions of
young men and women in India. This, in my opinion, is Infosys
greatest contribution.
I have realized that humility, grace and courtesy are genuine only
when you have power and glory. That is why the leaders at Infosys
have practiced this time and again. Humility provides us the
strength of mind to learn from people better than us. Grace and
courtesy make us worthy competitors. They also remind us that
such glory and power are ephemeral and give us the strength to
handle the days when we too could lose our shine.
The crucial things we have to do in the future are : recognize our
weaknesses; be open-minded about learning from people better
than us; learn from our mistakes and not repeat them; be humble,
honest and courteous; benchmark with the best in every dimension;
use innovation to perform at global levels; and create a worthwhile
vision and improve every day. This is how our mantra of focusing
on speed, imagination and excellence in execution will take this
company very far. I have absolutely no doubt about it. I wish Kris
and my fellow Infoscions the best in their journey forward. The
board has been kind enough to name me the Chairman-emeritus.
Therefore, I will always be there to add value if asked.
Thanks,
Narayana Murthy
30 years of Infosys
The finance journey
The finance journey started with the incorporation of Infosys on
July 2, 1981. The paid in capital was R10,000, reportedly borrowed
by Narayana Murthy from his wife. At inception, the Founders put
in the basic financial principles the company will earn a profit
from year one, all projects will be delivered at a reasonable profit,
the balance sheet will be liquid, borrowings will be only for asset
creation, corporate resources will never be used for personal
purposes and dividends will be paid out of surpluses. Indeed the
initial years were tough, as India was a closed economy. Revenues
grew fromR0.12 crore in the first year toR8.66 crore in fiscal 1992,
the year of economic reforms in India. The Founders were very
clear that 10 years from founding they would go for an IPO and
create liquidity for themselves. Employees were given stock in the
company. In fact, by March 31, 1992 they owned 13.6% of the
shares.
The IPO was indeed a seminal event for the company. During the
road show, the Founders made a projection that the company
would be a US$ 100 million revenue company by 2000, with
a 20% net income, when revenues were US$ 5.01 million with
net income of US$ 1.23 million as of March 31, 1993. The IPO
was for creating a campus for 1,000 people, along with state of
the art computing systems costing in all R16.58 crore, more than
the revenue of the previous year of R8.66 crore. Great courage
indeed! The IPO in February 1993 was a tough act. The market
did not understand a software company as it was unheard of and
completely new. The market was also rough at that time. The issue
barely squeezed through, with help from its investment bankers.
The issue opened at R145 on listing. Soon thereafter, our journey
commenced as a public company.
Right from the beginning of being a public company, we decided
that transparency was a competitive advantage and shareholders,
as true owners, deserved the fullest, most timely information.
September 1, 1993, our first AGM after listing, was a seminal
event and well attended; lunch was offered too. In October 1993,
India saw its first investor meet after listing at Mumbai with a large
attendance, where management presented the investors with its
strategy for growth, thus setting a new trend.
We invested part of the IPO proceeds in the primary and secondary
markets to enhance returns. The markets went bad and we wrote
off most of the investments. It was a humbling experience to stand
in front of the investors and admit that we had made a mistake and
assuring them that it would not be repeated.
Very soon the company put in place the 1994 Employees Stock
Option Scheme, which along with the 1998 ADR scheme and
the 1999 scheme gave stocks to over 18,000 employees, creating
hundreds of dollar millionaires and thousands of rupee millionaires.
Drivers, office assistants, secretaries got stock along with others and
V. Balakrishnan
Chief Financial Officer
T. V. Mohandas Pai
Director and Head Administration, Education and Research, Finacle,
Human Resources Development and Infosys Leadership Institute
30 years of Infosys
became millionaires. It soon became the most successful scheme in
India and set a benchmark for other companies. It gave us an unique
positioning, democratized wealth and suddenly the professionals
realized that they too could become wealthy by ethical means early
in their careers. It revolutionized India. The 1994 ESOP scheme
was sought to be taxed in the hands of the employees and after a
protracted legal battle, the Supreme Court held in 2008 that the
scheme did not create a taxable event, allowing all grantees the
benefit of no tax, helped of course by the abolition of capital gains
tax on sale provided the shares are held for more than 12 months.
The company made a private placement of shares at R450 in July
1994 to raise R25 crore for its expansion. Soon after, in October
1994, the company declared a bonus issue of 1:1, the first of many
bonus issues. 100 shares issued in the IPO at R9,500 has today
become 12,800 shares valued at R4.15 crore (as of March 31, 2011)
an annual compounded growth of 59%, a total gain of 4,64,422%,
including total dividends received to date of R26.4 lakh.
The 1994 annual report was a very different report in terms of financial
reporting and disclosure and soon became
a collectors item. It started a trend with
the 1995 report and subsequent reports
disclosing a management commentary on
the accounts, brand accounting, human
resources accounting, EVA statement,
and financial accounts in the GAAP of
eight countries, some of them in the local
language. The company won the first of
its continuous 11 awards for the Best
Presented Accounts from the Institute of
Chartered Accountants of India (ICAI).
The ICAI had to finally give us the Hall
of Fame award that made us ineligible to
apply for future years! The first financial
statements under U.S. GAAP done
voluntarily were issued.
We also issued the first publicly articulated
financial policy in India which inter alia
said that the company aimed to earn a
minimum return on capital employed of two times the cost of capital,
on invested capital of three times cost of capital; pay dividend of up
to 20% of post-tax profits only out of cash surpluses (now increased
to 30% of consolidated profit), maintain liquid assets on the balance
sheet to meet a years working expenses, borrow only for short-term
mismatches in cash flows, depreciate assets in the shortest possible
time; earn a minimum of 25% profit on sales revenue. In fact if a
search were to be made of any corporation in the world over the
last 15 years which has earned a minimum of 25% return on equity
and 25% profit on sales, very few companies would show up and
Infosys would be one of them. We started giving guidance in fiscal
1995 and this became a trend. Many have questioned us since then
on the need to give guidance, and our view has been that we need to
have symmetry of information between the business and the outside
world and this was the best way to do it.
We then started preparing for our listing on the NASDAQ. In 1995,
we had expressed our intention to list on the NASDAQ before the
end of the decade. We started getting ready with the U.S. GAAP
financial statements, benchmarked our corporate governance
standards and investor relations standards. We started announcing
our results quarterly from June 30, 1997, much before it became
mandatory. We revamped our Board having majority of independent
directors, instituted the Board committee systems, put in place a
whistle blower policy, and policies to prevent insider trading, all of
which became benchmarks once again. Infosys became the most
followed company for its governance practices. We started work
for the listing in 1997, postponed it as markets fell, started again in
1998 and completed in 1999.
The IPO road show was a great event, we met nine investors a
day, with two teams across the globe to raise US$ 70 million. Two
days before listing there was no book and we were nervous and
almost called off the issue but soon the orders came in a torrent.
It gathered a book of over US$ 3.5 billion, the first listing in the
U.S. by an Indian company. The book runners suggested a price of
US$ 37, we insisted on US$ 34 leaving them perplexed, insisting
that we had to be fair to our investors. The stock on listing opened
at US$ 51. We came back to India and were welcomed as heroes,
and history was created. We reached revenues of US$ 203.4 million
by fiscal 2000 with a net income of US$ 61.3 million, keeping the
commitment made to investors when our Founders did the first
road show!
A year later, we saw the biggest technology rally on the NASDAQ
with our stock going up to US$ 675 at
the height of the internet boom. Over two
weeks, the company saw its valuation go
up during the boom by US$ 20 billion
only to see it come down by US$ 15
billion in one week! The markets crashed
soon after in 2003 and the recession
started. During April 2003 at the time of
our annual guidance, Narayan Murthy
made the famous statement about fog on
the windscreen and we gave guidance
in tune with our business forecast. The
stock crashed 40% in two days and
shook up the market. We recovered
in our business and soon reached the
US$ 1 billion mark in fiscal 2004. We
had a great celebration! Liquidity on the
NASDAQ was lacking. We worked with
regulators in India to create the policies
for a Secondary sponsored listing of
an ADR. We had an issue of US$ 300
million, once again a first. We followed this up with a US$ 1 billion
secondary ADR in 2005 and then a US$ 1.5 billion secondary ADR
in fiscal 2007 that enabled us to get into the NASDAQ-100 index,
again a first for any Indian company. We were the first foreign
filers to file financial statements in IFRS with the Securities and
Exchange Commission, U.S.
We are proud to be part of this dream journey to set the benchmark
in financial reporting; to use transparency and disclosures as our
competitive advantage; to lead good practices in the country which
got mandated later for all companies to follow; to set and follow
the best corporate governance norms in the world; and above all
build a financially strong company in all aspects. We have built
a flexible financial model that has withstood many testing times.
We were always willing to stand-up and share any bad news with
stakeholders just as we shared good news. Our ability to look
at long-term challenges and invest ahead of need without being
unduly influenced by short-term consequences, had kept us in
good stead. Today we have a strong balance sheet with US$ 3.8
billion in cash and cash equivalents, listed on the NASDAQ and in
India with over 4,50,000 investors. The journey that started with
R10,000, has evolved into a balance sheet of R26,000 crore with
over R11,623 crore paid out as dividend.
The journey continues...
We are proud to have
been part of this dream
journey. Using exemplary
corporate governance
guidelines, we have
built a financially sound
company.
30 years of Infosys
In 1983, we had developed an application on a new platform for
a German client. During its acceptance testing, Narayana Murthy
noticed a single character error in the output and he called the client
immediately and informed them about the error. The company
was very impressed by our focus on quality, and our proactive and
transparent approach that they accepted the application without
going through the elaborate tests planned.
That incident sowed the seeds of our focus on quality in the
company. Though Quality, as a function at Infosys was formally
instituted in late 1992, it has been an integral part of our existence
over the last 30 years.
I have had the privilege of being part of most of the quality journey
at Infosys and the distinct honor of steering it for the past 19 years.
I have had the good fortune of working with a team comprising the
brightest minds in the industry such as, Dr. V. A. Sastry, Dr. Pankaj
Jalote, S. Raghavan, M. R. Bhashyam and Satyendra Kumar. I am
sharing the highlights of how our focus on quality has enabled us
to earn the trust of our stakeholders.
In November 1992, the Quality function was instituted at Infosys
under the leadership of Dr. V. A. Sastry in the backdrop of a booming
business. At the time, we had around 25 active projects but we
were aware that growth was around the corner. We had to lay a
strong foundation with a formal structure for the implementation
and measurement of quality. We also wanted to ensure that our
focus on quality translated into business value for our clients.
In the initial years, we took our first but firm steps on this journey
when we got our ISO (with TickIT
(1)
) certification in 1993 which
certified us on the strength of our basic processes. Our journey had
begun in right earnest.
Over the next few years, we worked towards increasing the scope
of our quality metrics by refining our software development
lifecycle processes. Dr. Pankaj Jalote led our efforts during the
CMM

assessment. We were assessed at Level 4 in 1997 and this
not only highlighted the strength of our business processes but also
indicated that the organization was undergoing tangible changes in
imbibing the quality culture.
This cultural change paid us rich dividends. In 1999, we touched
the US$ 100 million revenue mark and also became the first Indian
company to be listed on the NASDAQ. This success was duly
complemented by the distinction of becoming the 21st company in
the world to be accredited the CMM Level 5 standard for software
development.
By then, we were entering a phase where business was poised
to grow in leaps and bounds. This necessitated us to scale
our Quality function to keep pace with the growing business
complexity. This foresight drove Bhashyam and me to conduct
The quality journey
K. Dinesh
Director and Head Communication Design Group, Information Systems
and Quality & Productivity
30 years of Infosys
a detailed evaluation of the certification standards available at
the time. We adopted the Malcolm Baldrige National Quality
Award (MBNQA) model successfully in 2000 when our revenues
touched US$ 200 million and with around 300 ongoing projects.
The MBNQA is one of the most prestigious Total Quality
Management models adopted by many industries.
After 2000, when Satyendra Kumar took over as the head of Quality
and Sanjay Purohit joined him, the Quality function attained a
new dimension. Today, the Quality function is pervasive across
our services, units / enabler functions and geographies and plays a
pivotal role in managing organizational risk.
The past decade led to the implementation of the Balanced Scorecard

(2)
framework that translated corporate strategies into measurable
goals. As we added new lines of services
such as BPO, Aerospace, Medical Devices
and Telecom amongst others, our focus
was on growing sustainably and reducing
the impact of our operations on the
environment.
This led us to implement domain-specific
certification standards as and when new
service lines were added. Some of the
certifications include, eSCM-SP Level
5, AS 9100, ISO 13485, ISO 14001,
OHSAS18001 and TL 9000. Recently,
Infosys, as well as Infosys China, one
of our fastest growing subsidiaries, have
been assessed at CMMi Level 5.
One of the most significant developments
in this decade was the creation of
the Infosys Quality System, which
documents and demystifies our quality
management system through PRidE, our
in-house, web-based, business process
platform. Today, through our Business
Value Articulation (BVA) initiative, we
are connecting and articulating the
business value that we add to our clients
by continuously improving the quality of all our processes.
The Predictability, Profitability, Sustainability and Derisking (PSPD)
model has been at the core of our business philosophy. In 1993,
we had 25 projects, 750 employees, US$ 5 million in revenue and
operated out of two offices in India and one international sales
office in Boston.
Today, we have over 620 clients, 6,500 projects, 1,30,820
employees, US$ 6.04 billion in revenue, and operate out of 64 sales
offices and 63 global development centers spread across 75 cities
in 32 countries.
Despite the ever-increasing business complexity, our Quality
function has sustained its reach across the organization and
enabled us to deliver on the promises we make to our stakeholders,
year after year.
The fact that we deliver 99% of our projects on time and 96%
within budget, the fact that our repeat business has increased from
around 87% in 2000 to over 97% today, and the fact that our Client
Satisfaction Index went up even at the peak of the recession in 2009
are all testament to one fact that quality has been the platform on
which we have delivered predictable, profitable, sustainable and
de-risked business value to our stakeholders.
The prestigious awards and recognitions that we have received
along the way have made our journey even more heartening and
memorable. The IEEE Computer Society
and the Carnegie Mellon University
Software Engineering Institute awarded
the 2010 Software Process Achievement
Award and the award citation was a
testimony to our commitment : For
establishing an extremely cost-effective,
sustained, and culturally integrated
quality and productivity improvement
program during a period of extraordinary
corporate growth. We were also awarded
an entry to the Balanced Scorecard Hall
of Fame in 2007 on the strength of
our innovative strategy planning and
execution capabilities.
When I look back, I realize that quality
at Infosys is not just about governance,
prerequisites or metrics. Through quality,
we have succeeded as an organization to
set ourselves on the path of the continued
pursuit of excellence with a constancy of
purpose. In the process, we have earned
the sustained trust of our stakeholders
employees, clients, alliance partners, the
industry, government and the society at
large. This trust is an intangible, yet an invaluable asset and reflects
the success of our quality journey over the past three decades.
I strongly believe that it will continue to be at the core of our
success in the years to come.
(1)
TickIT is a quality certification program for software development,supported primarily by the software industries in the United Kingdom and Sweden.
(2)
The Balanced Scorecard is a strategic planning and management system originated by Dr. Robert Kaplan and Dr. David Norton as a performance measurement framework that added
strategic non-financial performance measures to traditional financial metrics to give managers and executives a more balanced view of organizational performance.
Through quality,
we have succeeded as
an organization to set
ourselves on the path of
the continued pursuit
of excellence with a
constancy of purpose.
In the process, we have
earned the sustained trust
of our stakeholders
30 years of Infosys
I still vividly remember one of the classes I taught in 1995 at our
Mangalore Development Center. It was a small rented building and
we had a batch of 30 new trainees. At that time, all of us used to
teach programming basics and database management to all our new
employees. Teaching was integral to our jobs because we wanted to
create an environment where everyone was expected to participate
in the education process and build long-lasting bonds with our
employees. Those trainees still remember the classes I taught.
Today, many of them are part of the senior management at Infosys.
Since the beginning, we had recognized the significance of education
in the growth of an individual, a company and that of a nation.
We believed that to create a learning organization, our employees
must constantly learn and grow professionally through various
phases of their development and life. While our formal education
department, what is now known as Education & Research (E&R),
was not created until 1991, the underlying foundation was always
present.
As we grew, there was a need to scale and address predictability.
Thus, we started our Education & Research (E&R) department,
a function charged with the responsibility to educate and train our
employees with a highly competent, full-time faculty. Meanwhile,
the economic reforms gave a fresh impetus to the IT industry and
was growing so rapidly that availability of talent was a serious
concern. The number of engineering graduates who specialized in
computer science was insufficient.
While we were scaling up, we realized that it was imperative to
build our own education department as a core competency rather
than outsource the training to third-party vendors.
With the adoption of global quality standards in the early Nineties,
education and training, like all other key organizational processes,
was integrated with our quality function. Having a dedicated
department for education meant that we could aim at the
standardization of our training programs.
Over the years, an incredible amount of material has been created
and this has become the main pillar of our successful training
programs. Our approach to education was always innovative
we identified several gaps in the prevailing education system
and created our own processes by experimenting with various
learning methodologies. Our educators were associated with
real-life projects and this helped them in designing courses that
were comprehensive, inter-connected and relevant.
Initially, our approach to learning was distributed. Every
Development Center had its own team and employees, and trainees
had to move often across locations to complete their training.
We decided that creating a centralized and strategic infrastructure
The education and research journey
S. Gopalakrishnan
Chief Executive Officer and Managing Director
30 years of Infosys
would address our growth. With this intent, the Infosys Global
Education Centre (GEC), Mysore, was established. The GEC is
the largest corporate education center in the world. It is a symbol
of not just our commitment to education and lifelong learning
but also of our journey as an organization from a batch of 30
trainees whom I taught in 1995, to a facility that currently hosts
over 14,000 trainees.
The GEC catapulted the growth of our E&R capabilities many
times over. Spread over 337 acres, the GEC is one of the largest
classical buildings in independent India. We currently employ
over 300 faculty members to provide standardized, comprehensive
education and training at the GEC.
While we added new services to our business portfolio,
we transitioned from being a technology solutions company to
a business solutions company. New services such as consulting,
package implementation, systems integration, infrastructure
management, independent validation
and business process management
necessitated the creation of an equipped
workforce. Our training programs
have been dynamic to take these new
challenges in their stride and rapidly
create new training streams.
Apart from entry-level training, we have
always believed that lifelong learning
is crucial to build a sustainable and
competitive advantage. Our continuous
learning programs are in line with the
needs of our clients and the emergence of
new technologies, and are based on the
role competencies being performed at a
business vertical along four dimensions
technology, client business domain,
processes, and behavioral skills.
We have also linked the learning and
performance management processes
and our certification programs assess the
knowledge of an individual with relevance to a specific role. We
have successfully conducted an incredible 2,00,000 assessments in
the last year alone.
We introduced knowledge management into our work culture
before it became a popular term. We had a system called the Body
of Knowledge (BoK), which consisted of a folder that was placed
on the company librarians desk. Individuals or teams would share
their problem-solving experience as a report and file it into this
folder for everyone to access.
Following the rapid growth in the Nineties, we realized we had to
expand its scale, considering our geographic spread, technological
flux and functional specialization. It was at this time that our E&R
department began developing Knowledge Management (KM) as a
strategic initiative.
The Infosys KM solution has grown to meet our changing needs.
We developed additional features around the KM solution to
support collaboration, namely, the KM portal a central repository
for content; People Knowledge Map a directory service for
locating experts; Knowledge Exchange a set of online discussion
forums; and KMail an auto-response generator and workflow
engine for answering questions. Together, these have enabled us to
leverage organizational knowledge in a systematic manner.
It is beyond doubt that education influences the development
and growth of a countrys economy. Over the last 30 years, the
Indian IT industry has grown to become the largest employer in
the countrys organized private sector. While India has produced
a large number of engineering and science graduates, the varying
quality of education is a cause for concern. At Infosys, education
has always been a fundamental principle, extending beyond the
growth of our organization.
As a major stakeholder in the global
aspirations of the Indian IT industry, we
were concerned with this issue and we
decided to create a program that could
help narrow this gap. This vision led
to the creation of the Campus Connect
Program, a unique industry-academia
interaction that seeks to reach upstream
with the education system and align
the capabilities and outcomes of the
educational institutions with the needs
of the IT industry. Today, Campus
Connect is proud to be associated with
almost 530 engineering institutions and
has successfully trained over 1,20,000
students.
The scope of education, research and
training cannot be confined within
the walls of a corporate organization.
Learning begins at the level of the
individual, and scales the levels of
team, organization and country, before
finally making a global impact. At Infosys, we recognize that the
superstructure of a globally competitive and sustainable business
transformation can only be built upon a strong base of learning
and education.
From a humble learning organization to a pioneer in the field of
industry-academia partnerships, it has been a journey where we
have learnt as much as we have taught. I feel proud when I see
the Infosys education and research wagon filling up with new and
eager learners every year. Empowered by learning, these young
Infoscions will create value for our clients, shareholders, their
fellow Infoscions, and the society at large.
From a humble
learning organization
to a pioneer in the field
of industry-academia
partnerships, it has been
a journey where we have
learnt as much as we have
taught.
30 years of Infosys
Building world-class infrastructure realization of a dream
Today, Infosys is recognized globally as a company with one of
the best infrastructure. It all started with a dream of having our
own campus in Bangalore. In 1992, the Karnataka government
allocated four acres of land in Electronics City, Bangalore to us.
It had a challenging terrain and poor accessibility and entailed
a cost of R17.22 crore when our revenues for fiscal 1992 was
only R8.66 crore. This didnt deter us and an IPO was floated
to raise funds for building the campus. It was to have a built-
up area of 1,60,000 sq. ft., with a capacity to seat 1,000 people,
low cost yet elegant, modern yet traditional. It was completed in
11 months, with Murthy overseeing the project himself. It soon
became the most visited corporate campus in India, with over 70
heads of state and global political leaders visiting it. Today, the
Bangalore campus has grown to 81 acres, a distributed low-rise
campus of 4.2 million sq. ft. of built up space, 26,850 seats, large
air-conditioning plants, a 2.5 MLD waste water recycling plant, a
helipad, cricket, football and hockey grounds, a 487-room hostel,
a 1,350-seater auditorium, an experience theatre, seven food courts,
swimming pools, gyms, a bookstore, a convenience store, bank
branches, a laundromat, ATMs, along with a multi-level parking
lot for 1,600 cars and 1,750 two-wheelers and a bus station for
75 buses. It has redefined the way the IT industry operates in India.
Our persistent efforts to improve infrastructure in our campus and
connectivity to it have resulted in more than 75% of employees
commuting to work by public transport. Till date, we have invested
R1,830 crore in the infrastructure of the campus and it generates
revenues to the tune of R7,900 crore annually.
In 1995, we decided to start an office in a smaller city and selected
Mangalore as the first center outside Bangalore, attracted by the high
educational standards of the city. In December 1995, we opened our
Mangalore center and soon expanded it to 15,000 sq. ft., with 300
seats. In 1999, we bought a semi-built bus station at an auction from
the government, refurbished it with 1,400 seats, and soon outgrew
this too. In 2006, we purchased 325 acres of SEZ land on top of a
beautiful, green hill overlooking the sea. Today, this has 6,27,000
sq. ft. of built-up space, with 3,350 seats, a food court and a hostel.
Another 6,14,000 sq. ft. is under construction, with a capacity of
2,500 seats. We are creating a bio-park and have planted around
75,000 indigenous trees and built seven large artificial lakes for
rainwater harvesting to make this a self-sustaining campus.
In 1996, as the company grew, we set up our operations in Pune.
It was in a rented space with 450 seats. In 1998, we built a 25-acre
campus with 4,300 seats. Outgrowing this, we acquired 114 acres in
2003 which, when completed, will have 6.5 million sq. ft. of built-
up space, seating 34,000 people. We experimented with interesting
architecture, constructing large space frame buildings, a 15-level
multistoried hostel with 1,000 rooms and large water harvesting
T. V. Mohandas Pai
Director and Head Administration, Education and Research, Finacle,
Human Resources Development and Infosys Leadership Institute
Ramadas Kamath U.
Senior Vice President and Head Administration, Commercial, Facilities,
Infrastructure and Security
30 years of Infosys
reservoirs. We also built one of Indias first all-steel, 11-level parking
lot for 2,000 cars and 1,000 two-wheelers and a bus station.
Down south, we started our operations in Chennai at the same
time as in Pune, and again in a rented place. In 2000, we started
our own campus at Sholinganallur. This campus has a built-
up area of 5,00,000 sq. ft., with a seating capacity of 3,700. We
added a second campus in a 129-acre space in Mahindra City SEZ.
This campus today has 2.5 million sq. ft. of built-up area, with
16,000 seats, and a 1,000-room hostel. Another 3.9 million sq. ft.
with 15,000 seats is under construction.
In 1999, we acquired 100 acres of land to build the Infosys
Leadership Institute (ILI) and a software development building
(SDB) in Mysore. What had started as a campus with an ILI
building, a 96-room hostel, an SDB and
two food courts, has today grown to be
the largest Infosys campus, with a total
area of 337 acres. We expanded our SDBs
and soon decided to make Mysore the
center for our global training by building
the Global Education Center (GEC 1).
In 2009, we built GEC 2, which is one
of Indias largest single buildings, a 1.02
million sq. ft. classical structure, with
classrooms for training 9,200 employees
at a single sitting, 300 faculty cabins, a
large food court with 2,000 seats, a huge
library, boardrooms, and a very large
atrium, making it the largest corporate
university in the world today.
Today our education infrastructure
can train about 14,000 trainees at one
sitting. It has a 10,100-room hostel and
ten food courts. It also has induction
rooms, a four-stage multiplex-cum-
auditorium area, an employee care
center of 1,10,000 sq. ft., with a large
swimming pool, indoor sports complex,
convenience stores, a medical center, a
cricket stadium, athletic tracks, a football ground, a climbing wall,
Indias largest laundry, and many other amenities. Overall, the
campus has 9 million sq. ft. of built-up space with an investment of
over R2,330 crore, and another 3 million sq. ft. is being planned.
This campus also has large water and waste water treatment plants,
power generation facilities and is a mini city in itself. We built eight
artificial lakes to harvest rainwater, which has helped us meet 60%
of our fresh water requirement in-house. We have planted over
40,000 trees, making it home to 63 species of birds and countless
varieties of butterflies.
After the initial occupation of rented premises in the High Tech
city, we moved to our own 50-acre campus in Hyderabad in
November 2001. This campus has 1.8 million sq. ft. of built-up
space, with 10,000 seats. Further growth led us to start work on
a 450-acre campus. We are building one of Indias largest software
development campuses, with the first phase of 2.9 million sq. ft.
with 14,000 seats, built at an investment of R980 crore. With the
addition of the second phase, it will have a total built-up area of
4.7 million sq. ft. and 25,000 employees, water harvesting facilities,
innovative air-conditioning technology saving 30% of our energy
consumption, and all buildings adhering to the highest LEED
standards. With a verdant landscape, 70 species of birds, 66 species
of butterflies, and 265 species of plants all carefully preserved, we
propose to make this one of the greenest IT campuses.
In 1997, we expanded east to Bhubaneswar. The state government
gave us a rented building meant for a government department.
Soon we purchased a 46-acre plot for a new campus and occupied
it in January 2001. Today, this campus can accommodate 4,000
employees. It also has innovative landscaping and green building
exteriors making it visually appealing.
In Chandigarh, we outgrew our modest office in Mohali and
purchased 30 acres of land in the SEZ for a new campus and
occupied this in 2006. Today this has 1.1 million sq. ft. with
5,300 seats. We also have 200 acres in Jaipur currently, along
with an Infosys BPO building with 3,500 seats. We will soon be
commencing the construction of new buildings for the parent
company in this campus.
In Thiruvananthapuram, we acquired
50 acres in January 2001 and we will
be building one of the largest IT parks
in Kerala. It has a unique architecture,
with SDBs in the shape of ships and will
have 2.4 million sq. ft. built-up area and
seats for 10,000 employees once it is
completed.
An incredible journey
What was just a dream in 1992 has
become an unbelievable journey with
28 million sq. ft. of built-up space and
1,23,000 seats as of March 31, 2011.
We are currently building another
8.3 million sq. ft. with 40,000 seats.
Soon we are starting a US$ 150 million
campus in Shanghai for 8,000 seats.
We have invested R 9,450 crore so
far, with a commitment of another
R 2,500 crore to complete what we
started. Our infrastructure needs are
very large. As of fiscal 2011, we have
a power demand of 81 MW, diesel
generating capacity of 134 MW, 48,000
tons of comfort air conditioning, UPS capacity of 45 MW, fresh
water storage of 33 million liters, waste water treatment capacity of
16 million liters, diesel storage of 1,700 KL, a laundry capacity
of 7.3 tonnes per day, 35 food courts capable of feeding 40,000
people in a single sitting, training facilities of 25,000 seats, 13,800
hostel rooms, over 2,25,000 trees and 2,085 acres of land across
the globe. We have a total network bandwidth of 6,700 Mbps
connecting over 1,50,000 desktops, 37,500 laptops and 5,500
servers globally. Till date, we have created parking spaces for 9,500
cars and 15,300 two-wheelers in our Indian campuses for the
comfort of our employees. Another seven multi-level parking lots
are under construction for 13,800 cars and 15,500 two-wheelers
to cater to our ever increasing employee strength. However, 70% of
our employees still use public transport to commute to work as a
result of our sustained focus on encouraging mass transport.
What started as a dream of a campus of 1,60,000 sq. ft. has grown
into a mammoth network, built to the highest standards, within the
shortest possible time, following the best environmental principles,
with a per capita energy consumption of only 230 units per month.
What was just a
dream in 1992 has
become an unbelievable
journey with 28 million
sq. ft. of built-up space
and 1,23,000 seats as
of March 31, 2011. We
are currently building
another 8.3 million sq. ft.
with 40,000 seats.
30 years of Infosys
As we enter the thirtieth year, my thoughts go back to 1986,
when I joined Infosys, then operating out of a two-storey
building in Bangalore. That period is still so vivid in my memory.
While studying engineering, I had realized that being an electrical
engineer for life was not my cup of tea. A chance encounter with
my neighbor, Bala Kuthiyar, changed my destiny. He was working
with Infosys and had been sent abroad. That, and an opportunity
to move out of electrical engineering, was motivation enough for
me to apply. Narayana Murthy and N. S. Raghavan interviewed me
and I was lucky to be selected. I joined Infosys at a princely salary
of R1,500, much to the dismay of my well-wishers, ignoring three
other wonderful job offers.
Twenty-five years is a long period. But for me time has elapsed
too fast. It has been an absolute dream working here and I have
enjoyed my tenure here to the fullest. Today, as I reflect on my
25-year tenure, I believe that Infosys has delivered on its vision,
creating a truly outstanding company with a distinct corporate
culture, one in which every Infoscion can take a great deal of
pride. I am deeply proud of its accomplishments and more so of
the team of people responsible for its ongoing success. While there
have been several milestones, in my perspective, the following
stand out as particularly memorable.
I was deputed to travel onsite to the U.S. within a couple of months
of joining the company. Until then, I had never lived away from my
family. I had wonderful colleagues who helped me settle down both
professionally and personally. I spent over three years in the U.S.,
traveling across multiple locations, often on single-person projects.
I also spent a year in the U.K., consulting at Reebok, perhaps the
first project for Infosys in Europe. These three-plus years was an
intense learning period for me.
Our Global Delivery Model (GDM) evolved in the early Nineties
and we set up our first Offshore Development Center (ODC) for
GE. The big moment for me was when we won a contract from
Reebok (France) to build a state-of-the art information management
system. We christened it as the Distributor Management Apparel
Package (DMAP), also called Dinesh, Murthy and Prahlad, as they
were actively involved. This was one of our early efforts at creating
a product that leveraged our deep domain knowledge.
We worked in shifts and the compilation took ages making us
disciplined coders. While it was hard work, we did have our share
of fun and learning and it was teamwork at its best. I still remember
the endless arguments with K. Dinesh on the need for hardware
upgrades and his insistence that we have staggered lunch breaks
and ensure 100% utilization to justify the upgrade costs.
Growing tall with Infosys
U. B. Pravin Rao
Senior Vice President and Head
Retail & Infrastructure Management Services
30 years of Infosys
Around the same time, we sold the DMAP to Reebok U.K., Reebok
Canada and Reebok International. I was personally involved in
selling and implementing the product at Reebok U.K. and later
to Reebok Canada. We were competing with another well-known
product and it was a great experience learning the art of client-
stakeholder management from K. Dinesh.
When I look at todays dominant Retail ERP packages, I believe
DMAP had rich and comparable features even in those days, and
perhaps this was a missed opportunity for Infosys not to market
DMAP beyond Reebok. Another significant milestone was Infosys
going public in 1993 and being listed on the Indian stock exchange.
A majority of us did not realize its significance and bought a few
100 shares out of a sheer sense of patriotism. It has turned out to
be one of the most profitable investments
made to date. Infosys also launched the
ESOP plan in 1994 thus becoming one of
the first companies in India to make this
kind of an offer. It created a strong sense
of ownership amongst our employees
and helped strengthen the Infosys brand.
The mid-nineties saw Infosys move its
corporate headquarters to Electronics
City, Bangalore, an unpopular move with
employees at that time. This was perhaps
one of the finest examples of futuristic
thinking on the part of the Infosys board
and I have seen many such examples
along the way.
While today we take our laptops
and smart phones for granted, I still
remember the times when we had
debates about how many people would
share a PC. During this period, I was
involved in Infosys winning the largest
development project for implementing a
policy management system for a leading
re-insurance company in the U.S.
The late Nineties saw Infosys expanding its service footprint
by introducing Enterprise Solutions and IBCS (consulting
practice). We leveraged our knowledge in implementing
Y2K solutions and expanded our client portfolio.
In 1999, we were listed on the NASDAQ, a proud moment for all of
us and an important step towards creating a global Infosys brand.
We also benefitted tremendously from the dotcom boom. I was
at that time heading delivery for the Europe region. This gave me
an opportunity to understand the European market, the challenges
around language, culture and client relationships. It contributed
significantly to my professional development.
The dotcom bubble burst in 2001 and led to challenging times for
Infosys. We were forced to take some tough measures. Employee
satisfaction plummeted to unprecedented lows. Nandan, the then
CEO, provided assurance that corrective steps would be taken.
An initiative was launched to identify the root cause for employee
dis-engagement. I was actively involved in the initiative and
experienced firsthand the efforts of the organization to stay true to
its core values in tough times as well. My faith in Infosys has been
reinforced through this and many other subsequent experiences.
One of the most satisfying periods for me has been my current stint
as Unit Head, Retail CPG and Logistics (RCL). RCL was the first
vertical to be formed in November 2002. It has been a wonderful
journey with industry-leading performances in many parameters.
We have won accolades both from our clients as well as from
industry analysts, we have been featured in several journals and
publications such as Fortune and Business Week.
We have contributed to Infosys aspirations of moving up the value
chain and IP-led growth through our solutions such as the ST360,
iConnect, digital commerce / marketing platforms, and competitive
intelligence. The proudest moment for us was when a RIS News
survey of leading Retailers in North America, rated Infosys as
the number one IT and consulting service provider for the retail
industry.
I cannot express how grateful I am for
the opportunity and privilege of working
with Infosys. It has been an extremely
fulfilling and enriching experience both
at a personal and professional level.
Very few people get the opportunity
to be part of a successful growth story
like Infosys and work closely with a
visionary and caring leadership like that
of our founders, led by Narayana Murthy.
In these years, I have grown with the
organization, celebrated success, learned
from the losses and have had the good
fortune of working with the brightest
minds in the industry. It did not take
long for me to realize that this is a special
company.
While many things have changed over
the years, our core values, our pursuit
of excellence and customer delight,
employee-friendliness and tremendous
personal sacrifice that each one at Infosys
offers to ensure that our clients are
successful, have remained the same. I am
confident that with the consistent contributions from Infoscions
and support from all stakeholders, we will be a global consulting
giant and an organization that we can continue to be truly proud
of, in the decades to come.
I have grown with the
organization, celebrated
success, learnt from the
losses and had the good
fortune of working with
the brightest minds in
the industry. It did not
take long for me to realize
that this is a special
company.
30 years of Infosys
I had the extraordinary privilege of steering the Human Capital
Management strategies at Infosys for the better part of the first
twenty years of its growth period. Justifying the Infosys tagline,
Powered by intellect, driven by values, coupled with our mission
to make Infosys a globally respected corporation, put an enormous
responsibility on all of us, to build high-capability human resource
teams and concurrently develop and nurture a value-driven
organizational culture.
We identified at a very early stage, that learnability was the most
critical factor for success in the software profession. We defined
learnability as the ability of the individual to make generic
inferences from specific experiences and being able to apply such
knowledge in new unstructured situations.
To be truthful, we were not, at that stage, exposed to the theory
of multiple intelligences developed later by Dr. Howard Gardner
of Harvard University. However, we quickly realized that Logical-
Mathematical Intelligence, or abilities in numbers and reasoning,
was essential to do well in this field. I set about developing and
validating a series of tests that could measure these attributes with
a certain degree of reliability.
We also believed that not all of our software professionals need to
be drawn only from the pool of Computer / Electronics / Electrical
Engineering graduates. We decided to enlarge the catchment area
for better access to larger numbers of bright students with high
levels of logical-mathematical intelligence.
We were, perhaps, the first blue-blooded software company in that
period to recruit fresh engineers from a variety of backgrounds
such as Mechanical Engineering, Civil Engineering, Naval
Architecture and Metallurgical Engineering. To select the best, we
relied on the Arithmetical Reasoning (AR) and Analytical Thinking
(AT) tests that were personally designed and developed by me.
These tests were considered to be tougher than the GMAT / GRE
tests, and soon, Infosys acquired the elitist tag word went round
that only the brightest engineers could get into the company.
Our faith in our tests was so strong that we even rejected a high
rank-holder from an IIT, simply because he did not get the
qualifying marks in our tests. The most piquant situation was
when Murthy insisted that I request Prof. K. V. Viswanathan, at that
time Computer Science professor at the prestigious IIM, Calcutta,
to take these tests. We were interviewing Prof. Viswanathan for
the position of Head of Education & Research and fortunately for
me, he was more than willing to take the tests. Not only did he
do well in the tests but went on to build the most effective E&R
division at Infosys. Today, the world-class training center in Mysore
is equipped to train 14,000 employees and Fortune magazine has
called it the Taj Mahal of training centers.
Human capital management
N. S. Raghavan
Employee No. 1 of Infosys
30 years of Infosys
The most daunting responsibility, however, was creating and
nurturing an organizational culture that emphasized the right set
of values, so that we could build an institution of lasting value, one
that we could be truly proud of in the decades to come.
It was clear to us that the strongest foundation for Infosys had to be
laid by the large contingent of our exemplary senior management.
Some of the critical qualities that the senior leadership needed to
demonstrate by personal example were displaying high levels of
transparency, creating trusting relationships, promoting merit and
performance-driven rewards and recognition systems, encouraging
a culture of bold innovations with a willingness to venture into
unchartered territories, and most critically, engendering a sense
of ownership among Infoscions by sharing the wealth that they
helped to create.
I personally believe that the most
significant intervention for emotionally
engaging Infoscions was the creation
of Employees Stock Offer Plan (ESOP),
long before any regulatory guidelines
were available. I remember the prolonged
discussions with Murthy on ESOP
distribution strategies. Murthy was of the
opinion that substantial amounts of ESOPs
should be given to a smaller percentage
of employees who were outstanding
performers. I argued that while a small
set of people did merit high rewards for
their outstanding contribution, the real
infrastructure for the growth of Infosys
was being built by a large number of very
good, but not necessarily outstanding
contributors. These professionals also
needed to be recognized and rewarded to
ensure sustained growth.
Finally, we came up with an optimal
solution where the outstanding
contributors were given large numbers
of ESOPs through the Chairmans quota
whereas most of the good performers earned smaller number
of ESOPs over a period, based on their yearly contributions.
The elitist Chairmans quota was based on recommendations sent
to Murthy, where as the egalitarian ESOP distribution was based on
a system of phased allocations for people at various levels.
With this, we created the largest number of dollar and rupee
millionaires by any company, and more importantly, created a sense
of ownership and belonging among all our employees. Carrying on
this tradition, Infosys, on entering the 30th year of its inception,
provided shares from the Infosys Employee Welfare Trust to all
employees based on their number of years of service at Infosys.
As a measure of our commitment to transparency and openness,
I made it a point to visit all Infosys campuses in April every year,
to personally explain the rationale behind the salary revisions,
promotions, loan policies, ESOP allocations, etc. To demonstrate
our genuine interest in employee feedback, I incorporated any
good suggestions from employees into the policy framework.
I remember that one year, I made a marginal change in the
remuneration of professionals with Computer Science degrees.
This was meant mainly to address the longstanding complaint
that it was unfair to treat Computer Science graduates with four
years of relevant education, on par with, say, a civil engineer who
had no such background and needed to be fully trained at Infosys.
I decided, therefore, to give a token increase in remuneration
to the Computer Science graduates.
However, I was surprised to receive
very strong negative feedback from all
non-Computer science graduates, many
of whom were rank holders from their
universities. They were very unhappy
that the commitment I had made in the
campuses that all graduates would be
treated as equals was being violated,
albeit in a small way. It was the principle
of honoring a commitment that they
were insisting on and not the amounts
involved. I accepted the fairness of the
argument and immediately converted
the small extra payment to Computer
Science graduates into an extra allowance
and restricted this payment to that year
alone.
Over the years, the innovative HR
strategies at Infosys have been receiving
accolades worldwide, with the latest
being the Global HR Excellence award
2010 by the World HRD Congress in
January 2010 for the Most Admired and
Best HR Team. Given the complexity of
managing a highly talented workforce
of more than 1,30,800, drawn from more than 85 nationalities
and deployed across the globe, Infosys can be truly proud of its
performance in the area of Human Capital Management.
I personally believe
that the most significant
intervention for
emotionally engaging
Infoscions was the
creation of Employees
Stock Offer Plan
(ESOP), long before any
regulatory guidelines
were available.
30 years of Infosys
Historical data
Notes : The above figures are based on Indian GAAP standalone financial statements.
(1)
Excluding extraordinary / exceptional items.
in rcrore, execpt per share data
30 years of Infosys
Contents
Letter to the shareholder .......................................... 2
The year at a glance ................................................. 4
Board and committees ............................................. 5
Directors report........................................................ 7
Managements discussion and analysis .................... 19
Risk management report .......................................... 28
CEO and CFO certification ........................................ 30
Abridged financial statements .................................. 31
Balance sheet abstract and the Companys
general business profile ............................................ 42
Consolidated financial statements ........................... 43
Corporate governance report .................................... 63
Shareholder information ........................................... 74
Global presence ........................................................ 81
Notice of the 30th Annual General Meeting
2 | Letter to the shareholder
Letter to the shareholder
Dear Shareholder,
Fiscal 2011 was a year of improved performance, recovery,
consolidation and new explorations for us. The global economic
climate posed several challenges, but we made the best use of our
resources and abilities for growth. At the beginning of the fiscal, we
had projected a revenue growth of 9% to 11% in rupee terms and
16% to 18% in US$ terms. At the end of the fiscal, we achieved a
growth of 20.9% in rupee terms and 25.8% in US$ terms.
Some of our verticals and service lines were high achievers in this
fiscal. The performance of our retail vertical helped us emerge first
among the global retail IT service providers in 2010. We were
adjudged second among the Global Outsourcing 100 by the
International Association of Outsourcing Professionals. The strong
customer-driven vertical focus that we have created has helped us
take advantage of the opportunities we identified in the market.
The overall performance for the year spelled growth, both for us and
for our clients. Our International Financial Reporting Standards
(IFRS) consolidated revenues for this fiscal stood at R 27,501
crore, a year-on-year growth of 20.9%. The profit after tax was
R6,823 crore, a year-on-year growth of 9.7%. In accordance with
the IFRS, our annual revenue for fiscal 2011 was US$ 6,041 million,
a year-on-year growth of 25.8%, while our net income registered
a year-on-year growth of 14.2% to stand at US$ 1,499 million.
Out of the total revenue, 65.3% came from North America, 21.5%
from Europe and 11.0% from the Rest of the World. The number
of our million-dollar clients grew to 366 in fiscal 2011 from 338
in the last fiscal.
We are pleased to announce a final dividend of R20 per equity share
(equivalent to US$ 0.45 per American Depository Share (ADS) at
the prevailing exchange rate of R44.40 per US$). The dividends are
payable on the equity shares / ADSs outstanding as on book closure
date, at the prevailing exchange rate on the payment date, and are
subject to approval by the shareholders. Earlier in the fiscal, we
paid an interim dividend of R10 per share and a 30th year special
dividend of R30 per share.
Our world-class business consulting model, designed to help our
clients build their enterprises of tomorrow through technology-
driven transformation, won us several prestigious projects this
fiscal. A large US-based retailer partnered with us on its strategy
on mobile application development to complement its e-commerce
offerings. A leading manufacturer of helicopters engaged us to
transform business intelligence capabilities at the enterprise level.
We performed a security audit assessment and remediation of
Sarbanes-Oxley-based conflicts for a global food service retailer in
its Oracle financial applications.
Kris Gopalakrishnan
S. D. Shibulal
Chief Operating Officer and Director
Letter to the shareholder | 3
Our flagship offering for the banking industry, Finacle,
continued to grow its business, with 41 client wins this fiscal. We
crossed another milestone as innovation partner to banks with the
launch of Finacle Analyz, a comprehensive analytics solution for
banks to make faster decisions. Flypp, the mobile application
marketplace developed by us, helped us enter a strategic
relationship for reciprocal licensing and distribution of applications
with Mobile Streams, the global mobile content retailer. iEngage,
our digital consumer platform, is currently powering social media
marketing, e-commerce and employee engagement programs for
five Global 500 companies.
A number of prestigious awards and recognitions were bestowed
on us this fiscal. The Boston Consulting Group ranked us among
the top 10 value-creating technology and telecommunications
companies. Our high standards of corporate governance earned
us the recognition of the best company for corporate governance
from Asiamoney. A FinanceAsia survey voted us the best company
in management, corporate governance, investor relations, and
corporate social responsibility in India. Another survey by the
Wall Street Journal named us the most admired company in India.
We thank the readers and investors for considering us worthy of
these distinctions.
Our commitment to adopt sustainable business practices were
recognized by India Carbon Outlook with the Sustainability
Leadership award. Even as we plan to add 4.7 million sq. ft. of
built-up area to our existing infrastructure, we adhere to the
highest environmental standards building LEED-certified
structures, creating water harvesting facilities, adopting innovative
air-conditioning technology, and making significant savings in
energy consumption. We continue to promote green technologies
and eco-friendly practices in our offices and for our clients.
As we step into the new fiscal, we also get ready to complete the
thirtieth year of our operations. Needless to say, it has been a
tremendous journey. An organization started by seven individuals
is now a family of 1,30,820 Infoscions. What was started with a
paltry capital of US$ 250 is now generating revenues in excess
of US$ 6 billion. From the first major client win of Data Basics
Corporation to 600-plus clients today; from a small rented office
space in Pune to over 60 development centers worldwide the
journey has been exhilarating as well as humbling.
While we celebrate what we have achieved in these three decades,
we must also bid farewell to the person who took the first steps
with courage and conviction and made the rest of the journey
easier for us. N. R. Narayana Murthy retires this year as Chairman
of the Board. His contributions to Infosys, to the IT industry and to
India need no reiteration. The Government of India recognized his
achievements by conferring the Padma Vibhushan on him in 2008.
He has received numerous awards and recognitions from around
the world in the last several years. Every Infoscion is grateful to
N. R. Narayana Murthy for his leadership by example and his
support to their personal development. In recognition of his
contribution to Infosys, the Board has decided to name him the
Chairman Emeritus of the company.
The composition of the Board has undergone a few more changes.
The Board has inducted two new members, R. Seshasayee and
Ravi Venkatesan. We are confident that these two industry stalwarts
will bring their experience, expertise and insights to our decision-
making process.
K. Dinesh, Member of the Board and Head of Quality, Information
Systems and the Communication Design Group, will retire
by rotation at the forthcoming Annual General Meeting and
has decided not to seek re-appointment. T. V. Mohandas Pai,
Member of the Board, and Director and Head Administration,
Education & Research, Finacle, Human Resources Department,
and Infosys Leadership Institute, has resigned as Member of the
Board. The Board has decided to relieve him of responsibilities
post the companys Annual General Meeting on June 11, 2011.
Both K. Dinesh and T. V. Mohandas Pai have been instrumental in
the growth of the company, and we wish them success with their
future endeavors.
On August 21, 2011, N. R. Narayana Murthy will retire as the
Chairman and Chief Mentor. The Board of Directors on April 30,
2011 announced the following changes to the board : K. V. Kamath
to be appointed as the Chairman of the Board; S. Gopalakrishnan
to relinquish the post of Chief Executive Officer and Managing
Director and be appointed as a Whole-time Director and designated
as executive Co-Chairman of the Board; S. D. Shibulal to be
appointed as the Chief Executive Officer and Managing Director.
All the above appointments are effective from August 21, 2011.
We are on the threshold of yet another breakthrough in our journey
towards adding greater value to our clients. We have unveiled
Infosys 3.0, our new brand positioning that essentially marks our
transition from a technology solutions company to a next-generation
global consulting and services company, proactively helping clients
build their enterprises of tomorrow. The global economy in general
and the IT industry in particular have changed significantly over
the past few years, requiring us to change our business strategy and
realign our agenda with that of our clients. We have consolidated
all our verticals under four heads : Financial Service and Insurance;
Manufacturing; Energy, Utilities, Communications and Services;
Retail, Consumer Packaged Goods, Logistics and Life Sciences.
We have decided on three focus areas : business transformation,
business operations and business innovation. We believe that the
new strategy and structure will help us expand our global market
by forging stronger strategic partnerships with our clients and
increasing our relevance to all facets of their enterprise.
In keeping with our shift from being a technology solutions
provider to a business transformation partner for our clients,
the Board has decided to change the name of the company from
Infosys Technologies Limited to Infosys Limited. We are confident
that this change will propel the organization forward to accelerated
growth and sustain its leadership position in the industry.
We hope you will continue to support our new direction in the
same way that you have stood by us over the years. At the end
of this eventful and successful year, our thanks go out to you,
our shareholders, and to our clients, the governments of various
countries, our partners and our employees.
Kris Gopalakrishnan
Chief Executive Officer and
Managing Director
S. D. Shibulal
Chief Operating Officer and
Director
Bangalore
April 30, 2011
4 | The year at a glance
The year at a glance
Indian GAAP standalone
in rcrore, except per share data
2011 2010 Growth (%)
Financial performance
Income 25,385 21,140 20.1
Gross profit 11,118 9,581 16.0
Operating profit (PBIDTA) 8,414 7,360 14.3
Profit after tax
(1)
6,443 5,755 12.0
EPS
(1)
(par value of R5/- each) : Basic 112.26 100.37 11.8
Diluted 112.22 100.26 11.9
Dividend Per share
(2)
60.00 25.00 140.0
Financial position
Capital expenditure 1,152 565 103.9
Fixed assets 4,555 4,188 8.8
Cash and cash equivalents
(3)
15,284 14,794 3.3
Net current assets 18,391 13,141 40.0
Total assets 24,677 22,268 10.8
Debt
Net worth 24,501 22,036 11.2
Cash and cash equivalents / total assets (%) 61.9 66.5
Market capitalization 1,86,100 1,50,110 24.0
IFRS consolidated
2011 2010 Growth (%)
Revenues 27,501 22,742 20.9
Gross profit 11,585 9,722 19.2
Operating income 8,102 6,910 17.3
Net income
(4)
6,823 6,219 9.7
EPS
(4)
Diluted 119.41 108.90 9.7
in US$ million, except per share data
2011 2010 Growth (%)
Revenues 6,041 4,804 25.8
Gross profit 2,544 2,055 23.8
Operating income 1,779 1,460 21.8
Net income
(4)
1,499 1,313 14.2
EPS
(4)
Diluted 2.62 2.30 13.9
Notes : 1 crore equals 10 million
(1)
Before exceptional item
(2)
Dividend includes 30th year special dividend of r30 per share for fiscal 2011.
(3)
Includes investment in certificate of deposit of r119 crore for the fiscal 2011; liquid mutual funds of r2,317 crore and r1,180 crore in certificate of deposit for fiscal 2010.
(4)
Includes income from sale of investments in OnMobile Systems Inc., U.S. of $ 11 million (r48 crore), net of transaction costs, for the financial year ended March 31, 2010.
IFRS Consolidated (in Rcrore) IFRS Consolidated (in US$ million)
Board and committees | 5
The Board of Directors
S. Gopalakrishnan
S. D. Shibulal
Prof. Marti G. Subrahmanyam
Lead Independent Director
Deepak M. Satwalekar
Independent Director
Dr. Omkar Goswami
Sridar A. Iyengar
David L. Boyles
Prof. Jeffrey S. Lehman
K. V. Kamath
R. Seshasayee
Ravi Venkatesan
(1)
K. Dinesh
Director and Head Communication Design Group,
Information Systems, and Quality & Productivity
T. V. Mohandas Pai
Director and Head Administration,
Education & Research, Finacle, Human Resources Development,
and Infosys Leadership Institute
Srinath Batni
Director and Head Delivery Excellence
Executive Council
S. Gopalakrishnan
Head Executive Council
S. D. Shibulal
K. Dinesh
T. V. Mohandas Pai
Director and Head Administration,
Education & Research, Finacle, Human Resources Development,
and Infosys Leadership Institute
Srinath Batni
V. Balakrishnan
Board and committees Infosys Technologies Limited
Ashok Vemuri
Senior Vice President Banking & Capital Markets,
and Strategic Global Sourcing
Chandra Shekar Kakal
Senior Vice President Enterprise Solutions
B. G. Srinivas
Senior Vice President Manufacturing, Product Engineering, and
Product Lifecycle & Engineering Solutions
Subhash B. Dhar
Senior Vice President
Communications, Media & Entertainment,
Global Sales, Alliances & Marketing and
Independent Validation Solutions
Board Committees
Audit committee
Chairperson
Sridar A. Iyengar
K. V. Kamath
R. Seshasayee
Compensation committee
K. V. Kamath
Chairperson
Dr. Omkar Goswami
David L. Boyles
Nominations committee
Chairperson
K. V. Kamath
Investor grievance committee
Dr. Omkar Goswami
Chairperson
R. Seshasayee
Risk management committee
David L. Boyles
Chairperson
Dr. Omkar Goswami
Sridar A. Iyengar
(1)
Appointed with effect from April 15, 2011.
6 | Board and committees
Infosys BPO Limited
T. V. Mohandas Pai
Chairperson
D. Swaminathan
Jayanth R. Varma
Sridar A. Iyengar
S. D. Shibulal
Director
Eric S. Paternoster
Director
B. G. Srinivas
Director
Infosys Technologies (China) Company Limited
S. D. Shibulal
Chairperson
V. R. Rangarajan
Chief Executive Officer and Director
Director
T. V. Mohandas Pai
Director
Srinath Batni
Director
Ashok Vemuri
Director
V. G. Dheeshjith
Director
T. P. Prasad
Director
Infosys Technologies (Shanghai) Company Limited
S. D. Shibulal
Chairperson
V. R. Rangarajan
Director and Legal Representative
Srinath Batni
Director
Infosys Technologies (Australia) Pty. Limited
K. Dinesh
Chairperson
Jackie Korhonen
Srinath Batni
Director
V. G. Dheeshjith
Director
U. B. Pravin Rao
Director
Subhash B. Dhar
Director
Infosys Consulting, Inc.
S. D. Shibulal
Chairperson
Stephen R. Pratt
Raj Joshi
Director
Director
Ashok Vemuri
Director
Director
B. G. Srinivas
Director
Infosys Technologies S. de R. L. de C. V.
Ashok Vemuri
Sole Manager
Infosys Technologies (Sweden) AB
S. D. Shibulal
Chairperson
Eric S. Paternoster
Director
Rajesh Krishnamurthy
Director
B. G. Srinivas
Director
Infosys Public Services, Inc.
Chairperson
Eric S. Paternoster
Chief Executive Officer and Director
S. D. Shibulal
Director
T. V. Mohandas Pai
Director
Infosys Tecnologia do Brasil Ltda
Puneet Singh Gill
Legal Administrator
Board and committees Subsidiaries
The Infosys Board of Directors
Standing : Ramaswami Seshasayee
Sridar A. Iyengar
Srinath Batni
Ravi Venkatesan
K. Dinesh
S. D. Shibulal
Dr. Omkar Goswami
David L. Boyles
Sitting : K. V. Kamath
S. Gopalakrishnan
T. V. Mohandas Pai
Director and Head Administration, Education & Research,
Finacle, Human Resources Development, and
Infosys Leadership Institute
As of April 15, 2011
The Infosys Executive Council
Standing : T. V. Mohandas Pai
Director and Head Administration, Education & Research,
Finacle, Human Resources Development, and
Infosys Leadership Institute
Ashok Vemuri
Banking & Capital Markets, and
Strategic Global Sourcing
B. G. Srinivas
Manufacturing, Product Engineering, and
Product Lifecycle & Engineering Solutions
K. Dinesh
Srinath Batni
Senior Vice President Enterprise Solutions
Subhash B. Dhar
Communications, Media & Entertainment,
Global Sales, Alliances & Marketing, and
Independent Validation Solutions
Sitting : V. Balakrishnan
S. Gopalakrishnan
S. D. Shibulal
As of April 15, 2011
Directors report | 7
Directors report
To the members,
We are delighted to present the report on our business and operations
for the year ended March 31, 2011.
1. Results of operations
2011 2010
Income from software services and
products 25,385 21,140
Software development expenses 14,267 11,559
Gross profit 11,118 9,581
Selling and marketing expenses 1,219 974
General and administration expenses 1,485 1,247
Operating profit before interest and
depreciation (PBIDTA) 8,414 7,360
Interest
Depreciation 740 807
Operating profit before tax 7,674 6,553
Other income, net 1,147 919
Net profit before tax and exceptional item 8,821 7,472
Provision for taxation 2,378 1,717
Net profit after tax and before exceptional
item 6,443 5,755
Income on sale of investments, net of
taxes
(1)
48
Net profit after tax and after exceptional
item 6,443 5,803
Profit and Loss account balance brought
forward 13,806 10,305
Amount available for appropriation 20,249 16,108
Dividend
Interim 574 573
30th year special dividend interim 1,722
Final 1,149 861
Total dividend 3,445 1,434
Dividend tax 568 240
Amount transferred to general reserve 645 580
Amount transferred to capital reserve 48
Balance in Profit and Loss account 15,591 13,806
EPS before exceptional item
(2)
Basic 112.26 100.37
Diluted 112.22 100.26
EPS after exceptional item
(2)
Basic 112.26 101.22
Diluted 112.22 101.10
Notes : r1 crore equals r10 million.
(1)
Income from sale of investments in OnMobile Systems Inc., U.S., net of taxes
and transaction costs.
(2)
Equity shares are at par value of r5/- each.
2. Building Tomorrows Enterprise
During the year, we formally launched our new corporate strategy,
Building Tomorrows Enterprise to showcase our plan for leading
the services industry into the new era as the next generation global
consulting and services company. In our journey to increase our
client relevance and sustain industry leadership, we have made
organizational changes towards creating Infosys 3.0 a truly global
enterprise partner for our clients to drive their transformational,
operational and innovation priorities and helping them build their
enterprise of the future.
To further our transition towards business-led consulting combined
with innovative products and solutions, we have regrouped our existing
industry units globally into the following groups :
Financial Services and Insurance
Manufacturing
Energy, Utilities, Communications and Services
Retail, Consumer Packaged Goods, Logistics and Life Sciences
This transition will enable us to increase our client relevance,
strengthen our strategic partnerships with our clients and evolve our
business model.
It will help us to sharpen our industry vertical focus, allow us to
invest in capabilities to deliver higher business value and align our
innovation agenda with that of our clients. The new structure will also
significantly expand our global market and provide opportunities for
the next generation of leaders.
3. Business
Our total income increased to R25,385 crore from R21,140 crore in the
previous year, at a growth rate of 20.1%. Our software export revenues
aggregated to R24,791 crore, up by 18.8% from R20,871 crore in
the previous year. Out of the total revenue 66.2% came from North
America, 20.7% from Europe and 10.7% from the Rest of the World.
Our revenues from India have increased from R 269 crore to
R594 crore, with a growth rate of 120.8% which is higher than that
of the other regions. The share of the fixed-price component of the
business was 42.1%, compared to 40.8% during the previous year.
Our gross profit amounted to R 11,118 crore (43.8% of revenue)
as against R 9,581 crore (45.3% of revenue) in the previous year.
The onsite revenues increased from 48.7% in the previous year to
50.2% in the current year. The onsite person-months comprised 26.5%
of the total billed efforts, compared to 26.1% during the previous
year. The Profit Before Interest, Depreciation, Taxes and Amortization
(PBIDTA) amounted to R8,414 crore (33.1% of revenue) as against
R 7,360 crore (34.8% of revenue) in the previous year. Sales and
marketing costs were 4.8% and 4.6% of our revenue for the years
ended March 31, 2011 and March 31, 2010 respectively. General and
administration expenses were 5.8% and 5.9% of our revenues during
the current year and previous year respectively. The net profit after tax
was R6,443 crore (25.4% of revenue) as against R5,803 crore (27.5%
of revenue) in the previous year. The net profit for the previous year
includes income from sale of investments in OnMobile Systems Inc.,
U.S., of R48 crore, net of taxes and transaction costs.
We seek long-term partnerships with our clients that enhance
their value while addressing their IT requirements. Our customer-
centric approach has resulted in high levels of client satisfaction.
We derived 98% of our revenues from repeat business. We, along
with our subsidiaries, added 139 new clients, including a substantial
number of large global corporations. The total client base at the end
of the year stood at 620. Further, we have 366 million-dollar clients
(338 in the previous year), 187 five-million-dollar clients (159 in the
previous year), 126 ten-million-dollar clients (97 in the previous year),
28 fifty-million-dollar clients (26 in the previous year), and
11 hundred-million-dollar clients (6 in the previous year).
During the year, we added 19.86 lakh sq. ft. of physical infrastructure
space. The total available space now stands at 276.63 lakh sq. ft.
The number of marketing offices as at March 31, 2011 was 64 as
compared to 65 in the previous year.
8 | Directors report
4. Subsidiaries
We have nine subsidiaries : Infosys BPO Limited, Infosys Technologies
(Australia) Pty. Limited, Infosys Technologies (China) Company
Limited, Infosys Consulting, Inc., Infosys Technologies S. de R. L. de
C. V., Infosys Technologies (Sweden) AB, Infosys Tecnologia do Brasil
Ltda, Infosys Public Services Inc., U.S., and Infosys Technologies
(Shanghai) Company Limited. We have four step-down subsidiaries :
Infosys BPO s.r.o., Infosys BPO (Poland) Sp.Z.o.o, McCamish Systems
LLC, and Infosys Consulting India Limited.
As per Section 212 of the Companies Act, 1956, we are required to
attach the Directors report, Balance Sheet, and Profit and Loss account
of our subsidiaries. The Ministry of Corporate Affairs, Government
of India vide its circular no. 2/2011 dated February 8, 2011 has
provided an exemption to companies from complying with Section
212, provided such companies publish the audited consolidated
financial statements in the Annual Report. Accordingly, the Annual
Report 2010-11 does not contain the financial statements of our
subsidiaries. The audited annual accounts and related information
of our subsidiaries, where applicable, will be made available upon
request. These documents will also be available for inspection during
business hours at our registered office in Bangalore, India. The same
will also be published on our website, www.infosys.com
5. Finacle
TM
Finacle, our universal banking solution, partners with banks
across the globe to power their innovation agenda enabling them to
differentiate their products and services thereby enhancing customer
experience and achieving greater operational efficiency.
Finacle
TM
is a comprehensive, flexible and fully web-enabled solution
that addresses the core banking, treasury, wealth management, Islamic
banking, consumer and corporate e-banking, direct banking, financial
inclusion and mobile banking requirements of universal, retail and
corporate banks worldwide. Other offerings in the Finacle
TM
universal
banking solution include the Finacle
TM
Core Banking solution for
regional rural banks; the Finacle
TM
Alerts Solution, which enables
banks to alert end-users on events recorded by diverse business
systems; Finacle
TM
Advizor, which combines the convenience of human
intervention with banking self-service channels through the interplay
of video, audio and data communication; and Finacle
TM
WatchWiz, a
comprehensive new-generation monitoring solution that allows banks
to monitor, diagnose and resolve issues. Our professional services
complement the solutions portfolio and include consulting, package
implementation, independent validation, migration, application
development and maintenance, system integration, software
performance engineering and support. These offerings make Finacle
a strong innovation facilitator, enabling banks to accelerate growth,
while maximizing value from their large-scale business transformation.
Finacle
TM
is chosen by 140 banks across 73 countries to power
operations across 47,000 branches. Today, Finacle
TM
enables its
customer banks to serve 390 million accounts and 289 million
consumers worldwide. Finacle is also leading the financial inclusion
agenda in India. Of the 82 regional rural banks in the country, 45 have
opted to leverage Finacle
TM
across 9,900 branches. Independent reports
by renowned research firms have positioned Finacle
TM
among the
leaders in the global evaluation of retail core banking solution vendors.
Finacle is one of the most scalable core banking solutions in the
world with an unparalleled performance benchmark of 104 million
effective transactions per hour for channel (non-branch) transactions
and 41 million effective transactions per hour for branch transactions.
6. Quality
We continue our journey of delivering value to our clients through
significant investments in quality programs. In September 2010,
an enterprise-wide CMMi assessment was conducted by an
SEI-certified high-maturity appraiser, and we were assessed at CMMi
Level 5. This is the highest level of the CMMi assessment. SEI-CMMi
is the Carnegie Mellon Software Engineering Institutes Capability
Maturity Model, which assesses the quality of an organizations
processes and methodologies.
Our Quality department handles large change-management initiatives
to drive quality and productivity improvements across the organization
and is managed through the Balanced Scorecard and Infosys Scaling
Outstanding Performance (iSOP) program.
During the year, the Quality department, in collaboration with multiple
stakeholders across the organization, had developed a framework
called Business Value Articulation which ensures alignment of
our approaches to deliver value to our customers. Some of our key
initiatives are :
ENCORE : An initiative to promote reuse and reduce cycle time by
creating and deploying reusable technical and business components.
i-Trim : A framework based on lean practices, focusing on eliminating
non-compete activities to optimize process performance, addressing
business and operational challenges in service delivery.
BrITe : Our customer centric, systematic, data driven methodology
to create an impact on the business results and assist in maximizing
profits.
Proso++ : An empirical model based on the best practices and execution
experience of the delivery teams at Infosys.
We continue to focus on institutionalizing large initiatives. Some of
our achievements in the area are listed below :
Infy Swift : Our differentiated methodology for the Global Delivery
Model (GDM) to achieve faster time to market.
ESTEEM : This is our Centre of Excellence to enhance estimation
maturity for improved predictability and de-risking of our client
delivery.
TRANSCEED : Our initiative to enhance program management
capabilities, including development of integrated systems and tools,
relevant enabling / certification and ecosystem for collaboration /
knowledge exchange.
ASCENT : A framework to provide a robust and integrated platform
for account management that further facilitates account planning,
monitoring and reviews.
PROSPER : A differentiated methodology for driving excellence in
production support services.
TIDE : A solution that brings together tools, systems and processes
across lifecycle stages and enhances data integrity by capturing
accurate data.
We are certified under various standards to meet our client demands
and improve value delivery. These certifications include TL 9000-SV,
ISO 9001 : 2008, AS EN 9100, ISO 20000, BS25999, OHSAS 18001,
ISO 14001, ISO 23026, ISO 27001 and ISO 13485. Infosys BPO has
been certified for eSCM SP v. 2.0 Level 5, the eSourcing Capability
Model for Service Providers developed by a consortium led by Carnegie
Mellon Universitys Information Technology Services Qualification
Center. Our Australia and Shanghai centers have been assessed at
SEI-CMMi Level 5 and ISO 27001.
7. Infosys Labs
Infosys Labs, launched as part of our strategic direction Building
Tomorrows Enterprise, is responsible for driving innovation across
the mega trends identified by us that will transform the businesses of
our clients. Building on the successes of the award winning SETLabs,
Infosys Labs will focus on the Companys vision and enable customer
co-creation, while continuing its focus on service differentiation and
developing client-focused business solutions.
Organized as a global network of research labs and innovation hubs,
Infosys Labs will :
Undertake research to dene the ideas behind Building Tomorrows
Enterprise
Identify large, multidisciplinary problem spaces that embody the
challenges facing our clients and create technological solutions to
solve them
Create client-specic innovation agenda through co-creation and
ensure business value realization
Collaborate with universities and external research labs worldwide
Leverage global talent
During the year, more than 96 articles were published by Infosys
Labs researchers in leading journals, magazines and conference
proceedings. SETLabs Briefings, our highly respected peer-reviewed
journal, published multiple issues this fiscal year, in areas such as
e-Governance, Green IT, Business Platforms for Next-Gen Enterprise
Packages, Leveraging IT for Better Performance, Service Oriented
Performance, Digital Convergence and Perspectives on Software
Engineering. Infosys Labs collaborated with leading national and
international universities such as the University of Southern California,
Indian Institute of Technology, Bombay Monash Research Academy,
Purdue University, IIIT, Hyderabad and IIIT, Bangalore.
During the year, Infosys Labs IP Cell filed 91 patent applications in the
United States Patent and Trademark Office (USPTO) and the Indian
Patent Office. We now have an aggregate of 357 patent applications
pending in India and the U.S. The USPTO has granted us 22 patents.
8. Branding
The Infosys brand is one of the most important intangible assets that
we own. As part of the journey towards building a globally respected
brand, we recently unveiled our new corporate strategy of Building
Tomorrows Enterprise, to position Infosys as a next generation global
consulting and IT services company.
During the fiscal year, our brand has been recognized by leading
publications and independent industry bodies. We were :
Ranked as Indias Most Admired Company according to the
Wall Street Journal survey
Voted the Most Admired Indian Company by peers in the
Businessworld Most Respected Companies 2011 survey
Acknowledged by the Harvard Business Review for our best practice
in The CEOs Role in Business Model Reinvention
Awarded the NASSCOM Diversity Award for Innovative Programs
Awarded the Sustainability Leadership award by India Carbon
Outlook
Awarded the CII National Award for Excellence in Energy
Management 2010
Industry analysts rated us as a leader in reports across our key services
and markets. The offerings for which we were rated highly include
application outsourcing, infrastructure management, Oracle and SAP
service providers, comprehensive finance and accounting, business
process outsourcing, and for the Finacle
TM
core banking solution.
We saw a substantial increase in the number of visitors to our website
and continued to add to the million-plus visitors to our blogs on
business and technology-related topics during the year. Our employees
contributed and published several thought leadership articles across
various industry forums and publications. We leveraged social media
platforms and engaged with our stakeholders and investors on
YouTube, SlideShare, Twitter and Facebook.
Leading global publications commended us on our leadership, talent
and performance. We continued to have a leadership presence at
premier industry events like Oracle
Open World and Sapphire. Our

annual client event, Confluence, in the U.S. and Europe were well
attended, and highly appreciated. At the World Economic Forum
in Davos, Switzerland, our lunch panel discussion witnessed a full
audience and the evening get-together hosted by us was attended by
some of the most influential and powerful global business leaders.
9. Awards and recognition
In 2010, as in previous years, awards and recognition marked our
accomplishments in various fields. We were :
The winners of the RMMY Best in Show award for the third year
in a row
Among the top 20 global companies to win the Most Admired
Knowledge Enterprises (MAKE) Award 2010
Named the best company for corporate governance in the
Asiamoney poll
Ranked among the top 10 value-creating technology and
telecommunications companies by the Boston Consulting Group
The winners (along with Telstra) of the Best ITSM (IT Service
Management) Project of the Year, the top industry award given by
itSMF Australia
Voted the best company in management, corporate governance,
investor relations, and corporate social responsibility (India) in a
survey by FinanceAsia
10. Capital expenditure
During the year, we capitalized R 1,017 crore excluding R 3 crore,
which was due to the movement in land from leasehold to freehold
to our gross block. This comprises of R 251 crore for investment
in computer equipment. The balance of R 764 crore was due
to infrastructure investment along with R 2 crore on vehicles.
We invested R225 crore to acquire 267 acres of land in Bangalore,
Delhi and Mangalore.
During the previous year, we capitalized R787 crore to our gross block.
This comprised of R140 crore for investment in computer equipment.
The balance of R646 crore was due to infrastructure investment along
with R1 crore on vehicles. We invested R43 crore to acquire 161 acres
of land in Hyderabad, Mysore and Mangalore.
11. Liquidity
We continue to be debt-free, and maintain sufficient cash to meet our
strategic objectives. We clearly understand that the liquidity in the
Balance Sheet has to balance between earning adequate returns and
the need to cover financial and business risks. Liquidity also enables
us to make a rapid shift in direction, should the market so demand.
During fiscal 2011, internal cash flows have more than adequately
covered working capital requirements, capital expenditure, investment
in subsidiaries and dividend payments. As at March 31, 2011, we
had liquid assets of R15,284 crore as against R14,794 crore at the
previous year-end.
These funds have been invested in deposits with banks, highly rated
financial institutions, certificates of deposits and liquid mutual funds.
12. Increase in share capital
During the year, we issued 3,26,367 shares on the exercise of stock
options under the 1998 and 1999 Employee Stock Option Plans.
As a result of this, the outstanding issued, subscribed and paid-up
equity shares increased from 57,38,25,192 to 57,41,51,559 shares
as at March 31, 2011.
13. Appropriations
Dividend
Our policy is to pay dividend of up to 30% of the consolidated net
profit after tax of the group.
In October 2010, we paid an interim dividend of R10/- per share and
a 30th year special dividend of R30/- per share. We recommended a
final dividend of R20/- per share (par value of R5/- each), making in
all R60/- per share as dividend for the year.
The total dividend amount paid out is R 3,445 crore, as against
R1,434 crore in the previous year. Dividend (including dividend tax)
excluding 30th year special dividend as a percentage of consolidated
profit after tax is 29.3% as compared to 26.9% in the previous year.
The register of members and share transfer books will remain closed
from May 28, 2011 to June 11, 2011 (both days inclusive). Our Annual
General Meeting has been scheduled to be held on June 11, 2011.
Transfer to reserves
We propose to transfer R645 crore (10% of the net profit for the year)
to the general reserve. An amount of R15,591 crore is proposed to be
retained in the Profit and Loss account.
14. Corporate governance
We continue to be a pioneer in benchmarking our corporate
governance policies with the best in the world. Our efforts are widely
recognized by investors in India and overseas. We have undergone the
corporate governance audit by ICRA and Credit Rating Information
Services of India Limited (CRISIL). ICRA has rated our corporate
governance practices at CGR 1. CRISIL has assigned CRISIL GVC
Level 1 rating to us.
We have complied with the recommendations of the Narayana Murthy
Committee on Corporate Governance constituted by the Securities and
Exchange Board of India (SEBI). For fiscal year 2011, the compliance
report is provided in the Corporate governance section of the Annual
Report. The auditors certificate on compliance with the mandatory
recommendations of the committee is provided in the Annexure to the
directors report section.
We have documented our internal policies on corporate governance.
In line with the committees recommendations, the Managements
Discussion and Analysis of the financial position of the Company is
provided in this Annual Report.
During the year, we continued to fully comply with the U.S. Sarbanes-
Oxley Act of 2002. Several aspects of the Act, such as the Whistleblower
Policy and Code of Conduct, have been incorporated in our Company
policy. Our Code of Conduct was updated to make it relevant and
responsive to the changing needs of our business.
15. Conservation of energy, research and
development, technology absorption, foreign
exchange earnings and outgo
The particulars as prescribed under Sub-section (1)(e) of Section 217
of the Companies Act, 1956, read with the Companies (Disclosure of
particulars in the report of the Board of Directors) Rules, 1988, are
provided in the Annexure to the directors report section.
16. Particulars of employees
In terms of the provisions of Section 217 (2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975,
the names and other particulars of employees are set out in the Annexure
to the directors report. However, having regard to the provisions of
Section 219 (1)(b)(iv) of the Companies Act, 1956, the Annual Report
excluding the aforesaid information is being sent to all the members
of the Company and others entitled thereto. Any member interested
in obtaining such particulars may write to the Company Secretary at
the registered office of the Company. The same will also be published
on our website www.infosys.com
17. Directors responsibility statement as required
under Section 217 (2AA) of the Companies
Act, 1956
The financial statements are prepared in accordance with the
accounting standards issued by the Institute of Chartered Accountants
of India and the requirements of the Companies Act, 1956, to the extent
applicable to us; and guidelines issued by SEBI on the historical cost
convention; as a going concern and on the accrual basis. There are
no material departures from prescribed accounting standards in the
adoption of the accounting standards.
The Board of Directors accepts responsibility for the integrity and
objectivity of these financial statements. The accounting policies used
in the preparation of the financial statements have been consistently
applied except as otherwise stated in the notes accompanying the
respective tables. The estimates and judgments related to the financial
statements have been made on a prudent and reasonable basis, in
order that the financial statements reflect in a true and fair manner
the form and substance of transactions, and reasonably present our
state of affairs and profits for the year.
We have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, to safeguard the assets of the Company and to
prevent and detect fraud and other irregularities.
18. Directors
The Board inducted R. Seshasayee and Ravi Venkatesan to the Board.
We seek your support in confirming their appointment as directors
liable to retire by rotation.
In accordance with the retirement policy for the Companys Board of
Directors (the Board), Claude Smadja, Independent Director, retired
from the Board effective August 30, 2010. We place on record our
deep sense of appreciation for the services rendered by Claude Smadja
during his tenure as a Board member.
As per Article 122 of the Articles of Association, K. Dinesh,
Srinath Batni, Sridar A. Iyengar, Deepak M. Satwalekar and Dr. Omkar
Goswami retire by rotation in the forthcoming Annual General Meeting.
All of them, being eligible, seek re-appointment, except K. Dinesh.
K. Dinesh has expressed his intention not to seek re-appointment.
The Members of the Board place on record their deep sense of
appreciation for the services rendered by K. Dinesh during his tenure
as Member of the Board and Head of Quality, Information Systems
and the Communication Design Group.
T. V. Mohandas Pai has resigned as Member of the Board and has
requested the Board to relieve him of the responsibilities post the
Companys Annual General Meeting on June 11, 2011.
The Board of Directors considered and accepted the resignation of
T. V. Mohandas Pai. The resignation is effective June 11, 2011,
post the Companys Annual General Meeting. The Members of the
Board have placed on record their deep sense of appreciation for
the services rendered by T. V. Mohandas Pai during his tenure as
Member of the Board, and Director and Head Administration,
Education & Research, Finacle, Human Resources Development, and
Infosys Leadership Institute.
19. Auditors
The auditors, B S R & Co., Chartered Accountants, retire at the ensuing
Annual General Meeting and have confirmed their eligibility and
willingness to accept office, if re-appointed.
20. Fixed deposits
We have not accepted any fixed deposits and, as such, no amount
of principal or interest was outstanding as of the Balance Sheet date.
21. Human resources management
Employees are our vital and most valuable assets. We have created
a favorable work environment that encourages innovation and
meritocracy. We have also set up a scalable recruitment and human
resources management process, which enables us to attract and retain
high-caliber employees. We added 15,321 (net) and 32,247 (gross)
employees this year, taking our total strength to 1,08,009 from
92,688 at the end of the previous year. We added 17,024 (net) and
43,120 (gross) employees this year, taking the total strength of the
Infosys group to 1,30,820 from 1,13,796 at the end of the previous
year. Our attrition rate stands at 17.0% compared to 13.4% for the
previous year. Over the last year, we received 8,29,800 applications
from prospective employees and we continue to remain an employer
of choice in the industry.
22. Education & Research
Continuous education of our employees is of prime significance for us.
We believe that this is necessary not only for our own sustainability
and growth as an organization but also for enabling the professional
development of our employees. In addition to the six month residential
foundation program that we conduct for every fresh engineer who joins
us, we also lay significant emphasis on the continuous education of
our employees. The foundation program is designed to aid students
in effectively transitioning from the academic world to the corporate
world as qualified professionals.
During the financial year, the total training provided for Infoscions
was over 1.5 million person days. During the year, we launched
several novel programs to help enhance the business competency of
our employees, in addition to introducing new programs aligned to
evolving business needs.
We have made significant progress with the Campus Connect
program aimed at building a robust industry-academia partnership.
We deepened our relationship with several engineering institutions
across India through the co-creation of several new electives introduced
into their curricula. During the financial year, we engaged with 1,040
faculty members who in turn trained 33,000 students. With this
the total number of faculty covered under the program is 5,600 and
the number of students trained is 1,20,000 from 530 engineering
institutions. The program has received international accolades such as
the Corporate University Xchange Award for Excellence and Innovation
for the year 2011. As part of SPARK, an Infosys program to expose
students from high schools and universities to the world of IT and raise
their aspirations, we engaged with over 1,75,000 students during the
financial year. From its launch a little over two years ago, the program
has reached out to over 2,80,000 students.
Our internationally acclaimed Knowledge Management program won
the Global MAKE (Most Admired Knowledge Enterprise) award for
the seventh time, the Asian MAKE award for the eighth time, and the
India MAKE award for the sixth time during the financial year.
Our researchers published their articles and white papers in prestigious
journals and conferences as well as in books and invited chapters in
reputed publications.
23. Infosys Leadership Institute
The Infosys Leadership Institute (ILI) was established with the aim of
developing world-class corporate leaders. The institute helps to identify
potential candidates and earmarks them for the training required to
take on key leadership positions within the Company. The ILIs Tier
Leadership development hopes to produce and mould business leaders
of tomorrow. The institute aims to be a globally recognized institution
with a focus on training leaders capable of tackling current and future
business challenges. The work done by the ILI helps not only in the
identification of leaders but also in the nurturing of a leadership
mindset and culture across the organization.
Over the last year, ILI has engaged in several activities to support and
grow our group of high potential tier leaders as well as advance the
field of leadership development. The institute rolled out the Leadership
Journey Series Assessment and conducted assessment feedback sessions
as well as helped leaders plan and execute their personal development
plans. It also developed structured roadmaps guiding development
around the seven key Infosys leadership dimensions, as well as key
initiatives such as Creating Client Value.
In 2010-11, ILI showcased thought leadership through collaborations
with leading researchers from India and abroad, 12 conference
presentations, one peer-reviewed journal article, several keynote
presentations and most importantly, the release of the book, Leadership
@ Infosys, which combines research and practice perspectives to capture
the essence of what it means to excel as a leader at Infosys.
24. Sustainability initiatives
Sustainability is a commitment for us to align our strategy in all aspects
of our business with our stakeholders in various dimensions such as
economic, social and environment. Our focus areas are embodied in
the following themes social contract, resource intensity and green
innovation and are articulated in our Sustainability Policy. Social
contracts are our implicit responsibility to the larger society, to factor
in social and environmental aspects as important dimensions of our
business. Resource intensity is about doing more with less resources
energy, water or material. Green innovation is about leveraging the
opportunity for business leadership through sustainability.
The Infosys Sustainability Executive Council (ISEC) oversees the
planning and progress of all our sustainability initiatives.
As part of our sustainability journey, many of our business units are
pursuing innovation in green technologies and many of these have
been implemented as solutions for our clients. Some of them are :
iSustain : An enterprise carbon energy and resource management
tool with sustainability reporting and performance management
capabilities.
InGreen Energy Management : Enables enterprises to reduce
energy usage through automated tracking and identication of
consumption patterns; opportunities for changes and reduction,
reporting and analysis. It has helped us save energy usage and
costs to the tune of 20%.
InGreen Personal Carbon Calculator : Helps organizations create
awareness among employees and measure their daily carbon
footprint.
iSmart : An intelligent power strip that can not only supply power
from an electrical source to devices connected to it in enterprise
environments, but also monitor their energy consumption level on
a continuous basis.
Integrated Real time Campus Management System (iRCMS) : An
enterprise monitoring system that tracks and allows efcient energy
management and prolong the life of energy equipment through
surveillance. iRCMS helps enterprises with their manpower
savings by allowing the facilities and business managers to take
informed decisions based on consumption and demand related
parameters of energy thereby helping buildings and real estates go
green and sustainable.
This fiscal year, our Green Initiatives and the Voice of Youth teams
successfully implemented several campaigns and initiatives for
creating awareness and influencing our employees and stakeholders
in reducing their carbon footprint. Some of the key employee-driven
activities have been :
Earth Hour : The global drive of WWF which led to 3,136 units
(over 3.1 MWh) of electrical equipment load turned off during one
hour across nine DC-locations in India.
Infosys Megawatt Challenge : The Infosys Megawatt Challenge was
launched at our U.S. ofces to reward employees who brought
about a reduction in their energy consumption over a period of six
months and a positive outreach at their local communities.
COP16 : Representation at the United Nations Climate Change
Conference (COP16) held at Cancun as a member on the delegation
from World Business Council for Sustainable Development.
As part of our commitment to social contracts, several of our employee-
driven clubs and groups are actively involved in building an equitable
society. Some of the significant programs this fiscal year have been :
Notebook Drive : This initiative targets students of government
schools who are not in a position to afford notebooks and
stationery to pursue their academics. The NBD provides them
stationery typically required by the beneciaries for one academic
year. We now reach out to 45,000 children in 400 schools and
distribute more than 1,72,000 notebooks. More than 4,000
Infoscions worldwide are actively involved in organizing donation
campaigns, purchasing notebooks, managing the logistics, and
overseeing the distribution of school kits.
SPARK : This program offers a learning environment that
helps students realize their potential and assess their industry
preparedness. The program partners with academic institutions to
enhance talent pool as well as meet the demands of the IT industry.
Launched in August 2008, SPARK is managed by 2,400 Infosys
volunteers across development centers. This year it has benetted
more than 1,75,000 students, 1,450 institutions and 6,200 faculty
members.
Karnataka ood relief : Infosys always responds to a humanitarian
crisis by volunteering and pledging support. In October 2009, the
northern districts of Karnataka were severely affected by oods after
torrential rainfall. It claimed hundreds of lives and rendered millions
of villagers homeless. Our employees joined hands to rebuild
villages and undertake a mass housing project. Infoscions, together
with the Board of Directors and the Infosys Foundation, contributed
R 30 crore towards relief, rehabilitation and reconstruction.
Under the auspices of the state governments Aasare scheme, we
partnered with local NGOs to construct homes across 18 villages.
The ongoing housing project serves as a model for sustainable
development.
For more details on our sustainability initiatives, visit www.infosys.com
25. Employee Stock Option Plan (ESOP)
We had introduced various stock option plans for our employees. The details of options granted under the 1998 Stock Option Plan (the 1998
Plan) and the 1999 Stock Option Plan (the 1999 Plan) are as follows :
1998 Plan 1999 Plan
Total grants authorized by the plan (no.) 1,17,60,000 ADS 5,28,00,000 shares
Pricing formula on date of grant Not less than 90% of
fair market value
Fair market value
Variation in terms NA NA
Ratio of ADS to equity shares 1 ADS = 1 equity share NA
Options granted during the year (no.)
Weighted average price per option granted (R) NA NA
Options vested as at March 31, 2011 (no.) 50,070 40,232
Options exercised during the year (no.) 1,88,675 1,37,692
Total number of shares arising as a result of exercise of options 1,88,675 1,37,692
Money raised on exercise of options (Rcrore) 13 11
Options forfeited and lapsed during the year (no.) 3,519 18,052
Total number of options in force at the end of the year (no.) 50,070 48,720
Grant to senior management
Employees receiving 5% or more of the total number of options granted during the year
Employees granted options equal to or exceeding 1% of the issued capital
Diluted EPS on issue of shares on exercise calculated in accordance with AS 20 112.22 112.22
SEBI has issued the Employee Stock Option Scheme and Employee
Stock Purchase Scheme Guidelines, 1999. This is effective for all stock
option schemes established after June 19, 1999. In accordance with
these guidelines, the excess of the market price of the underlying equity
shares as of the date of the grant over the exercise price of the option,
including up-front payments, if any, is to be recognized and amortized
on a straight line basis over the vesting period.
We have the 1998 Stock Option Plan and 1999 Stock Option Plan,
where the options are issued to the employees at an exercise price not
less than the fair market value.
If the compensation cost on account of stock options granted after
June 30, 2003 (as required by the amendment effective June 30,
2003) under 1998 and 1999 Plans was computed using the fair value
method, our compensation cost would have been higher by R1 crore.
Our profit would hence be less by R1 crore for fiscal 2010. The impact
on EPS for fiscal 2010 would be R0.01. For fiscal 2011 there was no
stock compensation cost. During fiscal 2011 and 2010, stock options
under the 1998 Plan and 1999 Plan have not been granted. Hence,
the weighted average fair values of grant during these years are nil.
All stock options under the 1998 and 1999 Employees Stock Option
Plans were granted at the prevalent market price on the date of grant.
Accordingly, we have calculated the compensation cost arising on
account of stock options granted using the intrinsic value method.
Hence, the disclosure in terms of Clause 12.1 (n) of SEBI (Employees
Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999, is not applicable.
2011 2010
No. of options Weighted average
exercise price (R)
No. of options Weighted average
exercise price (R)
1998 Plan
Outstanding at the beginning of the year 2,42,264 613 9,16,759 904
Forfeited (3,519) 722 (60,424) 1,550
Exercised (1,88,675) 600 (6,14,071) 854
Outstanding at the end of the year 50,070 683 2,42,264 613
Vested at the end of the year 50,070 683 2,42,264 613
1999 Plan
Outstanding at the beginning of the year 2,04,464 869 9,25,806 1,248
Forfeited (18,052) 964 (3,40,264) 1,968
Exercised (1,37,692) 823 (3,81,078) 821
Outstanding at the end of the year 48,720 962 2,04,464 869
Vested at the end of the year 40,232 717 1,84,759 735
26. Infosys Science Foundation
The Infosys Science Foundation, a not-for-profit trust set up to promote
research in pure and applied sciences, presented the Infosys Prize to
scientists and researchers in the five categories of research listed below :
Physical Sciences Physics, Chemistry and Earth Sciences
Mathematical Sciences Mathematics and Statistics
Engineering and Computer Science All branches of Engineering
Life Sciences Biology, Medicine and Plant Science
Social Sciences and Economics History, Sociology, Anthropology,
Political Science, Economics and International Relations
Nominations were evaluated by an eminent jury in each area,
comprising outstanding international personalities selected by the
trustees of the Foundation.
The Infosys Prize 2010 presentation was held in Mumbai on
January 6, 2011. Laureates were felicitated by the Prime Minister of
India, Dr. Manmohan Singh. The prize in each category comprised
a 24 karat gold medallion, a citation and a cash grant of R50 lakh.
For more details on the Infosys Science Foundation, refer to the website
www.infosys-science-foundation.com
27. Infosys Foundation
We are committed to contributing to the society and established
Infosys Foundation in 1996 as a not-for-profit trust to support our
social initiatives. The Foundation supports programs and organizations
devoted to the cause of the destitute, the rural poor, the mentally
challenged, and the economically disadvantaged sections of the society.
The Foundation also helps preserve certain cultural forms and dying
arts of India.
A summary of the work done by the Foundation is provided
in the Additional Information Report published on our website
www.infosys.com. On your behalf, we express our gratitude to the
honorary trustees of the Foundation for sparing their valuable time
and energy for its activities.
28. Green initiative
During the previous fiscal, we started a sustainability initiative with the
aim of being green and minimizing our impact on the environment. Like
last year, this year too we are publishing only the statutory disclosures in
the print version of the Annual Report along with the Abridged standalone
financial statements prepared in compliance with the Section 219 of the
Companies Act, 1956. Additional details are available on our website,
www.infosys.com.
Acknowledgments
We thank our customers, vendors, investors and bankers for their continued support during the year. We place on record our appreciation of the
contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, cooperation and support.
We thank the governments of various countries where we have our operations. We also thank the Government of India, particularly the Ministry
of Communication and Information Technology, the Ministry of Commerce, the Ministry of Finance, the Customs and Excise Departments, the
Income Tax Department, the Reserve Bank of India, the state governments, the Software Technology Parks (STPs) Bangalore, Bhubaneswar,
Chandigarh, Chennai, Gurgaon, Hyderabad, Jaipur, Mangalore, Mysore, Pune, and Thiruvananthapuram and other government agencies for
their support, and look forward to their continued support in the future.
for and on behalf of the Board of Directors
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Bangalore
April 15, 2011
IT infrastructure
During the year, optimized desktop power management configuration
has been extended to around 80,000 desktops. Our in-house
application, Terminator, designed to force-schedule the shutdown
of desktops, is being enhanced to achieve further reduction in power
demand by desktops. In addition to this, around 10,000 older desktops
have been replaced this year with newer power-efficient models.
We have continued our efforts towards restructuring the existing data
centers and server rooms. Around twelve server rooms have been
revamped this year and about 4,400 sq. ft. of server room / lab space
has been released. Further, our projects have been swift to adopt the
internal enterprise cloud, a shared, secure and virtualized computing
environment with an easy-to-use Self-Service portal. On an average,
90% of the virtual instances are in use at any given time and we are
planning to further augment the capacity.
Video Conferencing (VC) usage has increased steadily this year and
currently, on an average, around 2,500 VC calls are happening per
month. Further, we have introduced Telepresence, an Ultra High
Definition (1080p) VC facility in three locations. Telepresence relays
true life-size images and employs spatial audio to provide an immersive
experience to the participants. Usage of this facility would help us
connect with customers at CXO levels across the world and reduce
our travel requirements.
Research and Development (R&D)
Our new strategic direction Building Tomorrows Enterprise identifies
trends that are driving and transforming the businesses of our clients
globally. These include digital consumers, emerging economies,
healthcare economy, sustainable tomorrow, new commerce, smarter
organizations and pervasive computing. These themes are now being
used to define the research and innovation agenda of the Company.
Infosys Labs
Infosys Labs, a dedicated research and innovation group comprising
technology and domain-focused members has been established. It
builds on the successes of the award winning Software Engineering
and Technology Labs (SETLabs) and envisages a broader mandate.
The primary research focus areas include Software Engineering,
Convergence, Knowledge-driven Information Systems, Security
& Privacy, Distributed Computing and Innovation. We also
have dedicated Centers of Excellence on Maintenance & Service
Differentiation, Microsoft Technology and Cloud Computing.
Some of the specific areas of research include semantic and language
technologies for information extraction from social media and for
customer engagement, context aware systems, pervasive computing
including mobility & sensor networks, scalable computing including
GPGPU, multi-core and cloud computing, data privacy and user
authentication, preventive software maintenance and software
engineering.
Lear n more about I nf osys Labs and i t s f ocus areas at
http://www.infosys.com/infosys-labs/
Finacle
The Finacle R&D unit at Infosys is engaged in the research of
developing new technologies in the banking domain. Finacle R&D
solutions address the areas of core banking, wealth management,
CRM, Islamic banking and treasury requirements of retail, corporate
and universal banks worldwide. Finacle solutions also empower
banks with multiple sales, service and marketing channels including
e-banking and mobile banking.
a) Particulars pursuant to Companies
(Disclosure of particulars in the report
of the Board of Directors) Rules, 1988
Conservation of energy
Building infrastructure
During the year, two of our buildings, one in Jaipur and the other in
Thiruvananthapuram, were awarded the prestigious LEED Platinum
rating the highest rating for Green Buildings, by the Indian Green
Building Council (IGBC). All new buildings that were completed in
the previous year have been registered for LEED rating from IGBC
and we hope to achieve a Platinum rating in all cases. The energy
performance of all the buildings designed in the previous year has
been found to be more efficient than the globally accepted ASHRAE
efficiency standards for buildings.
On new technologies, one building in our Hyderabad campus has been
commissioned with radiant cooling, a method of cooling used for the
first time in a commercial building in India. A chilled water storage
tank of 300 KL capacity has been built at our Mangalore campus to
increase the efficiency of the air conditioning system. This system is
under testing and is expected to reduce peak load as well as energy
consumption. Initial results of this system have been very encouraging.
Chilled beam systems, which are expected to be more efficient than
the conventional air conditioning systems, are being implemented in
three new buildings in our Pune campus. High-efficiency chillers that
consume considerably lesser power have been selected for all new
upcoming projects, thus reducing peak demand as well as energy
consumption.
During the year, we worked with electricity and power regulators in
Karnataka and with the government of India for making green power
cheaper, an achievement that is significant not only for us but would
also benefit the community at large. A similar initiative is being taken
up in other parts of the country. We purchased about 8.53 million
units of green power during the year and this figure is expected to
increase substantially in the coming years. On renewable energy, two
solar photovoltaic systems of about 200 KW and 125 KW are being
installed in our Jaipur and Thiruvananthapuram campuses respectively.
Together, these are expected to generate about 4,50,000 units of
electricity annually, thus reducing the burden on the grid.
A considerable amount of time and effort was earmarked for conserving
power across all our development centers in India. Some of the
measures taken include :
Installation of wind turbines at our campuses in Pune, Bangalore
and Mangalore
Installation of occupancy sensors in conference rooms and
restrooms
Introduction of LED lamps in lieu of uorescent tubes
Variable Frequency Drives (VFD) installed in condenser pumps
on chillers
Approval to replace old and inefcient utilities such as DG sets,
pumps and motors
Strong monitoring of the Environmental Management System as
per ISO 14001 guidelines
These measures have resulted in reducing the per capita power
consumption by over 3% during the year.
Annexure to the directors report
Education & Research
The E-Com research lab of the E&R unit focuses its research in the
areas of game theory applications to IT services, distributed computing,
optimization theory applications to IT services, pattern recognition
systems, face recognition algorithms, large data management and
education technology.
Collaborations with academia and industry
We co-create with clients, technology partners, universities and the
larger innovation ecosystem by setting up joint innovation centers and
developing solutions for complex business problems.
We are associated with various universities globally including, Purdue
University, Indian Institute of Science, Bangalore, IIIT, Hyderabad,
IIIT, Bangalore, IIT, Bombay Monash Research Academy, University
of Southern California, University of Cambridge and the University of
Illinois at Urbana-Champaign. We also associate with several industry
consortia including the IU-ATC in the United Kingdom (U.K.) and the
Smart Services CRC in Australia.
With a definitive aim to enlarge the innovation ecosystem to include
start-ups, entrepreneurs, incubation cells and other innovation players
in the industry, Infosys Labs organized an Innovation Camp in
Bangalore in March 2011. This is part of our larger program planned
across the globe.
R&D highlights
Our efforts in R&D have helped us offer new services to clients in
the areas of Software Engineering, Convergence, Knowledge-driven
Information Systems, Security & Privacy and Distributed Computing.
We are developing client-focused business solutions based on
the intellectual property developed by multiple research groups.
Our R&D efforts have helped us win large deals across industry
verticals.
From a banking industry perspective, the Finacle R&D unit has
launched innovative offerings such as Finacle
TM
Advisor, Finacle
TM

Mobile Banking 2.0, Finacle
TM
Treasury-in-a-box, Finacle
TM
Core
Banking for regional rural banks and Finacle
TM
financial inclusion
solutions. Our research has also helped develop key Finacle solutions
like Core Banking, CRM, Consumer e-banking, Wealth Management
and others.
Our R&D efforts have also helped differentiate our solutions and win
awards. An illustrative list is provided here :
Finacle
TM
was adjudged a Winner in the 5th Annual Leaders in
Innovation Awards by Financial-i, a leading U.K. based nancial
publication for the Best Core Banking Software.
Our research on mobility and our innovation accelerator Infosys
mConnect, has powered award winning Infosys solutions such as
Flypp
TM
recognized for its innovative approach to technology
and business in telecom at the Aegis Graham Bell Awards 2010 and
Infy-on-the-Go recognized at the Information Week innovation
award 2010.
Infosys iSmart, a sensor-based energy management solution
developed by Infosys Labs, was selected as an innovative
solution in the Grand Challenges for Technologists (2010) held
by Technology Review (India), the magazine of the Massachusetts
Institute of Technology.
During the year, the research groups also published two books, Raising
Enterprise Applications A Software Engineering Perspective and Process-
centric Architecture for Software Systems, and over 125 papers in leading
publications and journals.
Future plan of action
We are now using the Building Tomorrows Enterprise theme to focus
on our technology research and to identify large, multidisciplinary
problem areas that embody the challenges facing our clients.
We will continue to focus on and collaborate with leading national
and international universities, product vendors and technology
start-up companies. We are creating an ecosystem to co-create business
solutions on client-specific business themes.
Expenditure on R&D
in rcrore
2011 2010
Revenue expenditure 521 437
Capital expenditure 6 3
Total 527 440
R&D expenditure / total revenue 2.1% 2.1%
Foreign exchange earnings and outgo
Activities relating to exports, initiatives taken to increase
exports, development of new export markets for products
and services, and export plans
During the year, 97.7% of our revenues were derived from exports.
We have established a substantial direct marketing network around
the world, including North America, Europe and Asia Pacific.
These offices are staffed with sales and marketing specialists who sell
our services to large international clients.
Foreign exchange earned and used
in rcrore
2011 2010
Earnings 23,960 21,075
Outflow (including capital imports) 10,765 8,490
Net foreign exchange earnings (NFE) 13,195 12,585
NFE / Earnings 55.1% 59.7%
for and on behalf of the Board of Directors
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Bangalore
April 15, 2011
b) Auditors certificate on corporate governance
The Members of Infosys Technologies Limited
We have examined the compliance of conditions of Corporate Governance by Infosys Technologies Limited (the Company), for the year ended
on 31 March 2011, as stipulated in Clause 49 of the Listing Agreement of the Company with the stock exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures
and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an
audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with
the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.
We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with
which the management has conducted the affairs of the Company.
for B S R & Co.
Chartered Accountants
Firm registration number : 101248W
Bangalore
15 April, 2011
Natrajh Ramakrishna
Partner
Membership number : 32815
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Statement pursuant to Section 212 of the Companies Act, 1956
in rcrore
Subsidiary Infosys
Technologies
(Australia)
Pty. Limited
Infosys
Technologies
(China)
Company
Limited
Infosys
Technologies
S. de R. L.
de C. V.
Infosys
Technologies
(Sweden) AB
Infosys
Tecnologia
do Brasil
Ltda
Infosys
Public
Services, Inc.
Infosys
Technologies
(Shanghai)
Company
Limited
(1)
Infosys
Consulting,
Inc.
Infosys
Consulting
India
Limited
Infosys BPO
Limited
Infosys BPO
s.r.o.
Infosys BPO
(Poland)
Sp.Z.o.o
McCamish
Systems
LLC
Financial period ended Mar 31,
2011
Dec 31,
2010
Dec 31,
2010
Dec 31,
2010
Dec 31,
2010
Mar 31,
2011
NA Mar 31,
2011
Mar 31,
2011
Mar 31,
2011
Mar 31,
2011
Mar 31,
2011
Mar 31,
2011
Holding companys interest as at
March 31, 2011
100.00%
in equity
shares
100.00% in
capital
100.00% in
capital
100.00%
in equity
shares
100.00%
in equity
shares
100.00%
in equity
shares
100.00% in
capital
100.00%
in equity
shares
100.00%
in equity
shares
99.98% in
equity shares
99.98% in
equity shares
99.98% in
equity shares
99.98% in
equity shares
Shares held by the holding company in the
subsidiary
1,01,08,869
shares of
AUD 0.11
par value,
fully paid up
NA NA 1,000 equity
shares of
SEK 100 par
value, fully
paid up
1,45,16,997
equity shares
of BRL 1 par
value, fully
paid up
1,00,00,000
equity shares
of US$ 0.50
par value,
fully paid up
NA 5,50,00,000
shares of
US$ 1.00
par value,
fully paid up
NA 3,38,22,319
equity shares
of R10 par
value, fully
paid up
NA NA NA
Net aggregate profits / losses of the
subsidiary for the current period so far as
it concerns the members of the holding
company :
a. Dealt with or provided for in the
accounts of the holding company
b. Not dealt with or provided for in the
accounts of the holding company Profit : 84 Profit : 40 Loss : 1 Profit : 1 Loss : 8 Loss : 1 Profit : 78 Profit : 2 Profit : 205 Profit : 2 Profit : 11 Loss : 20
Net aggregate profits / losses for previous
financial years of the subsidiary so far as
it concerns the members of the holding
company :
a. Dealt with or provided for in the
accounts of the holding company
b. Not dealt with or provided for in the
accounts of the holding company Profit : 285 Loss : 29 Loss : 15 Loss : 8 Loss : 186 Profit : 1 Profit : 877 Profit : 24 Profit : 24 Loss : 18
Notes : The above details are as at March 31, 2011

(1)
On February 21, 2011, the Company incorporated Infosys Technologies (Shanghai) Company Limited.
S. Gopalakrishnan
S. D. Shibulal
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
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Statement pursuant to Section 212 of the Companies Act, 1956
in rcrore except employee data
Subsidiary Exchange rate as at
March 31, 2011
Issued and
subscribed
share capital
Reserves Loans Total
assets
Total
liabilities
Investments Turnover Profit / (Loss)
before taxation
Provision
for
taxation
Profit /
(Loss) after
taxation
No. of
Employees
Long-term Current Total
Infosys Technologies (Australia) Pty.
Limited 1 AUD = R46.11 4 488 492 492 984 116 32 84 514
Infosys Technologies (China) Company
Limited 1 RMB = R6.82 107 5 23 135 135 359 42 2 40 2,765
Infosys Technologies S. de R. L. de C. V. 1 MXN = R3.75 54 (14) 40 40 99 1 2 (1) 521
Infosys Technologies (Sweden) AB 1 SEK = R7.10 1 1 1 11 1 0 1 13
Infosys Tecnologia do Brasil Ltda 1 BRL = R27.46 38 (15) 9 32 32 51 (6) 2 (8) 173
Infosys Public Services, Inc. 1 USD = R44.60 23 (3) 20 20 (1) (1)
Infosys Technologies (Shanghai)
Company Limited
(1)
1 RMB = R6.82 11 11 11
Infosys Consulting, Inc. 1 USD = R44.60 240 (106) 134 134 1 1 841 134 56 78 573
Infosys Consulting India Limited
(2)
INR 1 3 4 4 28 4 2 2 139
Infosys BPO Limited INR 34 1,107 1,141 1141 320 21 341 1,129 215 10 205 16,416
Infosys BPO s.r.o.
(3)
1 CZK = R2.58 3 28 31 31 56 3 1 2 353
Infosys BPO (Poland) Sp.Z.o.o
(3)
1 PLN = R15.76 4 76 80 80 140 14 3 11 1,059
McCamish Systems LLC
(3)
1 USD = R44.60 115 (121) 18 12 12 150 (20) (20) 285
Notes : Information on subsidiaries is provided in compliance with the circular no. 2/2011 dated February 8, 2011 of the Ministry of Corporate Affairs, Government of India. We undertake to make available the audited annual accounts and related information of
subsidiaries, where applicable, upon request by any of our shareholders. The annual accounts will also be available for inspection during business hours at our registered office in Bangalore, India. The same will also be available on our website,
www.infosys.com
Proposed dividend from the above subsidiaries is nil.

(1)
On February 21, 2011, the Company incorporated Infosys Technologies (Shanghai) Company Limited.

(2)
Wholly-owned subsidiary of Infosys Consulting, Inc.

(3)
Wholly-owned subsidiary of Infosys BPO Limited
S. Gopalakrishnan
S. D. Shibulal
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Managements discussion and analysis | 19
Overview
The financial statements have been prepared in compliance with the
requirements of the Companies Act, 1956, guidelines issued by the
Securities and Exchange Board of India (SEBI) and the Generally
Accepted Accounting Principles (GAAP) in India. Our Management
accepts responsibility for the integrity and objectivity of these financial
statements, as well as for the various estimates and judgments
used therein. The estimates and judgments relating to the financial
statements have been made on a prudent and reasonable basis, so that
the financial statements reflect in a true and fair manner the form and
substance of transactions, and reasonably present our state of affairs,
profits and cash flows for the year.
A. Industry structure and developments
Changing economic and business conditions and rapid technological
innovation are creating an increasingly competitive market
environment that is driving corporations to transform their operations.
Consumers of products and services are increasingly demanding
accelerated delivery times and lower prices. Companies are focusing
on their core competencies and using outsourced technology service
providers to adequately address these needs. The role of technology has
evolved from supporting corporations to transforming their business.
There is an increasing need for highly skilled technology professionals
in the markets in which we operate. At the same time, corporations
are reluctant to expand their internal IT departments and increase
costs. These factors have increased the reliance of corporations on
their outsourced technology service providers and are expected to
continue to drive future growth for outsourced technology services.
1. Increasing trend toward offshore technology services
Outsourcing the development, management and ongoing maintenance
of technology platforms and solutions has become increasingly
important to companies. The effective use of offshore technology
services offers a variety of benefits to them, including lower cost of
ownership of IT infrastructure, lower labor costs, improved quality
and innovation, faster delivery of solutions and more flexibility in
scheduling. In addition, technology companies are also recognizing
the benefits of offshore service providers in software research and
development and related support functions, and are outsourcing a
greater portion of these activities. This has also resulted in more and
more diversification in the range of services delivered offshore.
2. The India advantage
India is widely recognized as the premier destination for offshore
technology services. According to the NASSCOM Strategic Review
2011, IT services exports (excluding exports relating to business
process outsourcing (BPO), hardware, engineering design and product
development) from India are estimated to grow by 22.7% in fiscal
2011, to record revenues of US$ 33.5 billion. The same review also
forecasts that BPO exports from India are estimated to grow by 14%
in fiscal 2011 to record revenues of US$ 14.1 billion. There are several
key factors contributing to the growth of IT and IT-enabled services
(ITES) in India and by Indian companies. Some of these factors are
high-quality delivery, significant cost benefits and abundant skilled
resources.
3. Evolution of technology outsourcing
The realm of technology outsourcing is changing. In an environment
of rapid technological advancement, globalization and regulatory
changes, companies are looking at outsourcing approaches that require
their technology service providers to develop specialized systems,
processes and solutions along with cost-effective delivery capabilities.
4. Global Delivery Model (GDM)
Our GDM allows us to execute services where it is most cost effective
and sell services where it is most profitable. The GDM makes the
best use of our large pool of highly skilled technology professionals
and our 24-hour execution capabilities across multiple time zones.
Other factors that make it one of the best delivery models in the
world are its ability to accelerate delivery times of large projects by
simultaneously processing project components; cost competitiveness
across geographic regions; built-in redundancy to ensure uninterrupted
services; and a knowledge management system that enables us to
re-use solutions where appropriate.
Our GDM mitigates risks associated with providing offshore technology
services to our clients. Speedy and effective communication being
the key, we use multiple service providers and a mix of terrestrial
and optical fiber links with alternate routing. In India, we rely
on two telecommunication carriers to provide high-speed links
interconnecting our global development centers. We rely on multiple
links on submarine cable paths to interconnect our development
centers with network hubs in other parts of the world. Our significant
investment in redundant infrastructure enables us to provide
uninterrupted service to our clients.
5. Our end-to-end solutions
We complement our industry expertise with specialized support for
our clients. We also leverage the expertise of our various Centers
of Excellence and our software engineering group and technology
lab to create customized solutions for our clients. In addition, we
continually evaluate and train our professionals in new technologies
and methodologies. Finally, we ensure the integrity of our service
delivery by utilizing a scalable and secure infrastructure.
We generally assume full project management responsibility in
each of our solution offerings. We strictly adhere to our SEI-CMMi
Level 5 internal quality and project management processes. Our project
delivery focus is supplemented by a robust knowledge management
system that enables us to leverage existing solutions across our
Company. We use in-house tools for project management and software
lifecycle support. We believe that our processes, methodologies,
knowledge management systems and tools reduce the overall cost to
the client, mitigate risks, enhance the quality of our offerings and allow
clients to improve time-to-market for their solutions. The revenues
attributed to the custom application development, maintenance and
production support, product engineering, package-enabled consulting
and implementation and business transformation consulting services
represented a majority of our total revenues in fiscal 2011.
B. Financial condition
Sources of funds
1. Share capital
At present, we have only one class of shares equity shares of par
value R5/- each. Our authorized share capital is R300 crore, divided
into 60 crore equity shares of R5/- each. The issued, subscribed and
paid up capital stood at R287 crore as at March 31, 2011 (same as
the previous year).
During the year, employees exercised 1,88,675 equity shares issued
under the 1998 Stock Option Plan and 1,37,692 equity shares
issued under the 1999 Stock Option Plan. Consequently, the issued,
subscribed and outstanding shares increased by 3,26,367. The details
of options granted, outstanding and vested as at March 31, 2011, are
provided in the Notes to the consolidated financial statements section in
the Annual Report.
Management's discussion and analysis
20 | Managements discussion and analysis
2. Reserves and Surplus
2.a Capital reserve
The balance as at March 31, 2011 amounted to R54 crore. During the
previous year, the addition to the capital reserve account of R48 crore
is on account of transfer of profit on sale of investments in OnMobile
Systems Inc., U.S. of R48 crore, which was included in the net profit.
2.b Share premium
The addition to the share premium account of R35 crore during the
year is primarily on account of premium received on issue of 3,26,367
equity shares, on exercise of options under the 1998 and 1999 Stock
Option Plans of R24 crore.
An amount of R11 crore (R10 crore in the previous year) was credited
to the share premium account arising due to tax benefits in overseas
jurisdiction of deductions earned on exercise of employees' stock
options, in excess of compensation charged to the Profit and Loss
account.
2.c General reserves
An amount of R645 crore representing 10% of the profits for the year
ended March 31, 2011 (previous year R580 crore) was transferred to
the general reserves account from the Profit and Loss account.
2.d Profit and Loss account
The balance retained in the Profit and Loss account as at March 31,
2011 is R15,591 crore, after providing the interim, 30th year special
and final dividend for the year of R574 crore, R1,722 crore and R1,149
crore respectively and dividend tax of R568 crore thereon. The total
amount of profits appropriated to dividend including dividend tax
was R4,013 crore, as compared to R1,674 crore in the previous year.
2.e Shareholder funds
The total shareholder funds increased to R24,501 crore as at March
31, 2011 from R22,036 crore as of the previous year end. The book
value per share increased to R426.73 as at March 31, 2011, compared
to R384.01 as of the previous year-end.
Application of funds
3. Fixed assets
3.a Capital expenditure
We incurred a capital expenditure of R1,152 crore (R565 crore in the
previous year) comprising additions to gross block of R1,017 crore,
net of R3 crore movement in land from leasehold to freehold for the
year ended March 31, 2011. An increase of R90 crore on account
of increase in capital work-in-progress and R 45 crore on account
of decrease in retention monies. The entire capital expenditure was
funded out of internal accruals.
3.b Additions to gross block
During the year, we capitalized R 1,017 crore to our gross block
comprising R251 crore for investment in computer equipment and
the balance of R764 crore on infrastructure investment and R2 crore
on vehicles. We invested R225 crore to acquire 267 acres of land
in Bangalore, Delhi and Mangalore. The expenditure on buildings,
computer equipment, plant and machinery and furniture and fixtures,
increased by R 323 crore, R 251 crore, R 147 crore and R 69 crore
respectively.
During the previous year, we capitalized R 787 crore to our gross
block, including investment in computer equipment of R140 crore,
R646 crore on infrastructure investment and R1 crore on vehicles.
We invested R43 crore to acquire 161 acres of land in Hyderabad,
Jaipur, Mysore and Mangalore.
3.c Deductions to gross block
During the year, we deducted R440 crore (net book value of Rnil) from
the gross block on retirement of assets. During the previous year, we
retired / transferred various assets with a gross block of R387 crore
(net book value of Rnil) R8 crore on donation of computer systems
and R21 crore on disposal of various assets.
3.d Capital expenditure commitments
We have a capital expenditure commitment of R 742 crore, as at
March 31, 2011 as compared to R267 crore as at March 31, 2010.
4. Investments
We made several strategic investments aimed at procuring business
benefits and operational efficiency for us. During the previous year,
the Company sold 32,31,151 shares of OnMobile Systems Inc., U.S.,
for a total consideration of R53 crore, net of taxes and transaction cost.
4.a Majority-owned subsidiary
Infosys BPO Limited
We established Infosys BPO Limited as a majority-owned and
controlled subsidiary on April 3, 2002, to provide business process
management services. Infosys BPO seeks to leverage the benefits of
service delivery globalization, process redesign and technology to
drive efficiency and cost effectiveness in customer business processes.
On December 4, 2009, Infosys BPO acquired 100% of voting interest
in McCamish Systems LLC, a business process solutions provider
based at Atlanta, U.S., for a cash consideration of R173 crore and a
contingent consideration of R67 crore.
4.b Wholly-owned subsidiaries
During the year, the investments in our subsidiaries were as follows :
Subsidiary In foreign currency Rcrore
Infosys Technologies (China)
Company Limited US$ 9 million 42
Infosys Tecnologia do Brasil
Ltda BRL 3.8 million 10
Infosys Technologies S. de R. L.
de C. V., Mexico MXN 40 million 14
Company Limited
(1)
US$ 2.5 million 11
(1)
During the year, Infosys Technologies Limited incorporated a wholly-owned subsidiary
Infosys Technologies (Shanghai) Company Limited
5. Deferred tax assets / liabilities
We recorded deferred tax assets of R406 crore as at March 31, 2011
(R313 crore as at March 31, 2010) and deferred tax liability of R176
crore as at March 31, 2011 (R232 crore as at March 31, 2010).
We assess the likelihood that our deferred tax assets will be recovered
from future taxable income. We believe it is more likely than not that
we will realize the benefits of these deductible differences.
6. Sundry debtors
Sundry debtors amounted to R 4,212 crore (net of provision for
doubtful debts amounting to R 83 crore) as at March 31, 2011,
compared to R 3,244 crore (net of provision for doubtful debts
amounting to R100 crore) as at March 31, 2010. These debts are
considered good and realizable. Debtors are at 16.6% of revenues for
the year ended March 31, 2011, compared to 15.3% for the previous
year, representing a Days Sales Outstanding (DSO) of 61 days and
56 days for the respective years.
Our largest client constituted 2.7% of sundry debtors as at March 31,
2011. The age profile of debtors is as follows :
in %
Days 2011 2010
0-30 58.3 60.7
31-60 33.0 31.9
61-90 4.3 3.8
Above 91 4.4 3.6
100.0 100.0
Provisions are generally made for all debtors' outstanding for more than
180 days as also for others, depending on the Management's perception
of the risk. The need for provisions is assessed based on various factors,
including collectability of specific dues, risk perceptions of the industry
in which the customer operates and general economic factors that
could affect the customer's ability to settle.
The movement in provisions for doubtful debts during the year is
as follows :
in rcrore
2011 2010
Opening balance 100 105
Add : Amount provided 3 (1)
Less : Amount written-off 20 4
Closing balance 83 100
Provision for bad and doubtful debts as a percentage of revenue is
0.01% for the year ended March 31, 2011, as against nil for the year
ended March 31, 2010.
The unbilled revenues as at March 31, 2011 and March 31, 2010,
amounted to R1,158 crore and R789 crore respectively.
7. Cash and cash equivalents
The bank balances in India include both rupee accounts and foreign
currency accounts. The bank balances in overseas current accounts
are maintained to meet the expenditure of the overseas branches and
project-related expenditure overseas. The deposit account represents
deposits of maturity up to 365 days.
Our treasury policy calls for investing surpluses with highly-rated
companies, banks and financial institutions for maturities up to 365
days, as also with liquid mutual funds with a limit on investments in
individual entities.
8. Loans and advances
in rcrore
2011 2010
Unsecured, considered good
Loans to subsidiary 32 46
Advances
Pre-paid expenses 52 25
Interest accrued but not due 14 14
Advance to Gratuity Fund Trust 2
For supply of goods and services 50 5
Withholding and other taxes receivable 516 321
Others 10 13
Sub-total 674 426
Unbilled revenues 1,158 789
Advance income tax 924 641
Loans and advances to employees 126 100
Electricity and other deposits 60 60
Rental deposits 18 13
Deposits with financial institutions and
body corporate
(1)
1,844 1,781
Mark-to-market gain on forward and
options contracts 63 88
Total 4,867 3,898
(1)
An amount of r344 crore (r281 crore as at March 31, 2010) deposited with the Life
Insurance Corporation of India to settle leave obligations as and when they arise during
the normal course of business. This amount is considered as restricted cash and hence
not considered as cash and cash equivalents.
As at March 31, 2011, the outstanding loan to Infosys Technologies
(China) Company Limited was R 23 crore (US$ 5 million),
the outstanding loan as at March 31, 2010 was R 46 crore
(US$ 10 million). During the year, the Company has given a loan of
R9 crore (US$ 2 million) to Infosys Tecnologia do Brasil Ltda, which
is outstanding as of March 31, 2011. The loan is repayable within five
years and six months at the discretion of the subsidiary, for the China
and Brazil subsidiaries respectively.
The withholding and other taxes receivable represents transaction
taxes paid in various domestic and overseas jurisdictions which are
recoverable.
Unbilled revenues consist primarily of costs and earnings in excess
of billings to the client on fixed-price, and fixed-timeframe contracts.
The details of advance income taxes are as follows :
in rcrore
2011 2010
Domestic tax 897 635
Overseas tax 27 6
Total 924 641
Our loan schemes provide for personal loans and salary advances that
are provided primarily to employees in India who are not executive
officers or directors. The loans and advances are recoverable within
24 months.
Electricity and other deposits represent electricity deposits, telephone
deposits, insurance deposits and advances of a similar nature.
The rent deposits are for buildings taken on lease by us for our
software development centers and marketing offices in locations
across the world.
Deposits with financial institutions and corporate bodies represent
surplus money deployed in the form of short-term deposits.
9. Current liabilities
in rcrore
2011 2010
Sundry creditors
For goods and services 85 96
For accrued salaries and benefits 405 446
For other liabilities
Provision for expenses 537 375
Retention monies 21 66
Withholding and other taxes 292 235
Gratuity obligations unamortized
amount 22 26
Others 8 8
Sub-total 1,370 1,252
Advances received from clients 19 7
Unearned revenue 488 502
Unclaimed dividend 3 2
Total 1,880 1,763
Sundry creditors for accrued salaries and benefits include the provision
for bonus and incentive payable to the staff. Sundry creditors for other
liabilities represent amounts accrued for other operational expenses.
Retention monies represent monies withheld on contractor payments
pending final acceptance of their work. Withholding and other taxes
payable represent local taxes payable in various countries in which
we operate and the same will be paid in due course.
Effective July 1, 2007, we revised the employee death benefits provided
under the gratuity plan, and included all eligible employees under a
consolidated term insurance cover. Accordingly, the obligations under
the gratuity plan reduced by R37 crore, which is being amortized
on a straight line basis to the Profit and Loss account over ten years,
representing the average future service period of employees. An amount
of R4 crore was amortized during the year. The unamortized balance
as at March 31, 2011 was R22 crore.
Advances received from clients represent monies received for the
delivery of future services. Unearned revenue consists primarily of
advance client billing on fixed-price, and fixed-timeframe contracts
for which related costs were not yet incurred. Unclaimed dividends
represent dividends paid, but not encashed by shareholders, and are
represented by a bank balance of the equivalent amount.
10. Provisions
in rcrore
2011 2010
Proposed dividend 1,149 861
Tax on dividend 187 143
Income taxes 756 719
Unavailed leave 303 239
Post-sales client support and warranties 78 73
Total 2,473 2,035
Proposed dividend represents the final dividend we recommended
to our shareholders. Upon approval by our shareholders, this will be
paid after the Annual General Meeting. Provision for tax on dividend
denotes taxes payable on final dividend declared for the year.
Provisions for taxation represent estimated income tax liabilities, both
in India and overseas. The details are as follows :
in rcrore
2011 2010
Domestic tax 37 37
Overseas tax 719 682
Total 756 719
Provisions for unavailed leave is toward our liability for leave
encashment valued on an actuarial basis. The provision for post-sales
client support and warranties is towards likely expenses for providing
post-sales client support on fixed-price contracts.
C. Results of operations
1. Income
Of the total revenues for the years ended March 31, 2011 and
March 31, 2010, approximately 97.7% were derived from our overseas
operations whereas 2.3% were derived from domestic operations.
Our revenues are generated primarily on fixed-timeframe or time-and-
material basis. Revenues from software services on fixed-price and
fixed-timeframe contracts are recognized as per the proportionate-
completion method. On time-and-material contracts, revenue is
recognized as the related services rendered. Revenue from the sale
of user licenses for software applications is recognized on transfer of
the title in the user license, except in multiple arrangement contracts,
where revenue is recognized as per the proportionate-completion
method.
The segmentation of software services by project type is as follows :
in %
2011 2010
Fixed-price 42.1 40.8
Time-and-material 57.9 59.2
Total 100.0 100.0
Our revenues are also segmented into onsite and offshore revenues.
Onsite revenues are for those services which are performed at our client
locations or at our global development centers, as part of software
projects, while offshore revenues are for services which are performed
at our software development centers located in India.
The segmentation of revenues by location (including product revenue)
is as follows :
in %
2011 2010
Onsite 50.2 48.7
Offshore 49.8 51.3
Total 100.0 100.0
The services performed onsite typically generate higher revenues per
capita, but at lower gross margins in percentage as compared to the
services performed at our own facilities. Therefore, any increase in the
onsite effort impacts our margins.
The details of effort mix for software services and products in person-
months are as follows :
in %
2011 2010
Onsite 26.5 26.1
Offshore 73.5 73.9
Total 100.0 100.0
The growth in software services and product revenues is due to an
all-round growth in various segments of the business mix and is mainly
due to growth in business volumes.
The details of the same are as follows :
2011 2010
Income (in Rcrore)
Software services 24,100 20,215
Software products 1,285 925
Total 25,385 21,140
Person-months
Software services
Onsite 2,24,378 1,75,581
Offshore 5,50,555 4,42,336
Billed-total 7,74,933 6,17,917
Software products 71,020 54,772
Non-billable 2,04,435 2,31,186
Training 1,10,288 92,081
Sub-total 11,60,676 9,95,956
Support 62,345 54,032
Total 12,23,021 10,49,988
Increase / (Decrease) in billed person
months
Onsite 48,797 (3,748)
% change 27.8 (2.1)
Offshore 1,08,219 34,359
% change 24.5 8.4
Total 1,57,016 30,611
% change 25.4 5.2
Support / total (%) 5.1 5.1
1.a Software services
During the year, the volume of software services grew by 25.4%
compared to 5.2% in the previous year. The onsite and offshore volume
growth were 27.8% and 24.5% respectively during the year, compared
to (2.1) % and 8.4% in the previous year. In U.S. dollar terms, onsite
per capita revenues increased by 0.7% during the year, offshore per
capita revenues decreased by 4.2% and blended per capita revenues
decreased by 1.1%. During the previous year, onsite per capita revenues
increased by 3.4% offshore per capita revenues decreased by 4.7% and
blended per capita revenues decreased by 2.8% in U.S. dollar terms.
1.b Software products
The revenues from software products grew 38.9% compared to 9.1%
in the previous year. Of the software products revenue, 82.1% came
from exports (same as previous year).
2. Expenditure
2.a Software development expenses
in rcrore
2011 % 2010 % Growth
%
Revenues 25,385 100.0 21,140 100.0 20.1
Software
development
expenses :
Salaries and bonus 11,013 43.4 9,216 43.6 19.5
Technical
sub-contractors 2,044 8.0 1,479 7.0 38.2
Overseas travel
expenses 573 2.3 401 1.9 42.9
Cost of software
packages 320 1.3 309 1.4 3.6
Third party items
bought for service
delivery to clients 139 0.5 17 0.1 717.6
Communication
expenses 39 0.2 45 0.2 (13.3)
Post-sales
customer support
and warranties 5 (2) 350.0
Other expenses 134 0.5 94 0.5 42.6
Total 14,267 56.2 11,559 54.7 23.4
We incurred software development expenses at 56.2% of revenues,
compared to 54.7% during the previous year. Employee costs relate
to salaries paid to employees in India and include overseas staff
expenses. The total software professionals person-months increased
to 11,60,676 for the year ended March 31, 2011, from 9,95,956
person-months during the previous year, an increase of 16.5%. Of
this, the onsite and offshore billed person-months (including software
products) are 2,24,378 and 6,21,575 for the year ended March
31, 2011, as compared to 1,75,581 and 4,97,108 for the previous
year. The non-billable and trainees person-months were 3,14,723
and 3,23,267 during the current and previous year respectively.
The non-billable and trainees person-months were 27.1% and 32.5%
of the total software professional person-months for the current and
previous year respectively. We added 32,247 employees (gross) and
15,321 employees (net) during the year as compared to 18,905
employees (gross) and 6,837 employees (net) during the previous year.
The utilization rates of billable employees for the years ended
March 31, 2011 and March 31, 2010 are as follows :
in %
2011 2010
Including trainees 72.9 67.5
Excluding trainees 80.5 74.4
The cost of technical sub-contractors includes R1,568 crore toward
purchase of services from subsidiaries for the year ended March 31,
2011, as against R1,210 crore in the previous year. The details of such
related party transactions are available in the Notes to Accounts. The
balance amount was utilized toward availing the services of external
consultants to augment skill sets that were required in various projects.
We continue to engage the services of these consultants on a need basis.
The overseas travel expenses representing cost of travel overseas for
software development constituted approximately 2.3% and 1.9%
respectively of total revenue for the years ended March 31, 2011 and
March 31, 2010. Overseas travel expenses include visa charges of
R184 crore (0.7% of revenues) for the year, compared to R92 crore
(0.4% of revenues) in the previous year.
Cost of software packages primarily represents the cost of software
packages and tools procured for our internal use. These packages
and tools enhance the quality of our services and also meet the needs
of software development. The cost of software packages was 1.3%
and 1.4% respectively of the revenues for the years ending March 31,
2011 and March 31, 2010. Our accounting policy is to charge such
purchases to the Profit and Loss accounts in the year of purchase.
Third party items bought for service delivery to clients include software
and hardware procured from third parties for resale to clients primarily
in India. The increase in third party items bought for service delivery
to clients is due to an increase in volume of system integration projects
executed in the Indian market.
A major part of our revenues is generated from offshore software
development. We use high-end communication tools in order to
establish real-time connections with our clients. The communication
expenses represent approximately 0.2% of revenues for the years
ending March 31, 2011 and March 31, 2010 respectively.
The provision for post-sale customer support and warranties saw a
charge of R5 crore against the reversal of R2 crore for the years ended
March 31, 2011 and March 31, 2010 respectively.
Other expenses representing staff welfare, computer maintenance,
consumables and rent approximate to 0.5% of revenues during the
year (same as the previous year).
2.b Gross profit
The gross profit during the year was R11,118 crore representing 43.8%
of revenues compared to R9,581 crore representing 45.3% of revenues
in the previous year.
2.c Selling and marketing expenses
We incurred selling and marketing expenses at 4.8% of our total
revenues, compared to 4.6% in the previous year. Selling and marketing
expenses primarily consist of employee costs which include bonus
payment. All other expenses excluding the employee cost were 1.0%
of revenues during the year (same as previous year). The number of
sales and marketing personnel increased from 800 as at March 31,
2010 to 902 as at March 31, 2011.
We and our subsidiaries added 139 new customers as compared to
141 during the previous year.
2.d General and administration expenses
We incurred general and administration expenses amounting to 5.8%
and 5.9% of our total revenues, during the current year and previous
year respectively. All other expenses excluding the employee cost
were 4.2% of revenues during the year as compared to 4.3% in the
previous year.
Employee costs increased as the number of administration
personnel increased from 3,922 as at March 31, 2010 to 4,487 as at
March 31, 2011.
3. Operating profits
We earned an operating profit (PBIDTA) of R8,414 crore, representing
33.2% of total revenues compared to R7,360 crore, representing 34.8%
of total revenues, during the previous year.
4. Depreciation
We provided R740 crore and R807 crore toward depreciation for the
years ended March 31, 2011 and March 31, 2010 representing 2.9%
and 3.8% of total revenues. The depreciation for the years ended
March 31, 2011 and March 31, 2010 includes an amount of R33 crore
and R86 crore, toward 100% depreciation on assets costing less than
R5,000 each. The depreciation as a percentage of average gross block
(excluding land) is 11.9% and 13.7% for the years ending March 31,
2011 and 2010 respectively.
5. Other income, net
Our treasury policy allows us to invest in short-term instruments
with a maturity of up to 365 days, with a limit on individual fund /
bank. The increase in interest income during the year was on account
of higher cash generation in the business and increase in the average
yield during the year.
We use foreign exchange forward contracts and options to hedge our
exposure to movements in foreign exchange rates. The use of these
foreign exchange forward contracts and options reduces our risks /
costs. We do not use foreign exchange forward contracts or options
for trading or speculation purposes.
Foreign exchange gains / (losses) include transaction and translation
losses of R 13 crore and a loss of R 237 crore for the years ended
March 31, 2011 and March 31, 2010 respectively and option / forward
contracts-gain of R52 crore and a gain of R276 crore for the years
ended March 31, 2011 and March 31, 2010 respectively.
The composition of currency-wise revenues for the years ended
March 31, 2011 and March 31, 2010 is as follows :
in %
Currency 2011 2010
US Dollar (US$) 73.7 74.4
UK Pound (GBP) 6.5 8.5
Euro (EUR) 6.8 6.7
Australian Dollar (AUD) 6.6 5.8
Others 6.4 4.6
Total 100.0 100.0
6. Sensitivity to rupee movement
Every 1% movement in the Indian rupee against the US dollar has an
impact of approximately 50 basis points on operating margin.
7. Provision for tax
We have provided for our tax liability both in India and overseas. The
Indian corporate tax rate for the year ended March 31, 2011 is 33.22%.
Export profits for the year were entitled to tax benefits under two
schemes of the Government of India viz., the STPI and SEZ scheme.
7.a Software Technology Parks (STPs)
The profits attributable to operations under the STP scheme were
exempted from income tax for a consecutive period of ten years
from the financial year in which the unit started producing computer
software, or March 31, 2011, whichever was earlier.
The details regarding the commencement of operations at our STP
locations and the year upto which the deduction under the STP scheme
was availed are as follows :
Software Technology
Park
Year of
Commenc-
ement
(1)
Tax exemption
Claimed
from
(1)
Available
upto
(1)
Electronics City, Bangalore 1995 1997 2004
Mangalore 1996 1999 2005
Pune 1997 1999 2006
Bhubaneswar 1997 1999 2006
Chennai 1997 1999 2006
Phase I, Electronics City,
Bangalore 1999 1999 2008
Phase II, Electronics City,
Bangalore 2000 2000 2009
Hinjawadi, Pune 2000 2000 2009
Mysore 2000 2000 2009
Hyderabad 2000 2000 2009
Chandigarh 2000 2000 2009
Sholinganallur, Chennai 2001 2001 2010
Konark, Bhubaneswar 2001 2001 2010
Software Technology
Park
Year of
Commenc-
ement
(1)
Tax exemption
Claimed
from
(1)
Available
upto
(1)
Mangala, Mangalore 2001 2001 2010
Thiruvananthapuram 2004 2004 2011
(1)
Financial year
7.b Special Economic Zones (SEZs)
During the financial year three more SEZ units at Mysore, Hyderabad
and Mahindra City, Chennai commenced production.
As per the SEZ Act, the units will be eligible for a deduction of 100% of
profits or gains derived from the export of services for the first five years
from commencement of provision of services and 50% of such profits
or gains for the next five years. Certain tax benefits are also available
for a further five years subject to the units meeting defined conditions.
The details regarding the commencement of operations at our SEZ
locations and the year upto which the deduction under the SEZ scheme
is available are as follows :
Special Economic Zone Year of
Commenc-
ement
(1)
Tax exemption
Claimed
from
(1)
Available
upto
(1)
Mahindra City unit 1,
Chennai 2006 2006 2020
Mangalore 2008 2008 2022
Pune 2008 2008 2022
Mysore 2011 2011 2025
Hyderabad 2011 2011 2025
Mahindra City unit 2,
Chennai 2011 2011 2025
(1)
Financial year
Other fiscal benefits, including indirect tax waivers, are being extended
for setting up, operating and maintaining the unit.
For the current year, approximately 1.61% of our revenues came from
the STP unit at Thiruvananthapuram, which was under tax holiday,
9.60% of revenues came from the SEZ at Mahindra City unit 1,
Chennai, which was eligible for deduction based on 50% of the profits
of the unit and 13.34% of revenues came from other SEZ units, which
were eligible for deduction based on entire profits of these units. The
balance 75.45% of revenues came from other STP units, which were
subject to full tax in India. We pay taxes in various countries in which
we operate, on the income that is sourced to those countries. The
details of provision for taxes are as follows :
in rcrore
Year ended March 31, 2011 2010
Overseas tax 502 433
Domestic tax 2,019 1,551
2,521 1,984
MAT credit (288)
Deferred taxes (143) 21
2,378 1,717
The effective tax rate increased to 26.96 % in fiscal 2011 as compared
to 23.0% in fiscal 2010.
8. Net profit after tax
Our net profit increased by 12% to R6,443 crore for the year ended
March 31, 2011 from R5,755 crore in the previous year, excluding
exceptional item. This represents 25.4% and 27.2% of total revenue
for the year ended March 31, 2011 and March 31, 2010 respectively.
9. Earnings Per Share (EPS)
Our basic EPS increased by 11.8% during the year to R112.26 per
share from R100.37 per share in the previous year. The outstanding
shares used in computing basic EPS increased from 57,33,09,523 for
the year ended March 31, 2010 to 57,40,13,650 for the year ended
March 31, 2011, an increase of 0.1%.
10. Segmental profitability
Our operations predominantly relate to providing end-to-end business
solutions that leverage technology, thereby enabling clients to enhance
business performance, delivered to customers globally operating in
various industry segments. Accordingly, revenues represented along
industry classes comprise the primary basis of segmental information
set out in these financial statements. Secondary segmental reporting
is performed on the basis of the geographical location of customers.
The income and operating income by industry and geographical
segments are provided in this section.
10.a Industry segments
in rcrore
Finan-
cial
services
Manu-
factur-
ing
Telecom Retail Others Total
Segmental revenues
2011 9,293 4,686 3,134 3,757 4,515 25,385
2010 7,354 3,988 3,234 2,989 3,575 21,140
Growth % 26.4 17.5 (3.1) 25.7 26.3 20.1
Segmental operating income
2011 3,113 1,572 990 1,307 1,432 8,414
2010 2,644 1,258 1,167 1,065 1,226 7,360
Growth % 17.7 25.0 (15.2) 22.7 16.8 14.3
Segmental operating profit (%)
2011 33.5 33.5 31.6 34.8 31.7 33.1
2010 35.9 31.5 36.1 35.6 34.3 34.8
10.b Geographical segments
in rcrore
North
America
Europe India Rest of the
World
Total
Segmental revenues
2011 16,815 5,252 594 2,724 25,385
2010 14,170 4,633 269 2,068 21,140
Growth % 18.7 13.4 120.8 31.7 20.1
Segmental operating income
2011 5,684 1,821 186 723 8,414
2010 5,028 1,650 133 549 7,360
Growth % 13.0 10.4 39.8 31.7 14.3
Segmental operating profit (%)
2011 33.8 34.7 31.3 26.5 33.1
2010 35.5 35.6 49.4 26.5 34.8
11. Liquidity
Our growth has been financed largely through cash generated from
operations.
Net cash generated from operations was R4,270 crore and R5,855
crore for the years ended March 31, 2011 and March 31, 2010
respectively. Net cash provided by / (used in) investing activities was
R3,235 crore and (R3,298) crore for the years ended March 31, 2011 and
March 31, 2010 respectively. Net cash used in financing activities was
R3,642 crore and R1,481 crore for the years ended March 31, 2011
and March 31, 2010, respectively.
12. Related party transactions
These have been discussed in detail in the Notes to the Abridged financial
statements section of this report.
13. Events occurring after the Balance Sheet date
There were no significant events occurring after the Balance Sheet date.
D. Opportunities and threats
We believe our competitive strengths include :
Leadership in sophisticated solutions that enable our clients to
optimize the efciency of their business
Proven GDM
Commitment to superior quality and process execution
Strong brand and long-standing client relationships
Status as an employer of choice
Ability to scale
Innovation and leadership
1. Our strategy
We seek to further strengthen our position as a leading global
technology services company by successfully differentiating our service
offerings and increasing the scale of our operations. To achieve these
goals, we seek to :
Increase business from existing and new clients
Expand geographically
Continue to invest in infrastructure and employees
Continue to enhance our engagement models and offerings
Continue to develop deep industry knowledge
Enhance brand visibility
Pursue alliances and strategic acquisitions
2. Competition
We operate in a highly competitive and rapidly changing market and
compete with consulting firms such as Accenture Limited, Atos Origin
S.A., Cap Gemini S.A., and Deloitte Consulting LLP; divisions of large
multinational technology firms such as Hewlett-Packard Company
and International Business Machines Corporation; IT outsourcing
firms such as Computer Sciences Corporation, Keane Inc., Logica
Plc and Dell Perot Systems; offshore technology services firms such
as Cognizant Technology Solutions Corporation, Tata Consultancy
Services Limited and Wipro Technologies Limited; software firms such
as Oracle Corporation and SAP A.G.; business process outsourcing
firms such as Genpact Limited and WNS Global Services and in-house
IT departments of large corporations.
In the future, we expect competition from firms establishing and
building their offshore presence and firms in countries with lower
personnel costs than those prevailing in India. However, we recognize
that price alone cannot constitute a sustainable competitive advantage.
We believe that the principal competitive factors in our business
include the ability to effectively integrate onsite and offshore execution
capabilities to deliver seamless, scalable, cost-effective services; increase
scale and breadth of service offerings to provide one-stop solutions;
provide industry expertise to clients business solutions; attract and
retain high-quality technology professionals and maintain financial
strength to make strategic investments in human resources and physical
infrastructure through business cycles.
We believe we compete favorably with respect to these factors.
E. Outlook, risks and concerns
This section contains forward-looking statements that involve risks
and uncertainties. Our actual results could differ materially from those
anticipated in these statements as a result of certain factors.
The following lists our outlook, risks and concerns :
Our revenues and expenses are difcult to predict and can vary
signicantly from period to period, which could cause our share
price to decline. We may not be able to sustain our previous prot
margins or levels of protability.
Our revenues are highly dependent on clients primarily located
in the U.S. and Europe, as well as in certain industries, and an
economic slowdown or other factors that affect the economic
health of the U.S., Europe or these industries may affect our
business.
Currency uctuations may affect the results of our operations.
Our success depends largely upon our highly skilled technology
professionals and our ability to hire, attract, motivate, retain and
train our personnel.
We may face difculties in providing end-to-end business solutions
for our clients, which could lead to clients discontinuing their
work with us. This in turn could harm our business.
Intense competition in the market for technology services could
affect our cost advantages, which could reduce our share of
business from clients and may decrease our revenues.
Our revenues are highly dependent upon a small number of clients,
and the loss of any one of our major clients could signicantly
impact our business.
Legislation in certain countries in which we operate, including the
United States and the United Kingdom, may restrict companies in
those countries from outsourcing work to us.
Compliance with new and changing corporate governance and
public disclosure requirements adds uncertainty to our compliance
policies and increases our costs of compliance.
Our failure to complete xed-price, xed-timeframe contracts or
transaction-based pricing contracts within the budget and on time,
may negatively affect our protability.
Our client contracts can be terminated without cause and with
little or no notice or penalty. This could negatively impact our
revenues and protability.
Our engagements with customers are singular in nature and do not
necessarily provide for subsequent engagements.
Our client contracts are often conditioned upon our performance,
which, if unsatisfactory, may result in less revenue than previously
anticipated.
Some of our long-term client contracts contain benchmarking
provisions which, if triggered, could result in lower future revenues
and protability under the contract.
Our business will suffer if we fail to anticipate and develop new
services and enhance existing services in order to keep pace with
rapid changes in technology and in the industries on which we
focus.
Disruptions in telecommunications, system failures or virus attacks
could harm our ability to execute our GDM, which could result in
client dissatisfaction and a reduction of our revenues.
We may be liable to our clients for damages caused by disclosure of
condential information, system failures, errors or unsatisfactory
performance of services.
Our increasing work with governmental agencies may expose us
to additional risks.
We are investing substantial cash assets in new facilities and
physical infrastructure, and our protability could be reduced if
our business does not grow proportionately.
We may be unable to recoup our investment costs to develop our
software products.
Our insiders who are signicant shareholders may control the
election of our Board and may have interests that conict with
those of our other shareholders or holders of our ADSs.
We may engage in acquisitions, strategic investments, strategic
partnerships or alliances or other ventures that may or may not
be successful.
Our net income would decrease if the Government of India
reduces or withdraws tax benets and other incentives it provides
to us or when our tax holidays expire or terminate.
In the event that the Government of India or the government
of another country changes its tax policies in a manner that is
adverse to us, our tax expense may materially increase, reducing
our protability.
We operate in jurisdictions that impose transfer pricing and other
tax-related regulations on us, and any failure to comply could
materially and adversely affect our protability.
Wage pressures in India and the hiring of employees outside India
may prevent us from sustaining our competitive advantage and
may reduce our prot margins.
Terrorist attacks or a war could adversely affect our business,
results of operations and nancial condition.
The markets in which we operate are subject to the risk of
earthquakes, oods, tsunamis and other natural and man made
disasters.
Changes in immigration laws may affect our ability to compete
and provide services to our clients in various countries. This could
hamper our growth and may have an impact on our revenues.
Our ability to acquire companies organized outside India depends
on the approval of the Government of India and / or the Reserve
Bank of India, and failure to obtain this approval could negatively
impact our business.
For more details on risk factors, refer to our quarterly and annual filings
with the Securities and Exchange Commission (SEC), USA, available
on our website www.infosys.com
F. Internal control systems and their adequacy
The CEO and CFO certification provided in the CEO and CFO
Certification section of the Annual Report discusses the adequacy of
our internal control systems and procedures.
G. Material developments in human resources /
industrial relations, including number of people
employed
Our culture and reputation as a leader in the technology services
industry enables us to recruit and retain some of the best available
talent in India.
1. Human capital
Our employees are our most important and valuable assets. During
fiscal 2011, we received around 8,29,800 employment applications,
approximately 1,36,200 were interviewed and 67,400 job offers were
made. As of March 31, 2011, Infosys and its subsidiaries had employed
1,30,820 employees, of which 1,23,811 are technology professionals,
including trainees.
The key elements that define our human capital development include :
1.a Recruitment
We have built our global talent pool by recruiting students from
premier universities, colleges and institutes in India and through
need-based hiring of project leaders and middle managers.
We recruit students in India who have consistently shown high levels of
achievement. We have also begun selective recruitment at campuses in
the U.S., the U.K., Australia and China. We rely on a rigorous selection
process involving a series of aptitude tests and interviews to identify
the best applicants. This selection process is continually assessed and
refined based on the performance tracking of past recruits.
1.b Training and development
With a total built-up area of 1.44 million sq. ft., the Infosys Global
Education Center in Mysore, can train approximately 14,000
employees at a time.
As of March 31, 2011, we employed 698 full-time employees as
faculty, including 255 with doctorates or masters degrees. Our faculty
conducts integrated training for our new employees. Our employees
undergo certification programs each year to develop / upgrade the
skills relevant for their roles.
Leadership development is a core part of our training program.
We established the Infosys Leadership Institute at our Mysore campus
to enhance the leadership skills required to manage the complexities
of the rapidly changing marketplace.
We have also been working with several colleges across India through
our Campus Connect program, enabling their faculty to provide
industry related training to students.
1.c Compensation
Our technology professionals receive competitive salaries and benefits.
We have also adopted a performance-linked compensation program
that links compensation to individual performance, as well as the
Companys performance.
28 | Risk management report
Risk management report
The risk management report discusses the various dimensions of our enterprise risk management practices. Readers are cautioned that the risk related
information outlined here is not exhaustive and is for information purposes only. The discussion may contain statements, which may be forward-looking in
nature. Our business model is subject to uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements.
Readers are advised to exercise their own judgment in assessing risks associated with the Company and refer to discussions of risks in the Companys previous
annual reports and the filings with the Securities and Exchange Commission, USA.
A. Overview
Enterprise Risk Management (ERM) at Infosys encompasses practices
relating to identification, assessment, monitoring and mitigation
of various risks to our business objectives. ERM at Infosys seeks to
minimize adverse impact of risks on our business objectives and enable
the Company to leverage market opportunities effectively. Further, our
risk management practices seek to sustain and enhance the long-term
competitive advantage of the Company. Risk management is integral to
our business model, described as Predictable, Sustainable, Profitable
and De-risked (PSPD). Our core values and ethics provide the platform
for our risk management practices.
B. Infosys risk management framework
Our risk management framework comprises of the following key
components.
1. Risk management structure
The risk management structure at Infosys spans across the enterprise
at all levels. These levels also form the various lines of defense in our
risk management.
The key roles and responsibilities regarding risk management in the
Company are summarized below :
Level Key roles and responsibilities
Board of Directors
(Board)
Corporate governance oversight of risk
management performed by the Executive
Management
Review the performance of the Risk
Management Committee
Risk Management
Committee (RMC)
Comprises four independent directors
David L. Boyles, Chairperson
Sridar A. Iyengar
Dr. Omkar Goswami
Assisting the Board in fullling its corporate
governance oversight responsibilities with
regard to identication, evaluation and
mitigation of operational, strategic and
external environment risks
Monitoring and reviewing risk management
practices of the Company
Reviewing and approving risk-related
disclosures
Risk Council (RC) Comprises the Chief Executive Ofcer
(CEO), the Chief Operating Ofcer (COO)
and the Chief Financial Ofcer (CFO)
Reviewing enterprise risks from time
to time, initiating mitigation actions,
identifying the owners and reviewing the
progress and effectiveness of mitigation
actions
Formulation and deployment of risk
management policies
Deploying practices for the identication,
assessment, monitoring, mitigation and
reporting of risks
Level Key roles and responsibilities
Risk Council (RC) Providing updates to RMC and the Board
from time to time on the enterprise risks
and actions taken
Office of Risk
Management
(ORM)
Comprises the network of risk managers
from units and our group companies and is
led by the Chief Risk Ofcer (CRO)
Facilitating the execution of risk
management practices in the enterprise
as mandated, in the areas of risk
identication, assessment, monitoring,
mitigation and reporting
Providing periodic updates to the RC and
quarterly updates to the RMC on top risks
and their mitigation
Working closely with owners of risk
in deploying mitigation measures and
monitoring their effectiveness.
Unit Heads Responsible for managing their functions
as per the Company risk management
philosophy
Responsible for managing risks
concomitant to the business decisions
relating to their unit, span of control or
area of operations
Manage risks at the unit level that may arise
from time to time, in consultation with the
Risk Council
The Infoscion Adhering to risk management policies and
procedures
Implementation of prescribed risk
mitigation actions
Reporting risk events and incidents in a
timely manner
2. Risk categories
The following broad categories of risks have been considered in our
risk management framework :
Strategy : Risks emanating out of the choices we make on markets,
resources and delivery model which can potentially impact our
long-term competitive advantage
Industry : Risks relating to inherent characteristics of our industry
including, competitive structure, technological landscape, extent
of linkage to economic environment and regulatory structure
Counterparty : Risks arising from our association with entities
for conducting business. These include clients, vendors, alliance
partners and their respective industries
Resources : Risks arising from inappropriate sourcing or sub-
optimal utilization of key organizational resources such as talent,
capital and infrastructure
Operations : Risks inherent to business operations including those
relating to client acquisition, service delivery to clients, business
support activities, information security, intellectual property,
physical security and business activity disruptions
Risk management report | 29
Regulations and compliance : Risks due to inadequate compliance
to regulations, contractual obligations and intellectual property
violations leading to litigation and loss of reputation.
3. Key risk management practices
The key risk management practices include those relating to risk
assessment, measurement, monitoring, reporting, mitigation actions
and integration with strategy and business planning.
Risk identication and assessment : Periodic assessment of business
risk environment to identify signicant risks for the Company and
prioritizing the risks for action. Mechanisms for identication
and prioritization of risks include risk survey, business risk
environment scanning and focused discussions in the RC and
the RMC. A risk survey of executives across units, functions and
subsidiaries is conducted before the annual strategy exercise.
The risk register and internal audit ndings also provide pointers
for risk identication.
Risk measurement, mitigation and monitoring : For top risks,
dashboards are created that track external and internal indicators
relevant for risks, so as to indicate the risk level. The trend line
assessment of top risks, analysis of exposure and potential impact
are carried out. Mitigation plans are nalized, owners are identied
and the progress of mitigation actions are monitored and reviewed.
Risk Reporting : The top risks report outlining the risk level, trend
line, exposure, potential impact and status of mitigation actions is
discussed in the RC and the RMC on a periodic basis. In addition,
risk update is provided to the Board. Entity level risks such as
project and account level risks are reported to and discussed at the
appropriate levels within the organization.
Integration with strategy and business planning : Identied risks
are used as one of the key inputs for the development of strategy
and annual business plan.
Key components of Infosys Risk Management Framework
C. Overview of risk environment and key risk
management activities of the year
While the business risk environment gradually improved during the
year, several macro economic and regulatory developments required
our close monitoring and interventions. In our key markets, business
outlook indicators improved and the financial position of several key
clients stabilized during the year. While unemployment rates in key
markets moderated, they continued to be high prompting several
government policy interventions. There were regulatory changes and
proposals relating to visa policies in key markets. Macroeconomic
developments in the Eurozone led to high volatility in currencies
from which we derive our revenues. Keeping in view the business
risk environment, we closely monitored our competitive position and
deployed interventions.
Our risk management approach and practices continued to focus on
minimizing the adverse impact of risks on our business objectives
and to enable the Company to leverage market opportunities based
on risk-return parity. Our active management of currency risks
minimized the impact in a volatile currency market. Our continued
emphasis on credit risk management through periodic credit quality
assessments and focused collection mechanisms resulted in the
improvement of credit quality indicators. We continued our emphasis
on talent management relating to attraction, retention, engagement and
competency development. We further strengthened operational risk
mitigation mechanisms in areas including information security, data
protection, physical security, project service delivery and contracts
management. Our periodic assessment and monitoring of business
risk and regulatory environment resulted in timely deployment of
appropriate mitigation measures.
The following risk management activities were conducted :
1. Top risk identification, tracking and review
Annual risk survey across functions and subsidiaries to
get inputs on key risks and prioritization. Subsequent
discussions in the RC and the RMC for nalization of top
risks
Review of top risks in the RC and the RMC covering risk
level, trend line, exposure, potential impact and progress of
key mitigation actions
Review discussions on key items from risk register by the RC
and the RMC
2. Risk assessments and review
Periodic assessment of business risk environment including
analysis of top clients, counterparty exposures, competitive
positioning and sovereign risk
Risk assessment of regulatory environment, especially those
relating to visa and taxation
Assessment and review of nancial risks such as currency
risk, credit risk and liquidity
Risk assessments in multiple areas including talent
management, competitive positioning, service delivery,
information security, intellectual property, physical security
and business continuity
Review of contractual compliance monitoring systems and
account risk management systems in business units
Evaluation of the companys ERM program with global best
practices
30 | CEO and CFO certication
CEO and CFO certification
To
Infosys Technologies Limited
Bangalore
We, S. Gopalakrishnan, Chief Executive Officer and Managing Director, and V. Balakrishnan, Chief Financial Officer of Infosys Technologies
Limited, to the best of our knowledge and belief, certify that :
1. We have reviewed the Balance Sheet and Profit and Loss account (standalone and consolidated), and all the schedules and notes on accounts,
as well as the Cash Flow statements, and the Directors report.
2. Based on our knowledge and information, these statements do not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with
respect to the statements made.
3. Based on our knowledge and information, the financial statements, and other financial information included in this report, present in all
material respects a true and fair view of the Companys affairs, the financial condition, results of operations and cash flows of the Company
as of, and for, the periods presented in this report, and are in compliance with the existing accounting standards and / or applicable laws
and regulations.
4. To the best of our knowledge and belief, no transactions entered into by the Company during the year are fraudulent, illegal or violative of
the Companys Code of Conduct.
5. We are responsible for establishing and maintaining disclosure controls and procedures and internal controls over financial reporting for the
Company, and we have :
a. Designed such disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared.
b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with Generally Accepted Accounting Principles (GAAP).
c. Evaluated the effectiveness of the Companys disclosure, controls and procedures.
d. Disclosed in this report any change in the Companys internal control over financial reporting that occurred during the Companys most
recent fiscal year that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial
reporting.
6. We have disclosed, based on our most recent evaluation, wherever applicable, to the Companys auditors and the audit committee of the
Companys Board of Directors (and persons performing the equivalent functions) :
a. There were no deficiencies in the design or operation of internal controls, that could adversely affect the Companys ability to record,
process, summarize and report financial data, and there have been no material weaknesses in internal controls over financial reporting
including any corrective actions with regard to deficiencies.
b. There were no significant changes in internal controls during the year covered by this report.
c. All significant changes in accounting policies during the year, if any, and that the same have been disclosed in the notes to the financial
statements.
d. There were no instances of fraud of which we are aware, that involve the Management or other employees who have a significant role
in the Companys internal control system.
7. In the event of any materially significant misstatements or omissions, we will return to the Company that part of any bonus or incentive or
equity-based compensation, which was inflated on account of such errors.
8. We affirm that we have not denied any personnel, access to the audit committee of the Company (in respect of matters involving alleged
misconduct) and we have provided protection to whistleblowers from unfair termination and other unfair or prejudicial employment practices.
9. We further declare that all Board members and senior managerial personnel have affirmed compliance with the Code of Conduct for the
current year.
Bangalore
April 15, 2011
S. Gopalakrishnan
Managing Director
V. Balakrishnan
Abridged nancial statements | 31
Auditors report on abridged financial statements
To the Members of Infosys Technologies Limited
We have examined the abridged Balance Sheet of Infosys Technologies Limited (the Company) as at 31 March, 2011 and the abridged Profit
and Loss account and the Cash Flow statement for the year ended on that date, together with the notes thereon.
These abridged financial statements have been prepared by the Company pursuant to Rule 7A of the Companies (Central Governments) General
Rules and Forms, 1956 and are based on the accounts of the Company for the year ended 31 March, 2011 prepared in accordance with Schedule
VI to the Companies Act, 1956 and covered by our report dated 15 April, 2011 to the members of the Company which report is attached.
for B S R & Co.
Firms registration number : 101248W
Natrajh Ramakrishna
Partner
Bangalore Membership number : 32815
15 April, 2011
32 | Abridged nancial statements
Auditors report to the members of Infosys Technologies Limited
We have audited the attached Balance Sheet of Infosys Technologies Limited (the Company) as at 31 March, 2011, the Profit and Loss account
of the Company and the Cash Flow statement of the Company for the year ended on that date, annexed thereto. These financial statements are
the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by the Management, as well as evaluating the overall financial statement presentation. We believe
that our audit provides a reasonable basis for our opinion.
As required by the Companies (Auditors Report) Order, 2003 (the Order), as amended, issued by the Central Government of India in terms
of sub-section (4A) of Section 227 of the Companies Act, 1956 (the Act), we enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
Further to our comments in the Annexure referred to above, we report that :
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of
our audit;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those
books;
(c) the Balance Sheet, the Prot and Loss account and the Cash Flow statement dealt with by this report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, the Prot and Loss account and the Cash Flow statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;
(e) on the basis of written representations received from the directors, as at 31 March, 2011 and taken on record by the Board of Directors,
we report that none of the directors is disqualied as at 31 March, 2011 from being appointed as a director in terms of Section 274 (1)(g)
of the Act;
(f) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information
required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted
in India :
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March, 2011;
(ii) in the case of the Prot and Loss account, of the prot of the Company for the year ended on that date; and
(iii) in the case of the Cash Flow statement, of the cash ows of the Company for the year ended on that date.
for B S R & Co.
Natrajh Ramakrishna
Partner
15 April, 2011
Annexure to the auditors report
The Annexure referred to in our report to the members of Infosys Technologies Limited (the Company) for the year ended 31 March, 2011.
We report that :
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of xed assets.
(b) The Company has a regular program of physical verification of its fixed assets by which fixed assets are verified in a phased manner over
a period of three years. In accordance with this program, certain fixed assets were verified during the year and no material discrepancies
were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to the size of the
Company and the nature of its assets.
(c) Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.
(ii) The Company is a service company, primarily rendering information technology services. Accordingly, it does not hold any physical
inventories. Thus, paragraph 4 (ii) of the Order is not applicable.
(iii) (a) The Company has granted a loan to a body corporate covered in the register maintained under Section 301 of the Companies Act, 1956
(the Act). The maximum amount outstanding during the year was R47.71 crore and the year-end balance of such loan amounted to
R22.69 crore. Other than the above, the Company has not granted any loans, secured or unsecured, to companies, firms or parties
covered in the register maintained under section 301 of the Act.
(b) In our opinion, the rate of interest and other terms and conditions on which the loan has been granted to the body corporate listed in
the register maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the Company.
(c) In the case of the loan granted to the body corporate listed in the register maintained under Section 301 of the Act, the borrower has
been regular in the payment of the interest as stipulated. The terms of arrangement do not stipulate any repayment schedule and the
loan is repayable on demand. Accordingly, paragraph 4 (iii)(c) of the Order is not applicable to the Company in respect of repayment of
the principal amount.
(d) There are no overdue amounts of more than rupees one lakh in respect of the loan granted to a body corporate listed in the register
maintained under Section 301 of the Act.
(e) The Company has not taken any loans, secured or unsecured from companies, firms or parties covered in the register maintained under
Section 301 of the Act. Accordingly, paragraphs 4 (iii)(e) to 4 (iii)(g) of the Order are not applicable.
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard to purchase of xed assets and sale of services. The activities
of the Company do not involve purchase of inventory and the sale of goods. We have not observed any major weakness in the internal
control system during the course of the audit.
(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to
in Section 301 of the Act have been entered in the register required to be maintained under that section.
(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and
arrangements referred to in (v)(a) above and exceeding the value of R5 lakh with any party during the year have been made at prices
which are reasonable having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.
(viii) The Central Government of India has not prescribed the maintenance of cost records under Section 209 (1)(d) of the Act for any of the
services rendered by the Company.
(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and
Protection Fund, Income tax, Sales tax, Wealth tax, Service tax and other material statutory dues have been regularly deposited during
the year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of
Employees State Insurance, Customs duty and Excise duty.
Further, since the Central Government has till date not prescribed the amount of cess payable under Section 441A of the Act, we are not
in a position to comment upon the regularity or otherwise of the Company in depositing the same.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor
Education and Protection Fund, Income-tax, Sales tax, Wealth tax, Service tax and other material statutory dues were in arrears as at
March 31, 2011 for a period of more than six months from the date they became payable.
(b) According to the information and explanations given to us, there are no material dues of Wealth tax and Cess which have not been
deposited with the appropriate authorities on account of any dispute. However, according to the information and explanations given to
us, the following dues of Income tax, Sales tax, and Service tax, have not been deposited by the Company on account of disputes :
Name of the statute Nature of dues Amount
(Rcrore)
Period to which the amount
relates
Forum where dispute is pending
Income Tax Act, 1961 Fringe benefit tax and
interest demanded
2.28 Assessment year 2008-2009 Commissioner of Income Tax
(Appeals), Bangalore
Income Tax Act, 1961 Income-tax, interest and
penalty demanded
228.19
*#
Assessment year 2007-2008 Commissioner of Income Tax
Income Tax Act, 1961 Interest on Income-tax
demanded
0.51 Assessment year 2006-2007 Commissioner of Income Tax
KVAT Act, 2003 Sales tax, interest and
penalty demanded
24.53
*
April 2005 to March 2009 High Court of Karnataka
Central Sales Tax Act, 1956 Sales tax demanded 0.31
*#
April 2007 to March 2008 High Court of Andhra Pradesh
Service tax Service tax demanded 2.58 January 2005 to March 2009 Appellate Tribunal, Bangalore
Service tax Service tax and penalty
demanded
23.15 February 2007 to March 2009 Appellate Tribunal, Bangalore
* Net of amounts paid under protest.
#
A stay order has been received against the amount disputed and not deposited.
(x) The Company does not have any accumulated losses at the end of the nancial year and has not incurred cash losses in the nancial
year and in the immediately preceding nancial year.
(xi) The Company did not have any outstanding dues to any nancial institution, banks or debenture holders during the year.
(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other
securities.
(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund / nidhi / mutual benet
fund / society.
(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from
banks or nancial institutions.
(xvi) The Company did not have any term loans outstanding during the year.
(xvii) The Company has not raised any funds on short-term basis.
(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under
section 301 of the Act.
(xix) The Company did not have any outstanding debentures during the year.
(xx) The Company has not raised any money by public issues during the year.
(xxi) According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during
the course of our audit.
for B S R & Co.
Natrajh Ramakrishna
Partner
15 April, 2011
Abridged financial statements
Statement containing salient features of Balance Sheet as per Section 219 (1) (b) (iv) of the Companies Act, 1956
Abridged Balance Sheet
as at March 31, in rcrore
2011 2010
I. SOURCES OF FUNDS
1. SHAREHOLDERS FUNDS
(a) Capital
(i) Equity capital 287 287
(b) Reserves and surplus
(i) Capital reserve 54 54
(ii) Share premium account 3,057 3,022
(iii) Revenue reserve 5,512 4,867
(iv) Surplus in Profit and Loss account 15,591 13,806
24,501 22,036
2. DEFERRED TAX LIABILITIES 176 232
3. LOAN FUNDS
TOTAL OF (1) TO (3) 24,677 22,268
II. APPLICATION OF FUNDS
1. FIXED ASSETS
(a) Net block (original cost less depreciation) 4,056 3,779
(b) Capital work-in-progress 499 409
4,555 4,188
2. INVESTMENTS
(a) Investment in subsidiary companies unquoted 1,202 1,125
(b) Others unquoted 123 3,501
1,325 4,626
3. DEFERRED TAX ASSETS 406 313
4. (I) CURRENT ASSETS, LOANS AND ADVANCES
(a) Sundry debtors 4,212 3,244
(b) Cash and bank balances 13,665 9,797
(c) Loans and advances
(i) To subsidiary companies 32 46
(ii) To others 4,835 3,852
22,744 16,939
(II) LESS : CURRENT LIABILITIES AND PROVISIONS
(a) Liabilities 1,880 1,763
(b) Provisions 2,473 2,035
NET CURRENT ASSETS (I-II) 18,391 13,141
TOTAL OF (1) TO (4) 24,677 22,268
As per our report attached
for B S R & Co.
Natrajh Ramakrishna
Partner
Membership No. 32815
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Statement containing salient features of Profit and Loss account as per Section 219 (1)(b)(iv) of the Companies Act, 1956
Abridged Profit and Loss account
For the year ended March 31, in rcrore
2011 2010
I. INCOME
Income from software services and products 25,385 21,140
Interest 1,068 743
Dividend 18 101
Other income / (loss) 61 66
TOTAL 26,532 22,050
II. EXPENDITURE
Software development expenses 3,196 2,317
Selling expenses 241 215
Salaries, wages and other employee benefits 12,448 10,340
Managerial remuneration 16 16
Depreciation and amortization 740 807
Auditors remuneration 1 1
Provision for doubtful debts 3 (1)
Provision for post-sales client support and warranties 5 (2)
Other expenses 1,061 885
TOTAL 17,711 14,578
III. PROFIT BEFORE TAX AND EXCEPTIONAL ITEM (I-II) 8,821 7,472
IV. PROVISION FOR TAXATION 2,378 1,717
V. PROFIT AFTER TAX BEFORE EXCEPTIONAL ITEM (III-IV) 6,443 5,755
Income from sale of investments, net of taxes 48
6,443 5,803
VI. DIVIDEND ON EQUITY SHARES
Interim 574 573
30th year special dividend 1,722
Final dividend 1,149 861
VII. TRANSFER TO RESERVES / SURPLUS 2,430 4,129
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Abridged Cash Flow statement
2011 2010
CASH FLOWS FROM OPERATING ACTIVITIES
Net profit before tax and exceptional item 8,821 7,472
Adjustments to reconcile net profit before tax to cash provided by operating activities
Provision for investments (9)
Interest and dividend income (1,086) (844)
Effect of exchange differences on translation of deferred tax liabilities (6)
Effect of exchange differences on translation of foreign currency cash and cash equivalents (5) 68
Changes in current assets and liabilities
Sundry debtors (968) 146
Loans and advances (704) (368)
Current liabilities and provisions 234 236
7,026 7,508
Income taxes paid (2,756) (1,653)
NET CASH GENERATED BY OPERATING ACTIVITIES 4,270 5,855
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of fixed assets and change in capital work-in-progress (1,152) (565)
Investments in subsidiaries (77) (120)
Investments in other securities 3,378 (3,497)
Interest and dividend received 1,086 831
CASH FLOWS FROM INVESTING ACTIVITIES BEFORE EXCEPTIONAL ITEM 3,235 (3,351)
Proceeds on sale of long-term investments, net of taxes 53
NET CASH USED IN INVESTING ACTIVITIES 3,235 (3,298)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of share capital on exercise of stock options 24 88
Repayment of loan given to subsidiary 14 5
Dividends paid including residual dividend (3,156) (1,346)
Dividend tax paid (524) (228)
NET CASH USED IN FINANCING ACTIVITIES (3,642) (1,481)
Effect of exchange differences on translation of foreign currency cash and cash equivalents 5 (68)
NET INCREASE IN CASH AND CASH EQUIVALENTS 3,868 1,008
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 11,297 10,289
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 15,165 11,297
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Notes to the abridged financial statements for the year ended March 31, 2011
1. Company overview
Infosys Technologies Limited (Infosys or the Company) along with
its majority-owned and controlled subsidiary, Infosys BPO Limited
(Infosys BPO) and wholly-owned and controlled subsidiaries, Infosys
Technologies (Australia) Pty. Limited (Infosys Australia), Infosys
Technologies (China) Company Limited (Infosys China), Infosys
Consulting, Inc. (Infosys Consulting), Infosys Technologies S. de
R. L. de C. V. (Infosys Mexico), Infosys Technologies (Sweden) AB
(Infosys Sweden), Infosys Tecnologia do Brasil Ltda (Infosys Brasil),
Infosys Public Services, Inc., U.S. (Infosys Public Services) and Infosys
Technologies (Shanghai) Company Limited (Infosys Shanghai) is
a leading global technology services corporation. The Company
provides end-to-end business solutions that leverage cutting-edge
technology, thereby enabling clients to enhance business performance.
The Company provides solutions that span the entire software
lifecycle encompassing technical consulting, design, development,
re-engineering, maintenance, systems integration, package evaluation
and implementation, testing and infrastructure management services.
In addition, the Company offers software products for the banking
industry.
(Note 23 in the Notes to Accounts of the annual standalone financial statements)
2. Notes on accounts
Amounts in the abridged financial statements are presented in Indian
rupees crore, except for per share data and as otherwise stated. Certain
amounts that are required to be disclosed and do not appear due to
rounding off are detailed in note 11. All exact amounts are stated with
the suffix /-. One crore equals 10 million.
The previous year figures have been regrouped / reclassified, wherever
necessary to conform to the current presentation.
(Note 23.2 in the Notes to Accounts of the annual standalone financial statements).
3. Capital commitments and contingent liabilities
in r crore
Particulars As at March 31,
2011 2010
Estimated amount of
unexecuted capital contracts
(net of advances and deposits) 742 267
Outstanding guarantees
and counter guarantees to
various banks, in respect of
the guarantees given by those
banks in favour of various
government authorities and
others 3 3
Claims against the Company,
not acknowledged as debts
(1)
[Net of amount paid to
statutory authorities R469
crore (R241 crore) ] 271 28
in
million
in r
crore
in
million
in r
crore
Forward contracts outstanding
In USD 500 2,230 228 1,024
In Euro 20 127 16 97
In GBP 10 72 7 48
In AUD 10 46 3 12
Options contracts outstanding
In USD 200 898
2,475 2,079
(1)
Claims against the Company not acknowledged as debts include demand from the
Indian tax authorities for payment of additional tax of r671 crore (r214 crore),
including interest of r177 crore (r39 crore) upon completion of their tax review for
fiscal 2005, fiscal 2006 and fiscal 2007. The tax demands are mainly on account of
disallowance of a portion of the deduction claimed by the Company under Section
10A of the Income tax Act. The deductible amount is determined by the ratio of export
turnover to total turnover. The disallowance arose from certain expenses incurred
in foreign currency being reduced from export turnover but not reduced from total
turnover. The tax demand for fiscal 2007 also includes disallowance of portion of profit
earned outside India from the STP units and disallowance of profits earned from SEZ
units. The matter for fiscal 2005, 2006 and 2007 is pending before the Commissioner
of Income tax (Appeals), Bangalore.
The Company is contesting the demands and the Management, including its tax
advisors, believes that its position will likely be upheld in the appellate process. No
tax expense has been accrued in the financial statements for the tax demand raised.
The Management believes that the ultimate outcome of this proceeding will not have a
material adverse effect on the Companys financial position and results of operations.
(Note 23.2.2 in the Notes of Accounts of the annual standalone financial statements)
4. Quantitative details
The Company is primarily engaged in the development and
maintenance of computer software. The production and sale of such
software cannot be expressed in any generic unit. Hence, it is not
possible to give the quantitative details of sales and certain information
as required under paragraphs 3, 4C and 4D of part II of Schedule VI
to the Companies Act, 1956.
(Note 23.2.3 in the Notes to Accounts of the annual standalone financial statements)
5. Related party transactions
List of related parties
Name of subsidiaries Country Holding as at
March 31,
2011 2010
Infosys BPO India 99.98% 99.98%
Infosys Australia Australia 100% 100%
Infosys China
(1)
China 100% 100%
Infosys Consulting U.S. 100% 100%
Infosys Mexico
(2)
Mexico 100% 100%
Infosys Sweden Sweden 100% 100%
Infosys Shanghai
(3)
China 100%
Infosys Brasil
(4)
Brazil 100% 100%
Infosys Public Services, Inc. U.S. 100% 100%
Infosys BPO s.r.o
(5)
Czech
Republic 99.98% 99.98%
Infosys BPO (Poland)
Sp.Z.o.o
(5)
Poland 99.98% 99.98%
Infosys BPO (Thailand)
Limited
(5)
Thailand 99.98%
Infosys Consulting India
Limited
(6)
India 100% 100%
(5) (7)
U.S. 99.98% 99.98%
(1)
During the year ended March 31, 2011, the Company made an additional investment
of r42 crore (US$ 9 million) in Infosys China, which is a wholly owned subsidiary.
As of March 31, 2011, and March 31, 2010, the Company has invested an aggregate
of r107 crore (US$ 23 million) and r65 crore (US$ 14 million) respectively, in the
subsidiary.
(2)
of r14 crore (Mexican Peso 40 million) in Infosys Mexico, which is a wholly owned
subsidiary. As of March 31, 2011, and March 31, 2010, the Company has invested an
aggregate of r54 crore (Mexican Peso 150 million) and r40 crore (Mexican Peso 110
million) respectively, in the subsidiary.
(3)
On February 21, 2011, the Company incorporated a wholly-owned subsidiary, Infosys
Technologies (Shanghai) Company Limited and invested r11 crore (US$ 3 million) in
the subsidiary. As of March 31, 2011, the Company has invested an aggregate of r11
crore (US$ 3 million) in the subsidiary.
(4)
of r10 crore (BRL 4 million) in the subsidiary. As of March 31, 2011, and March 31,
2010, the Company has invested an aggregate of r38 crore (BRL 15 million) and
r28 crore (BRL 11 million) respectively, in the subsidiary
(5)
Infosys BPO s.r.o, Infosys BPO (Poland) Sp.Z.o.o, Infosys BPO (Thailand) Limited and
McCamish Systems LLC are wholly owned subsidiaries of Infosys BPO. During the year
ended March 31, 2011, Infosys BPO (Thailand) Limited was liquidated.
(6)
During the year ended March 31, 2010, Infosys Consulting incorporated wholly-owned
subsidiary, Infosys Consulting India Limited. As of March 31, 2011, and
March 31, 2010, Infosys Consulting has invested an aggregate of r1 crore in the
subsidiary.
(7)
During the year ended March 31, 2010, Infosys BPO acquired 100% of the voting
interests in McCamish Systems LLC (McCamish), a business process solutions provider
based in Atlanta, Georgia, in the United States. The business acquisition was conducted
by entering into Membership Interest Purchase Agreement for a cash consideration of
r173 crore and a contingent consideration of r67 crore. The acquisition was accounted
as a business combination which resulted in goodwill of r227 crore.
Infosys guarantees the performance of certain contracts entered into
by its subsidiaries.
Details of amounts due to or due from as at March 31, 2011 and
March 31, 2010 :
in rcrore
2011 2010
Loans and advances
Infosys China 23 46
Infosys Brasil 9
Sundry debtors
Infosys China 39 19
Infosys Australia 5 7
Infosys Mexico 1 1
Infosys Consulting 24 26
Infosys Brasil 1
Infosys BPO (including subsidiaries) 3 2
Sundry creditors
Infosys China 32 18
Infosys Australia 20
Infosys Consulting India 1 1
Infosys Mexico 1 5
Infosys Sweden 1 1
Deposit taken for shared services
Infosys BPO 7 7
The details of the related party transactions entered into by the
Company and maximum dues from subsidiaries for the year ended
in rcrore
Particulars Year ended March 31,
2011 2010
Capital transactions :
Financing transactions
Infosys Consulting 50
Infosys China 42
Infosys Shanghai 11
Infosys Mexico 14 18
Infosys Brasil 10 28
Infosys Public Services 24
Loans / Advances
Infosys Brasil 9
Infosys China (23)
Revenue transactions :
Purchase of services
Infosys China 240 134
Infosys Consulting India 5
Infosys Sweden 12 11
Infosys Brasil 3 5
2011 2010
Purchase of shared services including
facilities and personnel
Interest income
Infosys China 2 3
Sale of services
Infosys China 6 10
Infosys BPO (including subsidiaries) 21
Sale of shared services including facilities
and personnel
Maximum balances of loans and advances
Infosys China 48 48
Infosys Brasil 9
Infosys Mexico 4 4
During the year ended March 31, 2011, an amount of nil (R34 crore for
the year ended March 31, 2010) was donated to Infosys Foundation, a
not-for-profit foundation, in which certain directors of the Company
are trustees.
During the year ended March 31, 2011, an amount of R 12 crore
(R23 crore for the year ended March 31, 2010) has been granted to
Infosys Science Foundation, a not-for-profit foundation, in which
certain directors and officers of the Company are trustees.
6. Transactions with key management personnel
Key management personnel comprise directors and members of the
executive council.
Particulars of remuneration and other benefits paid to key management
personnel during the year ended March 31, 2011 and March 31, 2010
have been detailed in Schedule 12.
The aggregate managerial remuneration under Section 198 of the
Companies Act 1956, to the directors (including the managing director)
is as follows :
in rcrore
2011 2010
Whole-time directors
Salary 2 2
Contribution to provident and other
funds 1
Perquisites and incentives 6 7
Total remuneration 9 9
Non-whole-time directors
Commission 6 6
Reimbursement of expenses 1 1
Computation of net profit in accordance with Section 349 of the
Companies Act, 1956, and calculation of commission payable to non-
whole-time directors are as follows :
in rcrore
2011 2010
Net profit after tax and before exceptional
item 6,443 5,755
Add :
Whole-time directors remuneration 9 9
Commission to non-whole-time-
directors 6 6
Provision for bad and doubtful debts 3 (1)
Provision for doubtful loans and
advances
Depreciation as per books of accounts 740 807
9,579 8,293
Less :
Depreciation as envisaged under
Section 350 of the Companies Act
(1)
740 807
Net profit on which commission is
payable 8,839 7,486
Commission payable to non-whole-time-
directors :
Maximum allowed as per the Companies
Act, 1956 at 1% 88 75
Maximum approved by the share holders
at 1% (1%) 88 75
Commission approved by the Board 6 6
(1)
The Company depreciates fixed assets based on estimated useful lives that are lower
than those prescribed in Schedule XIV of the Companies Act, 1956. Accordingly, the
rates of depreciation used by the Company are higher than the minimum prescribed
by Schedule XIV.
During the year ended March 31, 2011 and March 31, 2010, Infosys
BPO has provided for commission of R0.12 crore and R0.12 crore to
a non-whole-time director of Infosys.
(Note 23.2.8 in the Notes to Accounts of the annual standalone financial statements).
7. Dues to micro, small and medium enterprises
The Company has no dues to micro and small enterprises during the
year ended March 31, 2011 and March 31, 2010 and as at March 31,
2011 and March 31, 2010.
8. Aggregate fair value of unquoted investments
As at March 31, 2011 and March 31, 2010, the aggregate fair value of
unquoted investments is R119 crore and R3,497.
9. Cash and cash equivalents
in rcrore
2011 2010
As per the Balance Sheet 13,665 9,797
Add : Deposits with financial institutions
(excluding interest accrued but not
due)
(1)
1,500 1,500
15,165 11,297
(1)
Excludes restricted deposits held with Life Insurance Corporation of India of r344 crore
(r281 crore) for funding leave liability.
10. Important ratios
Ratio Year ended March 31,
2011 2010
Sales to total assets ratio 1.03 0.95
Operating profit / average capital employed
ratio (%) 32.98 32.89
Return on average net worth before
exceptional item (%) 27.69 28.89
Return on average net worth after
Profit after tax to sales ratio before
Profit after tax to sales ratio after
11. Details of rounded off amounts
The abridged financial statements are represented in Rcrore as per the
approval received from Department of Company Affairs (DCA) earlier.
Those items which were not represented in the abridged financial
statement due to rounding off to the nearest Rcrore are given as follows :
Balance Sheet items
in rcrore
Schedule Description As at March 31,
2011 2010
5 Related party transactions
Debtors
Infosys BPO s.r.o. 0.04
Infosys Consulting India 0.29
Infosys Thailand 0.04
Infosys Sweden 0.08
Infosys Public Services 0.11
Infosys Brasil 0.62
Creditors
Infosys Brasil 0.14 0.16
Infosys Mexico 0.31
Profit & Loss items
in rcrore
Schedule Description Year ended March 31,
2011 2010
5 Related party transactions
Revenue transactions
Infosys BPO (Poland) 0.41 0.03
Infosys Brasil 0.35
(Note 23.3 in the Notes to Accounts of the annual standalone financial statements)
12. Transactions with key management personnel
Key management personnel comprises of directors and members of
the executive council.
Particulars of remuneration and other benefits paid to whole-time
directors and members of executive council during the year ended
in rcrore
Name Salary Contribu-
tions to
provident
and other
funds
Perqui-
sites and
incentives
Total
remu-
neration
Co-Chairman
Nandan M. Nilekani
(1)

0.09 0.02 0.23 0.34
Managing Director
S. Gopalakrishnan 0.34 0.08 0.69 1.11
0.32 0.08 0.61 1.01
Director
S. D. Shibulal 0.34 0.08 0.66 1.08
0.31 0.08 0.56 0.95
Whole-time Directors
K. Dinesh 0.34 0.08 0.68 1.10
0.32 0.08 0.61 1.01
T. V. Mohandas Pai 0.43 0.10 2.56 3.09
0.36 0.08 2.69 3.13
Srinath Batni 0.43 0.10 1.76 2.29
0.36 0.07 1.98 2.41
Executive Council Members
V. Balakrishnan 0.38 0.08 2.15 2.61
0.30 0.08 2.06 2.44
Ashok Vemuri 2.22 3.10 5.32
2.09 2.79 4.88
Chandra Shekar Kakal 0.34 0.08 2.16 2.58
0.28 0.06 1.73 2.07
B. G. Srinivas 1.94 2.99 4.93
1.81 2.75 4.56
Subhash B. Dhar 0.30 0.08 1.69 2.07
0.24 0.07 1.42 1.73
(1)
Effective July 9, 2009, Nandan M. Nilekani has relinquished the positions of
Co-Chairman and Member of the Board.
Particulars of remuneration and other benefits of non-executive
/ independent directors for the year ended March 31, 2011 and
March 31, 2010 are as follows :
Name Com-
mission
Sitting
fees
Reim-
burse-
ment of
expenses
Total
remu-
neration
Independent Directors
Deepak M. Satwalekar 0.59 0.01 0.60
0.60 0.60
Prof. Marti G.
Subrahmanyam 0.79 0.23 1.02
0.65 0.20 0.85
Dr. Omkar Goswami 0.51 0.03 0.54
0.52 0.03 0.55
Claude Smadja
(1)
0.23 0.09 0.32
0.59 0.25 0.84
Rama Bijapurkar
(2)
0.04 0.04
0.49 0.02 0.51
Sridar A. Iyengar 0.69 0.24 0.93
0.62 0.21 0.83
David L. Boyles 0.65 0.34 0.99
0.59 0.15 0.74
Prof. Jeffrey S. Lehman 0.67 0.13 0.80
0.61 0.24 0.85
K. V. Kamath 0.56 0.01 0.57
0.39 0.02 0.41
R. Seshasayee
(3)
0.10 0.10

Non-executive Chairman and Chief mentor
N. R. Narayana Murthy 0.61 0.61
0.57 0.57
(1)
Retired from the Board effective August 30, 2010
(2)
Resigned from the Board effective April 13, 2010
(3)
Joined the Board effective January 13, 2011
(Note 23.4 in the Notes to Accounts of the annual standalone financial statements)
42 | Balance sheet abstract and the Companys general business prole
Balance Sheet abstract and the Company's general business profile
Amount in rcrore, except per share data
I. Registration details
CIN L 8 5 1 1 0 K A 1 9 9 2 P L C 0 1 3 1 1 5
Registration no.
1 3 1 1 5 State code 0 8
Balance Sheet date 3 1 0 3 1 1
Date Month Year
II. Capital raised during the year
Public issue
N I L
Rights issue
N I L
Bonus issue N I L Private placement N I L
Preferential offer of shares under the
Employee Stock Option Plan scheme
(1)
2 4
III. Position of mobilization and deployment of funds
Total liabilities
2 4 6 7 7
Total assets
2 4 6 7 7
Sources of funds
Paid-up capital 2 8 7 Reserves and surplus 2 4 2 1 4
Secured loans N I L Unsecured loans N I L
Deferred tax liabilities 1 7 6
Application of funds
Net fixed assets 4 5 5 5 Investments 1 3 2 5
Net current assets 1 8 3 9 1 Deferred tax assets 4 0 6
Miscellaneous expenditure N I L Accumulated losses N I L
IV. Performance of the Company
Income from software services
and products
2 5 3 8 5
Other Income
1 1 4 7
Total income
2 6 5 3 2
Total expenditure
1 7 7 1 1
Profit before tax 8 8 2 1 Profit after tax 6 4 4 3
Earning per share (Basic) (R)
1 1 2 . 2 6
Earning per share
(Diluted) (R)
1 1 2 . 2 2
Dividend rate (%) (Equity share of par
value R5/- each)
(2) 1 2 0 0
V. Generic names of principal product / services of the Company
(as per monetary terms)
Item code no. (ITC Code)
8 5 2 4 9 0 0 9
Product description
C O M P U T E R S O F T W A R E
(1)
Issue of shares arising on the exercise of options granted to employees under the Companys (no.) 1998 Plan : 1,88,675; 1999 Plan : 1,37,692
(2)
Including 600% of 30th year special dividend
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Consolidated nancial statements | 43
Consolidated financial statements
Auditors report
To the board of directors of Infosys Technologies Limited
We have audited the attached consolidated Balance Sheet of Infosys Technologies Limited (the Company) and subsidiaries (collectively referred
to as the Infosys Group) as at 31 March, 2011, the consolidated Profit and Loss Account of the Infosys Group for the year ended on that date
and the consolidated Cash Flow Statement of the Infosys Group for the year ended on that date, annexed thereto. These financial statements are
We conducted our audit in accordance with the auditing standards generally accepted in India. Those standards require that we plan and perform
the audit to obtain reasonable assurance that the financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles
used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
We report that the consolidated financial statements have been prepared by the Companys management in accordance with the requirements of
Accounting Standard (AS) 21, Consolidated Financial statements prescribed by the Companies (Accounting Standards) Rules, 2006.
In our opinion and to the best of our information and according to the explanations given to us, the consolidated financial statements give a true
and fair view in conformity with the accounting principles generally accepted in India :
(a) in the case of the consolidated Balance Sheet, of the state of affairs of the Infosys Group as at 31 March 2011;
(b) in the case of the consolidated Prot and Loss Account, of the prot of the Infosys Group for the year ended on that date; and
(c) in the case of the consolidated Cash Flow Statement, of the cash ows of the Infosys Group for the year ended on that date.
for B S R & Co.
Natrajh Ramakrishna
Partner
April 15, 2011
44 | Consolidated nancial statements
Consolidated Balance Sheet
As at March 31, in rcrore
Schedule 2011 2010
SOURCES OF FUNDS
SHAREHOLDERS FUNDS
Share capital 1 286 286
Reserves and surplus 2 25,690 22,763
25,976 23,049
DEFERRED TAX LIABILITIES 5 176 232
MINORITY INTEREST
26,152 23,281
APPLICATION OF FUNDS
FIXED ASSETS 3
Original cost 8,501 7,839
Less : Accumulated depreciation and amortization 3,266 2,893
Net book value 5,235 4,946
Add : Capital work-in-progress 525 409
5,760 5,355
INVESTMENTS 4 144 3,702
DEFERRED TAX ASSETS 5 497 432
CURRENT ASSETS, LOANS AND ADVANCES
Sundry debtors 6 4,653 3,494
Cash and bank balances 7 15,095 10,556
Loans and advances 8 5,320 4,197
25,068 18,247
LESS : CURRENT LIABILITIES AND PROVISIONS
Current liabilities 9 2,677 2,343
Provisions 10 2,640 2,112
NET CURRENT ASSETS 19,751 13,792
26,152 23,281
SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS 24
Note : The schedules referred to above form an integral part of the consolidated Balance Sheet.
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Consolidated Profit and Loss account
For the year ended March 31, in rcrore, except per share data
Schedule 2011 2010
Income from software services, products and business process management 27,501 22,742
Software development and business process management expenses 11 15,054 12,071
GROSS PROFIT 12,447 10,671
Selling and marketing expenses 12 1,512 1,184
General and administration expenses 13 1,967 1,626
3,479 2,810
OPERATING PROFIT BEFORE DEPRECIATION AND MINORITY INTEREST 8,968 7,861
OPERATING PROFIT BEFORE MINORITY INTEREST 8,114 6,956
Other income, net 14 1,211 934
NET PROFIT BEFORE TAX, MINORITY INTEREST AND EXCEPTIONAL ITEM 9,325 7,899
Provision for taxation (refer to note 24.2.8) 15 2,490 1,681
NET PROFIT AFTER TAX AND BEFORE MINORITY INTEREST AND EXCEPTIONAL ITEM 6,835 6,218
Income from sale of investments, net of taxes (refer to note 24.2.22) 48
NET PROFIT AFTER TAX, EXCEPTIONAL ITEM AND BEFORE MINORITY INTEREST 6,835 6,266
Minority interest
NET PROFIT AFTER TAX, EXCEPTIONAL ITEM AND MINORITY INTEREST 6,835 6,266
Balance Brought Forward 14,371 10,560
Add : Intercompany dividend 16
14,387 10,560
AMOUNT AVAILABLE FOR APPROPRIATION 21,222 16,826
Interim dividend 574 573
Interim dividend 30th year special dividend 1,722
Amount transferred to general reserve 1,245 780
21,222 16,826
EARNINGS PER SHARE
Equity shares of par value R5/- each
Basic 119.66 108.99
Diluted 119.63 108.87
After exceptional item
Basic 119.66 109.84
Diluted 119.63 109.72
Number of shares used in computing earnings per share
(1)
Basic 57,11,80,050 57,04,75,923
Diluted 57,13,68,358 57,11,16,031
Notes : The schedules referred to above form an integral part of the consolidated Profit and Loss account.

(1)
Refer to note 24.2.16
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Consolidated Cash Flow statement
Schedule 2011 2010
Net profit before tax, minority interest and exceptional item 9,325 7,899
Adjustments to reconcile net profit before tax to cash provided by operating activities
(Profit) / loss on sale of fixed assets (2)
Effect of exchange differences on translation of deferred tax liability (8)
Effect of exchange differences on translation of foreign currency cash and cash
equivalents (45) 31
Effect of exchange differences on translation of subsidiaries 54 54
Sundry debtors 16 (1,159) 194
Loans and advances 17 (758) (438)
Current liabilities and provisions 18 489 187
7,598 7,940
Income taxes paid 19 (2,846) (1,753)
Purchases of fixed assets and change in capital work-in-progress 20 (1,305) (658)
Payment for acquisition of business, net of cash acquired (3) (173)
Investments in / (disposal) of securities 21 3,558 (3,698)
Proceeds from disposal of fixed assets 2
Interest and dividend received 22 1,148 871
Cash flow from investing activities before exceptional item 3,398 (3,656)
Proceeds on sale of long-term investments, net of taxes (refer to note 24.2.22) 53
NET CASH USED IN INVESTING ACTIVITIES 3,398 (3,603)
Dividends paid including net of intercompany dividend (3,140) (1,346)
Effect of exchange differences on translation of foreign currency cash and cash equivalents 45 (31)
NET INCREASE IN CASH AND CASH EQUIVALENTS 4,555 1,068
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 12,111 10,993
Add : Opening balance of cash and cash equivalents arising on consolidation of controlled
trusts 50
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 23 16,666 12,111
Note : The schedules referred to above form an integral part of the consolidated Cash Flow statement.
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Schedules to the consolidated Balance Sheet
in rcrore, except as otherwise stated
As at March 31, 2011 2010
1 SHARE CAPITAL
Authorized
Equity shares, R5/- par value
60,00,00,000 (60,00,00,000)
equity shares 300 300
Issued, subscribed and paid up
Equity shares,R5/- par value
(1)
287 287
57,41,51,559 (57,38,25,192)
equity shares fully paid up
Less : 28,33,600 (28,33,600) shares
held by Controlled Trusts 1 1
286 286
[Of the above, 53,53,35,478
(53,53,35,478) equity shares, fully
paid up have been issued as bonus
shares by capitalization of the
general reserve]
286 286
Notes : Forfeited shares amounted to r1,500/- (r1,500/-)
(1)
For details of options in respect of equity shares, refer to note 24.2.7 and also
refer to note 24.2.16 for details of basic and diluted shares.
3 FIXED ASSETS in rcrore, except as otherwise stated
Particulars Original cost Depreciation and amortization Net book value
As at
April 1,
2010
Additions /
Adjustments
Deletions /
Retirement /
Adjustments
As at
March 31,
2011
As at
April 1,
2010
For the year Deletions /
Adjustments
As at
March 31,
2011
As at
March 31,
2011
As at
March 31,
2010
Goodwill 916 916 916 916
Land : Freehold 178 229 407 407 178
Leasehold 149 3 146 146 149
Buildings
(1)
3,300 326 3,626 745 233 978 2,648 2,555
Plant and machinery
(2)
1,263 169 146 1,286 648 238 147 739 547 615
Computer equipment
(2)
1,251 294 214 1,331 1,046 236 213 1,069 262 205
Furniture and fixtures
(2)
710 78 113 675 403 124 112 415 260 307
Leasehold improvements 55 48 8 95 37 22 9 50 45 18
Vehicles 5 2 7 2 1 3 4 3
Intellectual property right 12 12 12 12
7,839 1,146 484 8,501 2,893 854 481 3,266 5,235 4,946
Previous year 7,093 1,175 429 7,839 2,416 905 428 2,893 4,946
Notes :
(1)
Buildings include r250/- being the value of 5 shares of r50/- each in Mittal Towers Premises Co-operative Society Limited.
(2)
During the years ended March 31, 2011 and March 31, 2010, certain assets which were old and not in use having gross book value of r488 crore and r387 crore respectively,
(net book value nil) were retired.
As at March 31, 2011 2010
4 INVESTMENTS
(1)
Long-term investments at cost
Trade (unquoted)
Other investments 6 7
Less : Provision made for
investments 2 3
4 4
Current investments at the lower
of cost and fair value
Non-trade (unquoted)
Liquid mutual fund units 21 2,518
Certificates of deposit 119 1,180
140 3,698
144 3,702
Aggregate amount of unquoted
investments 144 3,702
(1)
As at March 31, 2011 2010
2 RESERVES AND SURPLUS
Capital reserve 54 6
Add : Transfer from Profit and Loss
account (refer to note 24.2.22) 48
54 54
Foreign currency translation
reserve 101 47
Share premium account As at
April 1, 3,027 2,925
Add : Share premium arising on
consolidation of controlled
trusts 4
Receipts on exercise of
employee stock options 24 88
Income tax benefit arising
from exercise of stock options 11 10
3,062 3,027
General reserve As at April 1, 5,264 4,484
Add : Transfer from Profit and Loss
account 1,245 780
6,509 5,264
Add : Corpus of the controlled
trusts 47
15,964 14,371
25,690 22,763
As at March 31, 2011 2010
5 DEFERRED TAXES
Deferred tax assets
Fixed assets 253 217
Sundry debtors 20 28
Others 224 187
497 432
Deferred tax liabilities
Branch profit tax 176 232
176 232
As at March 31, 2011 2010
6 SUNDRY DEBTORS
Debts outstanding for a period
exceeding six months
Unsecured
Considered good
Considered doubtful 67 81
Other debts
Unsecured
Considered good
(1)
4,653 3,494
4,739 3,596
Less : Provision for doubtful debts 86 102
4,653 3,494
(1)
Includes dues from companies where our
directors are interested 2 11
Schedules to the consolidated Balance Sheet
As at March 31, 2011 2010
7 CASH AND BANK BALANCES
(1)
Cash on hand
Balances with scheduled banks
(2)
In current accounts
(3)
225 175
In deposit accounts 13,610 9,092
Balances with non-scheduled banks
In deposit accounts 708 336
In current accounts 552 953
15,095 10,556
(1)
Refer to note 24.2.20 for details of balances
with scheduled and non-scheduled banks
(2)
Includes balance held by controlled trusts
(refer to note 24.2.21.b) 89 48
(3)
Includes balance in unclaimed dividend
account (refer to note 24.2.21.a) 3 2
8 LOANS AND ADVANCES
Advances
Prepaid expenses 67 39
For supply of goods and
rendering of services 36 19
Withholding and other taxes
receivable 548 343
Others 24 30
675 431
Advance income taxes 993 667
MAT credit entitlement
(refer to note 24.2.8) 63 42
Interest accrued and not due 25 19
Loans and advances to employees
Housing and other loans 47 38
Salary advances 94 73
Deposits with financial institutions
(refer to note 24.2.9)
(1)
2,008 1,892
Mark-to-market gain on forward
and options contracts 66 95
5,320 4,197
Unsecured, considered doubtful
5,323 4,200
Less : Provision for doubtful loans
and advances to employees 3 3
5,320 4,197
(1)
Includes balance held by controlled trusts
(refer to note 24.2.21.b) 86 21
9 CURRENT LIABILITIES
Sundry creditors
Goods and services 44 10
Accrued salaries and benefits
Salaries 83 55
Bonus and incentives 649 594
payable 329 250
Payable for acquisition of business 65 68
Gratuity obligation unamortized
amount 22 26
Others 6 8
2,015 1,728
Payable by controlled trusts 119 74
Unclaimed dividend
(1)
3 2
2,677 2,343
(1)
Refer to note 24.2.21.a
10 PROVISIONS
Provision for
Income taxes
(1)
817 724
Post-sales client support and
warranties
(2)
88 82
2,640 2,112
(1)
(2)
Schedules to consolidated Profit and Loss account
For the year ended March 31, 2011 2010
11 SOFTWARE DEVELOPMENT
AND BUSINESS PROCESS
MANAGEMENT EXPENSES
Salaries and bonus including
overseas staff expenses 12,460 10,285
Contribution to provident and
other funds 420 281
Staff welfare 91 44
Technical sub-contractors 603 372
Software packages for own use 350 336
Third party items bought for
service delivery to clients 139 17
Overseas travel expenses 690 488
Communication expenses 82 83
Rent 90 73
Computer maintenance 53 29
Consumables 27 25
Provision for post-sales client
support and warranties 5 (2)
Miscellaneous expenses 44 40
15,054 12,071
12 SELLING AND MARKETING
EXPENSES
overseas staff expenses 1,208 928
other funds 7 4
Staff welfare 3 2
Travel and conveyance 7 7
Brand building 74 57
Commission charges 15 16
Professional charges 16 23
Rent 17 15
Marketing expenses 22 15
Telephone charges 15 11
Printing and stationery 1 1
Sales promotion 1 1
1,512 1,184
13 GENERAL AND
ADMINISTRATION EXPENSES
overseas staff expenses 638 520
other funds 29 21
Staff welfare
Power and fuel 167 145
Office maintenance 222 165
Guest house maintenance 9 4
Insurance charges 33 31
Rates and taxes 54 31
Donations 1 44
Rent 39 37
Advertisements 7 3
Professional membership and
seminar participation fees 12 9
Repairs to building 45 34
Repairs to plant and machinery 36 32
Postage and courier 13 12
Books and periodicals 4 4
Recruitment and training 2 2
Provision for bad and doubtful
debts 2
advances 2 1
Commission to non-whole-time
directors 6 6
Auditors remuneration
Statutory audit fees 2 2
Bank charges and commission 2 2
Freight charges 2 1
Research grants 18 23
1,967 1,626
14 OTHER INCOME, NET
Interest received on deposits with
banks and others
(1)
1,133 775
Dividend received on investment
in liquid mutual funds (non-trade
unquoted) 21 106
Miscellaneous income, net
(refer to note 24.2.10) 15 23
Gains / (losses) on foreign currency 42 30
1,211 934
(1)
Includes tax deducted at source 94 97
15 PROVISION FOR TAXATION
Income taxes
(1)
2,624 2,059
MAT credit entitlement (21) (307)
Deferred taxes
(2)
(113) (71)
2,490 1,681
(1)
(2)
Excludes translation difference of r8 crore on deferred tax liabilities
Schedules to consolidated Cash Flow statement
16 CHANGE IN SUNDRY DEBTORS
Less : Opening balance considered 3,494 3,672
Sundry debtors pertaining to
acquired business 16
1,159 (194)
17 CHANGE IN LOANS AND
ADVANCES
As per the Balance Sheet
(1)
5,320 4,197
Less : Gratuity obligation
unamortized amount relating
to plan amendment
(2)
22 26
Deposits with financial
institutions, included in cash
and cash equivalents
(3)
1,571 1,555
MAT credit entitlement 63 42
2,646 1,888
Opening balance of loans
and advances pertaining to
controlled trusts and acquired
business 62
758 438
(1)
Net of gratuity transitional liability
(2)
(3)
Excludes restricted deposits held with LIC of r437 crore (r337 crore) for funding
employee related obligations
18 CHANGE IN CURRENT
LIABILITIES AND PROVISIONS
Less : Unclaimed dividend 3 2
Gratuity obligation
unamortized amount relating
to plan amendment 22 26
Payable for acquisition of
business 65 68
Provisions considered
separately in cash flow
statement
Dividends 1,149 861
3,048 2,559
Opening Balance of current
liabilities and provisions
pertaining to controlled trusts
and acquired business 74
489 187
19 INCOME TAXES PAID
Charge as per the Profit and Loss
account 2,490 1,681
Add : Increase / (Decrease) in
advance income taxes 326 393
Increase / (Decrease) in
deferred taxes
(1)
113 74
Increase / (Decrease) in MAT
credit entitlement 21 (242)
Less : (Increase) / Decrease in
income tax provision 93 143
Income tax benefits arising
from exercise of stock options 11 10
2,846 1,753
(1)
20 PURCHASE OF FIXED ASSETS
AND CHANGE IN CAPITAL
WORK-IN-PROGRESS
Additions as per Balance Sheet
(1)
1,143 943
Less : Opening capital work-in-
progress 409 677
Add : Closing capital work-in-
progress 525 409
Add : Opening retention monies 72 55
Less : Closing retention monies 26 72
1,305 658
(1)
Net of r3 crore movement in land from leasehold to free-hold upon acquisition as at
March 31, 2011 and excludes goodwill of r227 crore and net fixed assets of r5 crore
pertaining to acquired business as at March 31, 2010.
21 INVESTMENTS IN / (DISPOSAL
OF) SECURITIES
(1)
As per the Balance Sheet 140 3,698
Less : Opening balance considered 3,698
(3,558) 3,698
(1)
Refer to note 24.2.11 for details of investments and redemptions
22 INTEREST AND DIVIDEND
RECEIVED
Interest and dividend income as per
Profit and Loss account 1,154 881
Add : Opening interest accrued but
not due 19 6
Less : Closing interest accrued but
not due
(1)
25 16
1,148 871
(1)
Excludes r3 crore pertaining to controlled trusts as of March 31, 2010
23 CASH AND CASH EQUIVALENTS
AT THE END
Add : Deposits with financial
institutions (excluding interest
accrued and not due)
(1)
1,571 1,555
16,666 12,111
(1)
Excludes restricted deposits held with LIC of R437 crore (R337 crore) for funding
employee related obligations
Schedules to the consolidated financial statements for the year ended
March 31, 2011
24. Significant accounting policies and notes
on accounts
Company overview
its majority owned and controlled subsidiary, Infosys BPO Limited
(Infosys BPO) and wholly owned and controlled subsidiaries, Infosys
Consulting, Inc. (Infosys Consulting), Infosys Technologies S. de
R. L. de C.V. (Infosys Mexico), Infosys Technologies (Sweden) AB
(Infosys Sweden), Infosys Tecnologia do Brasil Ltda (Infosys Brasil),
Technologies (Shanghai) Company Limited (Infosys Shanghai) and
controlled trusts is a leading global technology services corporation.
The group of companies (the Group) provides end-to-end business
solutions that leverage technology thereby enabling clients to enhance
business performance. The Group provides solutions that span the
entire software life cycle encompassing technical consulting, design,
development, re-engineering, maintenance, systems integration,
package evaluation and implementation, testing and infrastructure
management services. In addition, the Group offers software products
for the banking industry, business consulting and business process
management services.
24.1. Significant accounting policies
24.1.1. Basis of preparation of financial statements
The financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles (GAAP) under the historical
cost convention on the accrual basis except for certain financial
instruments which are measured at fair value. GAAP comprises
mandatory accounting standards prescribed by the Companies
(Accounting Standards) Rules, 2006 and guidelines issued by the
Securities and Exchange Board of India (SEBI). Accounting policies
have been consistently applied except where a newly issued accounting
standard is initially adopted or a revision to an existing accounting
standard requires a change in the accounting policy hitherto in use.
The financial statements are prepared in accordance with the principles
and procedures required for the preparation and presentation of
consolidated financial statements as laid down under the Accounting
Standard (AS) 21, Consolidated Financial statements. The financial
statements of Infosys the parent Company, Infosys BPO, Infosys
China, Infosys Australia, Infosys Mexico, Infosys Consulting, Infosys
Sweden, Infosys Brasil, Infosys Public Services, Infosys Shanghai
and controlled trusts have been combined on a line-by-line basis by
adding together book values of items like assets, liabilities, income and
expenses after eliminating intra-group balances and transactions and
resulting unrealized gain / loss. The consolidated financial statements
are prepared by applying uniform accounting policies in use at the
Group. Minority interests have been excluded. Minority interests
represent that part of the net profit or loss and net assets of subsidiaries
that are not, directly or indirectly, owned or controlled by the Company.
24.1.2. Use of estimates
The preparation of the financial statements in conformity with GAAP
requires the Management to make estimates and assumptions that affect
the reported balances of assets and liabilities and disclosures relating
to contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the period. Examples
of such estimates include computation of percentage-of-completion
which requires the Group to estimate the efforts expended to date as a
proportion of the total efforts to be expended, provisions for doubtful
debts, future obligations under employee retirement benefit plans,
income taxes, post-sales customer support and the useful lives of fixed
assets and intangible assets.
Accounting estimates could change from period to period. Actual
results could differ from those estimates. Appropriate changes in
estimates are made as Management becomes aware of changes in
circumstances surrounding the estimates. Changes in estimates are
reflected in the consolidated financial statements for the period in
which changes are made and, if material, their effects are disclosed in
the notes to the consolidated financial statements.
The Management periodically assesses using, external and internal
sources, whether there is an indication that an asset may be impaired.
An impairment loss is recognized wherever the carrying value of an
asset exceeds its recoverable amount. The recoverable amount is
higher of the assets net selling price and value in use which means
the present value of future cash flows expected to arise from the
continuing use of the asset and its eventual disposal. An impairment
loss for an asset other than goodwill is reversed if, and only if, the
reversal can be related objectively to an event occurring after the
impairment loss was recognized. The carrying amount of an asset
other than goodwill is increased to its revised recoverable amount,
provided that this amount does not exceed the carrying amount that
would have been determined (net of any accumulated amortization
or depreciation) had no impairment loss that had been recognized for
the asset in previous years.
24.1.3. Revenue recognition
Revenue is primarily derived from software development and
related services, licensing of software products and business process
management. Arrangements with customers are either on a fixed-price,
fixed-timeframe or on a time and material basis.
Revenue on time-and-material contracts are recognized as the related
services are performed and revenue from the end of the last billing to
the Balance Sheet date is recognized as unbilled revenues. Revenue from
fixed-price, fixed-timeframe contracts, where there is no uncertainty
as to the measurement or collectability of consideration, is recognized
based upon the percentage-of-completion method. When there is
uncertainty as to the measurement or the ultimate collectability revenue
recognition is postponed until such uncertainty is resolved. Cost and
earnings in excess of billings are classified as unbilled revenue while
billing in excess of cost and earnings is classified as unearned revenue.
Provision for estimated losses, if any, on uncompleted contracts are
recorded in the period in which such losses become probable based
on the current estimates.
Annual Technical Services revenue and revenue from fixed-price
maintenance contracts are recognized ratably over the period in
which services are rendered. Revenue from the sale of user licenses for
software applications is recognized on transfer of the title in the user
license, except in case of multiple element contracts, which require
significant implementation services, where revenue for the entire
arrangement is recognized over the implementation period based
upon the percentage of completion. Revenue from client training,
support and other services arising out of the sale of software products
is recognized as the related services are performed.
The Group accounts for volume discounts and pricing incentives to
customers as a reduction of revenue based on the ratable allocation
of the discount / incentive amount to each of the underlying revenue
transactions that result in progress by the customer towards earning
the discount / incentive. Also, when the level of discount varies with
increases in levels of revenue transactions, the Group recognizes the
liability based on its estimate of the customers future purchases.
If it is probable that the criteria for the discount will not be met,
or if the amount thereof cannot be estimated reliably, then the discount
is not recognized until the payment is probable and the amount can
be estimated reliably. The Group recognizes changes in the estimated
amount of obligations for discounts using a cumulative catch-up
approach. The discounts are passed on to the customer either as
direct payments or as a reduction of payments due from the customer.
The Group presents revenues net of value-added taxes in its
consolidated Profit and Loss account.
Profit on sale of investments is recorded on transfer of title from the
Group and is determined as the difference between the sale price and
carrying value of the investment. Lease rentals are recognized ratably
on a straight-line basis over the lease term. Interest is recognized using
the time-proportion method, based on rates implicit in the transaction.
Dividend income is recognized when the Groups right to receive
dividend is established.
24.1.4. Provisions and contingent liabilities
A provision is recognized if, as a result of a past event, the Group
has a present legal obligation that can be estimated reliably, and it is
probable that an outflow of economic benefits will be required to settle
the obligation. Provisions are determined by the best estimate of the
outflow of economic benefits required to settle the obligation at the
reporting date. Where no reliable estimate can be made, a disclosure
is made as contingent liability. A disclosure for a contingent liability is
also made when there is a possible obligation or a present obligation
that may, but probably will not, require an outflow of resources.
Where there is a possible obligation or a present obligation in respect
of which the likelihood of outflow of resources is remote, no provision
or disclosure is made.
24.1.4.a. Post-sales client support and warranties
The Group provides its clients with a fixed-period warranty
for corrections of errors and call support on all its fixed-price,
fixed-timeframe contracts. Costs associated with such support services
are accrued at the time related revenues are recorded and included
in cost of sales. The Group estimates such costs based on historical
experience and the estimates are reviewed annually for any material
changes in assumptions.
24.1.4.b. Onerous contracts
Provisions for onerous contracts are recognized when the expected
benefits to be derived by the Group from a contract are lower than the
unavoidable costs of meeting the future obligations under the contract.
The provision is measured at lower of the expected cost of terminating
the contract and the expected net cost of fulfilling the contract.
24.1.5. Fixed assets, including goodwill, intangible
assets and capital work-in-progress
Fixed assets are stated at cost, less accumulated depreciation and
impairments, if any. Direct costs are capitalized until fixed assets
are ready for use. Capital work-in-progress comprises outstanding
advances paid to acquire fixed assets and the cost of fixed assets that
are not yet ready for their intended use at the reporting date. Intangible
assets are recorded at the consideration paid for acquisition of such
assets and are carried at cost less accumulated amortization and
impairment. Goodwill comprises the excess of purchase consideration
over the fair value of the net assets of the acquired enterprise. Goodwill
arising on consolidation or acquisition is not amortized but is tested
for impairment.
24.1.6. Depreciation and amortization
Depreciation on fixed assets is provided on the straight-line method
based on useful lives of assets as estimated by the Management.
Depreciation for assets purchased / sold during the period is
proportionately charged. Individual low cost assets (acquired for less
than R5,000/-) are depreciated over a period of one year from the date
of acquisition. Intangible assets are amortized over their respective
individual estimated useful lives on a straight-line basis, commencing
from the date the asset is available to the Group for its use. Leasehold
improvements are written off over the lower of the remaining primary
period of lease or the life of the asset. The Management estimates the
useful lives for the other fixed assets as follows :
Buildings 15 years
Plant and machinery 5 years
Computer equipment 2-5 years
Furniture and fixtures 5 years
Vehicles 5 years
Depreciation methods, useful lives and residual values are reviewed
at each reporting date.
24.1.7. Retirement benefits to employees
24.1.7.a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, Infosys
provides for gratuity, a defined benefit retirement plan (the Gratuity
Plan) covering eligible employees of the Company and Infosys BPO.
The Gratuity Plan provides a lump-sum payment to vested employees
at retirement, death, incapacitation or termination of employment, of
an amount based on the respective employees salary and the tenure
of employment with the Group.
Liabilities with regard to the Gratuity Plan are determined by actuarial
valuation at each Balance Sheet date using the projected unit credit
method. The Company fully contributes all ascertained liabilities to
the Infosys Technologies Limited Employees Gratuity Fund Trust
(the Trust). In case of Infosys BPO, contributions are made to the
Infosys BPO Employees Gratuity Fund Trust. Trustees administer
contributions made to the Trusts and contributions are invested in
specific instruments, as permitted by the law. The Group recognizes the
net obligation of the Gratuity plan in the consolidated Balance Sheet as
an asset or liability, respectively in accordance with AS 15, Employee
Benefits. The Groups overall expected long-term rate-of-return
on assets has been determined based on consideration of available
market information, current provisions of Indian law specifying the
instruments in which investments can be made and historical returns.
The discount rate is based on the Government securities yield. Actuarial
gains and losses arising from experience adjustments and changes in
actuarial assumptions are recognized in the consolidated Profit and
Loss account in the period in which they arise.
24.1.7.b. Superannuation
Certain employees of Infosys are also participants in the superannuation
plan (the Plan) which is a defined contribution plan. The Company
has no obligations to the Plan beyond its monthly contributions.
Certain employees of Infosys BPO and Infosys Australia are also
eligible for superannuation benefit. Infosys BPO and Infosys Australia
makes monthly provisions under the superannuation plan based on
a specified percentage of each covered employees salary. Infosys BPO
has no further obligations to the superannuation plan beyond its
monthly provisions which are periodically contributed to a trust fund,
the corpus of which is invested with the Life Insurance Corporation
of India.
24.1.7.c. Provident fund
Eligible employees of Infosys receive benefits from a provident fund,
which is a defined benefit plan. Both the employee and the Company
make monthly contributions to the provident fund plan equal to a
specified percentage of the covered employees salary. The Company
contributes a part of the contributions to the Infosys Technologies
Limited Employees Provident Fund Trust. The remaining portion
is contributed to the government administered pension fund.
The rate at which the annual interest is payable to the beneficiaries by
the trust is being administered by the government. The Company has
an obligation to make good the shortfall, if any, between the return
from the investments of the Trust and the notified interest rate.
In respect of Infosys BPO, eligible employees receive benefits from
a provident fund, which is a defined contribution plan. Both the
employee and Infosys BPO make monthly contributions to this
provident fund plan equal to a specified percentage of the covered
employees salary. Amounts collected under the provident fund plan
are deposited in a government administered provident fund. Infosys
BPO has no further obligations under the provident fund plan beyond
its monthly contributions
24.1.7.d. Compensated absences
The employees of the Group are entitled to compensated absences
which are both accumulating and non-accumulating in nature.
The expected cost of accumulating compensated absences is determined
by actuarial valuation based on the additional amount expected to be
paid as a result of the unused entitlement that has accumulated at
the Balance Sheet date. Expense on non-accumulating compensated
absences is recognized in the period in which the absences occur.
24.1.8. Research and development
Research costs are expensed as incurred. Software product development
costs are expensed as incurred unless technical and commercial
feasibility of the project is demonstrated, future economic benefits
are probable, the Company has an intention and ability to complete
and use or sell the software and the costs can be measured reliably.
24.1.9. Foreign currency transactions
Foreign currency denominated monetary assets and liabilities are
translated into the relevant functional currency at exchange rates in
effect at the Balance Sheet date. The gains or losses resulting from such
translations are included in the Profit or Loss account. Non-monetary
assets and non-monetary liabilities denominated in a foreign currency
and measured at fair value are translated at the exchange rate prevalent
at the date when the fair value was determined. Non-monetary assets
and non-monetary liabilities denominated in a foreign currency and
measured at historical cost are translated at the exchange rate prevalent
at the date of transaction.
Revenue, expense and cash-flow items denominated in foreign
currencies are translated into the relevant functional currencies using
the exchange rate in effect on the date of the transaction. Transaction
gains or losses realized upon settlement of foreign currency transactions
are included in determining net profit for the period in which the
transaction is settled.
The functional currency of Infosys and Infosys BPO is the Indian
rupee. The functional currencies for Infosys Australia, Infosys China,
Infosys Consulting, Infosys Mexico, Infosys Sweden, Infosys Brasil,
Infosys Public Services and Infosys Shanghai are their respective
local currencies. The translation of financial statements of the foreign
subsidiaries from the local currency to the functional currency of the
Company is performed for Balance Sheet accounts using the exchange
rate in effect at the Balance Sheet date and for revenue, expense
and cash-flow items using a monthly average exchange rate for the
respective periods and the resulting difference is presented as foreign
currency translation reserve included in Reserves and Surplus. When
a subsidiary is disposed off, in part or in full, the relevant amount is
transferred to Profit or Loss.
24.1.10. Forward contracts and options in foreign
currencies
The Group uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use
of these foreign exchange forward and options contracts reduce the
risk or cost to the Group and the Group does not use those for trading
or speculation purposes.
Effective April 1, 2008, the Group adopted AS 30, Financial
Instruments : Recognition and Measurement, to the extent that the
adoption did not conflict with existing accounting standards and other
authoritative pronouncements of Company Law and other regulatory
requirements.
Forward and options contracts are fair valued at each reporting date.
The resultant gain or loss from these transactions is recognized in the
Profit or Loss account. The Group records the gain or loss on effective
hedges, if any, in the foreign currency fluctuation reserve until the
transactions are complete. On completion, the gain or loss is transferred
to the consolidated Profit and Loss account for that period. To designate
a forward or options contract as an effective hedge, the Management
objectively evaluates and evidences with appropriate supporting
documents at the inception of each contract whether the contract is
effective in achieving offsetting cash flows attributable to the hedged
risk. In the absence of a designation as effective hedge, a gain or loss
is recognized in the consolidated Profit and Loss account. Currently,
the hedges undertaken by the Group are all ineffective in nature and
the resultant gain or loss consequent to fair valuation is recognized
in the consolidated Profit and Loss account at each reporting date.
24.1.11. Income taxes
Income taxes are accrued in the same period the related revenue
and expenses arise. A provision is made for income tax annually
based on the tax liability computed after considering tax allowances
and exemptions. Provisions are recorded when it is estimated that a
liability due to disallowances or other matters is probable. MAT paid
in accordance with the tax laws, which gives rise to future economic
benefits in the form of tax credit against future income tax liability,
is recognized as an asset in the consolidated Balance Sheet if there
is convincing evidence that the Group will pay normal tax after the
tax holiday period and the resultant asset can be measured reliably.
The Group offsets, on a year-on-year basis, the current tax assets and
liabilities, where it has a legally enforceable right and where it intends
to settle such assets and liabilities on a net basis.
The differences that result between the profit offered for income
taxes and the profit as per the financial statements are identified and
thereafter a deferred tax asset or deferred tax liability is recorded
for timing differences, namely the differences that originate in one
accounting period and reverse in another, based on the tax effect of the
aggregate amount of timing difference. The tax effect is calculated on
the accumulated timing differences at the end of an accounting period
based on enacted or substantively enacted regulations. Deferred tax
assets, in a situation where unabsorbed depreciation and carry forward
business loss exists, are recognized only if there is virtual certainty
supported by convincing evidence that sufficient future taxable
income will be available against which such deferred tax asset can be
realized. Deferred tax assets, other than in situation of unabsorbed
depreciation and carry forward business loss, are recognized only if
there is reasonable certainty that they will be realized. Deferred tax
assets are reviewed for the appropriateness of their respective carrying
values at each reporting date. Tax benefits of deductions earned on
exercise of employee share options in excess of compensation charged
to the consolidated Profit and Loss account are credited to the share
premium account.
24.1.12. Earnings per share
Basic earnings per share is computed by dividing the net profit after tax
by the weighted average number of equity shares outstanding during
the period. Diluted earnings per share is computed by dividing the
net profit after tax by the weighted average number of equity shares
considered for deriving basic earnings per share and also the weighted
average number of equity shares that could have been issued upon
conversion of all dilutive potential equity shares. The diluted potential
equity shares are adjusted for the proceeds receivable had the shares
been actually issued at fair value which is the average market value of
the outstanding shares. Dilutive potential equity shares are deemed
converted as at the beginning of the period, unless issued at a later
date. Dilutive potential equity shares are determined independently
for each period presented.
The number of shares and potentially dilutive equity shares are adjusted
retrospectively for all periods presented for any share splits and bonus
shares issues including for changes effected prior to the approval of the
consolidated financial statements by the Board of Directors.
24.1.13. Investments
Trade investments are the investments made to enhance the Groups
business interests. Investments are either classified as current or long-
term based on the Managements intention at the time of purchase.
Current investments are carried at lower of cost and fair value of each
investment individually. Cost for overseas investments comprises
the Indian rupee value of the consideration paid for the investment
translated at the exchange rate prevalent at the date of investment.
Long-term investments are carried at cost less provisions recorded to
recognize any decline, other than temporary, in the carrying value of
each investment.
24.1.14. Cash and cash equivalents
Cash and cash equivalents comprises of cash and cash on deposit
with banks and corporations. The Group considers all highly liquid
investments with a remaining maturity at the date of purchase of three
months or less and that are readily convertible to known amounts of
cash to be cash equivalents.
24.1.15. Cash flow statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of a non-cash nature,
any deferrals or accruals of past or future operating cash receipts or
payments and item of income or expenses associated with investing
or financing cash flows. The cash flows from operating, investing and
financing activities of the Group are segregated.
24.1.16. Leases
Lease under which the Group assumes substantially all the risks and
rewards of ownership are classified as finance leases. Such assets
acquired are capitalized at fair value of the asset or present value of
the minimum lease payments at the inception of the lease, whichever
is lower. Lease payments under operating leases are recognized as an
expense on a straight line basis in the Profit and Loss account over
the lease term.
24.1.17. Government grants
The Group recognizes government grants only when there is reasonable
assurance that the conditions attached to them shall be complied
with, and the grants will be received. Government grants related
to depreciable fixed assets are treated as deferred income and are
recognized in the Profit and Loss statement on a systematic and rational
basis over the useful life of the asset. Government grants related to
revenue are recognized on a systematic basis in the Profit and Loss
statement over the periods necessary to match them with the related
costs which they are intended to compensate.
24.2. Notes on Accounts
Amounts in the financial statements are presented in Indian rupees
crore, except for per share data and as otherwise stated. Certain
amounts that are required to be disclosed and do not appear due to
rounding off are detailed in note 24.3. All exact amounts are stated
with the suffix /-. One crore equals 10 million.
24.2.1. Aggregate expenses
The aggregate amounts incurred on expenses are as follows :
in rcrore
2011 2010
Salaries and bonus including overseas
staff expenses 14,306 11,733
funds 456 306
Staff welfare 94 46
Technical sub-contractors 603 372
Third party items bought for service
delivery to clients 139 17
Guesthouse maintenance 9 4
Rent 146 125
Consumables 27 25
Advertisements 7 3
Donations 1 44
Professional membership and seminar
participation fees 12 9
Repairs to buildings 45 34
Provision for post-sales client support
and warranties 5 (2)
Recruitment and training 2 2
Provision for bad and doubtful debts 2
advances 2 1
Commission to non-whole-time directors 6 6
Sales promotion expenses 1 1
Freight charges 2 1
18,533 14,881
24.2.2. Capital commitments and contingent liabilities
in rcrore
2011 2010
Estimated amount of
unexecuted capital
contracts (net of
advances and deposits) 814 301
Outstanding
guarantees and counter
guarantees to various
banks, in respect of the
guarantees given by
those banks in favor
of various government
authorities and others 21 18
Claims against
the Company, not
acknowledged as debts

(1)
[Net of amount paid
to statutory authorities
of R469 crore (R241
crore)] 271 28
in
million
in R
crore
in
million
in R
crore
Forward contracts
outstanding
In USD 546 2,433 267 1,199
In Euro 28 177 22 130
In GBP 15 108 11 71
In AUD 10 46 3 12
Options contracts
outstanding
In USD 200 898
2,764 2,310
(1)
Claims against the Company not acknowledged as debts include demand from the
Indian tax authorities for payment of additional tax of r671 crore (r214 crore),
including interest of r177 crore (r39 crore) upon completion of their tax review for
fiscal 2005, fiscal 2006 and fiscal 2007. The tax demands are mainly on account of
disallowance of a portion of the deduction claimed by the Company under Section
10A of the Income tax Act. The deductible amount is determined by the ratio of export
turnover to total turnover. The disallowance arose from certain expenses incurred
in foreign currency being reduced from export turnover but not reduced from total
turnover. The tax demand for fiscal 2007 also includes disallowance of portion of profit
earned outside India from the STP units and disallowance of profits earned from SEZ
units. The matter for fiscal 2005, 2006 and 2007 is pending before the Commissioner
of Income tax ( Appeals), Bangalore.
The Company is contesting the demands and the Management, including its tax
advisors, believes that its position will likely be upheld in the appellate process. No
tax expense has been accrued in the financial statements for the tax demand raised.
The Management believes that the ultimate outcome of this proceeding will not have a
material adverse effect on the Companys financial position and results of operations.
24.2.3. Obligations on long-term, non-cancelable
operating leases
The lease rentals charged for the year ended March 31, 2011 and
March 31, 2010 and maximum obligations on long-term
non-cancelable operating leases payable as per the rentals are stated
in the respective agreements :
in rcrore
2011 2010
Lease rentals recognized during the year 146 125
in rcrore
Lease obligations payable As at March 31,
2011 2010
Within one year of the Balance Sheet date 109 84
Due in a period between one year and
five years 251 249
Due after five years 71 62
The operating lease arrangements extend upto a maximum of ten years
from their respective dates of inception and relates to rented overseas
premises. Some of these lease agreements have a price escalation clause.
24.2.4. Related party transactions
During the year ended March 31, 2011, an amount of nil (R35 crore for
the year ended March 31, 2010) was donated to Infosys Foundation,
a not-for-profit foundation, in which certain directors and officers
of the Company are trustees. Related parties include Infosys Science
Foundation and Infosys Technologies Limited Employees Welfare
Trust which are controlled trusts.
24.2.5. Transactions with key management personnel
have been detailed in Schedule 24.4.
24.2.6. Research and development expenditure
in rcrore
2011 2010
Capital 6 3
Revenue 527 435
24.2.7. Stock option plans
The Company has two Stock option plans that are currently operational.
1998 Stock Option Plan (the 1998 Plan)
The 1998 Plan was approved by the Board of Directors in December
1997 and by the shareholders in January 1998, and is for issue of
1,17,60,000 ADSs representing 1,17,60,000 equity shares. All options
under the 1998 Plan are exercisable for ADSs representing equity
shares. A Compensation Committee comprising independent members
of the Board of Directors administers the 1998 Plan. All options have
been granted at 100% of fair market value. The 1998 Plan lapsed on
January 6, 2008, and consequently no further shares will be issued to
employees under this plan.
In fiscal 2000, the Company instituted the 1999 Plan. The shareholders
and the Board of Directors approved the plan in September 1999,
which provides for the issue of 5,28,00,000 equity shares to the
employees. The Compensation Committee administers the 1999
Plan. Options were issued to employees at an exercise price that is
not less than the fair market value. The 1999 Plan lapsed on June 11,
2009, and consequently no further shares will be issued to employees
under this plan.
The activity in the 1998 Plan and 1999 Plan during the year ended
March 31, 2011 and March 31, 2010 is as follows :
2011 2010
The 1998 Plan :
Options outstanding, beginning of year 2,42,264 9,16,759
Less : Exercised 1,88,675 6,14,071
Forfeited 3,519 60,424
Options outstanding, end of year 50,070 2,42,264
The 1999 Plan :
Options outstanding, beginning of year 2,04,464 9,25,806
Less : Exercised 1,37,692 3,81,078
Forfeited 18,052 3,40,264
Options outstanding, end of year 48,720 2,04,464
The weighted average share price of options exercised under the 1998
Plan during the year ended March 31, 2011 and March 31, 2010 was
R2,950 and R2,266 respectively. The weighted average share price
of options exercised under the 1999 Plan during the year ended
March 31, 2011 and March 31, 2010 was R 2,902 and R 2,221
respectively.
The following tables summarize information about the 1998 and 1999
share options outstanding as of March 31, 2011 and March 31, 2010 :
Range of exercise prices per
share (R)
As at March 31, 2011
Number
of shares
arising out
of options
Weighted
average
remaining
contractual
life
Weighted
average
exercise
price
The 1998 Plan :
300-700 24,680 0.73 587
701-1,400 25,390 0.56 777
50,070 0.65 683
The 1999 Plan :
300-700 33,759 0.65 448
701-2,500 14,961 1.71 2,121
48,720 0.97 962
Range of exercise prices per
share (R)
Number
of shares
arising out
of options
Weighted
average
remaining
contractual
life
Weighted
average
exercise
price
The 1998 Plan :
300-700 1,74,404 0.94 551
701-1,400 67,860 1.27 773
2,42,264 1.03 613
The 1999 Plan :
300-700 1,52,171 0.91 439
701-2,500 52,293 1.44 2,121
2,04,464 1.05 869
The aggregate options considered for dilution are set out in note
24.2.16
Proforma Accounting for Stock Option Grants
Guidance note on Accounting for employee share based payments
issued by the Institute of Chartered Accountants of India establishes
financial accounting and reporting principles for employee share
based payment plans. The guidance note applies to employee share
based payment plans, the grant date in respect of which falls on or
after April 1, 2005.
As allowed by the guidance note, Infosys has elected to continue
to apply the intrinsic value-based method of accounting described
above, and has adopted the disclosure requirements of the guidance
note Accounting for employee share based payments. Had the
compensation cost for Infosys stock-based compensation plan been
determined in a manner consistent with the fair value approach
described in the guidance note, the Companys net profit and basic
and diluted earnings per share as reported would have reduced to the
proforma amounts as indicated :
2011 2010
Net profit after tax, exceptional item and
minority interest
As reported 6,835 6,266
Less : Stock-based employee
compensation expense 1
Adjusted proforma 6,835 6,265
Basic earnings per share as reported 119.66 109.84
Proforma basic earnings per share 119.66 109.83
Diluted earnings per share as reported 119.63 109.72
Proforma diluted earnings per share 119.63 109.71
The provision for taxation includes tax liabilities in India on the
Companys global income as reduced by exempt incomes and any tax
liabilities arising overseas on income sourced from those countries.
Infosys operations are conducted through Software Technology Parks
(STPs) and Special Economic Zones (SEZs). Income from STPs are
tax exempt for the earlier of ten years commencing from the fiscal year
in which the unit commences software development, or March 31,
2011. Income from SEZs is fully tax exempt for the first five years, 50%
exempt for the next five years and 50% exempt for another 5 years
subject to fulfilling certain conditions. For fiscal 2008 and 2009, the
company had calculated its tax liability under Minimum Alternate Tax
(MAT). The MAT credit can be carried forward and set off against the
future tax payable. In the current year, the Company has calculated
its tax liability under normal provisions of the Income Tax Act and
utilized the brought forward MAT credit.
As at March 31, 2011, the Company has provided for branch profit
tax of R176 crore for its overseas branches, as the Company estimates
that these branch profits would be distributed in the foreseeable future.
Further, the tax provision for the year ended March 31, 2010, included
a net tax reversal of R316 crore relating to SEZ units, for provisions
no longer required.
24.2.9. Loans and advances
in rcrore
2011 2010
Deposits with financial institutions :
HDFC Limited 1,571 1,551
Sundaram BNP Paribas Home Finance
Limited 4
Life Insurance Corporation of India 437 337
2,008 1,892
Deposit with Life Insurance Corporation of India represents amount
deposited to settle employee-related obligations as and when they
arise during the normal course of business (refer to note 24.2.21.b).
24.2.10. Fixed assets
For the year ended March 31, 2011, the Profit / Loss on disposal of
fixed assets is less than R1 crore and accordingly disclosed in note
24.3. Profit / Loss on disposal of fixed assets during the year ended
March 31, 2010 was R2 crore.
The Company has entered into lease-cum-sale agreements to acquire
certain properties. In accordance with the terms of these agreements,
the Company has the option to purchase the properties on expiry of
the lease period. The Company has already paid 99% of the value
of the properties at the time of entering into the lease-cum-sale
agreements. These amounts are disclosed as Land leasehold under
Fixed assets in the financial statements. Additionally, certain land has
been purchased for which the Company has possession certificate but
for which the sale deeds are yet to be executed as at March 31, 2011.
24.2.11. Details of investments
The details of investments in and disposal of securities for the year
ended March 31, 2011 and March 31, 2010 are as follows :
in rcrore
2011 2010
Investment in securities
Liquid mutual fund units 1,932 9,901
2,772 11,081
Redemption / Disposal of investment in
securities
Long-term investments 5
Certificates of deposit 1,901
6,330 7,388
Net movement in investment (3,558) 3,693
24.2.12. Holding of Infosys in its subsidiaries
Name of the
subsidiary
Country of
incorporation
As at March 31,
2011 2010
Infosys China
(1)
China 100% 100%
Infosys Mexico
(2)
Mexico 100% 100%
Infosys Shanghai
(3)
China 100%
Infosys Brasil
(4)
Brazil 100% 100%
Infosys Public Services U.S. 100% 100%
Infosys BPO s.r.o
(5)
Czech Republic 99.98% 99.98%
Sp.Z.o.o
(5)
Poland 99.98% 99.98%
Infosys BPO
(Thailand) Limited
(5)
Thailand 99.98%
Infosys Consulting
India Limited
(6)
India 100% 100%
McCamish Systems
LLC
(5)(7)
U.S. 99.98% 99.98%
(1)
of r42 crore (US$ 9 million) in Infosys China, which is a wholly owned subsidiary.
As of March 31, 2011 and March 31, 2010, the Company has invested an aggregate
of r107 crore (US$ 23 million) and r65 crore (US$ 14 million) respectively, in the
subsidiary.
(2)
of r14 crore (Mexican Peso 40 million) in Infosys Mexico, which is a wholly owned
subsidiary. As of March 31, 2011 and March 31, 2010, the Company has invested an
aggregate of r54 crore (Mexican Peso 150 million) and r40 crore (Mexican Peso 110
million) respectively, in the subsidiary.
(3)
On February 21, 2011, the Company incorporated a wholly-owned subsidiary, Infosys
Technologies (Shanghai) Company Limited and invested r11 crore (US$ 3 million) in
the subsidiary. As of March 31, 2011 the Company has invested an aggregate of
r11 crore (US$ 3 million) in the subsidiary.
(4)
of r10 crore (BRL 4 million) in the subsidiary. As of March 31, 2011 and March 31,
2010 the Company has invested an aggregate of r38 crore (BRL 15 million) and
r28 crore (BRL 11 million), respectively, in the subsidiary.
(5)
Infosys BPO s.r.o, Infosys BPO (Poland) Sp.Z.o.o, Infosys BPO (Thailand) Limited and
McCamish Systems LLC are wholly owned subsidiaries of Infosys BPO. During the year
ended March 31, 2011, Infosys BPO (Thailand) Limited was liquidated.
(6)
During the year ended March 31, 2010, Infosys Consulting incorporated a wholly-
owned subsidiary, Infosys Consulting India Limited. As of March 31, 2011 and March
31, 2010, Infosys Consulting has invested an aggregate of r1 crore in the subsidiary.
(7)
During the year ended March 31, 2010, Infosys BPO acquired 100% of the voting
interests in McCamish Systems LLC (McCamish), a business process solutions provider
based in Atlanta, Georgia, in the United States. The business acquisition was conducted
by entering into Membership Interest Purchase Agreement for a cash consideration of
r173 crore and a contingent consideration of r67 crore. The acquisition was accounted
as a business combination which resulted in goodwill of r227 crore.
24.2.13. Provision for doubtful debts
Periodically, the Group evaluates all customer dues to the Group for
collectability. The need for provisions is assessed based on various
factors including collectability of specific dues, risk perceptions of the
industry in which the customer operates, general economic factors,
which could effect the customers ability to settle. The Group normally
provides for debtor dues outstanding for 180 days or longer as at the
Balance Sheet date. As at March 31, 2011, the Group has provided
for doubtful debts of R19 crore (R21 crore as at March 31, 2010) on
dues from certain customers although the outstanding amounts were
less than 180 days old, since the amounts were considered doubtful of
recovery. The Group pursues the recovery of the dues, in part or full.
24.2.14. Segment reporting
The Groups operations predominantly relate to providing end-to-end
business solutions that leverage technology thereby enabling clients
to enhance business performance, delivered to customers globally
operating in various industry segments. Accordingly, revenues
represented along industry classes comprise the primary basis of
segmental information set out in these financial statements. Secondary
segmental reporting is performed on the basis of the geographical
location of customers.
The accounting principles consistently used in the preparation of the
financial statements are also consistently applied to record income and
expenditure in individual segments. These are as set out in the note
on significant accounting policies.
Industry segments at the Group are pri mari l y f i nanci al
services comprising customers providing banking, finance and
insurance services; manufacturing companies; companies in the
telecommunications and the retail industries; and others such as
utilities, transportation and logistics companies.
Income and direct expenses in relation to segments are categorized
based on items that are individually identifiable to that segment, while
the remainder of the costs are categorized in relation to the associated
turnover of the segment. Certain expenses such as depreciation,
which form a significant component of total expenses, are not
specifically allocable to specific segments as the underlying services
are used interchangeably. The Group believes that it is not practical to
provide segment disclosures relating to those costs and expenses, and
accordingly these expenses are separately disclosed as unallocated
and directly charged against total income.
Fixed assets used in the business or liabilities contracted have not
been identified for any of the reportable segments, as the fixed assets
and services are used interchangeably between segments. Accordingly,
no disclosure relating to total segment assets and liabilities are made.
Customer relationships are driven based on the location of the
respective client. North America comprises the United States of
America, Canada and Mexico; Europe includes continental Europe
(both the east and the west), Ireland and the United Kingdom; and the
Rest of the World comprising all other places except, those mentioned
above and India.
Geographical revenues are segregated based on the location of the
customer who is invoiced or in relation to which the revenue is
otherwise recognized.
Industry segments
Year ended March 31, 2011 and March 31, 2010 :
in rcrore
Particulars Financial
Services
Manufac-
turing
Telecom Retail Others Total
Revenues 9,862 5,393 3,549 3,898 4,799 27,501
7,731 4,506 3,661 3,035 3,809 22,742
Identifiable
operating
expenses 4,122 2,311 1,420

1,647 2,099

11,599
3,068 1,993 1,284

1,243 1,544 9,132
Allocated
expenses 2,456 1,370 899 990 1,219 6,934
1,953 1,139 926 767 964 5,749
Segmental
operating
income 3,284 1,712 1,230 1,261 1,481 8,968
2,710 1,374 1,451 1,025 1,301 7,861
Unallocable expenses 854
905
Operating income 8,114
6,956
Other income, net 1,211
934
Provision for investments
(9)
Net profit before taxes and exceptional
item 9,325
7,899
Income taxes 2,490
1,681
Net profit after taxes before exceptional
item 6,835
6,218
Exceptional item Income on sale of
investments, net of taxes
48
Net profit after taxes and exceptional item 6,835
6,266
Geographic segments
in rcrore
Particulars North
America
Europe India Rest
of the
World
Total
Revenues 17,958 5,927 599 3,017 27,501
14,972 5,237 270 2,263 22,742
Identifiable
operating expenses 7,658 2,467 281 1,193 11,599
6,067 2,093 80 892 9,132
Allocated expenses 4,555 1,488 144 747 6,934
3,784 1,325 68 572 5,749
Particulars North
America
Europe India Rest
of the
World
Total
Segmental operating
income 5,745 1,972 174 1,077 8,968
5,121 1,819 122 799 7,861
Unallocable
expenses 854
905
6,956
934
Provision on
investments
(9)
Net profit
before taxes and
exceptional item 9,325
7,899
Income taxes 2,490
1,681
Net profit after taxes
before exceptional
item 6,835
6,218
Exceptional item
Income on sale of
investments, net of
taxes
48
Net profit after taxes
and exceptional item 6,835
6,266
24.2.15. Dividends remitted in foreign currencies
The Company remits the equivalent of the dividends payable to equity
shareholders and holders of ADS. For ADS holders the dividend
is remitted in Indian rupees to the depository bank, which is the
registered shareholder on record for all owners of the Companys
ADSs. The depositary bank purchases the foreign currencies and remits
dividends to the ADS holders.
The particulars of dividends remitted are as follows :
in rcrore
Particulars Number of shares
to which the
dividends relate
Year ended
March 31,
2011 2010
Interim and 30th year
special dividend for
fiscal 2011 10,87,18,147 435
Interim dividend for
fiscal 2010 10,70,15,201 107
Final dividend for
fiscal 2010 10,68,22,614 160
Final dividend for
fiscal 2009 10,73,97,313 145
24.2.16. Reconciliation of basic and diluted shares used
in computing earnings per share
in Nos.
2011 2010
Number of shares considered as
basic weighted average shares
outstanding
(1)
57,11,80,050 57,04,75,923
Add : Effect of dilutive issues of
shares / stock options 1,88,308 6,40,108
Number of shares considered
as weighted average shares and
potential shares outstanding 57,13,68,358 57,11,16,031
(1)
Excludes shares held by controlled trusts
24.2.17. Provision for post-sales client support and
warranties
The movement in the provision for post-sales client support and
warranties is as follows :
in rcrore
2011 2010
Balance at the Beginning 82 92
Provision recognized / (reversed) 5 (2)
Provision utilized (8)
Translation difference 1
Balance at the end 88 82
Provision for post-sales client support is expected to be utilized over
a period of 6 months to 1 year.
24.2.18. Gratuity Plan
The following table sets out the status of the gratuity plan as required
under AS 15.
Reconciliation of the opening and closing balances of the present value
of the defined benefit obligation and plan assets :
in rcrore
2011 2010 2009 2008 2007
Obligations at year
beginning 325 267 224 225 183
Service cost 178 80 51 50 45
Interest cost 25 19 16 17 14
Actuarial loss / (gain) 17 (5) 1 (8) (1)
Benefits paid (65) (36) (25) (23) (16)
Amendment in benefit
plan (37)
Obligations at year end 480 325 267 224 225
Defined benefit
obligation liability as at
the Balance Sheet is fully
funded by the Group.
Change in plan assets
Plans assets at year
beginning, at fair value 327 268 236 225 170
Expected return on plan
assets 36 25 17 18 16
Actuarial gain 1 5 2 3
Contributions 182 69 35 14 54
Benefits paid (65) (36) (25) (23) (18)
Plan assets at year end,
at fair value 480 327 268 236 225
2011 2010 2009 2008 2007
Reconciliation of present
value of the obligation
and the fair value of the
plan assets :
Fair value of plan assets
at the end of the period 480 327 268 236 225
Present value of
the defined benefit
obligations at the end of
the year 480 325 267 224 225
Asset recognized in the
Balance Sheet 2 1 12
Assumptions
Interest rate 7.98% 7.82% 7.01% 7.92% 7.99%
Estimated rate of return
on plan assets 9.36% 9.00% 7.01% 7.92% 7.99%
Weighted expected rate
of salary increase 7.27% 7.27% 5.10% 5.10% 5.10%
Net gratuity cost for the year ended March 31, 2011 and March 31,
2010 comprises of the following components :
in rcrore
2011 2010
Gratuity cost for the year
Service cost 178 80
Interest cost 25 19
Expected return on plan assets (36) (25)
Actuarial gain 17 (6)
Plan amendment amortization (4) (3)
Net gratuity cost 180 65
Actual return on plan assets 37 26
Gratuity cost, as disclosed above, is included under salaries and bonus
and is segregated between software development expenses, selling and
marketing expenses and general and administration expenses on the
basis of the number of employees.
As of March 31, 2011 and March 31, 2010, the plan assets have been
primarily invested in government securities. The estimates of future
salary increases, considered in actuarial valuation, take account of
inflation, seniority, promotion and other relevant factors such as supply
and demand factors in the employment market.
Effective July 1, 2007, the Company revised the employee death
benefits provided under the gratuity plan, and included all eligible
employees under a consolidated term insurance cover. Accordingly,
the obligations under the gratuity plan reduced by R37 crore, which
is being amortized on a straight line basis to the Profit and Loss
account over ten years representing the average future service period
of the employees. The unamortized liability as at March 31, 2011 and
March 31, 2010 amounted to R22 crore and R26 crore, respectively
and is disclosed under Current Liabilities.
The group expects to contribute approximately R106 crore to the
gratuity trusts during fiscal 2012.
24.2.19.a. Provident Fund
The Guidance on Implementing AS 15, Employee Benefits (revised
2005) issued by the Accounting Standards Board (ASB) states that
benefits involving employer established provident funds, which require
interest shortfalls to be recompensed are to be considered as defined
benefit plans. Pending the issuance of the guidance note from the
Actuarial Society of India, the Companys actuary has expressed an
inability to reliably measure provident fund liabilities. Accordingly the
Company is unable to exhibit the related information.
The Company contributed R198 crore and R171 crore to the Provident
Fund during the year ended March 31, 2011 and March 31, 2010
respectively.
The Company contributed R 109 crore and R 91 crore to the
Superannuation Trust during the year ended March 31, 2011 and
March 31, 2010 respectively.
24.2.20. Cash and bank balances
The details of balances as on Balance Sheet dates with scheduled
banks are as follows :
in rcrore
Balances with scheduled banks in India As at March 31,
2011 2010
In current accounts
Citibank Unclaimed dividend account 1
Citibank N.A., India 2 2
Deustche Bank 12 13
Deustche Bank EEFC (Euro account) 8 3
Deustche Bank EEFC (Swiss Franc account) 2
Deutsche Bank EEFC (United Kingdom
Pound Sterling account) 1
Deustche Bank EEFC (U.S. Dollar account) 143 8
HDFC Bank Unclaimed dividend account 1 1
ICICI Bank 32 133
ICICI Bank EEFC (Euro account) 1
ICICI Bank EEFC (United Kingdom Pound
Sterling account) 1 2
ICICI Bank EEFC (U.S. Dollar account) 22 10
ICICI Bank Unclaimed dividend account 1 1
225 175
In deposit accounts
Andhra Bank 399 99
Allahabad Bank 561 150
Axis Bank 536
Bank of India 1,197 881
Bank of Baroda 1,100 299
Bank of Maharashtra 506 500
Barclays Bank 100
Canara Bank 1,329 963
Central Bank of India 354 100
Corporation Bank 295 276
DBS Bank 49
HDFC Bank 646
HSBC Bank 483
ICICI Bank 788 1,435
IDBI Bank 770 909
ING Vysya Bank 25
Indian Overseas Bank 518 140
Jammu and Kashmir Bank 12 10
Kotak Mahindra Bank 25 61
Oriental Bank of Commerce 653 100
Punjab National Bank 1,493 994
Standard Chartered Bank
State Bank of Hyderabad 255 233
State Bank of India 457 126
State Bank of Mysore 354 496
South Indian Bank 50
Syndicate Bank 504 475
The Bank of Nova Scotia
Union Bank of India 631 93
Vijaya Bank 144 95
Yes Bank 33
13,610 9,092
The details of balances as on Balance Sheet dates with non-scheduled
in rcrore
Balances with non-scheduled banks As at March 31,
2011 2010
In current accounts
ABN AMRO Bank, China 17 33
ABN AMRO Bank, China (U.S. Dollar account) 24 14
ABN AMRO Bank, Taiwan 3 2
Bank of America, Mexico 4 18
Bank of America, U.S. 296 686
Banamex, Mexico 2 2
China Merchants Bank, China 1
Citibank NA, Australia 61 25
Citibank NA, Brazil 5 9
Citibank NA, China (U.S. Dollar account) 11
Citibank NA, Czech Republic 1
Citibank NA, Czech Republic (U.S. Dollar
account) 2
Citibank NA, New Zealand 2 1
Citibank NA, Japan 17 2
Citibank NA, Thailand 1 1
Deutsche Bank, Belgium 5 18
Deutsche Bank, Czech Republic 1
Deutsche Bank, France 3 1
Deutsche Bank, Germany 5 12
Deutsche Bank, Moscow (U.S. Dollar account) 1
Deutsche Bank, Netherlands 2 7
Deustche Bank, Philippines 1
Deustche Bank, Philippines (U.S. Dollar
account) 1 3
Deutsche Bank, Poland 1 2
Deustche Bank, Poland (Euro account) 2 1
Deutsche Bank, Spain 1 1
Deustche Bank, Thailand 3
Deustche Bank, Thailand (U.S. Dollar account) 1
Deutsche Bank, U.K. 40 29
Deutsche Bank, Singapore 3 1
Deutsche Bank, Switzerland 1 10
Deutsche Bank, Switzerland (U.S. Dollar
account) 1
HSBC Bank, U.K. 10 2
ICICI Bank, U.K. 1 1
National Australia Bank Limited, Australia 1 21
National Australia Bank Limited, Australia
(U.S. Dollar account) 14
Nordbanken, Sweden 5 1
Royal Bank of Canada, Canada 23 20
Shanghai Pudong Development Bank, China 2
Wachovia Bank, U.S. 7
552 953
In deposit accounts
ABN AMRO bank, China 14
Bank of America, Mexico 17
Bank of America, U.S. 82
Citibank N.A., Czech Republic 5 9
Citibank N.A, (Euro account) 3
Citibank N.A, (U.S. Dollar account) 1 4
Citibank N.A, Brazil 3
Deutsche Bank, Poland 21 8
HSBC Bank, London 18
National Australia Bank Limited, Australia 546 312
Nordbanken, Sweden 1
708 336
Total cash and bank balances as per Balance Sheet 15,095 10,556
24.2.21. Cash Flow statement
24.2.21.a. Unclaimed dividend
The balance of cash and cash equivalents includes R 3 crore as at
March 31, 2011 (R2 crore as at March 31, 2010) set aside for payment
of dividends.
24.2.21.b. Balances held by controlled trusts
The balance of cash and cash equivalents includes R106 crore and
R69 crore as at March 31, 2011 and March 31, 2010 held by controlled
trusts.
24.2.21.c. Restricted cash
Deposits with financial institutions as at March 31, 2011 include
R437 crore (R337 crore as at March 31, 2010) deposited with Life
Insurance Corporation of India to settle employee related obligations
as and when they arise during the normal course of business.
This amount is considered as restricted cash and is hence not
considered cash and cash equivalents.
24.2.22 Exceptional item
During the year ended March 31, 2010 the Company sold 32,31,151
shares of OnMobile Systems Inc., U.S. (OMSI) at a price of R166.58
per share amounting to a total consideration of R53 crore, net of taxes
and transaction costs. The resultant income of R48 crore has been
appropriated to capital reserve.
24.3. Details of rounded off amounts
The financial statements are represented in Rcrore as per the approval
received from the Department of Company Affairs (DCA) earlier. Those
items which were not represented in the financial statement due to
rounding off to the nearest Rcrore are given as follows :
Balance Sheet items
in rcrore
2011 2010
Balance Sheet
24.2.20 Non-scheduled banks Current
Account
ABN AMRO Bank, Denmark 0.27 0.21
Banamex, Mexico 2.00
Bank of Baroda, Mauritius 0.02 0.02
China Merchants Bank, China 0.16 0.62
Citibank N.A., Czech Republic 0.18 0.35
Citibank N.A., Czech Republic
Euro account 0.31 0.13
Citibank N.A., China 0.13
Deustche Bank, Moscow 0.10 0.34
Deutsche Bank, Philippines 0.90 0.39
Deustche Bank, Poland 0.04 2.37
Deustche Bank, Poland Euro
account 0.02 0.74
Deutsche Bank, Zurich, Switzerland 0.01 9.72
ICICI Bank, U.K. 1.07
Nordbanken, Sweden 0.73
PNC Bank, U.S. 0.02
Standard Chartered Bank, UAE 0.17 0.09
Svenska Handelsbanken, Sweden 0.03 0.01
The Bank of Tokyo Mitsubishi
UFJ, Limited, Japan 0.41 0.16
Profit & Loss items
in rcrore
Schedule Description Year ended
March 31,
2011 2010
Profit and Loss
Minority interest 0.04 0.06
Residual dividend paid 0.25
Additional dividend tax 0.01 0.04
24.2.1 Aggregate expenses
Provision for doubtful loans
and advances 0.01
Certification charges 0.06 0.05
Out-of-pocket expenses 0.02 0.04
Others 0.05 0.01
Cash flow statement items
in rcrore
Schedule Description Year ended
March 31,
2011 2010
Profit / Loss on sale of fixed
assets 0.84 2.00
24.4 Transactions with key management
personnel
Key management personnel comprise directors and members of the
Executive Council.
Particulars of remuneration and other benefits paid to whole-time
directors and members of Executive Council during the year ended
in rcrore
tions to
provident
and other
funds
Perqui-
sites and
incentives
Total
Remun-
eration
Co-Chairman
(1)
Nandan M. Nilekani
0.09 0.02 0.23 0.34
Managing Director
0.32 0.08 0.61 1.01
Chief Operating Officer
and Director
S. D. Shibulal 0.34 0.08 0.66 1.08
0.31 0.08 0.56 0.95
K. Dinesh 0.34 0.08 0.68 1.10
0.32 0.08 0.61 1.01
T. V. Mohandas Pai 0.43 0.10 2.56 3.09
0.36 0.08 2.69 3.13
Srinath Batni 0.43 0.10 1.76 2.29
0.36 0.07 1.98 2.41
(1)
Effective July 9, 2009, Nandan M. Nilekani relinquished the positions of
Co-Chairman and Member of the Board.
in rcrore
tions to
provident
and other
funds
Perqui-
sites and
incentives
Total
Remun-
eration
Executive Council members
V. Balakrishnan 0.38 0.08 2.15 2.61
0.30 0.08 2.06 2.44
2.09 2.79 4.88
0.28 0.06 1.73 2.07
B. G. Srinivas 1.94 2.99 4.93
1.81 2.75 4.56
Subhash B. Dhar 0.30 0.08 1.69 2.07
0.24 0.07 1.42 1.73
Particulars of remuneration and other benefits of non-executive
/ independent directors for the year ended March 31, 2011 and
March 31, 2010 :
Name Commi-
ssion
Sitting
fees
Reimbu-
rsement of
expenses
Total
Remune-
ration
Independent directors
Deepak M. Satwalekar 0.59 0.01 0.60
0.60 0.60
Prof. Marti G.
Subrahmanyam 0.79 0.23 1.02
0.65 0.20 0.85
0.52 0.03 0.55
Claude Smadja
(1)
0.23 0.09 0.32
0.59 0.25 0.84
Rama Bijapurkar
(2)
0.04 0.04 0.08
0.49 0.02 0.51
0.74 0.21 0.95
0.59 0.15 0.74
0.61 0.24 0.85
K. V. Kamath 0.56 0.01 0.57
0.39 0.02 0.41
R. Seshasayee
(3)
0.10 0.10 0.20

0.57 0.57
(1)
Retired from the Board effective August 30, 2010
(2)
Resigned from the Board effective April 13, 2010
(3)
Joined the Board effective January 13, 2011
Corporate governance report | 63
Corporate governance report
Corporate governance ratings
CRISIL
CRISIL has been consistently assigning us the CRISIL GVC
Level 1 rating for several years now. This Governance and Value
Creation (GVC) rating indicates our capability to create wealth for all
our stakeholders while adopting sound corporate governance practices.
ICRA
ICRA assigned CGR 1 rating to our corporate governance practices.
The rating is the highest on ICRAs Corporate Governance Rating (CGR)
scale of CGR 1 to CGR 6. We are the first Company in India to be
assigned the highest CGR by ICRA. The rating reflects our transparent
shareholding pattern, sound Board practices, interactive decision-
making process, high level of transparency, disclosures encompassing
all important aspects of our operations and our excellent track record
in investor servicing. A notable feature of our corporate governance
practices is the emphasis on transparency and substance over form.
Corporate governance guidelines
Over the years, the Board has developed corporate governance
guidelines to help fulfill, our corporate responsibility towards our
stakeholders. These guidelines ensure that the Board will have the
necessary authority and processes in place to review and evaluate our
operations when required. Further, these guidelines allow the Board
to make decisions that are independent of the Management. The Board
may change these guidelines from time to time to effectively achieve
our stated objectives.
A. Board composition
Size and composition of the Board
The current policy is to have an appropriate mix of executive and
independent directors to maintain the independence of the Board, and
to separate its functions of governance and management. Currently,
the Board consists of 14 members, five of whom are executive or
whole-time directors, one is non-executive and eight are independent
directors.
Three of the executive directors are our founders. The Board believes
that the current size is appropriate, based on our present circumstances.
The Board periodically evaluates the need for change in its composition
and size.
Board of Directors is central to good corporate governance. Not only do directors help ensure regulatory compliance, but they shape corporate strategy and
help chart its execution.
Troy A. Paredes,
Commissioner, U.S. Securities and Exchange Commission
At the Transatlantic Corporate Governance Dialogue, Brussels, Belgium,
October 25, 2010
Companys philosophy
Corporate governance at Infosys is a value-based framework to manage
our Company affairs in a fair and transparent manner. As a responsible
corporation, we use this framework to maintain accountability in all
our affairs, and employ democratic and open processes. We have
evolved guidelines and best practices over the years to ensure timely
and accurate disclosure of information regarding our financials,
performance, leadership and governance of the Company.
Our corporate governance philosophy is based on the following
principles :
Satisfy the spirit of the law and not just the letter of the law.
Corporate governance standards should go beyond the law.
Be transparent and maintain a high degree of disclosure levels.
When in doubt, disclose.
Make a clear distinction between personal conveniences and
corporate resources
Communicate externally, in a truthful manner, about how the
Company is run internally
Comply with the laws in all the countries in which we operate
Have a simple and transparent corporate structure driven solely
by business needs
The Management is the trustee of the shareholders capital and not
the owner
The Board of Directors (the Board) is at the core of our corporate
governance practice and oversees how the Management serves and
protects the long-term interests of all our stakeholders. We believe
that an active, well-informed and independent Board is necessary to
ensure the highest standards of corporate governance.
The majority of our Board, eight out of 14, are independent members.
Further, we have audit, compensation, investor grievance, nominations
and risk management committees, which comprise independent
directors.
As part of our commitment to follow global best practices, we comply
with the Euroshareholders Corporate Governance Guidelines, 2000,
and the recommendations of the Conference Board Commission
on Public Trusts and Private Enterprises in the U.S. We also adhere
to the United Nations Global Compact policy. Further, a note on
our compliance with the corporate governance guidelines of six
countries (Australia, Canada, France, Germany, Japan and the United
Kingdom) in their national languages is available on our website,
www.infosys.com
64 | Corporate governance report
Composition of the Board, and directorships held as at March 31, 2011
Name of the director Age India listed
companies
(1)
All companies
around the world
(2)
Committee
membership
(3)
Chairperson of
committees
(3)
Founder and non-executive director
N. R. Narayana Murthy 64 6
Founders and whole-time directors
S. Gopalakrishnan 56 1
S. D. Shibulal 56 8 1
K. Dinesh 57 3
T. V. Mohandas Pai 52 5
Srinath Batni 56 4
Deepak M. Satwalekar 62 4 8 4 2
Prof. Marti G. Subrahmanyam 64 0 8 2
Dr. Omkar Goswami 54 6 12 8 4
Sridar A. Iyengar 63 3 13 6 3
David L. Boyles 62 2
Prof. Jeffrey S. Lehman 54 2
K. V. Kamath 63 3 5 1
R. Seshasayee 62 3 16 4
Notes : There are no inter-se relationships between our Board members.
(1)
Excluding directorship in Infosys Technologies Limited and its subsidiaries.
(2)
Directorships in companies around the world (listed, unlisted and private limited companies) including Infosys Technologies Limited and its subsidiaries.
(3)
As required by Clause 49 of the Listing Agreement, the disclosure includes memberships / chairpersonship of audit committee and investor grievance committee in Indian public
companies (listed and unlisted).
Responsibilities of the Chairman, CEO and the COO
Our current policy is to have a non-executive Chairman and Chief Mentor
N. R. Narayana Murthy; a Chief Executive Officer (CEO) and Managing
Director S. Gopalakrishnan; and a Chief Operating Officer (COO)
and Director S. D. Shibulal. The responsibility and authority of these
officials are as follows :
The Chairman and Chief Mentor is responsible for mentoring
our core management team in transforming us into a world-
class, next-generation organization that provides state-of-the-art,
technology-leveraged business solutions to corporations across the
world. He also interacts with global thought leaders to enhance
our leadership position. In addition, he continues to interact
with various institutions to highlight the benets of IT and help
these benets percolate to all sections of the society. As Chairman
of the Board, he is also responsible for all Board and corporate
governance matters.
The CEO and Managing Director is responsible for corporate
strategy, brand equity, planning, external contacts and other
management matters. He is also responsible for achieving the
annual business targets and acquisitions.
The COO is responsible for all customer service operations.
He is also responsible for innovation and research in technology
advancements, new initiatives and investments.
The CEO, COO, the other executive directors and senior
management personnel are responsible for achieving targets. They
make periodic presentations to the Board on their responsibilities
and performance.
Board definition of independent directors
According to Clause 49 of the Listing Agreement with Indian stock
exchanges, an independent director means a person who is not an
officer or employee of the Company or its subsidiaries or any other
individual having a material pecuniary relationship or transactions with
the Company which, in the opinion of our Board of Directors, would
interfere with the exercise of independent judgment in carrying out
the responsibilities of a director. We adopted a much stricter definition
of independence as required by the NASDAQ listing rules and the
Sarbanes-Oxley Act, U.S.
Prof. Marti G. Subrahmanyam is the Lead Independent Director.
He represents and acts as spokesperson for the independent directors
as a group, and is responsible for the following :
Presiding over all executive sessions of the Boards independent
directors
Working closely with the Chairman and the CEO to nalize the
information ow, meeting agendas and schedules
Liaising with the Chairman, CEO and the independent directors
on the Board
Taking the lead role, along with the Chairman, in the Board
evaluation process
Board membership criteria
The nominations committee works with the entire Board to determine
the appropriate characteristics, skills and experience required for the
Board as a whole as well as its individual members. Board members
are expected to possess the expertise, skills and experience required
to manage and guide a high-growth, high-tech IT services company,
deriving revenue primarily from G-7 countries. Expertise in strategy,
technology, finance, quality and human resources is essential. Generally,
the members are between 40 and 60 years of age, and are not related
to any executive directors or independent directors. They are not
expected to serve in any executive or independent position in any
company that is in direct competition with us. Board members are
expected to rigorously prepare for, attend and participate in all Board
and applicable committee meetings. Each member is expected to
ensure that their other current and planned future commitments do
not materially interfere with their responsibilities with us.
Selection of new directors
The Board is responsible for the selection of new directors. The Board
delegates the screening and selection process involved in selecting new
directors to the nominations committee, which consists exclusively
of independent directors. The nominations committee in turn makes
recommendations to the Board on the induction of any new directors.
Membership term
The Board constantly evaluates the contribution of the members
and periodically shares updates with the shareholders about
re-appointments as per statute. The current law in India mandates
the retirement of one third of the Board members (who are liable to
retire by rotation) every year, and qualifies the retiring members for
re-appointment. Executive directors are appointed by the shareholders
for the tenure of a maximum period of five years, but are eligible
for re-appointment upon completion of their term. Subject to the
applicable provisions of law, non-executive directors generally serve
for a period of nine years (three terms of three years each) or up to
the age of retirement, whichever is earlier.
Retirement policy
The age of retirement for all executive directors is 60 years.
The nominations committee may, at its discretion, determine their
continuation as members of the Board upon superannuation /
retirement.
The age of retirement for non-executive directors and independent
directors is 65 years.
The age of retirement for independent directors joining the Board on
or after October 15, 2010, shall be 70 years.
An independent Board chair is generally permitted to serve in the
capacity until the age of 70 years.
Succession planning
The nominations committee works with the Board to plan for orderly
succession of leadership within the Board and the company, and to
maintain contingency plans for succession in case of any exigencies.
Board compensation policy
The compensation committee determines and recommends to the
Board the compensation payable to the directors. All Board-level
compensation is approved by the shareholders and separately
disclosed in the financial statements. Remuneration of the executive
directors consists of a fixed component and a performance incentive.
The compensation committee makes a quarterly appraisal of
the performance of the executive directors based on a detailed
performance-related matrix. The annual compensation of the executive
directors is approved by the compensation committee, within the
parameters set by the shareholders at the shareholders meetings.
The compensation payable to the independent directors is limited to
a fixed amount per year as determined and approved by the Board,
the sum of which is within the limit of 1% of our net profits for the
year, calculated as per the provisions of the Companies Act, 1956.
The performance of independent directors is reviewed by the Board
on an annual basis.
Cash compensation paid to directors in fiscal 2011
in rcrore
Name of the director Fixed salary Bonus /
Incentives
Commission Total Notice
period (in
months)
Basic salary Perquisites /
Allowances
Retiral
benefits
Total fixed
salary
Founder and non-executive
director
N. R. Narayana Murthy 0.61 0.61 NA
Founders and whole-time directors
S. Gopalakrishnan 0.34 0.12 0.08 0.54 0.57 1.11 6
S. D. Shibulal 0.34 0.11 0.08 0.53 0.55 1.08 6
K. Dinesh 0.34 0.11 0.08 0.53 0.57 1.10 6
T. V. Mohandas Pai 0.43 0.14 0.10 0.67 2.42 3.09 6
Srinath Batni 0.43 0.14 0.10 0.67 1.62 2.29 6
Deepak M. Satwalekar 0.59 0.59 NA
Prof. Marti G. Subrahmanyam 0.79 0.79 NA
Dr. Omkar Goswami 0.51 0.51 NA
Rama Bijapurkar
(1)
0.04 0.04 NA
Claude Smadja
(2)
0.23 0.23 NA
Sridar A. Iyengar 0.69 0.69 NA
David L. Boyles 0.65 0.65 NA
Prof. Jeffrey S. Lehman 0.67 0.67 NA
K. V. Kamath 0.56 0.56 NA
R. Seshasayee
(3)
0.10 0.10 NA
Notes : None of the above directors are eligible for any severance pay and none of them hold any stock options as at March 31, 2011.

(1)
For the period April 1, 2010 to April 13, 2010

(2)
For the period April 1, 2010 to August 30, 2010

(3)
For the period January 13, 2011 to March 31, 2011
Shares and options held by non-executive / independent
directors as at March 31, 2011
Equity
shares
(no.)
ADS (no.)
N. R. Narayana Murthy 23,79,672
Deepak M. Satwalekar 56,000
Prof. Marti G. Subrahmanyam 17,500
Dr. Omkar Goswami 12,300
Sridar A. Iyengar
David L. Boyles 2,000
K. V. Kamath
R. Seshasayee
Non-executive / independent directors remuneration
Section 309 of the Companies Act, 1956, states that a director, who
is neither in the whole-time employment of the Company nor a
managing director, may be paid remuneration by way of commission,
if the Company, by special resolution, authorizes such payment.
Members of the Company at the Annual General Meeting held on
June 22, 2007, approved payment of remuneration by way of
commission to non-executive directors, at a sum not exceeding 1% per
annum of our net profits. We have paid R5.44 crore (US$ 1,218,250)
as commission to our non-executive directors. The aggregate amount
was arrived at as per the following criteria :
in Rcrore US$
Fixed Board fee 0.33 75,000
Variable fee
(1)
0.11 25,000
Chairperson of the Board 0.22 50,000
Lead Independent Director 0.13 30,000
Chairperson audit committee 0.13 30,000
Members audit committee 0.09 20,000
Chairperson other committees 0.04 10,000
Members other committees 0.02 5,000
Notes : 1 US$ = r44.60

(1)
Variable fee is based on the attendance at the Board meeting(s).
Independent directors based overseas and traveling to India to attend
Board meetings will be eligible to receive an additional US$ 10,000
per meeting. This is based on the fact that these independent directors
have to spend at least two additional days in travel while attending
Board meetings in India.
The Board believes that the above commission structure is
commensurate with global best practices in terms of remunerating
non-executive / independent directors of a Company of similar size
and adequately compensates for the time and contribution made by
our non-executive / independent directors.
Memberships in other boards
Executive directors may, with the prior consent of the Chairperson
of the Board of Directors, serve on the boards of two other business
entities, provided that such business entities are not in direct
competition with our business operations. Executive directors are
also allowed to serve on the boards of corporate or government bodies
whose interests are germane to the future of the IT and software
business, or the key economic institutions of the nation, or whose
prime objective is benefiting society. Independent directors are not
expected to serve on the boards of competing companies. Other than
this, there are no limitations except those imposed by law and good
corporate governance practices. The outside directorships held by
each of our directors are listed in the Composition of the Board and
Directorships table in this section.
B. Board meetings
Scheduling and selection of agenda items for
Board meetings
Dates for Board meetings in the ensuing year are decided in advance
and published as part of the Annual Report. Most Board meetings
are held at our registered office at Electronics City, Bangalore, India.
The Chairperson of the Board and the Company Secretary draft the
agenda for each meeting, along with explanatory notes, in consultation
with the CEO and the Lead Independent Director, and distribute these
in advance to the directors. Every Board member can suggest additional
items for inclusion in the agenda. The Board meets at least once a quarter
to review the quarterly results and other items on the agenda, and also
on the occasion of the Annual General Meeting of the shareholders.
Additional meetings are held, when necessary. Independent directors
are expected to attend at least four Board meetings in a year. However,
the Board being represented by independent directors from various
parts of the world, it may not be possible for each one of them to be
physically present at all the meetings. We use video / teleconferencing
facilities to enable their participation. Committees of the Board
usually meet the day before the formal Board meeting, or whenever
the need arises for transacting business. Five Board meetings were
held during the year ended March 31, 2011. These were held on
April 13, 2010; June 12, 2010 (coinciding with last years Annual General
Meeting of the shareholders) ; July 13, 2010; October 15, 2010 and
January 13, 2011.
Attendance of directors during fiscal 2011
Name of the director No. of meetings
Held Attended
N. R. Narayana Murthy 5 5
Prof. Marti G. Subrahmanyam 5 5
Deepak M. Satwalekar 5 5
Dr. Omkar Goswami 5 5
Sridar A. Iyengar 5 5
David L. Boyles 5 5
K. V. Kamath 5 5
R. Seshasayee 1 1
K. Dinesh 5 5
S. D. Shibulal 5 5
T. V. Mohandas Pai 5 5
Srinath Batni 5 5
Note : All the above directors attended the Annual General Meeting held on
June 12, 2010, with the exception of R. Seshasayee, who was appointed as
director with effect from January 13, 2011.
Availability of information to Board members
The Board has unfettered and complete access to any information
within the Company, and to any of our employees. At Board meetings,
managers who can provide additional insights into the items being
discussed are invited.
Regular updates provided to the Board include :
Annual operating plans and budgets, capital budgets and updates
Quarterly results of our operating divisions or business segments
Minutes of meetings of audit, compensation, nominations,
risk management and investor grievance committees as well as
abstracts of circular resolutions passed
The Board minutes of the subsidiary companies
General notices of interest received from directors
Dividend data
Information on recruitment and remuneration of senior ofcers
just below the Board level, including appointment or removal of
the CFO and Company Secretary, if any.
Materially important litigations, show cause, demand, prosecution
and penalty notices
Fatal or serious accidents, dangerous occurrences, and issues
related to material efuent or pollution
Any materially relevant defaults in nancial obligations to and
by us
Any issue that involves possible public or product liability claims
of a substantial nature
Details of joint ventures, acquisitions of companies or
collaboration agreements
Transactions that involve substantial payments toward goodwill,
brand equity or intellectual property
Any signicant development involving human resources
management
Sale of material nature, of investments, subsidiaries and assets,
which are not in the normal course of business
Details of foreign exchange exposure and the steps taken by the
Management to limit risks of adverse exchange rate movement
Non-compliance of any regulatory, statutory or listing
requirements, as well as shareholder services such as non-
payment of dividend and delays in share transfer
Discussion with independent directors
The Boards policy is to regularly have separate meetings with
independent directors to update them on all business-related issues
and new initiatives. In such meetings, the executive directors and
other members of the senior management make presentations on
relevant issues.
In addition, our independent directors meet periodically in an
executive session that is without the Chairperson, or any of the
executive directors, or the Management.
Materially significant related party transactions
There have been no materially significant related party transactions,
monetary transactions or relationships between the Company and
directors, the Management, subsidiary or relatives, except for those
disclosed in the financial statements for the year ended March 31, 2011.
C. Board committees
Currently, the Board has five committees : audit committee,
compensation committee, nominations committee, investor grievance
committee and risk management committee. All committees consist
entirely of independent directors.
The Board, in consultation with the nominations committee, is
responsible for constituting, assigning, co-opting and fixing terms
of service for committee members. It delegates these powers to the
nominations committee.
The Chairperson of the Board, in consultation with the Company
Secretary and the committee chairperson, determines the frequency
and duration of the committee meetings. Normally, all the committees
meet four times a year. Recommendations of the committees are
submitted to the entire Board for approval.
The quorum for meetings is either two members or one-third of the
members of the committee, whichever is higher.
1. Audit committee
Our audit committee (the committee) comprises five independent
directors :
Deepak M. Satwalekar, Chairperson
Sridar A. Iyengar
K. V. Kamath
R. Seshasayee
In India, we are listed on the Bombay Stock Exchange (BSE) and
the National Stock Exchange (NSE). In the U.S., we are listed on the
NASDAQ Global Select. In India, Clause 49 of the Listing Agreement
makes it mandatory for listed companies to adopt an appropriate
audit committee charter. The Blue Ribbon Committee set up by
the U.S. Securities and Exchange Commission (SEC) recommends
that every listed Company adopt an audit committee charter. This
recommendation has also been adopted by NASDAQ.
In our meeting on May 27, 2000, our committee adopted a charter
which meets the requirements of Clause 49 of the Listing Agreement
with Indian stock exchanges and the SEC.
The primary objective of the committee is to monitor and provide
effective supervision of the Managements financial reporting process
to ensure accurate and timely disclosures, with the highest levels
of transparency, integrity and quality of financial reporting. The
committee oversees the work carried out in the financial reporting
process by the Management, the internal auditors and the independent
auditor, and notes the processes and the safeguards employed by
each. The committee has the ultimate authority and responsibility
to select, evaluate and, where appropriate, replace the independent
auditor in accordance with the law. All possible measures must be
taken by the committee to ensure the objectivity and independence
of the independent auditor.
Audit committee attendance during fiscal 2011
Four audit committee meetings were held during the year on
April 12, 2010; July 12, 2010; October 14, 2010 and January 12, 2011.
No. of meetings
Held Attended
K. V. Kamath
(1)
3 3
R. Seshasayee
(2)

(1)
Appointed with effect from April 13, 2010
(2)
Appointed with effect from January 13, 2011
During the year, the audit committee held two conference calls on
April 7, 2010 and October 8, 2010.
Audit committee report for the year ended March 31, 2011
Each member of the committee is an independent director, according
to the definition laid down in the audit committee charter, and Clause
49 of the Listing Agreement with the relevant Indian stock exchanges.
The Management is responsible for the Companys internal controls
and the financial reporting process. The independent auditors are
responsible for performing an independent audit of the Companys
financial statements in accordance with the generally accepted
auditing standards, and for issuing a report thereon. The committees
responsibility is to monitor these processes. The committee is also
responsible for overseeing the processes related to the financial
reporting and information dissemination. This is to ensure that the
financial statements are true, fair, sufficient and credible. In addition,
the committee recommends to the Board the appointment of the
Companys internal and independent auditors.
In this context, the committee discussed with the Companys auditors,
the overall scope and plans for the independent audit. The Management
represented to the committee that the Companys financial statements
were prepared in accordance with the Generally Accepted Accounting
Principles. The committee discussed with the auditors, in the absence
of the Management (whenever necessary), the Companys audited
financial statements including the auditors judgments about the
quality, not just the applicability, of the accounting principles, the
reasonableness of significant judgments and the clarity of disclosures
in the financial statements.
The committee also discussed with the auditors other matters required
by the Statement on Auditing Standards No. 114 (SAS 114) The
Auditors Communication With Those Charged With Governance
and the Sarbanes-Oxley Act of 2002.
Relying on the review and discussions conducted with the Management
and the independent auditors, the audit committee believes that the
Companys financial statements are fairly presented in conformity with
the Generally Accepted Accounting Principles in all material aspects.
The committee has also reviewed the internal controls put in place
to ensure that the accounts of the Company are properly maintained
and that the accounting transactions are in accordance with prevailing
laws and regulations. In conducting such reviews, the committee found
no material discrepancy or weakness in the internal control systems
of the Company.
The committee also reviewed the financial policies of the Company
and expressed its satisfaction with the same.
The Companys auditors provided to the committee the written
disclosures required by Independence Standards Board Standard
No. 1 Independence Discussions with Audit Committees based
on which the committee discussed the auditors independence with
both the Management and the auditors. After review, the committee
expressed its satisfaction on the independence of both the internal
and the statutory auditors.
Moreover, the committee considered whether any non-audit services
provided by the auditors firm could impair the auditors independence,
and concluded that there were no such services provided.
The committee secured compliance on the affirmation of the Board
of Directors to the NASDAQ stock exchange, under the relevant rules
of the exchange on composition of the committee and independence
of the committee members, disclosures relating to non-independent
members, financial literacy and financial expertise of members, and a
review of the audit charter.
Based on the committees discussion with the Management and the
auditors and the committees review of the representations of the
Management and the report of the auditors to the committee, the
committee has recommended the following to the Board of Directors :
1. The audited nancial statements prepared as per Indian GAAP
of Infosys Technologies Limited for the year ended March 31,
2011, be accepted by the Board as a true and fair statement of
the nancial status of the Company;
2. The audited abridged nancial statements prepared as per
Indian GAAP of Infosys Technologies Limited for the year
ended March 31, 2011, be accepted by the Board as a true and
fair statement of the nancial status of the Company;
3. The audited, consolidated nancial statements prepared
as per Indian GAAP of Infosys Technologies Limited and its
subsidiaries for the year ended March 31, 2011 be accepted by
the Board as a true and fair statement of the nancial status of
the group; and
4. The audited nancial statements prepared as per International
Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB) for the
year ended March 31, 2011, be accepted and included in the
Companys Annual Report on Form 20-F, to be led with the
U.S. Securities and Exchange Commission.
The committee has recommended to the Board the re-appointment
of B S R & Co., Chartered Accountants, as the statutory auditors of
the Company for the fiscal year ending March 31, 2012, and that
the necessary resolutions for appointing them as auditors be placed
before the shareholders. The committee has also recommended to the
Board the appointment of KPMG, India, as independent auditors of
the Company for the IFRS financial statements, for the financial year
ending March 31, 2012.
The committee recommended the appointment of Singhvi Dev and
Unni as the internal auditors of the Company for the fiscal ending
March 31, 2012, to review various operations of the Company, and
determined and approved the fees payable to them.
The committee has also issued a letter in line with recommendation
No. 9 of the Blue Ribbon Committee on audit committee effectiveness,
which is to be provided in the financial statements prepared in
accordance with IFRS section of the Annual Report on Form 20-F.
In conclusion, the committee is sufficiently satisfied that it has
complied with its responsibilities as outlined in the audit committee
charter.
Sd/-
Mumbai Deepak M. Satwalekar
May 6, 2011 Chairperson
2. Compensation committee
Our compensation committee (the committee) comprises four
independent directors. They are :
K. V. Kamath, Chairperson
David L. Boyles
Dr. Omkar Goswami
The purpose of the committee of the Board of Directors (the Board)
shall be to discharge the Boards responsibilities related to compensation
of the Companys executive directors and senior management. The
committee has the overall responsibility of approving and evaluating
the compensation plans, policies and programs for executive directors
and senior management.
The committee shall annually review and approve for the CEO,
the executive directors and senior management (a) the annual base
salary; (b) the annual incentive bonus, including the specific goals
and amount; (c) equity compensation; (d) employment agreements,
severance arrangements, and change in control agreements / provisions,
and (e) any other benefits, compensation or arrangements.
The committee, in consultation with the CEO, shall review the
performance of all the executive directors each quarter, on the basis
of the detailed performance parameters set for each of the executive
directors at the beginning of the year. The compensation committee
may, from time-to-time, also evaluate the usefulness of such
performance parameters, and make necessary amendments.
Compensation committee attendance during fiscal 2011
Five compensation committee meetings were held during the
year ended March 31, 2011. These were held on April 12, 2010;
June 12, 2010; July 12, 2010; October 15, 2010 and January 13, 2011.
No. of meetings
Held Attended
K. V. Kamath
(1)
4 4
David L. Boyles 5 5
Dr. Omkar Goswami
(1)
4 4
(1)
During the year, the compensation committee held three
conference calls on August 26, 2010; November 26, 2010 and
February 16, 2011.
Compensation committee report for the year ended
March 31, 2011
During the year, the committee reviewed the performance of all
whole-time directors on each quarter based on a detailed performance
parameters set for each of the whole-time directors and approved the
payment of individual performance incentives to each one of them.
The committee also from time to time evaluated the usefulness of such
performance parameters and has suggested necessary changes to the
to the same. The committee further reviewed the performance of the
Members of the Executive Council on a half yearly basis and approved
the payment of variable compensation.
The committee believes that the compensation and benefits are
adequate to motivate and retain the senior officers of the Company.
The Nominations committee, on April 30, 2011 recommended the
appointment of K. V. Kamath as the Non-Executive Chairman of the
Board of Directors with effect from August 21, 2011. In this connection,
the Committee discussed and recommended to the Board that, while
serving in this role, K. V. Kamath, as the Non-Executive Chairman of
the Board be entitled to a special fee of US$ 150,000 (over and above
the regular Board fee) per year for Chairmanship of the Board. In
arriving at this conclusion, the Committee took note of the fact that
K. V. Kamath would devote as much as 30 days per year to Infosys,
over and above the time that other independent directors ordinarily
devote to Infosys.
K. V. Kamath being interested in the proceedings recused himself from
the discussions on the matter.
Apart from the said disclosures, none of the directors had a material
beneficial interest in any contract of significance to which the Company
or any of its subsidiaries were a party, during the financial year.
Sd/-
Bangalore Dr. Omkar Goswami
April 30, 2011 Member, Compensation Committee
3. Nominations committee
Our nominations committee (the committee) comprises three
independent directors :
Prof. Jeffrey S. Lehman, Chairperson
K. V. Kamath
The purpose of the committee (the committee) of the Board of
Directors (the Board) is to oversee the Companys nomination
process for the top level management and specifically to identify,
screen and review individuals qualified to serve as executive directors,
non-executive directors and independent directors consistent with
criteria approved by the Board and to recommend, for approval by the
Board, nominees for election at the annual meeting of shareholders.
The committee also makes recommendations to the Board on
candidates for :
1. Nomination for election or re-election by the shareholders; and
2. Any Board vacancies that are to be lled by the Board.
The committee may act on its own in identifying potential candidates,
inside or outside the Company, or may act upon proposals submitted by
the Chairperson of the Board of Directors. The committee will review
and discuss all documents pertaining to candidates and will conduct
evaluation of candidates in accordance with a process that it sees fit
and appropriate, passing on the recommendations for nomination
to the Board.
The committee also coordinates and oversees the annual
self-evaluation of the Boards performance and of individual directors
in the governance of the Company.
Nominations committee attendance during fiscal 2011
The committee held four meetings during the year on April 12, 2010;
July 13, 2010; October 14, 2010 and January 12, 2011.
No. of meetings
Held Attended
K. V. Kamath
(1)
3 3
(1)
Nominations committee report for the year ended
March 31, 2011
The nominations committee (the committee) of the Board of Directors
(the Board) is responsible for overseeing the Companys nomination
process for the top level management positions and to identify, screen
and recommend to the Board individuals qualified to serve as executive
directors, non-executive directors and independent directors consistent
with the criteria approved by the Board.
Leadership succession at Infosys upon the retirement of N. R. Narayana
Murthy, the Chairman of the Board and the Chief Mentor, is a subject
the nominations committee has been busy with for a substantial
period of time. This process involved several close consultations with
individual Board members.
The nominations committee believes that sound succession planning
of senior leadership is the most important ingredient for creating a
robust future for the Company. Therefore, the Committee adopted a
rigorous process to ensure that the Board selects the right candidates
for senior leadership positions.
The committee circulated documents reviewing the skills and
experiences that should be represented within the Board, as well as
(in particular) the key responsibilities of the Chairman. The committee
revised these documents in response to feedback from other Board
members.
The committee solicited nominations from Board members of potential
candidates for Board membership and leadership positions. Members
of the committee had individual and group conversations with
individual Board members and groups of Board members concerning
the suitability of different potential candidates.
The upcoming retirement of N. R. Narayana Murthy defines a unique
transition in the history of the Company. After careful deliberation
internally and with each of the other Board members, the committee
unanimously concluded that it was important to use this moment for a
full transition at the senior leadership level, rather than for a transition
only in the position of Chairman, with an anticipated transition at the
CEO level ten months later.
The committee also decided that it was important to continue to
incorporate new global perspectives on governance best practices,
while at the same time ensuring that the leadership structure also
satisfied the specific needs of the Company.
Accordingly, the Committee was of the unanimous opinion that at this
moment in the Companys history, it is best to have a Non-Executive
Chairman of the Board who will bring an independent perspective to
that role, an Executive Co-Chairman for stronger connect with clients,
investors and employees, and a Chief Executive Officer and Managing
Director with primary responsibility for designing and implementing
the strategy of the Company. Specifically, the committee forwarded
the following recommendations to the Board for its consideration.
1. K. V. Kamath be appointed as the Chairman of the Board.
2. S. Gopalakrishnan be appointed as the Whole-time Director and
to be designated as the Executive Co-Chairman of the Board.
3. S. D. Shibulal be appointed as the Chief Executive Ofcer and
Managing Director.
K. V. Kamath being interested in the proceedings recused himself from
the discussions on his appointment as the Chairman of the Board.
The committee recommended that the Board appoint N. R. Narayana
Murthy as the Chairman Emeritus, effective August 21, 2011. This
is in recognition of his founding the Company, mentoring his senior
management and nurturing the organization over the last thirty years.
During the year, the committee recommended the induction of
R. Seshasayee and Ravi Venkatesan as Independent Directors on the
Board. The Committee was impressed with R. Seshasayees extensive
experience in managing the operations of a large corporation during
tough times and his ability to tackle and manage challenges, and
with Ravi Venkatesans extensive experience in stewarding successful
transformational changes within established, respected multinational
companies, coupled with his knowledge of the Indian and global
software services industry.
Also, during the year, the committee discussed the retirement of
Members of the Board as per statutory requirements. As a third of the
members have to retire every year based on their date of appointment,
K. Dinesh, Srinath Batni, Sridar A. Iyengar, Deepak M. Satwalekar and
Dr. Omkar Goswami, will retire in the ensuing AGM. The committee
considered their performance and recommended that the shareholders
consider the necessary resolutions for the re-appointment of these
members, except for K. Dinesh, who expressed his intention not to
seek re-appointment, due to personal reasons.
During the year, the committee also coordinated and oversaw the
annual performance self-evaluation of the Board and of individual
directors in the governance of the Company.
Sd/-
Bangalore Prof. Jeffrey S. Lehman
April 30, 2011 Chairperson
4. Investor grievance committee
Our investor grievance committee (the committee) comprises four
independent directors :
Dr. Omkar Goswami, Chairperson
R. Seshasayee
K. Parvatheesam, Company Secretary, is the Compliance Officer.
Investor grievance committee attendance during
fiscal 2011
The committee has the mandate to review and redress shareholder
grievances. Four investor grievance committee meetings were held
during the year on April 13, 2010; July 13, 2010; October 15, 2010
and January 13, 2011.
No. of meetings
Held Attended
R. Seshasayee
(1)
1 1
(1)
Appointed with effect from January 13, 2011
Investor grievance committee report for the year ended
March 31, 2011
The committee expresses satisfaction with the Companys performance
in dealing with investor grievances and its share transfer system.
The details of complaints resolved during the financial year ended
Nature of complaints Received Resolved Closing
Dividend related 706 706
It has also been noted that the shareholding in dematerialized mode
as on March 31, 2011 was 99.72%, the same as in the previous year.
Sd/-
Bangalore Dr. Omkar Goswami
5. Risk management committee
Our risk management committee (the committee) is comprised of
four independent directors :
David L. Boyles, Chairperson
Sridar A. Iyengar
Dr. Omkar Goswami
The purpose of the committee of the Board of Directors (the Board)
shall be to assist the Board in fulfilling its corporate governance ideals
in overseeing the responsibilities with regard to the identification,
evaluation and mitigation of operational, strategic and external
environment risks. The committee has the overall responsibility of
monitoring and approving the risk policies and associated practices
of the Company. The committee is also responsible for reviewing
and approving risk disclosure statements in any public documents
or disclosures.
Risk management committee attendance during
fiscal 2011
The committee held five meetings during the year on April 13, 2010;
July 12, 2010; July 13, 2010; October 14, 2010 and January 12, 2011.
No. of meetings
Held Attended
David L. Boyles 5 5
The committee also held three conference calls on April 1, 2010;
October 11, 2010 and on January 8, 2011.
Risk management committee report for the year ended
March 31, 2011
The committee reviewed the Companys risk management practices on
a quarterly basis. This included review of business risk environment,
top risks in terms of exposure, risk levels and their trend line, potential
impact and progress of mitigation plans. Further, as per a scheduled
annual calendar, the committee reviewed risk management practices
in the areas of service delivery, talent management, competitive
positioning, information security, client account level risks, contracts
management and financial risks. In addition, individual committee
members performed reviews in specific areas. The committee
also reviewed the results of the annual risk survey and findings of
benchmarking evaluation of the Companys ERM program. The
committee has also received and considered an assessment of its
activities by the Board.
While acknowledging the dynamic nature of the business environment,
the committee believes that the Infosys Risk Framework along with
risk assessment, monitoring, mitigation and reporting practices are
adequate to minimize the impacts of foreseeable material risks facing
the Company and will strengthen the risk management practices in
the Company. In conclusion, the committee is sufficiently satisfied
that it has complied with its responsibilities as outlined in the risk
management committee charter.
Sd/-
Bangalore David L. Boyles
D. Management review and responsibility
Formal evaluation of officers
The compensation committee of the Board approves the compensation
and benefits for all Executive Board Members as well as members of the
Executive Council. Another committee, headed by the CEO, reviews,
evaluates and decides the annual compensation of our officers from the
level of Vice President, excluding members of the Executive Council.
Investor grievances and share transfer
We have a Board-level investor grievance committee to examine
and redress shareholders and investors complaints. The status on
complaints and share transfers is reported to the entire Board. The
details of shares transferred and the nature of complaints are provided
in the Shareholder information section of the Annual Report. For shares
transferred in physical form, the Company provides adequate notice
to the seller before registering the transfer of shares. The share transfer
committee of the Company will meet as often as required to approve
share transfers. For matters regarding shares transferred in physical
form, share certificates, dividends and change of address, shareholders
should communicate with Karvy Computershare Private Limited,
our registrar and share transfer agent. Their address is given in the
Shareholder information section of the Annual Report.
Share transactions in electronic form can be effected in a much simpler
and faster manner. After confirmation of sale / purchase transaction
from the broker, shareholders should approach the depository
participant with a request to debit or credit the account for the
transaction. The depository participant will immediately arrange to
complete the transaction by updating the account. There is no need for
separate communication to the Company to register the share transfer.
Details of non-compliance
There has been no instance of non-compliance with any legal
requirements nor have there been any strictures imposed by any stock
exchange, SEBI or SEC, on any matters relating to the capital market
over the last three years.
Postal ballots
For the year ended March 31, 2011, there are no ordinary or special
resolutions that need to be passed by our shareholders through a
postal ballot.
Auditors certificate on corporate governance
As required by Clause 49 of the Listing Agreement, the auditors
certificate is given in the Annexure to the directors report section in the
Annual Report.
CEO and CFO certification
As required by Clause 49 of the Listing Agreement, the CEO / CFO
certification is provided in the CEO and CFO certification section of
the Annual Report.
Code of Conduct
In compliance with Clause 49 of the Listing Agreement, the Company
has adopted a Code of Conduct. This code is applicable to the Members
of the Board, the Executive Council and all employees of the Company
and Subsidiaries. The Code of Conduct is available on our website,
www.infosys.com.
All the members of the Board and the Executive Council and senior
financial officers have affirmed compliance to the Code of Conduct,
as at March 31, 2011. A declaration to this effect, signed by the CEO,
the Managing Director and the CFO, is provided in the CEO and CFO
certification section of the Annual Report.
Board interaction with clients, employees, institutional
investors, the government and the press
The Chairman, the CEO and the COO, in consultation with the
CFO, handle all interactions with investors, the media and various
governments. The CEO and the COO manage most of the interactions
with clients and employees.
Risk management
We have an integrated approach to managing risks inherent in
various aspects of our business. More details are provided in the Risk
management report section of the Annual Report.
Managements discussion and analysis
A detailed report on the Managements discussion and analysis is
provided in the Managements discussion and analysis section of the
Annual Report.
E. Shareholders
Disclosures regarding the appointment or re-appointment
of directors
According to the Articles of Association, one-third of the directors
retire by rotation and, if eligible, seek re-appointment at the
Annual General Meeting of shareholders. As per Article 122 of the
Articles of Association, K. Dinesh, Srinath Batni, Sridar A. Iyengar,
Deepak M. Satwalekar and Dr. Omkar Goswami will retire in the
ensuing Annual General Meeting. The Board has recommended the
re-appointment of all the retiring directors, except K. Dinesh who
expressed his intention not to seek re-appointment due to personal
reasons. The Board also decided to appoint S. Gopalakrishnan as the
Whole-time Director (to be designated as the Executive Co-Chairman
of the Board) and S. D. Shibulal as the Chief Executive Office and
Managing Director. These appointments are effective from August 21,
2011. The detailed profiles of all these directors are provided in the
Notice convening the Annual General Meeting.
Communication to the shareholders
We send quarterly reports to each shareholder via email. The report
contains select financial data extracted from the audited financial
statements under Indian GAAP and unaudited financial statements
under IFRS. The quarterly report along with additional information
is also posted on our website. Moreover, the quarterly / annual results
and official news releases are generally published in The Economic Times,
The Times of India, Business Standard, Business Line, Financial Express and
Udayavani (a regional daily published from Bangalore). Quarterly and
annual financial statements, along with segmental information, are also
posted on our website. Earnings calls with analysts and investors are
broadcast live on the website and their transcripts are published on the
website soon thereafter. Any specific presentations made to analysts and
others are also posted on our website. The proceedings of the Annual
General Meeting are webcast live for shareholders across the world.
The video archives are also available on our website, www.infosys.com
General body meetings
The details of the last three Annual General Meetings are as follows :
Financial year ended Date and Time Venue Special resolution passed
March 31, 2008 June 14, 2008 at 3 p.m. IST NIMHANS Convention Center,
Hosur Road, Bangalore, India
None
March 31, 2009 June 20, 2009 at 3 p.m. IST Christ University Auditorium,
None
March 31, 2010 June 12, 2010 at 3 p.m. IST Christ University Auditorium,
None
Compliance with non-mandatory requirements of Clause
49 of the Listing Agreement
Clause 49 of the Listing Agreement mandates us to obtain a certificate
from either the auditors or practicing Company Secretaries regarding
compliance of conditions of corporate governance as stipulated in the
Clause, and annex the certificate with the Directors report, which is
sent annually to all our shareholders. We have obtained a certificate to
this effect and the same is given as an Annexure to the directors report.
The Clause further states that the non-mandatory requirements may
be implemented as per our discretion. However, the disclosures
of compliance with mandatory requirements and adoption (and
compliance) / non-adoption of the non-mandatory requirements shall
be made in this section of the Annual Report.
We comply with the following non-mandatory requirements :
The Board
Independent directors may have a tenure not exceeding, in the
aggregate, a period of nine years on our Board.
None of the independent directors on our Board have served for a
tenure exceeding nine years from the date when the new Clause 49
became effective.
Remuneration committee
We have instituted a compensation committee. A detailed note on
compensation / remuneration committee is provided under the
Compensation committee in this section.
Shareholders rights
The Clause states that a half-yearly declaration of financial performance,
including summary of the significant events in the last six months,
may be sent to each shareholder.
We communicate with investors regularly through e-mail, telephone
and face-to-face meetings either in investor conferences, Company
visits or on road shows.
We also leverage the internet in communicating with our investor base.
We announce quarterly financial results within two weeks of the close
of a quarter. After the announcement of the quarterly financial results,
a business television channel in India telecasts a live discussion with
our Management. This enables a large number of retail shareholders
in India to understand our operations better. The announcement of
quarterly results is followed by media briefings in several television
channels, press conferences and earnings conference calls. The earnings
calls are webcast live on the internet so that information is available
to all at the same time. Further, transcripts of the earnings calls are
posted on our website, www.infosys.com, within a week. Highlights
of the results are also made available to mobile phone users in India
through SMS and WAP.
Training of Board members
All new non-executive directors inducted into the Board are given an
orientation. Presentations are made by various executive directors and
senior management giving an overview of our operations to familiarize
the new non-executive directors with the operations. The new
non-executive directors are given orientation on our services, group
structure and subsidiaries, our constitution, Board procedures and
matters reserved for the Board, our major risks and risk management
strategy.
The Boards policy is to have separate meetings regularly with
other members of the senior management share point of views and
leadership thoughts on relevant issues.
We also facilitate the continual education requirements of our directors.
Each director is entitled for a training fee of US$ 5,000 per annum.
Independent directors are allowed to attend educational programs in
the areas of board / corporate governance.
Mechanism for evaluating non-executive Board members
The Board evaluates the performance of non-executive / independent
directors through a peer-evaluation process every year. Each Board
member makes a presentation to the Board highlighting their
contributions and thought leadership initiatives pursued during the
year. A scale of 1 to 3 is used by every Board member during the
evaluation of each of the external Board members.
Independent directors have three key roles, namely, governance,
control and guidance. Some of the performance indicators based on
which the independent directors are evaluated include:
Ability to contribute to and monitor our corporate governance
practices.
Ability to contribute by introducing international best practices to
address top-management issues.
Active participation in long-term strategic planning.
Commitment to the fulllment of a directors obligations and
duciary responsibilities. This includes participation at the Board
and Committee Meetings.
Whistleblower policy
We have established a mechanism for employees to report concerns
about unethical behavior, actual or suspected fraud, or violation of our
code of conduct or ethics policy. It also provides for adequate safeguards
against victimization of employees who avail of the mechanism, and
also allows direct access to the Chairperson of the audit committee in
exceptional cases. We further affirm that no employee has been denied
access to the audit committee.
F. Compliance with the corporate governance
codes
Corporate Governance Voluntary Guidelines 2009
The Ministry of Corporate Affairs, Government of India, published the
Corporate Governance Voluntary Guidelines in 2009. These guidelines
have been published keeping in view the objective of encouraging the
use of better practices through voluntary adoption, which not only
serve as a benchmark for the corporate sector but also help them
in achieving the highest standard of corporate governance. These
guidelines provide corporate India a framework to govern themselves
voluntarily as per the highest standards of ethical and responsible
conduct of business. The Ministry hopes that adoption of these
guidelines will also translate into a much higher level of stakeholders
confidence which is crucial in ensuring the long-term sustainability
and value generation by businesses. The guidelines broadly focus
on areas such as Board of Directors, responsibilities of the Board,
audit committee functions, roles and responsibilities, appointment of
auditors, compliance with secretarial standards and a mechanism for
whistleblower support. We substantially comply with the Corporate
Governance Voluntary Guidelines.
Revised Clause 49 of the Listing Agreement
SEBI, with a view to improving corporate governance standards
in India and to enhance the transparency and integrity of the
market, constituted a committee on corporate governance under the
chairmanship of N. R. Narayana Murthy. The committee issued two
sets of recommendations : the mandatory recommendations and the
non-mandatory recommendations.
SEBI has incorporated the recommendations made by the
Narayana Murthy Committee on Corporate Governance in Clause 49.
A revised Clause 49 was made effective from January 1, 2006. We fully
comply with the revised Clause 49 of the Listing Agreement.
Naresh Chandra Committee
Following instances of irregularities involving auditors in the U.S.
and in India, the Government of India, by an order dated August 21,
2002, constituted a high-level committee under the chairmanship
of Naresh Chandra to examine the auditor-company relationship
and to regulate the role of auditors. Chapters 2, 3 and 4 of the
Naresh Chandra Committee report are relevant to us. We comply with
these recommendations.
Kumar Mangalam Birla Committee
SEBI appointed a committee on corporate governance on May 7, 1999,
under the chairmanship of Kumar Mangalam Birla, to promote and
raise the standards of corporate governance. The SEBI Board adopted
the recommendations of the committee on January 25, 2000. We
comply with these recommendations.
Euroshareholders Corporate Governance Guidelines, 2000
Euroshareholders is the confederation of European shareholders
associations, constituted to represent the interests of individual
shareholders in the European Union. The guidelines are based on the
general principles of corporate governance issued by the Organization
for Economic Co-operation and Development (OECD) in 1999, but
are more specific and detailed. Subject to the statutory regulations in
force in India, we comply with these recommendations.
Compliance with findings and recommendation of the
Conference Board Commission on Public Trust and Private
Enterprises in the U.S.
The Conference Board Commission on Public Trust and Private
Enterprises was convened to address the circumstances which led
to corporate irregularities and the subsequent decline of confidence
in the American capital markets. The commission addressed three
key areas executive compensation, corporate governance, and
audit and accounting issues, and issued its first set of findings
and recommendations. We substantially comply with these
recommendations.
OECD Principles of Corporate Governance
The governments of the 30 countries in the OECD have recently
approved a revised version of the OECDs Principles of Corporate
Governance, adding new recommendations for good practice in
corporate behavior with a view to rebuilding and maintaining
public trust in companies and stock markets. We comply with these
recommendations.
A detailed compliance report, with the recommendations of various
committees listed in this section, is available on our website
www.infosys.com.
United Nations Global Compact
Announced by the United Nations Secretary-General, Kofi Annan, at
the World Economic Forum in Davos, Switzerland, in January 1999,
and formally launched at the UN Headquarters in July 2000, the
Global Compact calls on companies to embrace ten principles in the
areas of human rights, labor standards and environment. The Global
Compact is a value-based platform designed to promote institutional
learning. It utilizes the power of transparency and dialog to identify
and disseminate good practices based on universal principles.
The ten principles are drawn from the Universal Declaration of
Human Rights, the International Labor Organizations Fundamental
Principles on Rights at Work, and the Rio Principles on Environment
and Development.
The Global Compact recommends that companies embrace, support
and enact, within their sphere of influence, a set of core values in
the areas of human rights, labour standards, the environment and
anti-corruption.
According to these principles, businesses should :
Support and respect the protection of internationally proclaimed
human rights
Ensure that they are not complicit in human rights abuses
Uphold the freedom of association and the effective recognition
of the right to collective bargaining
Support the elimination of all forms of forced and compulsory
labor
Support the effective abolition of child labor
Eliminate discrimination with respect to employment and
occupation
Support a precautionary approach to environmental challenges
Undertake initiatives to promote greater environmental
responsibility
Encourage the development and diffusion of environment-
friendly technologies
Work against corruption in all its forms, including extortion and
bribery
On August 27, 2001, we adopted the United Nations Global Compact
policy and became a partner with the United Nations in this initiative.
A strong sense of social responsibility is an integral part of our value
system. We adhere to the principles of the United Nations Global
Compact.
Source : www.unglobalcompact.org
74 | Shareholder information
Shareholder information
The Company is sending periodic communication to the concerned
shareholders, advising them to lodge their claims with respect to
unclaimed dividend. Shareholders are cautioned that once unclaimed
dividend is transferred to IEPF, no claim shall lie in respect thereof
with the Company.
Dividend remitted to IEPF during the last three years
Fiscal Amount (R)
2011 4,48,296
2010 6,60,204
2009 6,49,767
Investor services
Tentative calendar
Quarter ending Earnings release Quiet period
Jun 30, 2011 Jul 12, 2011 Jun 16 to Jul 14, 2011
Sep 30, 2011 Oct 12, 2011 Sep 16 to Oct 14, 2011
Dec 31, 2011 Jan 12, 2012 Dec 16, 2011 to Jan 14, 2012
Mar 31, 2012 Apr 13, 2012 Mar 16 to Apr 15, 2012
Annual General Meeting
Date and time June 11, 2011, Saturday, 3 p.m. IST
Venue The Christ University Auditorium,
Hosur Road, Bangalore 560 029
Book closure dates May 28, 2011 to June 11, 2011
Dividend payment date June 13, 2011
Investor awareness
Maintaining the highest standards of corporate governance is not a
matter of mere form, but of substance. In continuation of our efforts in
that direction, we have provided a synopsis of some of your rights and
responsibilities as a shareholder on our website, www.infosys.com. We
encourage you to visit our website and read the document. We hope
that the document will give you appropriate guidance, though in brief,
on any questions regarding your rights as a shareholder.
Dematerialization of shares and liquidity
Infosys shares are tradable compulsorily in electronic form and,
through Karvy Computershare Private Limited, Registrars and
Share Transfer Agents, we have established connectivity with both
the depositories, that is, National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited (CDSL). The
International Securities Identification Number (ISIN) allotted to our
shares under the Depository System is INE009A01021.
As at March 31, 2011, 99.72% of our shares were held in dematerialized
form and the rest in physical form.
We were the first company in India to pay a one-time custodial fee of
R44.43 lakh to NSDL. Consequently, our shareholders do not have
to pay depository participants, the custodial fee charged by NSDL on
their holding.
Corporate
Infosys was incorporated in Pune, in 1981, as Infosys Consultants
Private Limited, a private limited company under the Indian
Companies Act, 1956. We changed our name to Infosys Technologies
Private Limited in April 1992 and to Infosys Technologies Limited
in June 1992, when we became a public limited company. We made
an initial public offering in February 1993 and were listed on stock
exchanges in India in June 1993. Trading opened at R145 per share,
compared to the IPO price of R95 per share. In October 1994, we
made a private placement of 5,50,000 shares at R450 each to Foreign
Institutional Investors (FIIs), Financial Institutions (FIs) and body
corporates.
In March 1999, we issued 20,70,000 American Depositary Shares
(ADSs) (equivalent to 10,35,000 equity shares of par value of
R10/- each) at US$ 34 per ADS under the ADS Program and the same
were listed on the NASDAQ National Market. All the above data is
unadjusted for issue of stock split and bonus shares. In July 2003,
June 2005 and November 2006, we successfully completed secondary
ADR issues of US$ 294 million, US$ 1.1 billion and US$ 1.6 billion
respectively.
The address of our registered office is Electronics City, Hosur Road,
Bangalore 560 100, Karnataka, India.
Bonus issues and stock split
Fiscal 1986 1989 1991 1992 1994 1997 1999 2005 2007
Bonus 1:1 1:1 1:1 1:1 1:1 1:1 1:1 3:1 1:1
Note : In addition of shares, the Company split the stock in the ratio of 2 for 1 in fiscal
2000.
Dividend policy
The dividend policy is to distribute up to 30% of the consolidated
Profit After Tax (PAT) of the Infosys group as dividend.
Unclaimed dividend
Section 205 of the Companies Act, 1956, mandates that companies
transfer dividend that has been unclaimed for a period of seven years
from the unpaid dividend account to the Investor Education and
Protection Fund (IEPF). In accordance with the following schedule,
the dividend for the years mentioned as follows, if unclaimed within
a period of seven years, will be transferred to IEPF.
Year Type of
dividend
Dividend
per share
(R)
Date of
declaration
Due date
for transfer
Amount
(R)
(1)
2004 Final
(2)
115.00 Jun 12, 04 Jul 11, 11 27,53,100
2005 Interim 5.00 Oct 12, 04 Nov 11, 11 5,95,535
Final 6.50 Jun 11, 05 Jul 10, 12 5,82,452
2006 Interim 6.50 Oct 11, 05 Nov 10, 12 4,88,384
Final
(3)
38.50 Jun 10, 06 Jul 9, 13 17,28,727
2007 Interim 5.00 Oct 11, 06 Nov 10, 13 6,46,835
Final 6.50 Jun 22, 07 Jul 21, 14 9,16,420
2008 Interim 6.00 Oct 11, 07 Nov 10, 14 10,91,136
Final
(4)
27.25 Jun 14, 08 Jul 13, 15 30,41,349
2009 Interim 10.00 Oct 11, 08 Nov 10, 15 21,47,850
Final 13.50 Jun 20, 09 Jul 25, 16 20,24,481
2010 Interim 10.00 Oct 09, 10 Nov 14, 16 18,95,420
Final 15.00 Jun 12, 10 Jul 17, 17 25,36,950
2011 Interim
(5)
40.00 Oct 15, 10 Nov 20, 17 54,44,880
(1)
Amount unclaimed as at March 31, 2011.
(2)
Includes one-time special dividend of r100/- per share.
(3)
Includes silver jubilee special dividend of r30/- per share.
(4)
Includes special dividend of r20/- per share.
(5)
Includes 30th year special dividend of r30/- per share.
Shareholder information | 75
Shares held in demat and physical mode as at March 31, 2011 are
as follows :
Category Number of % to total
equity shareholders shares
Demat mode
NSDL 3,31,093 56,68,67,476 98.73
CDSL 84,986 56,81,625 0.99
Total 416,079 57,25,49,101 99.72
Physical mode 544 16,02,458 0.28
Grand total 4,16,623 57,41,51,559 100.00
To enable us to serve our investors better, we request shareholders
whose shares are in physical mode to dematerialize shares and to
update their bank accounts with the respective depository participants.
Secretarial audit
As a measure of good corporate governance practice, the Board
of Directors of the Company appointed Parameshwar G. Hegde,
Practicing Company Secretary, to conduct Secretarial Audit of records
and documents of the Company. The Secretarial Audit Report confirms
that the Company has complied with all the applicable provisions of
the Companies Act, 1956, Depositories Act, 1996, Listing Agreements
with the Stock Exchanges, and all the Regulations and Guidelines of the
Securities and Exchange of India (SEBI) as applicable to the Company.
The audit also covers the reconciliation on a quarterly basis, the total
admitted capital with National Securities Depository Limited (NSDL)
and Central Depository Services (India) Limited (CDSL) and the total
issued and listed capital. The audit has confirmed that the total issued
/ paid up capital is in agreement with the aggregate total number of
shares in physical form and the total number of dematerialized shares
held with NSDL and CDSL. Further, the company voluntarily adheres
to the various Secretarial Standards issued by the Institute of Company
Secretaries of India.
Investor complaints
Received Attended
Nature of
complaints
2011 2010 2011 2010
Dividend / Bonus
related 706 629 706 629
We attended to most of the investors grievances / correspondences
within a period of ten days from the date of receipt of such grievances.
The exceptions have been for cases constrained by disputes or legal
impediments.
Designated e-mail address for investor services
In terms of Clause 47 (f) of the Listing Agreement, the designated e-mail
address for investor complaints is investors@infosys.com
Legal proceedings
There are certain pending cases related to disputes over title to shares
in which we had been made a party. However, these cases are not
material in nature.
Shareholders holding more than 1% of the shares
The details of shareholders (non-founders) holding more than 1% of
the equity as at March 31, 2011 are as follows :
Name of the shareholder No. of Shares %
Life Insurance Corporation of India
(1)
2,45,97,487 4.28
Oppenheimer Developing Markets Fund
(2)
1,25,56,971 2.19
Abu Dhabi Investment Authority
(2)
1,10,65,282 1.93
Franklin Templeton Investment Funds
(2)
99,87,588 1.74
ICICI Prudential Life Insurance Company
Limited
(3)
84,09,519 1.46
Vanguard Emerging Markets Stock Index
Fund
(2)
70,88,500 1.23
Government of Singapore
(2)
63,01,219 1.10
Aberdeen Asset Managers Limited
(2)
62,68,000 1.09
Bajaj Allianz Life Insurance Company
Limited
(3)
61,41,329 1.07
HDFC Trustee Company Limited
(3)
59,05,736 1.03
(1)
Financial institution
(2)
Foreign institutional investor
(3)
Body corporate
Distribution of shareholding as at March 31, 2011
Range of equity
shares held
No. of
share-
holders
% No. of shares %
1 14,561 3.50 14,561 0.00
2-10 1,92,179 46.13 12,85,207 0.22
11-50 1,37,501 33.00 36,49,192 0.64
51-100 31,252 7.50 24,74,459 0.43
101-200 15,387 3.70 23,48,626 0.40
201-500 9,991 2.40 33,09,698 0.58
501-1,000 5,846 1.40 43,36,039 0.76
1,001-5,000 6,267 1.50 1,47,43,304 2.57
5,001-10,000 1,434 0.34 1,01,97,201 1.78
10,001 and above 2,204 0.53 43,07,43,251 75.02
Total 4,16,622 100.00 47,31,01,538 82.40
Equity shares
underlining ADS 1 0.00 10,10,50,021 17.60
Total 4,16,623 100.00 57,41,51,559 100.00
Share transfers in physical form
Shares sent for physical transfer are effected after giving a 15-day
notice to the seller for confirmation of the sale. Our share transfer
committee meets as often as required. The total number of shares
transferred in physical form during the year was 424 as against 60
for the previous year.
Listing on stock exchanges
Codes India Global
NSE BSE NASDAQ
Exchange INFOSYSTCH 500209 INFY
Reuters INFY.NS INFY.BO INFY.O
Bloomberg NINFO IN INFO IN
The listing fees for fiscal 2012 have been paid for all the above stock
exchanges.
Stock market data relating to shares listed in India
Our market capitalization is included in the computation of the BSE-30
Sensitive Index (Sensex), the BSE Dollex, S&P CNX NIFTY Index and
NASDAQ-100 Index. The monthly high and low quotations, as well
as the volume of shares traded at the BSE, the NSE and NASDAQ for
the current year are provided in the following page.
Shareholding pattern
Category March 31, 2011 March 31, 2010
Shareholders
(no.)
Voting
strength (%)
Number of
shares held
Shareholders
(no.)
Voting
strength (%)
Number of
shares held
Founders holding
Indian founders 19 16.04 9,20,85,078 19 16.05 9,20,84,978
Total founders holding (A) 19 16.04 9,20,85,078 19 16.05 9,20,84,978
Public shareholding
Institutional investors
Mutual funds 332 4.60 2,63,83,936 266 4.02 2,30,90,168
Banks, financial institutions and
insurance companies 60 4.40 2,52,50,097 55 3.90 2,24,10,708
Foreign institutional investors 989 36.12 20,73,99,314 892 36.36 20,86,37,229
Others
Private corporate bodies 3,357 6.70 3,84,66,629 3,223 5.40 3,09,81,305
Indian public 4,05,131 13.18 7,56,70,639 3,70,644 14.33 8,22,20,794
NRIs / OCBs / Foreign nationals 6,696 0.86 49,37,208 6,571 0.81 46,58,086
Trusts 38 0.50 29,08,637 45 0.50 28,65,977
Total public shareholding (B) 4,16,603 66.36 38,10,16,460 3,81,696 65.32 37,48,64,267
Equity shares underlying ADS (C) 1 17.60 10,10,50,021 1 18.63 10,68,75,947
Total (A + B + C) 4,16,623 100.00 57,41,51,559 3,81,716 100.00 57,38,25,192
Stock market data Exchanges in India
BSE NSE Total volume
High (R) Low (R) Volume (No.) High (R) Low (R) Volume (No.) (BSE & NSE)
(No.)
2010
April 2,801.55 2,644.05 38,02,005 2,801.60 2,643.75 2,62,06,242 3,00,08,247
May 2,702.15 2,533.30 20,57,441 2,706.15 2,533.40 2,03,97,880 2,24,55,321
June 2,817.90 2,625.25 18,12,206 2,822.70 2,624.35 1,80,94,283 1,99,06,489
July 2,894.95 2,729.00 28,21,046 2,895.90 2,727.50 2,01,31,995 2,29,53,041
August 2,873.40 2,696.00 15,50,015 2,874.65 2,700.45 1,49,29,717 1,64,79,732
September 3,058.50 2,750.65 19,29,074 3,059.15 2,753.00 2,25,48,316 2,44,77,390
October 3,184.25 2,969.60 29,26,489 3,185.25 2,970.85 2,47,46,483 2,76,72,972
November 3,082.90 2,966.45 16,12,368 3,082.65 2,963.80 1,73,13,835 1,89,26,203
December 3,445.00 3,054.55 19,67,499 3,446.95 3,052.40 1,74,02,190 1,93,69,689
2011
January 3,475.85 3,116.30 24,39,518 3,481.45 3,117.70 2,28,41,828 2,52,81,346
February 3,161.20 3,003.05 16,89,953 3,165.25 2,997.10 2,02,18,080 2,19,08,033
March 3,236.75 2,922.15 23,82,349 3,241.30 2,922.30 2,30,22,036 2,54,04,385
Total 3,475.85
(1)
2,533.30
(1)
2,69,89,963 3,481.45
(1)
2,533.40
(1)
24,78,52,885 27,48,42,848
Volume traded / average
outstanding shares (%) FY 2011 6 52 58
FY 2010 9 72 81
FY 2009 18 100 118
Note : The number of shares outstanding is 47,31,01,538. American Depositary Shares (ADSs) have been excluded for the purpose of this calculation.
(1)
Represents yearly high and yearly low of equity shares.
Shareholder information | 77
Stock market data NASDAQ
High ($) Low ($) High (R) Low (R) Volume (No.)
2010
April 63.05 59.86 2,796.90 2,655.40 3,49,68,168
May 60.75 55.18 2,816.97 2,558.70 3,56,44,538
June 63.56 56.55 2,952.36 2,626.75 2,99,59,933
July 63.02 58.01 2,832.11 2,606.96 3,01,27,055
August 63.37 57.28 2,487.84 2,574.16 2,39,45,776
September 67.31 59.70 3,024.91 2,682.91 2,75,77,117
October 71.20 66.34 3,154.16 2,947.48 3,57,49,334
November 69.56 64.51 3,191.41 2,959.71 2,42,38,801
December 76.41 67.85 3,416.29 3,033.57 1,86,54,990
2011
January 77.53 67.62 3,559.40 3,104.43 3,54,93,366
February 69.56 66.52 3,148.98 3,011.36 2,15,98,322
March 71.70 64.52 3,197.82 2,877.59 3,33,67,452
Total 77.53
(1)
55.18
(1)
3,559.40
(1)
2,558.70
(1)
35,13,24,852
Notes : 1 ADS = 1 equity share. U.S. dollar has been converted into Indian rupee at the monthly closing rates. The number of ADSs outstanding as at March 31, 2011 was 10,10,50,021.
The percentage of volume traded to the total float was 347.67% as against 500.24% in the previous year.
(1)
Represents yearly high and yearly low of ADSs
Infosys share price versus the BSE Sensex
Base 100 = April 1, 2010
ADS premium compared to price quoted on BSE
Based on monthly high prices
Outstanding ADSs
Our ADSs as evidenced by American Depositary Receipts (ADRs) are traded in the U.S. on the NASDAQ Global Select Market under the ticker
symbol INFY. Each equity share is represented by one ADS. The ADRs evidencing ADSs began trading on NASDAQ from March 11, 1999,
when they were issued by the Depository Deutsche Bank Trust Company Americas (the Depository), pursuant to the Deposit Agreement. As at
March 31, 2011, there were 54,850 record holders of ADRs evidencing 10,10,50,021 ADSs (1 ADS = 1 equity share).
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Share price chart
We caution that the stock price performance shown in the graph below should not be considered indicative of potential future stock price performance.
Notes : Adjusted for bonus issues and stock split.
Base 100 = June 1993.
Historical stock price performance should not be considered indicative of potential future stock price performance.
Investor contacts
Addresses of regulatory authority / stock exchanges
In India
Securities and Exchange Board of India
Plot No. C4-A, G Block, Bandra Kurla Complex
Bandra (East), Mumbai 400 051
Tel. : 91 22 2644 9000 / 4045 9000
Fax : 91 22 2644 9016 20 / 4045 9016 20
National Stock Exchange of India Limited
Exchange Plaza, Bandra-Kurla Complex
Bandra (East), Mumbai 400 051
Tel. : 91 22 2659 8100, Fax : 91 22 2659 8120
Bombay Stock Exchange Limited
Phiroze Jeejeebhoy Towers
Dalal Street, Mumbai 400 001
Tel. : 91 22 2272 1233, Fax : 91 22 2272 1919
Outside India
The NASDAQ Stock Market
One Liberty Plaza
165 Broadway
New York, NY 10006
Tel. : 212 401 8700
Depository for equity shares in India
National Securities Depository Limited
Trade World, A Wing, 4th and 5th Floors
Kamala Mills Compound
Senapathi Bapat Marg, Lower Parel
Mumbai 400 013
Tel. : 91 22 2499 4200, Fax : 91 22 2497 6351
Central Depository Services (India) Limited
Phiroze Jeejeebhoy Towers, 17th Floor
Dalal Street, Fort
Mumbai 400 001
Tel. : 91 22 2272 3333, Fax : 91 22 2272 3199
For queries relating to financial statements
V. Balakrishnan
Tel. : 91 80 2852 0440, Fax : 91 80 2852 0754
E-mail : balakv@infosys.com
For queries relating to shares / dividend / compliance
K. Parvatheesam
Company Secretary and Compliance Officer
Tel. : 91 80 4116 7750, Fax : 91 80 2852 0754
E-mail : parvatheesam_k@infosys.com
Investor correspondence in India
Avishek Lath
Manager Investor Relations
Tel. : 91 80 4116 7744, Fax : 91 80 2852 0754
E-mail : avishek_lath@infosys.com
Investor correspondence in the U.S.
Sandeep Mahindroo
Senior Manager Investor Relations
Tel. : 1 646 254 3133, Fax : 1 646 254 3101
E-mail : sandeep_mahindroo@infosys.com
Registrar and share transfer agents
Karvy Computershare Private Limited
Registrars and Share Transfer Agents
Plot No. 17 to 24, Near Image Hospital
Vittalrao Nagar, Madhapur
Hyderabad 500 081, India
Tel. : 91 40 4465 5151, Fax : 91 40 4465 5024
E-mail : shobha@karvy.com
Depository bank (ADS)
United States
Deutsche Bank Trust Company Americas
Trust & Securities Services
60 Wall Street, 27th Floor
MS# NYC60-2727
New York, NY 10005, U.S.
Tel. : 1 212 250 1905, Fax : 1 212 797 0327
India
Deutsche Bank A. G.
Trust & Securities Services
222, Dr. D. N. Road, Kodak Houses
1st Floor, Fort, Mumbai 400 001, India
Tel. : 91 22 6658 4380 89, Fax : 91 22 2207 9614
Custodian in India (ADS)
ICICI Bank Limited
Securities Market Services
Empire Complex, F7 / E7 First Floor
414, Senapati Bapat Marg, Lower Parel
Mumbai 400 013, India
Tel. : 91 22 6667 2030 / 2026, Fax : 91 22 6667 2740 / 2779
Global presence | 81
Global presence
Asia Pacific
Hong Kong
2 Exchange Square
8 / F, 8 Connaught Place
Central, Hong Kong
Tel. : 852 2297 2231
Fax : 852 2297 0066
Japan
Izumi Garden Wing 2F
1-6-3, Roppongi, Minato-ku
Tokyo 106 0032
Tel. : 81 3 5545 3251
Fax : 81 3 5545 3252
Malaysia
Merak Block, Suite B
Persiaran Multimedia
1st Floor, Cyberjaya,
Kuala Lumpur 63000
Tel. : 60 383 203 829
Mauritius
4th Floor, B Wing
Ebne Cyber Towers
Reduit, Mauritius
Tel. : 230 401 9200
Fax : 230 464 1318
Singapore
04-01 / 06,
1 Changi Business Park
Crescent,
Singapore 486025
Tel. : 65 6572 8400
Fax : 65 6572 8405
Level 43, Unit 2
Suntec Tower 2
9 Temasek Blvd
Singapore 038989
Tel. : 65728400
Fax : 65728400
United Arab Emirates
Dubai
506 and 805
Liberty House, DIFC
P. O. Box 506846
Dubai
Tel. : 971 4 508 0200
Fax : 971 4 508 0225
Sharjah
Z3 Office 11, SAIF Zone
P. O. Box 8230, Sharjah
Tel. : 971 6 557 1068
Fax : 971 6 557 3768
Europe
Belgium
Regus Park Atrium
11, Rue des Colonies
Kolonienstraat
B 1000 Brussels
Tel. : 32 2 517 62 30
Fax : 32 2 517 67 00
Czech Republic
Regus Business Center
Prague Stock Exchange
Rybna Street 682 / 14
11005 Prague 1
Tel. : 420 222 191 387
Fax : 420 222 191 700
Denmark
Regus Copenhagen
Larsbjoernsstraede 3
1454 Copenhagen
Tel. : 45 33 3772 94
Fax : 45 33 3243 70
Finland
Regus Mannerheimintie 12 B
00100 Helsinki
Tel. : 358 925 166 239
Fax : 358 925 166 100
France
Paris
Tour Opus 12, 4th Floor
77 Esplanade du Gnral
de Gaulle
92 914 Paris La Defense 9
Tel. : 33 1 56 39 12 00
Fax : 33 1 56 39 12 01
Toulouse
7, Avenue Didier Daurat
2nd Floor, Blagnac
31700 Toulouse
Tel. : 33 5 34 50 92 77
Fax : 33 5 34 50 91 90
Germany
Eschborn
Topas 1, Merganthalleralle
77 65760 Eschborn
Tel. : 49 6196 9694 0
Fax : 49 6196 9694 200
Frankfurt
Opernturm, 22nd Floor,
Bokenheimer Landstrasse,
60306 Frankfurt am Main
Tel. : 49 0 69 269566 000
Fax : 49 0 69 269566 200
Stuttgart
Liebknechtstrasse 33
D 70565 Stuttgart
Tel. : 49 711 7811 570
Fax : 49 711 7811 571
Walldorf
Partner Port
Altrottstr. 31, 69190 Walldorf
Tel. : 49 6227 73 4350
Fax : 49 6227 73 4359
Greece
Greek Branch,Regus Hellas
S.A. 166A Kifissias Avenue &
2, Sofokleous str
Maroussi GR 151 26
Tel : 30 210 727 9055
Fax : 30 210 7279200
Ireland
Regus Prembroke House
30 Pembroke Street Upper
Dublin 2
Tel. : 353 1 234 2470
Fax : 353 1 234 2575
Norway
Ibsen AS
C. J. Hambrosplass 2C
1st Floor, Oslo 0164
Tel. : 47 22 99 60 42
Fax : 47 22 99 60 10
Russia
4 / 430, 4. Lesnoy Pereulok,
Moscow 125047
Tel. : 7 495 642 8710
Fax : 7 495 225 8500
Spain
Regus CUZCO IV
Paseo de la Castellana 141-8
28046, Madrid
Tel. : 34 91 503 0644
Fax : 34 91 503 0530
Sweden
Stureplan 4C, 4tr
114 35, Stockholm
Tel. : 46 8 463 1112
Fax : 46 8 463 1114
Switzerland
Basel
Regus Basel City Centre
Innere Margarethenstrasse 5
Basel 4051
Tel. : 41 0 61 204 4545
Fax : 41 0 61 204 4500
Geneva
18, Avenue Louis-Casai
1209 Geneva
Tel. : 41 22 747 7894
Fax : 41 22 747 7900
Zurich
3rd Floor, Badenerstrasse 530
8048 Zurich
Tel. : 41 43 817 4170
Fax : 41 43 817 4150
The Netherlands
World Trade Center
H-Tower, 23rd Floor
Zuidplein 190
1077 XV Amsterdam
Tel. : 31 20 796 5500
Fax : 31 20 796 5501
United Kingdom
Aberdeen
CBXII West Wing
382 - 390 Midsummer
Boulevard
Milton Keynes MK9 2RG
Tel. : 44 1908 84 74 00
Fax : 44 1908 84 74 01
London
14th and 15th Floor
10 Upper Bank Street
Canary Wharf
London E 14 5NP
Tel. : 44 20 7715 3300
Fax : 44 20 7715 3301
Swindon
Part First Floor
Wakefield House
Aspect Park, Pipers Way
Swindon SN 31RE
Tel. : 44 179 352 8766
Fax : 44 179 352 3714
India
Bangalore
Electronics City, Hosur Road
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Infosys Center Point
Offshore Development Center
Plot No. 26A
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Reddy Building
K 310, 1st Main
5th

Block, Koramangala
Bangalore 560 095
Tel. : 91 80 2553 2591
Fax : 91 80 2553 0391
Salarpuria Infozone
3rd and 4th Floor
Wing A, No. 39 (P),
No. 41 (P) and No. 42 (P)
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Bhubaneswar
Plot No. E / 4, Info City
Bhubaneswar 751 024
Tel. : 91 674 232 0032
Fax : 91 674 232 0100
Chandigarh
Block A and B, Ground Floor
DLF Building, Plot No. 2
Rajiv Gandhi Technology Park
Kishangarh
Chandigarh 160 101
Tel. : 91 172 502 1100
Fax : 91 172 504 6222
Plot No. 1
Kishangarh
Chandigarh 160 101
Tel. : 91 172 503 8000
Fax : 91 172 504 6860
Chennai
138 Old Mahabalipuram Road
Sholinganallur
Chennai 600 119
Tel. : 91 44 2450 9530
Fax : 91 44 2450 0390
Mahindra Industrial Park
TP 1 / 1, Central Avenue
Techno Park SEZ
Mahindra World City
Natham Sub Post, Chengelpet
Kancheepuram District
Chennai 603 002
Tel. : 91 44 4741 1111
Fax : 91 44 4741 5151
Hyderabad
Survey No. 210
Manikonda Village
Lingampally
Rangareddy (Dist.)
Hyderabad 500 032
Tel. : 91 40 6642 0000
Fax : 91 40 2300 5223
Mangalore
Kuloor Ferry Road, Kottara
Mangalore 575 006
Tel. : 91 824 245 1485
Fax : 91 824 245 1504
IT and ITeS SEZ
Kamblapadavu
Kurnad Post, Pajeeru Village
Bantwal Taluk 574 153
Dakshina Kannada (Dist.)
Tel. : 91 824 228 4492
Fax : 91 824 228 4491
Mumbai
85, C, Mittal Towers
8th Floor, Nariman Point
Mumbai 400 021
Tel. : 91 22 2284 6490
Fax : 91 22 2284 6489
Mysore
No. 350, Hebbal
Electronics City
Mysore 570 018
Tel. : 91 821 240 4101
Fax : 91 821 240 4200
New Delhi
K30, Green Park Main
Behind Green Park Market
New Delhi 110 016
Tel. : 91 11 2651 4829
Fax : 91 11 2685 3366
Pune
Plot No. 1, Rajiv Gandhi
Infotech Park,
Hinjawadi, Taluka Mulshi,
Pune 411 057
Tel. : 91 20 2293 2800
Fax : 91 20 2293 2832
Plot No. 24
Rajiv Gandhi Infotech Park
Phase II, Village Maan
Taluka Mulshi, Pune 411 057
Tel. : 91 20 3982 7000
Fax : 91 20 3982 8000
Thiruvananthapuram
3rd

Floor, Bhavani Technopark
Thiruvananthapuram 695 581
Tel. : 91 471 398 2222
Fax : 91 471 270 0889
Plot No. 1,
Technopark Campus II,
Attipara Village
Tel. : 91 471 398 2222
Fax : 91 471 270 0889
North America
Canada
Calgary
Suite 1000, 888-3rd Street SW
Bankers Hall,West Tower
Calgary, AB T2P 5C5
Tel. : 1 403 444 6896
Fax : 1 403 444 6699
Toronto
5140 Yonge Street
Suite 1400 Toronto
Ontario, M2N 6L7
Tel. : 1 416 224 7400
Fax : 1 416 224 7449
United States
Atlanta
400 Galleria Parkway
Suite 1490, Atlanta
GA 30339
Tel. : 1 770 799 1860
Fax : 1 770 799 1861
Bellevue
3326 160th Avenue SE
Suite 300, Bellevue
WA 98008
Tel. : 1 425 256 6200
Fax : 1 425 256 6201
Bentonville
2700 SE S Street, Suite 200
Bentonville, AR 72712
Tel. : 1 479 271 4600
Fax : 1 479 271 4601
Bridgewater
400 Crossing Boulevard
Suite 101, Bridgewater
NJ 08807
Tel. : 1 908 450 8200
Fax : 1 908 450 8201
82 | Global presence
North America (contd.)
Charlotte
13777 Ballantyne Corporate PL
Suite 250, Charlotte, NC
28277
Tel. : 1 704 972 0320
Fax : 1 704 972 0311
Fremont
6607 Kaiser Drive
Fremont, CA 94555
Tel. : 1 510 742 3000
Fax : 1 510 742 3090
Hartford
95 Glastonbury Blvd
Glastonbury, CT 06033
Tel. : 1 860 494 4139
Fax : 1 860 494 4140
Houston
14800 St. Marys Lane
Suite 160, Houston
TX 77079
Tel. : 1 281 493 8698
Fax : 1 281 493 8601
Lake Forest
One Spectrum Pointe
Suite 350, Lake Forest
CA 92630
Tel. : 1 949 206 8400
Fax : 1 949 206 8499
Lisle
2300 Cabot Drive
Suite 250, Lisle
IL 60532
Tel. : 1 630 482 5000
Fax : 1 630 505 9144
Minneapolis
80 South, 8th Street
Suite 900
Minneapolis, MN 55402
Tel. : 1 612 349 5258
Fax : 1 510 248 2022
New York
630 Fifth Avenue
Suite 1600, Rockefeller Center
New York, NY 10111
Tel. : 1 646 254 3100
Fax : 1 646 254 3101
Phoenix
10835 N 25th Avenue
Suite 200, Phoenix
AZ 85029
Tel. : 1 480 655 3598
Fax : 1 480 655 3501
Plano
6100, Tennyson Parkway
Suite 200, Plano
TX 75024
Tel. : 1 469 229 9400
Fax : 1 469 229 9598
Quincy
Two Adams Place
Quincy, MA 02169
Tel. : 1 781 356 3100
Fax : 1 781 356 3150
Reston
12021 Sunset Hills Road
Suite 340, Reston
VA 20190
Tel. : 1 703 234 3798
Fax : 1 703 234 3701
Southfield
3000 Town Center
Suite 2850
Southfield, MI 48075
Tel. : 1 248 603 4300
Fax : 1 248 208 3315
Subsidiaries of Infosys
Technologies Limited
Infosys Technologies
(Australia) Pty. Limited
Brisbane
Level 12, 259 Queen Street
Brisbane QLD 4000
Tel. : 61 7 3231 9800
Fax : 61 7 3231 9899
Melbourne
Level 5, 818 Bourke Street
Docklands VIC 3008
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2999
Melbourne (Lonsdale Street)
Level 21
150 Lonsdale Street
Melbourne VIC 3000
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2997
Perth
Level 18, Central Park Building
152-158 St. Georges Terrace,
Perth WA 6000
Tel. : 61 8 9288 1750
Fax : 61 8 9288 1753
Sydney
Level 3, 77 Pacific Highway
North Sydney NSW 20060
P. O. Box 1885
Tel. : 61 2 8912 1500
Fax : 61 2 8912 1555
New Zealand
Level 27, PWC Tower
188 Quay Street
Auckland New Zealand 1010
Tel. : 64 9 363 2700
Fax : 64 9 363 2727
Ltda
Brazil
Rua Da Paisagem, 220
Edificio Lumiere, Andar : 5 E 6
Vila Da Serra, Nova Lima
Minas Gerais - CEP
34.000-000-Brazil
Tel. : 55 31 33068900
Fax : 55 31 33068901
Company Limited
Beijing
No. 7 Guang Hua Road
Floor 28th
B1- 1 HanWei Building.
ChaoYang District
Beijing, China
Tel. : 010 57335000
Dalian
No. 1001-1006, No. 1 Hui
Xian Garden
Dalian Hi-Tech Industry Park
Dalian, China
Tel : 86 21 58843000
Fax : 86 21 58843001
Hangzhou
Bldg A2, No. 301 Binxing
Road Binjiang District
Hangzhou 310052
Tel. : 86 571 87930030
Fax : 86 571 87930001
Shanghai
Bldg A, No. 6, 3158 Long
Dong Road,
Zhangjiang Hi-Tech Park,
Shanghai 201203
Tel : 86 21 58843000
Fax : 86 21 58843006
Bldg 18,
1387 Zhang Dong Road,
Shanghai 201203
Tel : 86 21 58843000
Fax : 86 21 58843001
(Shanghai) Company Limited
Room 401, 501, Building Wu,
No. 555 Dong Chuan Road,
Min Hang District,
Shanghai, China
Tel : 86 21 58843000
Fax : 86 21 58843001
Infosys Technologies S. de R
L. de C. V.
Mexico
Ave. Acueducto No. 2610
4piso Col. Del Paseo
Residencial
Monterrey, N. L. C. P. 64920
Tel. : 521 81 1253 8400
Fax : 521 81 1253 8401
Corporativo Santa Maria
Boulevard Diaz
Ordaz Numero 130
Monterrey, Mexico CP 64650
Tel. : 521 81 8850 9300
Fax : 521 81 8850 9301
North America
Suite 200, Plano, TX 75024
Tel. : 1 469 229 9400
Fax : 1 469 229 9598
United Kingdom
14th and 15th Floor
Canary Wharf
London E 14 5NP
Tel. : 44 20 7715 3300
Fax : 44 20 7715 3301
Subsidiary of Infosys
Consulting, Inc.
Limited
Plot No. 26-A, Ground Floor
Electronic City, Hosur Road,
Bangalore 560 100
Tel : 91 80 6688 1144
Fax : 91 80 6688 2140
(Sweden)
AB Stureplan 4C, 4tr
114 35, Stockholm
Tel. : 46 8 463 1112
Fax : 46 8 463 1114
Infosys BPO Limited
Australia - Melbourne
Level 5, 818, Bourke Street
Docklands VIC 3008
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2999
Canada - Toronto
5140, Yonge Street
Suite 1400
Toronto ON M2N 6L7
Tel. : 416 224 7400
Fax : 416 224 7449
India - Bangalore
Bangalore 560 100
Tel. : 91 80 2852 2405
Fax : 91 80 2852 2411
Pavithra Complex, No. 1
27th Main, 2nd Cross
1st Stage, BTM Layout
Bangalore 560 068
Tel. : 91 80 3021 3600
Fax : 91 80 4171 4808
Salarpuria Infozone
Wing A, No. 39 (P)
41 (P) and 42 (P)
Electronic City, Hosur Road
Bangalore 560100
Tel. : 91 80 4067 0035
Fax : 91 80 4067 0034
27, SJR Towers
Bannerghatta Road
J. P. Nagar, III Phase
Bangalore 560 078
Tel. : 91 80 5103 2000
Fax : 91 80 2658 8676
India - Chennai
Temple Steps 6th and 7th
Floor
No. 184, Annasalai Saidapet
Chennai 600 015
Tel. : 91 44 6600 7000
Fax : 91 44 6600 7005
India - Gurgaon
7th floor Tower A, B and C
Building No. 6
DLF Cyber City
Developer Limited
Special Economic Zone
Sector 24 and 25 DLF PH-3
Gurgaon
Tel. : 91 124 4583 700
Fax : 91 124 4583 701
India - Jaipur
Plot No. E-142-143
Sitapura Industrial Area
Jaipur 302022
Tel. : 91 141 2771 325
Fax : 91 141 2771 325
IT-A-001
Mahindra World City
Village Kalwara
Tahsil Sanganer
Jaipur 302029
Tel. : 91 141 3956 000
Fax : 91 141 3956 100
India - Pune
Plot No. 1, Building No. 4
Pune Infotech Park
Hinjawadi, Taluka Mulshi
Pune 411 057
Tel. : 91 20 2293 2900
Fax : 91 20 2293 4540
Plot No. 24
Tel. : 91 20 2293 2800
Fax : 91 20 2293 4540
Philippines
2nd and 3rd Floor
Trade Hall Metro
Market, Bonifacio Global City
Fort Bonifacio Taguig City
Metro Manila, Philippines
Tel. : 632 856 3319
Fax : 632 856 3320
United Kingdom
14th Floor
Canary Wharf
London E14 5NP
Tel. : 44 20 7715 3388
Fax : 44 20 7715 3301
United States - Bridgewater
1st Floor, Bridgewater
NJ 08807
Tel. : 1 908 450 8209
Fax : 1 908 842 0284
BPO
Infosys BPO s.r.o
Czech Republic
Holandka 9,63900, Brno
Tel. : 420 542 212406
Fax : 420 543 236349
Infosys BPO Poland Sp.Z o.o.
Al. Pisudskiego 22 90-051
Lodz, Poland
Tel. : 48 42 291 8000
Fax : 48 42 291 8081
UL. Gdanska 47
90-729 Lodz, Poland
Tel. : 48 42 291 8205
Fax : 48 42 291 80 73
6425 Powers Ferry Road
3rd Floor
Atlanta, GA 30339
Tel. : 1 800 366 0819
Fax : 1 770 690 1800
Global presence
Creative concept and design by Communication Design Group, Infosys.
2011 Infosys Technologies Limited, Bangalore, India. Infosys acknowledges the proprietary rights in the trademarks and product names of other companies mentioned in the Annual Report.
INFOSYS TECHNOLOGIES LIMITED
Bangalore 560 100, India
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
www.infosys.com
April 30, 2011
Dear member,
You are cordially invited to attend the thirtieth Annual General Meeting of the members to be held on Saturday,
June 11, 2011 at 3.00 p.m. IST at the Christ University Auditorium, Hosur Road, Bangalore 560 029, Karnataka, India.
The Notice for the meeting, containing the business to be transacted, is enclosed herewith.
Attendees with disabilities who require assistance at the Annual General Meeting are requested to contact :
Charles Henry Hawkes
Vice President and Regional Head Facilities
Infosys Technologies Limited,
Bangalore 560 100, India
Tel. : 91 80 2852 0261 Ext. : 2250
Mobile : 91 98450 15990
Very truly yours,
Encl : Notice
Notice
Notice is hereby given that the thirtieth Annual General Meeting
(AGM) of the members of Infosys Technologies Limited will be held
on Saturday, June 11, 2011, at 3.00 p.m. IST at the Christ University
Auditorium, Hosur Road, Bangalore 560 029, Karnataka, India, to
transact the following business :
Ordinary business
Item no. 1 Adoption of accounts
To receive, consider and adopt the Balance Sheet as at March 31, 2011,
the Profit and Loss account for the year ended on that date and the
Report of the Directors and the Auditors thereon.
Item no. 2 Declaration of dividend
To declare a final dividend for the financial year ended March 31, 2011.
Item no. 3 Re-appointment of Srinath Batni
To appoint a director in place of Srinath Batni, who retires by rotation
and, being eligible, seeks re-appointment.
Item no. 4 Re-appointment of Sridar A. Iyengar
To appoint a director in place of Sridar A. Iyengar, who retires by
rotation and, being eligible, seeks re-appointment.
Item no. 5 Re-appointment of Deepak M. Satwalekar
To appoint a director in place of Deepak M. Satwalekar, who retires
by rotation and, being eligible, seeks re-appointment.
Item no. 6 Re-appointment of Dr. Omkar Goswami
To appoint a director in place of Dr. Omkar Goswami, who retires by
rotation and, being eligible, seeks re-appointment.
Item no. 7 Retirement of K. Dinesh
To resolve not to fill the vacancy for the time being in the Board, caused
by the retirement of K. Dinesh, who retires by rotation and does not
seek re-appointment.
Item no. 8 Appointment of Auditors
To appoint auditors to hold office from the conclusion of this Annual
General Meeting until the conclusion of the next Annual General
Meeting and to fix their remuneration and to pass the following
resolution thereof :
Resolved that B S R & Co., Chartered Accountants (Firm registration
number 101248W), be and are hereby re-appointed as the Auditors
of the Company to hold office from the conclusion of this Annual
General Meeting to the conclusion of the next Annual General Meeting
on such remuneration as may be determined by the Board of Directors
in consultation with the Auditors, and the remuneration may be paid
on a progressive billing basis to be agreed between the Auditors and
the Board of Directors.
Special business
Item no. 9 Appointment of R. Seshasayee as a Director,
liable to retire by rotation
To consider and, if thought fit, to pass with or without
modification(s), the following resolution as an ordinary
resolution
Resolved that R. Seshasayee, be and is hereby appointed as a Director
of the Company, liable to retire by rotation.
Item no. 10 Appointment of Ravi Venkatesan as a
Director, liable to retire by rotation
modification(s), the following resolution as an ordinary
resolution
Resolved that Ravi Venkatesan, be and is hereby appointed as a Director
of the Company, liable to retire by rotation.
Item no. 11 Appointment of S. Gopalakrishnan as
Whole-time Director
modification(s), the following as an ordinary resolution :
Resolved that pursuant to the provisions of Section(s) 269, read with
Schedule XIII and other applicable provisions, if any, of the Companies
Act, 1956 (including any statutory modification(s) or re-enactment(s)
thereof, for the time being in force), approval of the Company be
and is hereby accorded to the appointment of S. Gopalakrishnan, as
Whole-time Director of the Company for a period of five years, with
effect from August 21, 2011 (subject to the retirement policy applicable
to the Board of Directors of the Company) on the terms and conditions
as stated in the explanatory statement and on the remuneration set
out below :
1. Salary per month : R 2,90,550 in the scale of R 2,75,000 to
R6,00,000.
2. Bonus : Up to a maximum of 20% of the salary, payable quarterly
or at other intervals, as may be decided by the Board of Directors
(the Board).
3. Company performance linked incentive : Payable quarterly or at
other intervals, as may be decided by the Board.
4. Individual performance linked incentive : Payable quarterly or at
5. Perquisites and allowances :
a. Housing : Furnished / unfurnished residential accommodation
or house rent allowance up to 10% of the salary in lieu
thereof. The expenditure incurred by the Company on gas,
electricity, water and furnishings, if any, shall be valued as per
Income Tax Rules, 1962.
b. Medical reimbursement / allowance : Reimbursement of
actual expenses for self and family and / or allowance will
be paid as decided by the Board from time to time.
c. Leave travel concession / allowance : For self and family once
in a year, as decided by the Board from time to time.
d. Club fees : Fees payable subject to a maximum of two clubs.
e. Provision for driver / drivers salary allowance : As per the
rules of the Company.
f. Personal accident insurance : As per the rules of the Company.
6. Other benefits :
a. Earned / privilege leave : As per the rules of the Company.
b. Companys contribution to provident fund and
superannuation fund : As per the rules of the Company.
c. Gratuity : As per the rules of the Company.
d. Encashment of leave : As per the rules of the Company.
e. Company car and telephone : Use of the Companys car and
telephone at the residence for official purposes, as per the
(i)
Minimum remuneration :
Resolved further that notwithstanding anything herein above stated,
where in any financial year closing on and after March 31, 2012, the
Company incurs a loss or its profits are inadequate, the Company
shall pay to S. Gopalakrishnan the remuneration by way of salary,
bonus and other allowances not exceeding the limits specified under
Para 2 of Section II, Part II of Schedule XIII to the Companies Act,
1956 (including any statutory modifications or re-enactment(s) thereof,
for the time being in force), or such other limits as may be prescribed
by the Government from time to time as minimum remuneration.
Resolved further that the Board of Directors of the Company be and
are hereby authorized to vary, alter or modify the different components
of the above-stated remuneration as may be agreed to by the Board of
Directors and S. Gopalakrishnan.
Item no. 12 Appointment of S. D. Shibulal as
modifications, the following as an ordinary resolution :
Resolved that pursuant to the provisions of Section(s) 269 read with
Schedule XIII, and other applicable provisions, if any, of the Companies
Act, 1956 (including any statutory modifications or re-enactment(s)
thereof, for the time being in force), approval of the Company be
and is hereby accorded to the appointment of S. D. Shibulal, as Chief
Executive Officer and Managing Director of the Company for a period
of five years, with effect from August 21, 2011 (subject to the retirement
policy applicable to the Board of Directors of the Company) on the
terms and conditions as stated in the explanatory statement and on
the remuneration set out below :
1. Salary per month : R 2,90,550 in the scale of R 2,75,000 to
R6,00,000.
2. Bonus : Up to a maximum of 20% of the salary, payable quarterly
or at other intervals, as may be decided by the Board of Directors
(Board).
3. Company performance linked incentive : Payable quarterly or at
4. Individual performance linked incentive : Payable quarterly or at
5. Perquisites and allowances :
a. Housing : Furnished / unfurnished residential accommodation
or house rent allowance up to 10% of the salary in lieu
thereof. The expenditure incurred by the Company on gas,
electricity, water and furnishings, if any, shall be valued as per
the Income Tax Rules, 1962.
b. Medical reimbursement / allowance : Reimbursement of
actual expenses for self and family and / or allowance will be
paid as decided by the Board from time to time.
c. Leave travel concession / allowance : For self and family once
in a year, as decided by the Board from time to time.
d. Club fees : Fees payable subject to a maximum of two clubs.
e. Provision for driver / drivers salary allowance : As per the
f. Personal accident insurance : As per the rules of the Company.
(ii)
6. Other benefits :
a. Earned / privilege leave : As per the rules of the Company.
b. Companys contribution to provident fund and
superannuation fund : As per the rules of the Company.
c. Gratuity : As per the rules of the Company.
d. Encashment of leave : As per the rules of the Company.
e. Company car and telephone : Use of the Companys car and
telephone at the residence for official purposes, as per the
Minimum remuneration :
Resolved further that notwithstanding anything herein above stated,
where in any financial year closing on and after March 31, 2012, the
Company incurs a loss or its profits are inadequate, the Company
shall pay to S. D. Shibulal the remuneration by way of salary, bonus
and other allowances not exceeding the limits specified under
Para 2 of Section II, Part II of Schedule XIII to the Companies Act,
1956 (including any statutory modifications or re-enactment(s) thereof,
for the time being in force), or such other limits as may be prescribed
by the Government from time to time as minimum remuneration.
Resolved further that the Board of Directors of the Company be and
are hereby authorized to vary, alter or modify the different components
of the above-stated remuneration as may be agreed to by the Board of
Directors and S. D. Shibulal.
Item no. 13 Change in the name of the Company
modifications, the following as a special resolution :
Resolved that subject to the approval of the Central Government
under Section 21 and other applicable provisions, if any, of the
Companies Act, 1956, the name of the Company be changed from
Infosys Technologies Limited to Infosys Limited and that the name
of the Company shall be Infosys Limited with effect from the date of
issue of Certificate of Incorporation by the Registrar of Companies,
Karnataka, in that behalf, and accordingly, the name Infosys
Technologies Limited wherever it occurs in the Memorandum and
Articles of Association of the Company be substituted by the name
Infosys Limited.
Resolved further that, the Board of Directors be and are hereby
authorized to take all necessary steps for giving effect to the aforesaid
resolution.
Registered office :
Electronics City
Hosur Road
Bangalore 560 100
India
Bangalore
April 30, 2011
by order of the Board of Directors
for Infosys Technologies Limited
K. Parvatheesam
Company Secretary
Notes
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE
ANNUAL GENERAL MEETING IS ENTITLED TO APPOINT A
PROXY TO ATTEND AND VOTE IN THE MEETING AND THE
PROXY NEED NOT BE A MEMBER OF THE COMPANY.
2. The instrument appointing the proxy must be deposited at the
registered office of the Company not less than 48 hours before
the commencement of the meeting.
3. Members / proxies should bring duly filled Attendance Slips sent
herewith to attend the meeting.
4. The Register of Directors Shareholding, maintained under
Section 307 of the Companies Act, 1956, will be available for
inspection by the members at the AGM.
5. The Register of Contracts, maintained under Section 301 of the
Companies Act, 1956, will be available for inspection by the
members at the registered office of the Company.
6. The Register of Members and Share Transfer Books will remain
closed from May 28, 2011 to June 11, 2011 (both days inclusive).
7. The certificate from the Auditors of the Company certifying that
the Companys 1998 Stock Option Plan and 1999 Stock Option
Plan are being implemented in accordance with SEBI Guidelines,
1999 (Employees Stock Option Scheme and Employees Stock
Purchase Scheme), and in accordance with the resolution of
the members passed at the general meeting will be available for
inspection by the members at the AGM.
8. Subject to the provisions of Section 206A of the Companies Act,
1956, dividend as recommended by the Board of Directors, if
declared at the meeting, will be paid on June 13, 2011 to those
members whose names appear on the Register of Members as on
May 27, 2011.
9. Members whose shareholding is in the electronic mode are
requested to direct change of address notifications and updates
of savings bank account details to their respective depository
participants. Members are encouraged to utilize the Electronic
Clearing System (ECS) for receiving dividends.
10. Members are requested to address all correspondence, including
dividend matters, to the Registrar and Share Transfer Agents,
Karvy Computershare Private Limited, Plot No. 17 to 24, Near
Image Hospital, Vittalrao Nagar, Madhapur 414, Hyderabad
500081, India.
11. Members wishing to claim dividends, which remain unclaimed,
are requested to correspond with K. Parvatheesam, Company
Secretary, at the Companys registered office. Members are
requested to note that dividends not encashed or claimed within
seven years from the date of transfer to the Companys Unpaid
Dividend Account, will, as per Section 205A of the Companies
Act, 1956, be transferred to the Investor Education and Protection
Fund.
12. Infosys is concerned about the environment and utilizes natural
resources in a sustainable way. Recently, the Ministry of Corporate
Affairs (MCA), Government of India, through its Circular
Nos. 17 / 2011 and 18 / 2011, dated April 21, 2011 and
April 29, 2011 respectively, has allowed companies to send
official documents to their shareholders electronically as part of
its green initiatives in corporate governance.
Recognizing the spirit of the circular issued by the MCA,
we henceforth propose to send documents like the Notice
convening the general meetings, Financial Statements, Directors
Report, Auditors Report, etc to the email address provided by
you with your depositories.
We request you to update your email address with your
depository participant to ensure that the annual report and other
documents reach you on your preferred email.
(iii)
Explanatory statement under Section
173 (2) of the Companies Act, 1956
Item no. 9
R. Seshasayee was co-opted as an Additional Director of the Company
with effect from January 13, 2011, pursuant to Section 260 of
the Companies Act, 1956, read with Article 114 of the Articles of
Association of the Company. R. Seshasayee holds office of Director
up to the date of the Annual General Meeting. The Company has
received notice in writing from a member along with a deposit of
R500/- proposing the candidature of R. Seshasayee for the office of
Director under the provisions of Section 257 of the Companies Act,
1956. None of the Directors of the Company other than R. Seshasayee
is interested or concerned in the resolution.
The Board accordingly recommends the resolution as set out in
Item no. 9 of the Notice for approval of the members.
Item no. 10
Ravi Venkatesan was co-opted as an Additional Director of the
Company with effect from April 15, 2011, pursuant to Section 260
of the Companies Act, 1956, read with Article 114 of the Articles of
Association of the Company. Ravi Venkatesan holds office of Director
up to the date of the Annual General Meeting. The Company has
received notice in writing from a member along with a deposit of
R500/- proposing the candidature of Ravi Venkatesan for the office
of Director under the provisions of Section 257 of the Companies
Act, 1956. None of the Directors of the Company other than
Ravi Venkatesan is interested or concerned in the resolution.
The Board accordingly recommends the resolution as set out in
Item no. 10 of the Notice for approval of the members.
Item no. 11
The members of the Company at their meeting held on June 22, 2007
approved the appointment of S. Gopalakrishnan as Chief Executive
Officer and Managing Director of the Company for a period of
five years commencing June 22, 2007.
However, pursuant to the leadership succession changes announced
by the Board on April 30, 2011, it is proposed to appoint
S. Gopalakrishnan as the Whole-time Director (with the designation,
Executive Co-Chairman of the Board) with effect from August 21,
2011. Accordingly, S. Gopalakrishnan will relinquish the office of
Chief Executive Officer and Managing Director on August 20, 2011.
The appointment as Whole-time Director is subject to the approval of
members. The terms and conditions of his appointment are as follows :
1. Period of appointment : Five years beginning August 21, 2011
and ending on August 20, 2016, subject to the retirement policy
applicable to the Board of Directors of the Company.
2. Details of remuneration : As provided in the resolution.
3. The agreement, executed between the Company and
S. Gopalakrishnan, may be terminated by either party by giving
six months notice in writing of such termination.
4. S. Gopalakrishnan shall perform such duties as shall from time
to time be entrusted to him, subject to the superintendence,
guidance and control of the Board of Directors and he shall
perform such other duties as shall from time to time be entrusted
to him by the Board of Directors.
The resolution seeks the approval of the members in terms of Section
269 read with Schedule XIII and other applicable provisions of the
Companies Act, 1956 for the appointment of S. Gopalakrishnan as
the Whole-time Director of the Company for a period of five years
commencing from August 21, 2011.
No director, except S. Gopalakrishnan, is interested or concerned in
the appointment and remuneration payable to S. Gopalakrishnan as
Whole-time Director.
The terms of appointment of S. Gopalakrishnan, as stated in this notice,
may be treated as the abstract under Section 302 of the Companies Act,
1956. The copies of relevant resolutions of the Board with respect to the
appointment is available for inspection by members at the registered
office of the Company during working hours on any working day till
the date of the Annual General Meeting.
The Board accordingly recommends the resolution as set out in Item
no. 11 for approval of the members.
Item no. 12
The members of the Company at their meeting held on June 22, 2007
approved the appointment of S. D. Shibulal as Whole-time Director of
the Company for a period of five years commencing January 10, 2007.
The Board of Directors at their meeting held on April 30, 2011, resolved
to appoint S. D. Shibulal as the Chief Executive Officer and Managing
Director of the Company, commencing August 21, 2011.
The appointment is subject to the approval of members. The terms
and conditions of his appointment are as follows :
1. Period of appointment : Five years beginning August 21, 2011
and ending on August 20, 2016, subject to the retirement policy
applicable to the Board of Directors of the Company.
2. Details of remuneration : As provided in the resolution.
3. The agreement, executed between the Company and
S. D. Shibulal, may be terminated by either party by giving six
months notice in writing of such termination.
4. S. D. Shibulal shall perform such duties as shall from time to time
be entrusted to him, subject to the superintendence, guidance
and control of the Board of Directors and he shall perform such
other duties as shall from time to time be entrusted to him by the
Board of Directors.
The resolution seeks the approval of the members in terms of Section
269, read with Schedule XIII and other applicable provisions of the
Companies Act, 1956 for the appointment of S. D. Shibulal as the
Chief Executive Officer and Managing Director of the Company for a
period of five years commencing August 21, 2011.
No director, except S. D. Shibulal, is interested or concerned in the
appointment and remuneration payable to S. D. Shibulal as the Chief
Executive Officer and Managing Director.
The terms of appointment of S. D. Shibulal, as stated in this notice,
may be treated as the abstract under Section 302 of the Companies Act,
1956. The copies of relevant resolutions of the Board in respect of the
appointment is available for inspection by members at the registered
office of the Company during working hours on any working day till
the date of the Annual General Meeting.
The Board accordingly recommends the resolution as set out in Item
no. 12 for approval of the members.
(iv)
Item no. 13
The Board of Directors at their meeting held on April 30, 2011 decided
to change the name of the Company from Infosys Technologies Limited
to Infosys Limited.
Infosys provides comprehensive business solutions that leverage
technology and domain expertise to help its clients gain market
differentiation and competitive advantage. Infosys comprehensive
offerings include business and technology consulting, custom
application and development, maintenance and production support,
infrastructure management, package enabled consulting and
implementation, product engineering solutions and product lifecycle
management, systems integration, re-engineering, independent
validation, and business process management as well as newer solutions
such as cloud strategy adoption and Software as a Service (SaaS).
Infosys has operations in more than 30 countries and is a well-known
brand. Today, the group is known by the brand Infosys across all the
stakeholders and general public.
Also, the Board believes that use of the word, Technologies, is restrictive
for the kind of business the Company is pursuing today, when it is
playing the role of a transformation partner for most of its global clients.
The Company is also playing a larger role as a systems integrator by
globally aligning with hardware, products and software players.
In order to reflect the brand name and represent the groups activities,
the Board recommends the change of the Companys name to
Infosys Limited.
This decision will henceforth see all our business segments to be
referred by the Company name Infosys. This business decision
regarding the change in the Company name is part of our branding
strategy for the Infosys Group. This does not, in any way, mean a change
in constitution / control / management of the Company.
None of the Directors is in any way interested or concerned in the
proposal. The Board accordingly recommends the resolution as set out
in Item no. 13 for approval of the members.
Registered office :
Electronics City
Hosur Road
Bangalore 560 100
India
Bangalore
April 30, 2011
by order of the Board of Directors
for Infosys Technologies Limited
K. Parvatheesam
Company Secretary
Companies (other than Infosys) in which Sridar A. Iyengar
holds directorship and committee memberships
Directorships Chairperson of Board committees
Infosys BPO Limited
ICICI Bank Limited
Rediff.com India Limited
Mahindra Holidays and Resorts
India Limited
OnMobile Global Limited
CL Educate Limited
ICICI Prudential Life Insurance
Company Limited
Cleartrip Travel Services Private
Limited
AverQ Inc.
Kovair Software Inc.
Rediff Holdings Inc.
American India Foundation Inc.
Cleartrip Inc.
ICICI Bank Limited
Audit Committee
Rediff.com India Limited
Audit Committee
CL Educate Limited
Audit committee
Member of Board committees
Infosys BPO Limited
Audit committee
Mahindra Holidays and Resorts
India Limited
Audit Committee
Shareholding in the Company
Sridar A. Iyengar does not hold any shares of the Company.
Profile and expertise in specific functional
areas
Deepak M. Satwalekar was the Managing Director
and CEO of HDFC Standard Life Insurance
Company Limited between 2000 and 2008. Before
that, he served as the Managing Director of Housing
Development Finance Corporation (HDFC) since 1993. He has been
a consultant to the World Bank, the Asian Development Bank, the
United States Agency for International Development (USAID), and the
United Nations Centre for Human Settlements (HABITAT).
Deepak is a recipient of the Distinguished Alumnus Award from the
Indian Institute of Technology, Bombay. He is on the Advisory Council
of IIT, Bombay and has been a member and chairman of several expert
groups related to industry, government and the Reserve Bank of India.
Deepak obtained a Bachelors degree in Technology from IIT,
Bombay and a Masters degree in Business Administration from the
American University, Washington DC.
Srinath Batni
areas
Srinath Batni was inducted as a member of the
Board of Directors of Infosys in May 2000. He is
responsible for Delivery Excellence at Infosys.
Srinath is also a Director on the Board of Infosys
Technologies (China) Company Limited, Infosys Technologies
(Shanghai) Company Limited and Infosys (Australia) Pty. Limited.
Srinath joined Infosys in June 1992 as Project Manager and since held
several management positions. Before joining Infosys, he worked as a
Project Manager for the Indian subsidiary of a leading French company
(since 1990). Prior to that, he was responsible for implementing
production management and materials management systems at one
of Indias leading public sector heavy engineering and manufacturing
companies (since 1980).
Srinath received a Bachelors degree in Mechanical Engineering from
Mysore University in 1975 and a Masters degree in Mechanical
Engineering from the Indian Institute of Science, Bangalore, in 1979.
Companies (other than Infosys) in which Srinath Batni
Company Limited
Company Limited
Infosys Technologies (Australia)
Pty. Limited
None
None
Srinath Batni holds 5,89,847 equity shares of the Company.
Sridar A. Iyengar
areas
Sridar A. Iyengar is an independent mentor investor
in early stage entrepreneurs and companies. For
more than 35 years, he has worked in the U.K.,
U.S. and India with a large number of companies
at all stages such as growth and globalization. He has been advising
them on strategic issues.
Sridar A. Iyengar is the President of the Foundation for Democratic
Reforms in India, a US-based non-profit organization. He is also an
advisor to several venture and private equity funds.
He was previously a senior partner with KPMG in the U.S. and U.K.
and served for three years as Chairman and CEO of KPMGs operations
in India.
Sridar A. Iyengar has a Bachelor of Commerce (Hons) degree from
the University of Calcutta and is a Fellow of the Institute of Chartered
Accountants in England and Wales.
(v)
Additional information on directors recommended for re-appointment
Companies (other than Infosys) in which Dr. Omkar Goswami
CERG Advisory Private Limited
Dr. Reddys Laboratories Limited
Infrastructure Development
Finance Company Limited
Crompton Greaves Limited
DSP BlackRock Investment
Managers Private Limited
Ambuja Cements Limited
Cairn India Limited
Godrej Consumer Products
Limited
Max New York Life Insurance
Company Limited
Avantha Power and
Infrastructure Limited
Max India Limited
Dr. Reddys Laboratories Limited
Audit Committee
Cairn India Limited
Investor Grievance Committee
Crompton Greaves Limited
Audit Committee
Infrastructure Development
Finance Company Limited
Audit Committee
Cairn India Limited
Audit Committee
Godrej Consumer Products
Limited
Audit Committee
Dr. Omkar Goswami holds 12,300 equity shares of the Company.
R. Seshasayee
areas
A Chartered Accountant by profession, R. Seshasayee
started his career with Hindustan Lever Limited
in 1971. Currently, he is the Executive Vice
Chairman of Ashok Leyland Limited. Seshasayee
was the Managing Director of Ashok Leyland from April 1998 to
March 2011.
As the Managing Director, Seshasayee spearheaded the drive for
growth and development of Ashok Leyland. The company registered
a turnover of US$ 1.61 billion in 2009-2010 and has one of the most
comprehensive product portfolios in the medium and heavy commercial
vehicle segment. Under Seshasayees leadership, Ashok Leyland has
maintained its unbroken track record of profitability, and expanded
its global footprint. He has been the Chairman of IndusInd Bank since
July 2007. On the National Council of Confederation of Indian
Industry (CII) for over twenty years, he was the National President
of CII from 2006-2007. He was the President of the Society of Indian
Automobile Manufacturers, the apex body representing the automobile
industry of India from 2001-2003.
Seshasayee has served on several government committees, including
the J. J. Irani Committee on Company Law. He is a member of the
Board of Trade, an advisory body on policies relating to trade and
commerce. He was also a member of the government delegation to
the Doha Ministerial Round of the World Trade Organization (WTO)
in 2001 and the Hong Kong Ministerial in 2005.
Seshasayee has been part of several professional committees such as
the Accounting Standards Board and the Research Committees of the
Institute of Chartered Accountants of India.
Seshasayee was also a director on the Boards of various companies,
including ICICI Bank. He is also associated with several charitable,
educational, cultural and social welfare organizations, including the
Indian Cancer Institute.
(vi)
Companies (other than Infosys) in which Deepak
M. Satwalekar holds directorship and committee
memberships
Franklin Templeton Asset
Management India Private
Limited
Asian Paints (India) Limited
Piramal Healthcare Limited
Germinait Solutions Private
Limited
The Tata Power Company
Limited
IL&FS Transportation Networks
Limited
National Stock Exchange of
India Limited
Indian Institute for Human
Settlements
Piramal Healthcare Limited
The Tata Power Company
Limited
Audit Committee
Deepak Satwalekar holds 56,000 equity shares of the Company.
Dr. Omkar Goswami
areas
Dr. Omkar Goswami is the Founder and Chairman
of CERG Advisory Private Limited (CERG is the
acronym for the Corporate and Economic Research
Group).
A professional economist, Dr. Goswami completed his Masters in
Economics from the Delhi School of Economics in 1978 and his
D. Phil (Ph.D) from Oxford in 1982. He taught and conducted
research for 18 years at Oxford, Delhi School of Economics, Harvard,
Tufts, Jawaharlal Nehru University, Rutgers University and the Indian
Statistical Institute, New Delhi.
In March 1997 he moved away from formal academics to become the
editor of Business India, one of the countrys most prestigious business
magazines. From August 1998 to March 2004, Dr. Goswami served as
the Chief Economist of the Confederation of Indian Industry Indias
premier apex industry organization.
Dr. Goswami has served on several government committees.
He was the chairman of the Committee on Industrial Sickness and
Corporate Restructuring in 1993, which recommended the revamping
of Indias bankruptcy laws and procedures; member of the Working
Group on the Companies Act; the CII Committee on Corporate
Governance; the Rakesh Mohan Committee on Railway Infrastructure
Reform; the Vijay Kelkar Committee on Direct Tax Reforms; the
Naresh Chandra Committee on Auditor-Company Relationship; the
N. R. Narayana Murthy Committee on Corporate Governance instituted
by SEBI, among others.
Dr. Goswami has been a consultant to the World Bank, the IMF, the
Asian Development Bank and the OECD.
Other than his regular columns for newspapers and magazines,
Dr. Goswami has authored three books and over 70 research papers
on economic history, industrial economics, public sector, bankruptcy
laws and procedures, economic policy, corporate finance, corporate
governance, public finance, tax enforcement and legal reforms.
Companies (other than Infosys) in which Ravi Venkatesan
None None
None
Ravi Venkatesan holds 110 equity shares of the Company.
S. Gopalakrishnan
areas
S. Gopalakrishnan (Kris) is one of the founders
of Infosys Technologies Limited. In 1981, Kris,
along with N. R. Narayana Murthy and five others,
founded Infosys Technologies Limited. His initial
responsibilities included the management of design, development,
implementation, and support of information systems for clients in the
consumer products industry in the U.S.
Between 1987 and 1994, Kris headed the technical operations of
KSA / Infosys (a joint venture between Infosys and KSA in Atlanta,
U.S.) as Vice President (Technical). In 1994, Kris returned to India
and was appointed Deputy Managing Director of Infosys.
On June 22, 2007, Kris was appointed the CEO and Managing Director
of Infosys. Kris previously served as the Chief Operating Officer
(April 2002), and as the President and Joint Managing Director
(August 2006). His responsibilities included customer services,
technology, investments, and acquisitions.
Kris is recognized as a global thought leader. He was selected in
Thinkers 50, an elite list of global business thinkers compiled by
Des Dearlove and Stuart Crainer, in association with the IE Business
School, Madrid, and the London Business Schools Management
Innovation Lab.
Kris is the Chairman of the Confederation of Indian Industry (CII)
Southern Regional Council and serves on the Board of Governors
at the Indian Institute of Management (IIM), Bangalore. Kris is also
the Chairman of the Indian Institute of Information Technology and
Management (IIITM), Kerala, and the Vice Chairman of the Board of
Information Technology Education Standards (BITES) set up by the
Karnataka Government. He is a member of ACM, IEEE and IEEE
Computer Society.
In January 2011, Kris was awarded the Padma Bhushan, the countrys
third highest civilian honor, by the Government of India.
Kris holds Masters degrees in Physics (1977) and Computer Science
(1979) from the Indian Institute of Technology, Madras.
Companies (other than Infosys) in which
S. Gopalakrishnan holds directorship and committee
memberships
None None
None
S. Gopalakrishnan holds 66,56,726 equity shares of the Company.
Companies (other than Infosys) in which R. Seshasayee
Ashok Leyland Limited
Ashley Airways Limited
Ashley Alteams India Limited
Hinduja Foundries Limited
IndusInd Bank Limited
Hinduja Automotive Limited,
U.K.
Ashok Leyland Nissan Vehicles
Limited
Hinduja Group India Limited
Hinduja Leyland Finance
Limited
Hinduja National Power
Corporation Limited
Irizar TVS Limited
Nissan Ashok Leyland
Nissan Ashok Leyland
Powertrain Limited
Optare plc., U.K.
Ashok Leyland Defense Systems
Limited
None
Ashok Leyland Limited
Investors Grievance
Committee
Hinduja Foundries Limited
Investors Grievance
Committee
R. Seshasayee does not hold any equity shares of the Company.
Ravi Venkatesan
areas
Ravi Venkatesan was the Chairman of Microsoft
India and was responsible for Microsofts marketing,
operational and business development efforts in
the country.
Prior to joining Microsoft, Ravi Venkatesan worked for over seventeen
years with Cummins Inc., a US-based designer, manufacturer and
distributor of engines and related technologies. He served in various
leadership capacities at Cummins including Chairman of Cummins
India Limited and Managing Director of Tata Cummins Limited, a
joint venture between Cummins Inc. and Tata Motors. His biggest
contribution at Cummins was leading the transformation of Cummins
in India into a major provider of power solutions and the largest
manufacturer of automotive engines in the country.
Ravi Venkatesan has a B.Tech in Mechanical Engineering from the
Indian Institute of Technology, Bombay (1985), an MS in Industrial
Engineering from Purdue University (1986) and a MBA from Harvard
University (1992) where he was a Baker Scholar. Ravi Venkatesan was
awarded Purdue Universitys Outstanding Industrial Engineer award
for the year 2000 and the Distinguished Alumnus award by the Indian
Institute of Technology, Bombay in 2003.
Ravi Venkatesan is a member of the Executive Council of NASSCOM,
the Confederation of Indian Industry (CII), was a Director on the
Board of Thermax Ltd. and a member of the Advisory Council of the
Indian Institute of Technology, Bombay and IIIT, Bangalore. He has
contributed frequently to the Harvard Business Review and some of
his articles include Strategic Sourcing to Make or Not to Make and The
Strategy that Wouldnt Travel.
(vii)
S. D. Shibulal
areas
S. D. Shibulal (Shibu) is one of the co-founders
and a member of the Board of Directors of Infosys
Technologies Limited. Shibu has over three decades
of IT leadership experience. He has played a pivotal
role in the Infosys journey and a seminal role in the evolution of the
Global Delivery Model which is now the de-facto industry standard
for delivery of outsourced IT services.
Shibu started his Infosys journey in 1981 by first spearheading its
project management, and then handling client relationships in the
North American region for a decade. He followed this with a five-year
sabbatical with Sun Microsystems between 1991 and 1996, where he
was responsible for designing and implementing their first e-commerce
application amongst other creditable contributions. In 1997, on
his return to Infosys, Shibu established and headed the Internet
Consultancy practice. He moved on to serve several leadership roles
at the group level, firstly as the Worldwide Head of Customer Delivery
and later as Group Head, Worldwide Sales and Customer Delivery.
Over the years, Shibu has been known to foster innovation, leadership,
teamwork and work values within the organization.
On June 22, 2007, Shibu took over from S. Gopalakrishnan as
Chief Operating Officer and has been serving this role since.
His focus has been on increasing competitiveness, improving customer
experience, improving employee engagement and increasing the depth
of services.
Shibu received a Masters degree in Physics from the University of
Kerala and an MS in Computer Science from the University of Boston.
He is a member of several international forums, such as the Seoul
International Business Advisory Council (SIBAC), the International
Board of Foundation, Globethics.net, the Global Corporate Governance
Forums Private Sector Advisory Group, the International Advisory
Board, Boston University and the Metropolitan College Deans Advisory
Board, Boston University.
Companies (other than Infosys) in which S. D. Shibulal
Infosys BPO Limited
Company Limited
Infosys Technologies (Sweden)
AB
Limited
Infosys Public Services Inc.
Company Limited
None
Infosys BPO Limited
Audit Committee
S. D. Shibulal holds 24,69,711 equity shares of the Company.
Attendance record of the directors seeking
appointment / re-appointment
Directors Number of meetings
held attended
Srinath Batni 5 5
R. Seshasayee 1 1
Ravi Venkatesan
S. D. Shibulal 5 5
Disclosure in terms of Clause 49 (IV) (G) (ia) of the Listing
Agreement
There are no inter-se relationships between the Board members.
(viii)
Registered Office : Electronics City, Hosur Road, Bangalore 560 100, India
ADDITIONAL INFORMATION AND PRACTICE NOT REQUIRED UNDER THE COMPANIES ACT, 1956
Infosys Board acknowledges the fact that not all shareholders attend the AGM and even though a proposal may have received the assent of the
requisite majority of shareholders present at the AGM, the overall shareholder response to any proposal is not captured or known.
Infosys believes that determining and disclosing the overall shareholder response to the proposals placed before the shareholders in a general
meeting is a valuable corporate governance practice. To this end, during the previous eight AGMs, the Company had made available a
non-mandatory ballot through the postal system / internet as a channel for all shareholders to informally express their views on the resolutions
tabled before the shareholders in the AGM. The non-mandatory ballot has helped the Company assess the general view of the absentee shareholders
on the resolutions set out in the Notice.
The non-mandatory ballot through the internet is not in substitution of, or in addition to, your right as a shareholder to vote at the AGM.
The non-mandatory ballot through the internet will not have the force of a legally binding vote and will not be construed as a vote at the AGM.
The result of the non-mandatory ballot through the internet will not impact the votes cast at the AGM. For your vote to be valid, ensure that you
are present in person or send the nominated proxy in person to attend the AGM.
Please note that regardless of you participating in the non-mandatory ballot through the internet, you as a shareholder are entitled to attend and
vote at the AGM or to appoint a proxy to attend the AGM.
The Company has appointed Parameshwar Hegde, Practicing Company Secretary, who in the opinion of the Board is a duly qualified person, as
the Scrutinizer for the non-mandatory ballot through the internet. The Scrutinizer will collate all non-mandatory ballots and the results of the
same will be disclosed at the AGM proceedings.
INSTRUCTIONS FOR PARTICIPATING IN THE NON-MANDATORY BALLOT THROUGH THE INTERNET
To access the non-mandatory ballot portal, use the following URL :
From Infosys website : www.infosys.com/agm2011
From Karvy website : http://karisma.karvy.com/infosys
HOW TO VOTE
1. Shareholders will have to choose between three modes of holding holding shares in physical form, holding shares in a demat account with
a depository participant connected to National Securities Depository Limited (NSDL) or holding shares in a demat account with a depository
participant connected to Central Depository Services (India) Limited (CDSL).
2. Investors having a demat account with a depository participant connected to NSDL : Enter the depository participant identification number
(DP ID) and client identification number (Client ID). Example : DP ID IN302902 and Client ID 11111111
3. Investors having a demat account with a depository participant connected to CDSL : Enter the 16-digit demat account number.
Example : Demat Account Number is 1234567832145678
4. Investors holding shares in physical form : Enter the registered folio number. Example : Folio ITL000123
5. If valid entry as per step 2, step 3 or step 4 above is done, you will be able to cast your ballot. Cast your ballot by clicking on the check box
corresponding to each resolution and make your selection by choosing In Favor, Against or Abstain for each resolution. Alternatively, you
can also click the SELECT ALL button and cast your ballot.
6. Click the SAVE / NEXT button to preview the options that you had selected in the previous step.
7. Click the SUBMIT button to cast your vote for the online ballot.
8. Investors may cast their non-mandatory ballot only once on a resolution, using a specific demat account. If an investor has multiple demat
accounts, he / she will be able to participate in the non-mandatory ballot separately, for each demat account, by using the respective DP ID
and Client ID.
9. The portal will be open for voting from June 1, 2011 to June 9, 2011 between 10 a.m. to 5 p.m. IST.
PROXY FORM
Thirtieth Annual General Meeting June 11, 2011
Regd. Folio no. / DP Client ID
I / We ........................ of ............. in the district of
................................ being a member / members of the Company hereby appoint .................... of
..... in the district of . or failing him / her ..................of
..... in the district of .... as my / our proxy to vote for me / us on my / our
behalf at the THIRTIETH ANNUAL GENERAL MEETING of the Company to be held at the Christ University Auditorium, Hosur Road,
Bangalore 560 029, Karnataka, India, at 3 p.m. IST on Saturday, June 11, 2011 and at any adjournment(s) thereof.
Signed this . day of 2011.

Fifteen Paise
Revenue
Stamp

Signature of the member
Note : This form, in order to be effective, should be duly stamped, completed, signed and deposited at the Registered Office of the Company, not less than 48 hours before the meeting.
............................................................................................. Please tear here ............................................................................................
ATTENDANCE SLIP
Thirtieth Annual General Meeting June 11, 2011
Regd. Folio no. / DP Client ID
No. of shares held
I certify that I am a member / proxy for the member of the Company.
I hereby record my presence at the THIRTIETH ANNUAL GENERAL MEETING of the Company at the Christ University Auditorium, Hosur
Road, Bangalore 560 029, Karnataka, India, at 3 p.m. IST on Saturday, June 11, 2011.

Name of the member / proxy Signature of the member / proxy
(in BLOCK letters)
Note : Please fill up this attendance slip and hand it over at the entrance of the meeting hall. Members are requested to bring their copies of the Annual Report to the meeting.
Route map
Map not to scale
Christ University Auditorium
Hosur Road,
Bangalore 560 029
Karnataka, India.
30 years of Infosys
Annual Report 2010-11
30 years of Infosys
Additional Information 2010-11
00-Cover-Page.indd 1 5/25/2011 2:03:34 PM
30 years of Infosys
Infosys Additional Information 2010-11
Posterity will not excuse you if you did not dream big. You owe it to your
customers, your colleagues, your investors, and the society. Every major
civilization, every great advance in science and technology, and every great
company is built on a big dream.
30 years of Infosys
Turning thirty is a good time to reminisce. And reflect. And look
ahead.
Thirty is one of those rare junctures when you have both youth
and experience on your side. Thus, as Infosys completes thirty, we
talk about the pleasures and pains of starting small; the genesis
of a value-based organization culture; personal goals turning
into company milestones; sharing wealth and caring for society;
learning and educating; building infrastructure for one and all;
agreeing to disclose and refusing to compromise on quality; and
above all, believing in a vision and leading by example to see it
become reality.
Thirty is also the time to break new ground.
This Annual Report is printed on 100% recycled paper as certified by the U.K.-based National Association of Paper Merchants (NAPM) and France-based Association des Producteurs et
des Utilisateurs des papiers et cartons Recycls (APUR).
30 years of Infosys
This page is intentionally left blank
30 years of Infosys
Awards for Excellence 2010-11 .............................................. 2
Ratio analysis ........................................................................ 7
Auditors report ..................................................................... 9
Balance Sheet .....................................................................12
Profit and Loss account ......................................................13
Cash Flow statement .........................................................14
Schedules ............................................................................15
Financial statements as per IFRS ....................................... 35
Additional information ........................................................ 64
Select historical data .......................................................... 65
Revenue segmentation ...................................................... 66
Statutory obligations ........................................................... 67
Human resource valuation .................................................. 69
Value-added statement ...................................................... 70
Brand valuation ................................................................... 71
Economic Value-Added (EVA
) statement .......................... 72
Balance sheet including intangible assets .......................... 73
Intangible assets score sheet ............................................ 74
ValueReporting ............................................................... 76
Management structure ...................................................... 78
Infosys Foundation ............................................................. 79
Report on health, safety and environment ........................ 80
Financial statements (unaudited) ....................................... 82
Extract of audited IFRS financial statements ..................... 91
Global presence .................................................................. 92
Contents
2 | Awards for Excellence
Awards for Excellence 2010-11
The Pursuit of Excellence forms an integral part of our core values. At Infosys, employees have made excellence a habit. The abundance of talent
within the organization and our employees single-minded determination to be the best ensure that we are ahead of our competition. This has,
over the years, earned us the trust and confidence of our stakeholders.
The Infosys Awards for Excellence seeks to reward those employees who have remained true to our core values. They were initiated in 1995 as
the Managerial Excellence Awards. Over the years the awards have grown to exemplify much of what it means to be an Infoscion. The awards
recognize the vision, ability and hard work of those who have enriched us with their valuable contributions. The Awards for Excellence, 2010,
were given at the organizational and regional levels.
Organizational Level
We are what we repeatedly do.
Excellence, then, is not an act, but
a habit.
Aristotle
Account Management
(Large Account)
Real Excellence in Engagement and
Delivery
Atul Kumar Jain
Devasenapathy Murugappan Muthu
Milind Vasantrao Pande
Mohit Saxena
Nageswara Rao V. Chilamkurthi
Ravi Kumar Dikshit
Senthil Nathan M.
Sunil Shivappa
The Band of Achievers
Anindya Ghosh
Krishna Kowndinya Ayyalasomayajula
Prashant R. Khadilkar
Priya Chander
Ramkumar Akilen
Satyanarayana N. G.
Shyamsundar V.
Swaminathan Sundaresan
Account Management
(Small Account)
Global Power Leader Account
Management Team
Abhishek Arun
Alagappan Rm
Chinmay Jain
Devendra Singh
Prabhat Kumar Das
Prashant Bandopant Pendse
Rohit Agarwal
Rohit Kedia
Brand Management
Infosys iEngage Digital Consumer
Platform Launch
Akhil Srivastava
Arun Kumar Ganesan
Balaji Sampath
Harini Suresh Babu
Rahul S.
Sumit Virmani
Oracle Practice at Enterprise Solutions
Amandeep Singh Syali
Jeanne S. Willis
Priyanka Chandra
Rishi Raj Paul
Steven Charles Tunley
Varinder Verma
Client Delight
Online Store for a Consumer
Electronics Major
Divya Vijayamma
Feby Denahon
Jamal Basha Pesaravai
Kishore Raghavendra Kamath
Raghavendra Gandadi
Rajesh J. Thekkekkara
Ruby Mottackel
Suchitra
Awards for Excellence | 3
Application and Infrastructure Support for
the E-commerce Platform
Anil Kumar B.
Ashutosh Agrawal
Beulah Vejendla
Manga Rachakonda
Mohit Agarwal
Prakash Kumar Agarwal
Sreekanth Bajagur Panduranga Rao
Vishal Miglani
Department Management
The Quality Department
Development Center (Large)
The Hyderabad Development Center
Development Center (Small)
The China Development Center
The Mangalore Development Center
Infosys Champion Domain
Champion
Gautam Bandyopadhyay
Infosys Champion Technology
Champion
Chandan Mahadeo Gokhale
Jitendra Pal Thethi
Innovation Initiatives
Infosys MaskIT Team Enabling
Differentiator and Non Linear Growth
Ashutosh Saxena
Balaji Raghunathan
Mandar Sharadchandra Joshi
Ramakrishna Reddy G.
Venugopal Subbarao
Vishal Krishna Saxena
Innovation Thought Leadership
Intelligent Power Strip
Kumar Padmanabh
Sanjoy Paul
Internal Customer Delight
Delivery Risk Management Group
Akhil Goyal
Binesh T. Narayan Nair
Dharmalingam T.
Kalaivani K. G.
Lakshmidevi Dhakshanamoorthy
Taher Nuruddin Kapadia
People Development
Engineering Competency Development
as a Strategic Business Differentiator
Niranjan Vijay Awati
Shivakumar Jayappa Addamani
Sridhar Gatpa
Sriranga Ramanuj Acharya K. N.
Sumana Y. S.
Swetha V. C.
Victor Sundararaj
People Integration at McCamish
Systems LLC
Christina Stephenson
Dependra Mathur
Megan Groves
Neeti Khanka
Peddity Samuel Abhishek
Superna Shankar
Program Management
Application Support and Maintenance
Program for Leading Apparel Retailer
Anusheel Gupta
Atul Agarwal
Deepanjan Deb
Dhayal Prasad Subramanian
Malini B. N.
Namita Kumar Shettigar
Sivasankar Stalin
Srinivasa N. Karanth
Sriram Subramanian
Suneel Govindrao Kulkarni
Service Assurance Platform Upgrade for a
Leading Australian Telco
Aloke Kumar Dey
Amol Dnyaneshwar Ghongade
Bhargava Chakravarthy Nimmaraju
Ditesh Chohan
Nagaiah Pasi
Naveen Kumar L.
Srinivas Babu Vaddepati
Sumita Srivastava
Susanto Kumar De
Veera Anjani Kumar Valivarthi
Project Execution Excellence
Sigma Base Development and
Implementation
Hisaya Kusagawa
Pranav Shekhar Jha
Raghu S.
Samir Y. Vaidya
Shreyas Prabhu
Srinivas S. Deshpande
Suchand R. S.
Vivek Kumar Singh
Vivek Sinha
Arindam Deb
Brochure Solution
Ambili K.
Aparna Suriyanarayanan
Arul Rosaline Pradipa S.
Biju Nambisan
Divya Veerarahavalu Muthukrishnan
Rajesh Krishnan
Ravishankar R.
Renjith John
Srinivasan Nambi
Vishnuvardhana V. V.
Billing Setup Module & Tariff Billing Tool
Deepman Singh
Gourav Sood
Kapil Ahuja
Mayank Mehrotra
Saurabh Chaudhary
Shweta Arora
Sushant Mohan Saxena
Taranjit Singh
Vishal Aggarwal
Material Planning Toolkit Development for
a Large Food and Beverage Major
Joy Sen
Prabhat Khare
Sathish Babu Sridharan
Saurabh Agarwal
Shalini Mandara Ramachandra
Shashi Kiran A. R.
Shweta Menon
Sridevi Chatta
Suneetha Chittamuri
Local Application Maintenance and
Support for an Auto Giant in Japan
Madan Mohan Jana
Madona Kumar
Mahesh Kumar Damani
Manoj Kumar Goyal
Nibedita Panda
Rashmi N.
Tao Guo
Vivek Sinha
Yuji Yamaguchi
Business Insight & Analytics
Anwar Abdu Mohamed
Aromal Beena Sivadasan
Ashwini Kumar Gopalkrishna Shenoy
Minhaj Ashraf
Mukund Nair
Ramu Balakrishnan
Sakalya Dattaprasad Kulkarni
Sandesh Venkatesh Shanbhag
Siddharth Prakash Warang
Roshan Lawrence D Souza
Sales Management
Application and Infrastructure Support for
the Worlds Leading Software Company
Anand Swaminathan
Anant Raghavendra Adya
Burhanuddin Jaffer
Nimesh Kocheta
Raju P. Kattady
Rama Murthy Prabhala
Santhanakrishnan S.
Venkatesh R. L.
Social Consciousness
North Karnataka Flood Relief Program
Archana N.
Arun Vijaya Kumar
Hanamant Baburao Kulkarni
Manjunath Gopi
Pavan Mailwar
Vasudevrao Madhukarrao Deshpande
Technology Excellence
Cloud Computing
Hamsaraj Laxman Shetty
Rajkumar R.
Venkatesh Nagaraju Sagare
The Infosys Customer
Satisfaction Survey 2010
The Manufacturing IBU (MFG)
The Product Lifecycle and Engineering
Solutions (PLES) Unit
The Infosys Code Champion
Charan Kumar Vuda
Srinivas Ksheerasagara
Sujaya Kumari S.
Unit Management
The Enterprise Solutions (ES) Unit
The Infosys BPO
The Retail, CPG, Logistics (RETL) Unit
Regional Level
First Prize
Client Delight
Mid-year Review Program
Anshuk Anil Jain
Dinesh Chekuri
Maneesh Rajesh Kumar Shrivastava
Prakash M.
Sandeep Bolukonda
Srinivasan Kale
Sriuma Parimi
Wajid Hussain Mohammed
Service Assurance Platform Upgrade for a
Leading Australian Telco
Aloke Kumar Dey
Amol Dnyaneshwar Ghongade
Bhargava Chakravarthy Nimmaraju
Ditesh Chohan
Naveen Kumar L.
Sumita Srivastava
Susanto Kumar De
Vijendra Singh Rajput
Champion
Jayesh Amdekar
Sudripto De
Champion
Kiran K. S. R.
Transforming Drug Discovery through
Biological Entity Management System
Anirban Ghosh
Kirti Jindal
Krutin Kumar Boloor
Neppoliyan Thangavelu
Ramesh Krishnan Balakrishnan
Sunil Medagam
Client Services Group Boot Camp
Anubhav Pradhan
Maneesh Vinod Bakhle
Nevil Jose Paul
Satheesha B. N.
Srikantan Moorthy
Suparna Shankar
Flourishing Ecosystem of New Business
Offerings and Internal Adoption of
Mobility Around Infosys mConnect
Karthik G. V.
Pallab Sen
Puneet Gupta
Raghavendra D. Hegde
Sameer Wadhwa
Venkat Kumar Sivaramamurthy
People Development
Infosys China Education Center Jiaxing
LuLu Ma
Murali Mohan K.
Wei Shen
XiuJuan Zhu
YunZhi Jiang
Zheng Zong
Remedy People Development Program
Ajay Manchandani
Gagan Agrawal
Nagaraj Achutha Pai
Piyush Agrawal
Saumitra Bhalchandra Kalikar
Sumeet Rajendra Das
Project Execution Excellence
Customer Marketing Group for a Fortune
500 Global Financial Services Company
Amit Prakash Gupta
Bal Mukund Shukla
Gopesh Kumar
Hari Thachappilly
Harshad Ravindra Khodke
Hrishikesh Vijay Shirodkar
Kapil Mohan Singbal
Priyank Jain
Sandeep Nivritti Lokhande
Vijay Anand
Bottom Hole Assembly Drawing
Application for an Oil Field Services
Company
Abhishek Saxena
Animesh Kumar Hazra
Charly Arnold Geddam
Krishna Kumar Arrepu
Mehul Vinod Patel
Narasimha Murty Bulusu
Sandeep Garg
Srinivasa Rao Chukka
Sriram Sundararajan
Uday Prasad Panday
Business Process Analysis and Technical
Documentation
Aastha Ashok Shangloo
Dilip Bansilal Kalra
Pranay B. Lohkare
Sangita Avadhut Sathe
Sita Devi U. Pillay
Surendra Balusu
Vaibhav Mitrasen Patil
Varun Singh
Vinaykumar Shrikant Mhapankar
Yogesh Suresh Agrawal
Carrier Access Billing System
Garima Khanna
Nitin Tularam Mahajan
Partha Chakraborty
Priya Jaysinh Joisher
Pushpak Dhanaraj Deore
Satyabrata Biswas
Shirish Bansal
Vikash Kumar Singh
Yash Manohar Gajpalla
Yogendra Jayprakash Dhruva
Railroad Shipment and Operations
Application Support
Gopinath D.
Murali M.
Naveen Guha Narain Govindarajulu
Naveen Mysore Srinivas
Rajesh Velayudhan Veliyaveetil
Rohit Tandon
Shubha S. D.
Sovan Sunil Panda
Sudeendra Nagaraj
Swarna Sankaran
Yard Planner 2.5 (YP 2.5)
Arun C. B.
Krishnan G. R.
Rishikesh Kumar
Shishir Alva
Shrinivas N.
Sovan Sunil Panda
Sudhir Sanjeeva Murthy Jajur
Distributor Connect Project
Deepak Gupta
Lokesh Gupta
Nitesh Mittal
Noopur Narendra Kumar Kothari
Rajesh M. P.
Sanketh Acharya
Shalini A.
Sneha Ghanashyam Raikar
Sourav Roy
Suresh Prahlad Bharadwaj
Maintenance of Intermodal and
Equipment Distribution
Dinesh Thurvas Ravindranath
Gaurav Rastogi
GuiDan Wu
Jigar Doshi
Kripa Bhaarath
Prem Jaisinghani
Sumit Mohan Jha
Sunish V.
Suresh Mullappulli Chettoor
Vijayalakshmi Krishnamurthy
Oracle-based Financial Management
Solution for a Payment Services Major
Ankur Ram Shankar Sharma
Basavraj Loni
Dilip Fauzdar
Hitesh Ashok Madan
Raghavendra Rao Manjoji Rao Nagendra Rao
Rohit Mohindru
Sachin Satyanarayan Chitlange
Sagar Dwarkanath Navandar
Sowmya Varadarajan Trikkur
Tarika Jain
Awards for Excellence | 5
Patient Appointment Scheduling (PAS)
Angeline Jeya Shanthi George Sargunar G.
Anusha Muthukrishnan
Bharath Kumar Burla
Gayathri Murugan
Hema Sampath Kumar
Naresh Kumar Venkatampalli Venkatesan
Ramnathan Ravindran
Senthil Murugan Manikantan
Tharani Sathyanarayanan
Yogarajan Gnanaprakasam Kumaran
Supply Chain Support
Ajish Murali
Jobin John
Manoj Kumar Jain
Mukesh Ralhan
Nirav Satish Vikamshi
Nitin Aggarwal
Shuchi Bhandari
Sundeep Thirukovela
Vidya S.
Yashvanth Lohantha Shantharam
Leading Mortgage Insurer Insurance
Data Entry & Accounting
Jayakrishnan Sasikumar
Kathiriki Sreenivas Reddy
Murali M. S.
Ravi Babu Kolati
Sree Lekshmi L. B.
Sujith K. Shajee
Spectrum Internationalization (i18n)
Program
Mayank Jain
Nikhil Gupta
Nitin Bansal
Perminder Singh Vohra
Prashant Jindal
Satya Prabh Kathooria
Saurabh Kashyap
Sumit Chadha
Vinay Prabhu M.
Sudhir Srivastava
HoPE Club Service Beyond Charity
Abhishek Tiwari
Ayappa Nanjappa Kongettira
Debasis Konar
Manoj S.
Pritam Kumar Sinha
Rajesh Kumar Singh
Ramesh K. N.
Shruthi Laxmain N.
Sudhir Reddy Dyapa
Vikas Mulla
Mamata Welfare Society
Bhaskara Peddanarappagari
Dhiraj Varma Budharaju K.
Gayathri Devi Kandukuri
Kankanala Sundeep Reddy
Nipun Jain
Rama Murthy Prabhala
Rambabu Sampangi Kaipa
Ramesh Illuri
Sreevalli Lavanya Chintalapati
Veerabhadra Rao Chilukuri
Promoting Green Power in the Country
Praveen Gupta
Samarpan
Deepak Kumar Barolia
Jayanthi Huttinagadde Venkatachalaiah
Kiran N. G.
Kusuma Kumari C.
Lakshmi Kamala Wunnava Venkata
Maheshkumar Basavarajappa
Pankaj Tiwari
Suja Warriar
Swapnil Ramesh Shah
Vasanth J.
Systems and Processes
A System for Co-designing Industry
Electives with Academia
Anoop Singh
Manisha
Mukundh Nagarajan
Renu Vadhvani
Soudamini Randhir Patil
Srinagesh Chatarajupalli
Content Management System and
Content Delivery Network for Infosys
Website
Ajith Kumar K. G.
Gaurav Kumar
Manish Kumar
Sachin Prakash Sancheti
Suresh Selvaraj
IS Efficiency
Geetha Das
Jasbir Kaur Saund
Jolly Samar
Niraj Kumar Verma
Rajkumar S.
Suresh B. K.
Software Asset Management (SAM)
Anup Arjunrao More
Bhaskaran Srinivasan
Chandrakanth Desai
Deepak A. G.
Shreshta Shyamsundar
Yoganand T. D.
Technology Excellence
Digital Marketing Platform
Ajit Sagar
Senthil Kumar Krishnasamy
Shailesh Leslie Albuquerque
Tharanian Mahendran
Vishvanath Mahesh Muthyala
Intelligent Power Plant Controller
Karthikeyan Krishnamoorthy
Bijoy Alokkan
Rahul Kumar
Aniket Dinkarrao Patil
Bhabani Sankar Pattanayak
Omkar Deepak Muranjan
Sachin Shivdatt Joshi
Yash Manohar Gajpalla
Value Champion
Improving the Quality of Life of Filariasis
Patients
Naveen Krishna Tarur
Regional Level
Second Prize
Client Delight
Global Pre-paid Interactive Portfolio for a
Global Financial Services Company
Amit Lal
Chandra Mohan Nandakumar
Dhinakaran T.
Jithesh E. P.
Muthu Kumar Natarajan
Sivakumar Swaminathan
Sunil Fernandes
Vivek Dwivedi
Siebel Support Project for a Large
Telecom Provider in Asia-Pacific
Anshul Dubey
Naga Dolanandam Pitchuka
Pradeep Reddy Nalliahgari
Rama Rao Ganapatineedi
Rasheed Abdul Mohammad
Swapna Chanda
Tulasi Cherukuri
Vimlesh Ankur
Champion
Abhishek Sabharwal
Amit Lohani
Kailash Badrinarayan Samdani
Champion
Venu Gopala Krishna Kishore Anumakonda
Vikram Srivastava
Jai Ganesh
Anand Avinash Tambey
Tarun Lalwani
Sidharth Subhash Ghag
Finacle
TM
Advisor from MS Competency
Group Finacle Archie
Anushree Chharia
Remya N. S.
Sandeep S.
Sanjay Kannan
Sivasubburaj Palraj
Srinivas Gali
Flypp
TM
White Labeled Mobile
Applications Store
Bhaskara Krishna Hegde
Kush Kochgaway
Puneet Srivastava
Rohit Sampige
Sameer Laxman Shetty
Sanjeev Kapoor
Infrastructure Transformation Services
Basab Bandyopadhyay
Guruprakash Pai Karkala
Madhukar I. B.
Ramshankar Ramdattan
Rohit Nand
Infy-on-the-go
Deepak Nagesh Murdeshwar
Mandar Kumar Ananda
Shailesh Mahadev Kawale
Srinivas Sreekumar
Vijay Natarajan
Vinod Sai G.
iNSTAF Infosys Network Services Test
and Automation Framework
Manjunath D. Kulkarni
Nithin Jose
Sanjay Kumar Misra
Shaijo Mohan
Sourabh Pandey
Syeda Irrum Shabbir
Infosys Tools Group Deployment Team
Bhakti Neeladhar Salian
Naresh Balaram Choudhary
Sandeep Chauhan
Snehashree M. K. Prasad
Srinivasa Sujit Rao
Vasudeva Murthy Niranjan
Mysore Food Committee Creating
Options and Delight
Dinesh Singh
John Britto Jesuraj
Sarit Poria
Subrata Das
Suhail Muhammed
Vidyabhushana Hande
New Engagement Models Corporate
Initiative
Amit Misra
Amod Bandu Kumbhar
Asha Kurup
Lakshmi Narasimha Rao Gunda
Saji Antony K.
Vijaya Sorna Kumar Namasivayam
People Development
Direction Forward Initiative
Aktharunnisa Syed Hasinuddin
Antony Menacherry
Krithika Ramachandran
Madhu Sudhan R.
Narayanan Shanmugam
Sathya Ganesh
Finance Center of Excellence
Empowering Through Collective Learning
Anna Tumidajewicz
Divya G
Jairam Raghunatha Rao
Meenu Verma
Michal Cieslak
Sunita Ramachandra Bhat
SNEHAM Team
Anbulingom T.
Deeppak Chakravarthy Kambarayar
Devaraj Balakrishnan
Dharmambiha D. R.
Lakshmi Narayanan R.
Lilly Priyadarshini L.
Sivakumar Ganesan
Thothadri Srinivasan
Vasanth S.
Vinoth Kumar
Social Forum to Enable the Needy
Anil Kumar G. R.
Darshana Ganesh Muruvanda
Jitendra Kumar
Majur Avinash Puranik
Manoj Aggarwal
Mrithyunjay D. S.
Rajagopalan P.
Subrata Das
Vidya Rajesh Paliwal
Vivek Gajanan Hanchate
Spark Hyderabad Raising Aspirations of
Students
Anand Rajendra Kumar
Brijesh Chawda
Mani Sri Vellanki
Narsimha Rao Mannepalli
Rajanish Vaidya
Sasank Sekhar Nayak
Srinagesh Chatarajupalli
Sudheer Reddy Kola
Venkata Bhanu Prasad Tolety
Vinesh Kumar R.D
Spark Raising Aspirations of Students @
Chandigarh
Anil Kumar Gupta
Arvind Raina
Deepak Bhalla
Dharm Veer Singh
Jeet Vikram Minhas
Kanika Sharma
Nikhil Jain
Pankaj Bharti
Richa Arora
Vishal Bhat
SPRING Infosys China
Dhanesh Subramanian
Gopi Chand Paladugu
JianYe Zhu
Jin Xu
LiLi Lu
Lom Harshni Chauhan
Porna Pramanik
WeiDong Li
XiaoLei Liu
YuMei Li
Team Akanksha
Akshaya Kumar Satpathy
Amrita Deo
Basudev Mohanty
Debi Prasanna Patnaik
Manish Kumar Pandey
Nitiv Nigam
Prashant Kumar Sahu
Ramakrishna Sahoo
Sanjaya Kumar Moharana
Sanjeeb Panda
Systems and Processes
Infosys Tools Group Systems and
Processes Team
Amit Gulati
Naresh Balaram Choudhary
Pallavi Bomma
Prabhat Ranjan Kumar
Raghavendra S.
Srinivasa Sujit Rao
Predictability Sustainability Profitability
and De-risking model for Revenue
Recognition for Infosys and Group of
Companies
Gopalakrishnan Ramachandran
Mohammed Shazin Thottathil
Narasimharao V. V. S. V. R Kompella
Prem Joseph Pereira
Ravi Krishnan Subramony
Sandip Kumar Agarwal
Akshay Gangadhar Shinde
Praveen Kumar Behara
Rohit Sapru
Thangamani S.
Ratio analysis | 7
Infosys Additional information 2010-11
Ratio analysis
2011 2010 2009
Ratios financial performance
Export revenue / total revenue (%) 97.66 98.73 98.72
Domestic revenue / total revenue (%) 2.34 1.27 1.28
Software development expenses / total revenue (%) 56.20 54.68 55.00
Gross profit / total revenue (%) 43.80 45.32 45.00
Selling and marketing expenses / total revenue (%) 4.80 4.61 4.60
General and administration expenses / total revenue (%) 5.85 5.90 6.32
Selling, General and Administrative (SG&A) expenses / total revenue (%) 10.65 10.51 10.92
Aggregate employee costs / total revenue (%) 49.08 48.96 49.20
Operating profit (PBIDTA) / total revenue (%) 33.15 34.82 34.08
Depreciation and amortization / total revenue (%) 2.92 3.82 3.42
Operating profit after depreciation and interest / total revenue (%) 30.23 31.00 30.66
Other income / total revenue (%) 4.52 4.30 2.48
Provision for investments / total revenue (%) (0.04)
Profit before tax / total revenue (%) 34.75 35.35 33.13
Tax / total revenue (%) 9.37 8.12 4.42
Effective tax rate Tax / PBT (%) 26.96 22.98 13.33
Profit after tax
(2)
/ total revenue (%) 25.38 27.22 28.72
Ratios Balance Sheet
Debt-equity ratio
Current ratio 5.22 4.46 4.72
Days Sales Outstanding (DSO) 61 56 61
Cash and equivalents / total assets (%)
(1)
61.94 66.48 57.65
Cash and equivalents / total revenue (%)
(1)
60.21 70.03 50.78
Capital expenditure / total revenue (%) 4.54 2.75 5.81
Operating cash flows / total revenue (%) 16.82 27.80 25.42
Depreciation / average gross block (%) 11.90 13.17 13.23
Technology investment / total revenue (%) 2.25 2.12 2.70
Ratios returns
PAT
(2)
/ average net worth (%) 27.69 28.89 37.18
ROCE (PBIT / average capital employed) (%) 37.58 37.25 42.85
Return on average invested capital (%)
(1)
67.73 68.75 78.84
Capital output ratio 1.08 1.05 1.29
Invested capital output ratio
(1)
3.01 2.81 3.03
Value added / total income (%) 82.99 84.45 83.68
Enterprise-value / total revenue (x) 6.73 6.40 3.23
Dividend / adjusted public offer price
(3)
(%) 4,042 3,368 3,166
Market price / adjusted public offer price (%) 436,723 3,52,465 1,78,800
Ratios growth
Overseas revenue (%) 18.78 4.33 29.65
Total revenue (%) 20.08 4.32 29.50
Operating profit before depreciation (%) 14.32 6.57 39.15
Net profit
(2)
(%) 11.95 (1.10) 30.18
Net profit after exceptional item (%) 11.03 (0.27) 30.18
Basic EPS
(2)
(%) 11.85 (1.26) 29.92
Basic EPS after exceptional item (%) 10.91 (0.42) 29.92
Ratios per share
Basic EPS
(2)
(R) 112.26 100.37 101.65
Basic EPS after exceptional item (R) 112.26 101.22 101.65
Basic cash EPS
(2)
(R) 125.14 114.46 113.77
Basic cash EPS after exceptional item (R) 125.14 115.30 113.77
Price / earnings, end of year
(2)
28.87 26.06 13.02
Price / cash earnings, end of year
(2)
25.90 22.85 11.64
PE / EPS growth
(2)
2.44 (20.68) 0.44
Book value (R) 426.73 384.01 310.90
Price / book value, end of year 7.60 6.81 4.26
Dividend per share (par value of R5/- each)
(3)
30.00 25.00 23.50
Dividend
(3)
(%) 600 500 470
Dividend payout (%)
(3) (4)
29.34 26.93 26.26
Market capitalization / total revenue, end of year (x) 7.33 7.10 3.74
Notes : The ratio calculations are based on standalone Indian GAAP financial statements.
(1)
Investments in liquid mutual funds and certificates of deposit have been considered as cash and cash equivalents for the purpose of the above ratio analysis.
(2)
(3)
Excludes special dividend for fiscal 2011
(4)
Calculated as a % of the consolidated profits of the Infosys group
8 | Ratio analysis
Ratio analysis
(1)
Investments in liquid mutual funds and certificates of deposit have been considered as cash and cash equivalents for the purpose of the above ratio analysis.
(2)
(3)
Excludes special dividend for fiscal 2011
Auditors report | 9
We have audited the attached Balance Sheet of Infosys Technologies Limited (the Company) as at March 31, 2011, the Profit and Loss account
of the Company and the Cash Flow statement of the Company for the year ended on that date, annexed thereto. These financial statements are
We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform
principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe
As required by the Companies (Auditors Report) Order, 2003 (the Order), as amended, issued by the Central Government of India in terms
of sub-section (4A) of Section 227 of the Companies Act, 1956 (the Act), we enclose in the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
Further to our comments in the Annexure referred to above, we report that :
(a) we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our
audit;
(b) in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those
books;
(c) the Balance Sheet, the Prot and Loss account and the Cash Flow statement dealt with by this report are in agreement with the books of
account;
(d) in our opinion, the Balance Sheet, the Prot and Loss account and the Cash Flow statement dealt with by this report comply with the
Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;
(e) on the basis of written representations received from the directors, as at March 31, 2011 and taken on record by the Board of Directors, we
report that none of the directors is disqualied as at March 31, 2011 from being appointed as a director in terms of Section 274(1)(g) of the
Act;
(f) in our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information
required by the Act, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted
in India :
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;
(ii) in the case of the Prot and Loss account, of the prot of the Company for the year ended on that date; and
(iii) in the case of the Cash Flow statement, of the cash ows of the Company for the year ended on that date.
for B S R & Co.
Bangalore
15 April 2011
Natrajh Ramakrishna
Partner
Auditors report to the members of Infosys Technologies Limited
10 | Auditors report
Annexure to the auditors report
The Annexure referred to in our report to the members of Infosys Technologies Limited (the Company) for the year ended March 31, 2011.
We report that :
(i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(b) The Company has a regular programme of physical verification of its fixed assets by which fixed assets are verified in a phased manner
over a period of three years. In accordance with this programme, certain fixed assets were verified during the year and no material
discrepancies were noticed on such verification. In our opinion, this periodicity of physical verification is reasonable having regard to
the size of the Company and the nature of its assets.
(c) Fixed assets disposed of during the year were not substantial, and therefore, do not affect the going concern assumption.
(ii) The Company is a service company, primarily rendering information technology services. Accordingly, it does not hold any physical
inventories. Thus, paragraph 4(ii) of the Order is not applicable.
(iii) (a) The Company has granted a loan to a body corporate covered in the register maintained under Section 301 of the Companies Act, 1956
(the Act). The maximum amount outstanding during the year was R47.71 crore and the year-end balance of such loan amounted to
R22.69 crore. Other than the above, the Company has not granted any loans, secured or unsecured, to companies, firms or parties
covered in the register maintained under section 301 of the Act.
(b) In our opinion, the rate of interest and other terms and conditions on which the loan has been granted to the body corporate listed in
the register maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the Company.
(c) In the case of loan granted to the body corporate listed in the register maintained under Section 301 of the Act, the borrower has been
regular in the payment of the interest as stipulated. The terms of arrangement do not stipulate any repayment schedule and the loan
is repayable on demand. Accordingly, paragraph 4(iii)(c) of the Order is not applicable to the Company in respect of repayment of the
principal amount.
(d) There are no overdue amounts of more than rupees one lakh in respect of the loan granted to a body corporate listed in the register
maintained under Section 301 of the Act.
(e) The Company has not taken any loans, secured or unsecured from companies, firms or parties covered in the register maintained under
Section 301 of the Act. Accordingly, paragraphs 4(iii)(e) to 4(iii)(g) of the Order are not applicable.
(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate
with the size of the Company and the nature of its business with regard to purchase of fixed assets and sale of services. The activities
of the Company do not involve purchase of inventory and the sale of goods. We have not observed any major weakness in the internal
control system during the course of the audit.
(v) (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to
in Section 301 of the Act have been entered in the register required to be maintained under that section.
(b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and
arrangements referred to in (v)(a) above and exceeding the value of R5 lakh with any party during the year have been made at prices
which are reasonable having regard to the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the public.
(vii) In our opinion, the Company has an internal audit system commensurate with the size and the nature of its business.
(viii) The Central Government of India has not prescribed the maintenance of cost records under Section 209(1)(d) of the Act for any of the
services rendered by the Company.
(ix) (a) According to the information and explanations given to us and on the basis of our examination of the records of the Company, amounts
deducted / accrued in the books of account in respect of undisputed statutory dues including Provident Fund, Investor Education and
Protection Fund, Income tax, Sales tax, Wealth tax, Service tax and other material statutory dues have been regularly deposited during the
year by the Company with the appropriate authorities. As explained to us, the Company did not have any dues on account of Employees
State Insurance, Customs duty and Excise duty.
Further, since the Central Government has till date not prescribed the amount of cess payable under Section 441A of the Act, we are not
in a position to comment upon the regularity or otherwise of the Company in depositing the same.
According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor
Education and Protection Fund, Income tax, Sales tax, Wealth tax, Service tax and other material statutory dues were in arrears as at
March 31, 2011 for a period of more than six months from the date they became payable.
Auditors report | 11
(b) According to the information and explanations given to us, there are no material dues of Wealth tax and Cess which have not been
deposited with the appropriate authorities on account of any dispute. However, according to information and explanations given to us,
the following dues of Income tax, Sales tax, and Service tax, have not been deposited by the Company on account of disputes :
Name of the statute Nature of dues Amount
(Rcrore)
Period to which
the amount relates
Forum where dispute
is pending
Income Tax Act,1961
Fringe benefit tax and
interest demanded 2.28 Assessment year 2008-2009
Commissioner of Income Tax
Income Tax Act,1961
Income-tax, interest and
penalty demanded 228.19
(1) (2)
Assessment year 2007-2008
Income Tax Act,1961
Interest on Income-tax
demanded 0.51 Assessment year 2006-2007
KVAT Act, 2003
Sales tax, interest and
penalty demanded 24.53
(1)
April 2005 to March 2009 High Court of Karnataka
Central Sales Tax Act,
1956 Sales tax demanded 0.31
(1) (2)
April 2007 to March 2008 High Court of Andhra Pradesh
Service tax Service tax demanded 2.58 January 2005 to March 2009 Appellate Tribunal, Bangalore
Service tax
Service tax and penalty
demanded 23.15 February 2007 to March 2009 Appellate Tribunal, Bangalore
Notes :
(1)
Net of amounts paid under protest.
(2)
A stay order has been received against the amount disputed and not deposited.
(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses in the financial
year and in the immediately preceding financial year.
(xi) The Company did not have any outstanding dues to any financial institution, banks or debenture holders during the year.
(xii) The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
(xiii) In our opinion and according to the information and explanations given to us, the Company is not a chit fund / nidhi / mutual benefit
fund / society.
(xiv) According to the information and explanations given to us, the Company is not dealing or trading in shares, securities, debentures and
other investments.
(xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from
banks or financial institutions.
(xvi) The Company did not have any term loans outstanding during the year.
(xvii) The Company has not raised any funds on short-term basis.
(xviii) The Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under
Section 301 of the Act.
(xix) The Company did not have any outstanding debentures during the year.
(xx) The Company has not raised any money by public issues during the year.
(xxi) According to the information and explanations given to us, no material fraud on or by the Company has been noticed or reported during
the course of our audit.
for B S R & Co.
Bangalore
15 April 2011
Natrajh Ramakrishna
Partner
12 | Standalone nancial statements
Balance Sheet
As at March 31,
in rcrore
Schedule 2011 2010
SOURCES OF FUNDS
SHAREHOLDERS FUNDS
Share capital 1 287 287
Reserves and surplus 2 24,214 21,749
24,501 22,036
DEFERRED TAX LIABILITIES 5 176 232
24,677 22,268
APPLICATION OF FUNDS
FIXED ASSETS 3
Original cost 6,934 6,357
Less : Accumulated depreciation and amortization 2,878 2,578
Net book value 4,056 3,779
Add : Capital work-in-progress 499 409
4,555 4,188
INVESTMENTS 4 1,325 4,626
DEFERRED TAX ASSETS 5 406 313
CURRENT ASSETS, LOANS AND ADVANCES
Sundry debtors 6 4,212 3,244
Cash and bank balances 7 13,665 9,797
Loans and advances 8 4,867 3,898
22,744 16,939
LESS : CURRENT LIABILITIES AND PROVISIONS
Current liabilities 9 1,880 1,763
Provisions 10 2,473 2,035
NET CURRENT ASSETS 18,391 13,141
24,677 22,268
Note : The schedules referred to above are an integral part of the Balance Sheet.
for B S R & Co.
Firms Reg No : 101248W
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Standalone nancial statements | 13
Profit and Loss account
For the year ended March 31,
Schedule 2011 2010
Income from software services and products 25,385 21,140
Software development expenses 11 14,267 11,559
GROSS PROFIT 11,118 9,581
Selling and marketing expenses 12 1,219 974
General and administration expenses 13 1,485 1,247
2,704 2,221
OPERATING PROFIT BEFORE DEPRECIATION 8,414 7,360
OPERATING PROFIT 7,674 6,553
Other income, net 14 1,147 910
NET PROFIT BEFORE TAX AND EXCEPTIONAL ITEM 8,821 7,472
Provision for taxation (refer to note 23.2.11) 15 2,378 1,717
NET PROFIT AFTER TAX BEFORE EXCEPTIONAL ITEM 6,443 5,755
Income on sale of investments, net of taxes (refer to note 23.2.25) 48
NET PROFIT AFTER TAX AND EXCEPTIONAL ITEM 6,443 5,803
Balance brought forward 13,806 10,305
AMOUNT AVAILABLE FOR APPROPRIATION 20,249 16,108
Dividend
Interim dividend 574 573
30th year special dividend 1,722
Amount transferred to general reserve 645 580
20,249 16,108
EARNINGS PER SHARE
Equity shares of par value R5/- each
Basic 112.26 100.37
Diluted 112.22 100.26
After exceptional item
Basic 112.26 101.22
Diluted 112.22 101.10
Number of shares used in computing earnings per share
(1)
Basic 57,40,13,650 57,33,09,523
Diluted 57,42,01,958 57,39,49,631
Notes : The schedules referred to above are an integral part of the Profit and Loss account.
(1)
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Cash Flow statement
For the year ended March 31,
in rcrore
Schedule 2011 2010
Net profit before tax 8,821 7,472
Adjustments to reconcile net profit before tax to cash provided by operating
activities
Effect of exchange differences on translation of deferred tax liabilities (6)
Effect of exchange differences on translation of foreign currency cash and
cash equivalents (5) 68
Sundry debtors (968) 146
Loans and advances 16 (704) (368)
Current liabilities and provisions 17 234 236
7,026 7,508
Income taxes paid 18 (2,756) (1,653)
Purchase of fixed assets and change in capital work-in-progress 19 (1,152) (565)
Investments in subsidiaries 20 (a) (77) (120)
Investment / (Disposal) of other securities 20 (b) 3,378 (3,497)
Interest and dividend received 21 1,086 831
CASH FLOWS FROM INVESTING ACTIVITIES BEFORE EXCEPTIONAL ITEM 3,235 (3,351)
Proceeds on sale of long-term investments, net of taxes (refer to note 23.2.25) 53
NET CASH PROVIDED BY / (USED IN) INVESTING ACTIVITIES 3,235 (3,298)
Repayment of loan given to subsidiary 20 (c) 14 5
Dividends paid including residual dividend (3,156) (1,346)
Effect of exchange differences on translation of foreign currency cash and cash
equivalents 5 (68)
NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS 3,868 1,008
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 11,297 10,289
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 22 15,165 11,297
Note : The schedules referred to above are an integral part of the Cash Flow statement.
for B S R & Co.
Natrajh Ramakrishna
Partner
S. Gopalakrishnan
Managing Director
S. D. Shibulal
Director
Director
Director
Dr. Omkar Goswami
Director
Sridar A. Iyengar
Director
David L. Boyles
Director
Director
K. V. Kamath
Director
R. Seshasayee
Director
K. Dinesh
Director
Bangalore
April 15, 2011
T. V. Mohandas Pai
Director
Srinath Batni
Director
V. Balakrishnan
K. Parvatheesam
Company Secretary
Schedules to the Balance Sheet
As at March 31, 2011 2010
1 SHARE CAPITAL
Authorized
60,00,00,000 (60,00,00,000) equity
shares 300 300
Issued, subscribed and paid up
(1)
287 287
57,41,51,559 (57,38,25,192) equity
shares fully paid up
[Of the above, 53,53,35,478 (53,53,35,478)
equity shares, fully paid up have been issued
as bonus shares by capitalization of the
general reserve]
287 287
Notes : Forfeited shares amounted to r1,500/- (r1,500/-)
(1)
For details of options in respect of equity shares, refer to note 23.2.10 and
also refer to note 23.2.19 for details of basic and diluted shares
2 RESERVES AND SURPLUS
Capital reserve 54 6
Add : Transferred from Profit and Loss
account 48
54 54
Share premium account Opening
balance 3,022 2,925
Add : Receipts on exercise of employee
stock options 24 87
Income tax benefit arising from
exercise of stock options 11 10
3,057 3,022
General reserve Opening balance 4,867 4,287
Add : Transferred from Profit and Loss
account 645 580
5,512 4,867
24,214 21,749
3 FIXED ASSETS
Particulars Original cost Depreciation and amortization Net book value
As at
April 1,
2010
Additions
during the
year
Deductions
/ Retirement
during the
year
As at
March 31,
2011
As at
April 1,
2010
For the
year
Deductions
During the
year
As at
March 31,
2011
As at
March 31,
2011
As at
March 31,
2010
Land : Freehold 178 228 406 406 178
Leasehold 138 3 135 135 138
Buildings
(1) (2)
3,209 323 3,532 737 227 964 2,568 2,472
Plant and machinery
(2) (3)
1,149 147 144 1,152 597 215 144 668 484 552
Computer equipment
(2) (3)
1,037 251 196 1,092 882 186 196 872 220 155
Furniture and fixtures
(2) (3)
629 69 100 598 347 112 100 359 239 282
Vehicles 5 2 7 3 3 4 2
Intellectual property
rights 12 12 12 12
6,357 1,020 443 6,934 2,578 740 440 2,878 4,056 3,779
Previous year 5,986 787 416 6,357 2,187 807 416 2,578 3,779
Notes :
(1)
Buildings include r250/- being the value of 5 shares of r50/- each in Mittal Towers Premises Co-operative Society Limited.
(2)
Includes certain assets provided on operating lease to Infosys BPO, a subsidiary. Refer to note 23.2.6 for details
(3)
During the year ended March 31, 2011 and March 31, 2010, certain assets which were old and not in use having gross book value of r440 crore and r387 crore respectively
(net book value nil) were retired.
As at March 31, 2011 2010
4 INVESTMENTS
(1)
Long-term investments at cost
Trade (unquoted)
Other investments 6 6
Less : Provision for investments 2 2
4 4
Subsidiaries
Infosys BPO Limited
(2)
3,38,22,319 (3,38,22,319) equity shares
of R10/- each, fully paid 659 659
Infosys Technologies (China) Company
Limited 107 65
Infosys Technologies (Australia) Pty.
Limited
1,01,08,869 (1,01,08,869) equity shares
of AUD 0.11 par value, fully paid 66 66
Infosys Consulting, Inc., U.S.
5,50,00,000 (5,50,00,000) common
stock of US$ 1.00 par value, fully paid 243 243
Infosys Technologies,
S. de R. L. de C. V., Mexico 54 40
Infosys Technologies Sweden AB
1,000 (1,000) equity shares of SEK 100
par value, fully paid
Infosys Tecnologia do Brasil Ltda
1,45,16,997 (1,07,16,997) shares of
BRL 1.00 par value, fully paid 38 28
Company Limited 11
Infosys Public Services, Inc.
1,00,00,000 (1,00,00,000) common
stock of US$ 0.50 par value, fully paid 24 24
1,202 1,125
Current investments at the lower of cost and
fair value
Liquid mutual fund units 2,317
119 3,497
1,325 4,626
Aggregate amount of unquoted investments 1,325 4,626
Notes :
(1)
Refer to note 23.2.15 for details of investments
(2)
Investments include 6,79,250 (13,36,331) options of Infosys BPO limited
As at March 31, 2011 2010
5 DEFERRED TAXES
Deferred tax assets
Fixed assets 234 201
Sundry debtors 19 28
Other assets 153 84
406 313
Deferred tax liabilities
Branch profit tax 176 232
6 SUNDRY DEBTORS
(1)
Debts outstanding for a period exceeding
six months
Unsecured
Other debts
Unsecured
Considered good
(2)
4,212 3,244
4,295 3,344
Less : Provision for doubtful debts 83 100
4,212 3,244
(1)
Includes dues from companies where directors are
interested 2 11
(2)
Includes dues from subsidiaries
(refer to note 23.2.7) 72 56
7 CASH AND BANK BALANCES
(1)
Cash on hand
Balances with scheduled banks
In current accounts
(2)
197 153
In deposit accounts 13,024 8,868
Balances with non-scheduled banks
In current accounts 444 776
13,665 9,797
(1)
Refer to note 23.2.12 for details of balances with
scheduled and non-scheduled banks
(2)
Includes balance in unclaimed dividend account
(refer to note 23.2.23.a) 3 2
8 LOANS AND ADVANCES
Loans to subsidiary
(refer to note 23.2.7) 32 46
Advances
Prepaid expenses 52 25
For supply of goods and rendering
of services 50 5
Advance to gratuity trust and others 2
receivable 516 321
Others 10 13
660 412
Loans and advances to employees
Housing and other loans 42 38
Salary advances 84 62
As at March 31, 2011 2010
(refer to note 23.2.13) 1,844 1,781
Mark-to-market gain on forward and
4,867 3,898
Unsecured, considered doubtful
4,870 3,900
Less : Provision for doubtful loans and
advances to employees 3 2
4,867 3,898
9 CURRENT LIABILITIES
Sundry creditors
Goods and services
(1)
85 96
Accrued salaries and benefits
Salaries 42 25
Bonus and incentives 363 421
Withholding and other taxes payable 292 235
Gratuity obligation unamortized amount
relating to plan amendment 22 26
Others
(2)
8 8
1,370 1,252
Unclaimed dividend 3 2
1,880 1,763
(1)
Includes dues to subsidiaries (refer to note 23.2.7) 55 95
(2)
Includes deposits received from subsidiary
(refer to note 23.2.7) 7 7
10 PROVISIONS
Provision for
Income taxes
(1)
756 719
Post-sales client support and
warranties
(2)
78 73
2,473 2,035
Notes :
(1)
(2)
Schedules to the Balance Sheet
Loans and advances (contd.) :
Schedules to Profit and Loss account
11 SOFTWARE DEVELOPMENT
EXPENSES
funds 378 244
Staff welfare 53 28
Technical sub-contractors subsidiaries 1,568 1,210
Technical sub-contractors others 476 269
Overseas travel expenses including visa 573 401
Consumables 23 22
Rent 25 22
14,267 11,559
12 SELLING AND MARKETING EXPENSES
staff expenses 969 753
funds 7 4
Staff welfare 2 2
Traveling and conveyance 4 3
Rent 12 12
Sales promotion expenses 1
1,219 974
13 GENERAL AND ADMINISTRATION
EXPENSES
staff expenses 390 330
funds 25 17
Office maintenance expenses 188 136
Donations 1 43
Rent 31 28
Advertisements 6 3
Provision for bad and doubtful debts
and advances 3 (1)
directors 5 6
Freight charges 1 1
1,485 1,247
14 OTHER INCOME, NET
Interest received on deposits with
banks and others
(1)
1,068 743
Dividend received on investment in
liquid mutual fund units
(non-trade unquoted) 18 101
Miscellaneous income, net
(2)
22 27
Gains / (losses) on foreign currency, net 39 39
1,147 910
91 95
Notes :
(1)
Includes tax deducted at source
(2)
Refer to note 23.2.6 and 23.2.14
15 PROVISION FOR TAXATION
Income taxes
(1)
2,521 1,984
MAT credit entitlement (288)
Deferred taxes
(2)
(143) 21
2,378 1,717
Notes :
(1)
(2)
General and administration expenses (contd.) :
Schedules to Cash Flow statement
For the Year ended March 31, 2011 2010
16 CHANGE IN LOANS AND ADVANCES
Less : Gratuity obligation unamortized
amount relating to plan
amendment
(1)
22 26
included in cash and cash
equivalents
(2)
1,500 1,500
Loan to subsidiary 32 46
2,375 1,671
704 368
Notes :
(1)
(2)
Excludes restricted deposits held with LIC of r344 crore (r281 crore) for
funding leave liability
17 CHANGE IN CURRENT LIABILITIES
AND PROVISIONS
Less : Unclaimed dividend 3 2
Gratuity obligation unamortized
amount relating to plan
amendment 22 26
Provisions separately considered in
Cash Flow statement
2,215 1,981
234 236
18 INCOME TAXES PAID
Charge as per the Profit and Loss
account 2,378 1,717
Add / (Less) : Increase / (Decrease) in
advance income taxes 283 373
Increase / (Decrease) in deferred
taxes
(1)
143 (21)
Increase / (Decrease) in MAT credit
entitlement (262)
Income tax benefit arising from
exercise of stock options (11) (10)
(Increase) / Decrease in income tax
provision (37) (144)
2,756 1,653
Note :
(1)
19 PURCHASE OF FIXED ASSETS AND
CHANGE IN CAPITAL WORK-IN-
PROGRESS
As per the Balance Sheet
(1)
1,017 787
Less : Opening capital work-in-progress 409 615
Add : Closing capital work-in-progress 499 409
Add : Opening retention monies 66 50
Less : Closing retention monies 21 66
1,152 565
Note :
(1)
Net of r3 crore movement in land from leasehold to free-hold for the year
ended March 31, 2011

For the Year ended March 31, 2011 2010
20 (a) INVESTMENTS IN SUBSIDIARIES
(1)
77 120
Note :
(1)
Refer to note 23.2.15 for investment made in subsidiaries
20 (b) INVESTMENT / (DISPOSAL) OF
SECURITIES
(1)
Opening balance considered 3,497
Less : Closing as per the Balance
Sheet 119 (3,497)
3,378 3,497
Note :
(1)
Refer to note 23.2.15 for investment and redemptions
20 (c) REPAYMENT OF SUBSIDIARY LOAN
Opening balance 46 51
Less : Closing balance
(1)
32 46
14 5
Note :
(1)
Net of exchange rate fluctuation of Nil and r5 crore as at March 31, 2011
and March 31, 2010 respectively
21 INTEREST AND DIVIDEND
RECEIVED
Interest and dividend income as per
Profit and Loss account 1,086 844
Add : Opening interest accrued but not
due 14 1
Less : Closing interest accrued but not
due on certificates of deposit and
bank deposits 14 14
1,086 831
22 CASH AND CASH EQUIVALENTS AT
THE END
Add : Deposits with financial
institutions
(1)
1,500 1,500
15,165 11,297
Note :
(1)
Excludes restricted deposits held with LIC of r344 crore (r281 crore) for
funding leave liability (refer to note 23.2.23b)
Schedules | 19
Schedules to the financial statements for the year ended March 31, 2011
23. Significant accounting policies and
notes on accounts
Company overview
its majority-owned and controlled subsidiary, Infosys BPO Limited
(Infosys BPO) and wholly-owned and controlled subsidiaries, Infosys
Consulting Inc. (Infosys Consulting), Infosys Technologies S. de
R. L. de C. V. (Infosys Mexico), Infosys Technologies (Sweden) AB.
(Infosys Sweden), Infosys Tecnologia do Brasil Ltda. (Infosys Brasil),
Technologies (Shanghai) Company Limited (Infosys Shanghai) is
a leading global technology services corporation. The Company
provides end-to-end business solutions that leverage cutting-edge
technology, thereby enabling clients to enhance business performance.
The Company provides solutions that span the entire software
lifecycle encompassing technical consulting, design, development,
re-engineering, maintenance, systems integration, package evaluation
and implementation, testing and infrastructure management services.
In addition, the Company offers software products for the banking
industry.
23.1. Significant accounting policies
23.1.1. Basis of preparation of financial statements
These financial statements are prepared in accordance with Indian
Generally Accepted Accounting Principles (GAAP) under the historical
cost convention on the accrual basis except for certain financial
instruments which are measured at fair values. GAAP comprises
mandatory accounting standards as prescribed by the Companies
(Accounting Standards) Rules, 2006, the provisions of the Companies
Act, 1956 and guidelines issued by the Securities and Exchange Board
of India (SEBI). Accounting policies have been consistently applied
except where a newly issued accounting standard is initially adopted
or a revision to an existing accounting standard requires a change in
the accounting policy hitherto in use.
23.1.2. Use of estimates
The preparation of the financial statements in conformity with GAAP
requires the Management to make estimates and assumptions that affect
the reported balances of assets and liabilities and disclosures relating
to contingent liabilities as at the date of the financial statements and
reported amounts of income and expenses during the period. Examples
of such estimates include computation of percentage of completion
which requires the Company to estimate the efforts expended to date
as a proportion of the total efforts to be expended, provisions for
doubtful debts, future obligations under employee retirement benefit
plans, income taxes, post-sales customer support and the useful lives
of fixed assets and intangible assets.
Accounting estimates could change from period to period. Actual
results could differ from those estimates. Appropriate changes in
estimates are made as the Management becomes aware of changes in
circumstances surrounding the estimates. Changes in estimates are
reflected in the financial statements in the period in which changes
are made and, if material, their effects are disclosed in the notes to
the financial statements.
The Management periodically assesses, using external and internal
sources, whether there is an indication that an asset may be impaired.
An impairment loss is recognized wherever the carrying value of an
asset exceeds its recoverable amount.
The recoverable amount is higher of the assets net selling price and
value in use, which means the present value of future cash flows
expected to arise from the continuing use of the asset and its eventual
disposal. An impairment loss for an asset is reversed if, and only if,
the reversal can be related objectively to an event occurring after the
impairment loss was recognized. The carrying amount of an asset
is increased to its revised recoverable amount, provided that this
amount does not exceed the carrying amount that would have been
determined (net of any accumulated amortization or depreciation)
had no impairment loss been recognized for the asset in prior years.
23.1.3. Revenue recognition
Revenue is primarily derived from software development and related
services and from the licensing of software products. Arrangements
with customers for software development and related services are either
on a fixed-price, fixed-timeframe or on a time-and-material basis.
the Balance Sheet date is recognized as unbilled revenues. Revenue
from fixed-price and fixed-timeframe contracts, where there is no
uncertainty as to measurement or collectability of consideration, is
recognized based upon the percentage of completion method. When
there is uncertainty as to measurement or ultimate collectability,
revenue recognition is postponed until such uncertainty is resolved.
Cost and earnings in excess of billings are classified as unbilled revenue,
while billings in excess of cost and earnings is classified as unearned
revenue. Provision for estimated losses, if any, on uncompleted
contracts are recorded in the period in which such losses become
probable based on the current estimates.
Annual Technical Services revenue and revenue from fixed-price
maintenance contracts are recognized ratably over the period in
which services are rendered. Revenue from the sale of user licenses for
software applications is recognized on transfer of the title in the user
license, except in case of multiple element contracts, which require
significant implementation services, where revenue for the entire
arrangement is recognized over the implementation period based
upon the percentage-of-completion. Revenue from client training,
support and other services arising due to the sale of software products
is recognized as the related services are performed.
The Company accounts for volume discounts and pricing incentives
to customers as a reduction of revenue based on the ratable allocation
of the discount / incentive amount to each of the underlying revenue
transactions that result in progress by the customer towards earning
increases in levels of revenue transactions, the Company recognizes
the liability based on its estimate of the customers future purchases.
If it is probable that the criteria for the discount will not be met, or
if the amount thereof cannot be estimated reliably, then discount is
not recognized until the payment is probable and the amount can be
estimated reliably. The Company recognizes changes in the estimated
amount of obligations for discounts using a cumulative catch-up
approach. The discounts are passed on to the customer either as
direct payments or as a reduction of payments due from the customer.
The Company presents revenues net of value-added taxes in its Profit
and Loss account.
Profit on sale of investments is recorded on transfer of title from the
Company and is determined as the difference between the sale price
and carrying value of the investment. Lease rentals are recognized
ratably on a straight line basis over the lease term. Interest is recognized
using the time-proportion method, based on rates implicit in the
transaction. Dividend income is recognized when the Companys right
to receive dividend is established.
20 | Schedules
23.1.4. Provisions and contingent liabilities
A provision is recognized if, as a result of a past event, the Company
has a present legal obligation that can be estimated reliably, and it is
probable that an outflow of economic benefits will be required to settle
the obligation. Provisions are determined by the best estimate of the
outflow of economic benefits required to settle the obligation at the
reporting date. Where no reliable estimate can be made, a disclosure
is made as contingent liability. A disclosure for a contingent liability is
also made when there is a possible obligation or a present obligation
that may, but probably will not, require an outflow of resources.
Where there is a possible obligation or a present obligation in respect
of which the likelihood of outflow of resources is remote, no provision
or disclosure is made.
23.1.4.a. Post-sales client support and warranties
The Company provides its clients with a fixed-period warranty for
corrections of errors and telephone support on all its fixed-price, fixed-
timeframe contracts. Costs associated with such support services are
accrued at the time when related revenues are recorded and included
in cost of sales. The Company estimates such costs based on historical
experience and the estimates are reviewed annually for any material
changes in assumptions.
23.1.4.b. Onerous contracts
benefits to be derived by the Company from a contract are lower
than the unavoidable costs of meeting the future obligations under
the contract. The provision is measured at lower of the expected cost
of terminating the contract and the expected net cost of fulfilling the
contract.
23.1.5. Fixed assets, intangible assets and capital
work-in-progress
Fixed assets are stated at cost, less accumulated depreciation and
impairment, if any. Direct costs are capitalized until fixed assets
are ready for use. Capital work-in-progress comprises outstanding
advances paid to acquire fixed assets, and the cost of fixed assets
that are not yet ready for their intended use at the reporting date.
Intangible assets are recorded at the consideration paid for acquisition
of such assets and are carried at cost less accumulated amortization
and impairment.
23.1.6. Depreciation and amortization
Depreciation on fixed assets is provided on the straight-line method
over the useful lives of assets estimated by the Management.
Depreciation for assets purchased / sold during a period is
proportionately charged. Individual low-cost assets (acquired for less
than R5,000/-) are depreciated over a period of one year from the date
of acquisition. Intangible assets are amortized over their respective
individual estimated useful lives on a straight-line basis, commencing
from the date the asset is available to the Company for its use. The
Management estimates the useful lives for the other fixed assets as
follows :
Buildings 15 years
Computer equipment 2 5 years
Vehicles 5 years
23.1.7. Retirement benefits to employees
23.1.7.a. Gratuity
In accordance with the Payment of Gratuity Act, 1972, the Company
provides for gratuity, a defined benefit retirement plan (the Gratuity
Plan) covering eligible employees.
The Gratuity Plan provides a lump sum payment to vested employees
at retirement, death, incapacitation or termination of employment, of
an amount based on the respective employees salary and the tenure
of employment with the Company.
valuation at each Balance Sheet date using the projected unit credit
method. The Company fully contributes all ascertained liabilities to
the Infosys Technologies Limited Employees Gratuity Fund Trust
(the Trust). Trustees administer contributions made to the Trust and
contributions are invested in specific investments as permitted by the
law. The Company recognizes the net obligation of the Gratuity Plan
in the Balance Sheet as an asset or liability, respectively in accordance
with Accounting Standard (AS) 15, Employee Benefits. The
Companys overall expected long-term rate-of-return on assets has been
determined based on consideration of available market information,
current provisions of Indian law specifying the instruments in which
investments can be made, and historical returns. The discount rate
is based on the government securities yield. Actuarial gains and
losses arising from experience adjustments and changes in actuarial
assumptions are recognized in the Profit and Loss account in the period
in which they arise.
Certain employees of Infosys are also participants in the superannuation
plan (the Plan) which is a defined contribution plan. The Company
has no obligations to the Plan beyond its monthly contributions.
23.1.7.c. Provident fund
Eligible employees receive benefits from a provident fund, which
is a defined benefit plan. Both the employee and the Company
Limited Employees Provident Fund Trust. The remaining portion is
contributed to the government administered pension fund. The rate at
which the annual interest is payable to the beneficiaries by the trust is
administered by the government. The Company has an obligation to
make good the shortfall, if any, between the return from the investments
of the Trust and the notified interest rate.
23.1.7.d. Compensated absences
The employees of the Company are entitled to compensated absences
which are both accumulating and non-accumulating in nature. The
expected cost of accumulating compensated absences is determined
by actuarial valuation based on the additional amount expected to
be paid as a result of the unused entitlement that has accumulated at
the Balance Sheet date. Expense on non-accumulating compensated
absences is recognized in the period in which the absences occur.
23.1.8. Research and development
23.1.9. Foreign currency transactions
Foreign-currency denominated monetary assets and liabilities are
translated at exchange rates in effect at the Balance Sheet date. The
gains or losses resulting from such translations are included in the Profit
and Loss account. Non-monetary assets and non-monetary liabilities
denominated in a foreign currency and measured at fair value are
translated at the exchange rate prevalent at the date when the fair value
was determined. Non-monetary assets and non-monetary liabilities
denominated in a foreign currency and measured at historical cost
are translated at the exchange rate prevalent at the date of transaction.
Schedules | 21
Revenue, expense and cash-flow items denominated in foreign
currencies are translated using the exchange rate in effect on the date
of the transaction. Transaction gains or losses realized upon settlement
of foreign currency transactions are included in determining net profit
for the period in which the transaction is settled.
23.1.10. Forward and options contracts in foreign
currencies
The Company uses foreign exchange forward and options contracts to
hedge its exposure to movements in foreign exchange rates. The use
of these foreign exchange forward and options contracts reduce the
risk or cost to the Company and the Company does not use those for
trading or speculation purposes.
Effective April 1, 2008, the Company adopted AS 30, Financial
Instruments : Recognition and Measurement, to the extent that the
adoption did not conflict with existing accounting standards and
other authoritative pronouncements of the Company Law and other
regulatory requirements.
Forward and options contracts are fair valued at each reporting date.
The resultant gain or loss from these transactions are recognized in
the Profit and Loss account. The Company records the gain or loss
on effective hedges, if any, in the foreign currency fluctuation reserve
until the transactions are complete. On completion, the gain or loss is
transferred to the Profit and Loss account of that period. To designate
a forward or options contract as an effective hedge, the Management
objectively evaluates and evidences with appropriate supporting
documents at the inception of each contract whether the contract is
effective in achieving offsetting cash flows attributable to the hedged
risk. In the absence of a designation as effective hedge, a gain or loss is
recognized in the Profit and Loss account. Currently hedges undertaken
by the Company are all ineffective in nature and the resultant gain or
loss consequent to fair valuation is recognized in the Profit and Loss
account at each reporting date.
Income taxes are accrued in the same period that the related revenue
and expenses arise. A provision is made for income tax annually,
based on the tax liability computed, after considering tax allowances
and exemptions. Provisions are recorded when it is estimated that a
liability due to disallowances or other matters is probable. Minimum
Alternate Tax (MAT) paid in accordance with the tax laws, which gives
rise to future economic benefits in the form of tax credit against future
income tax liability, is recognized as an asset in the Balance Sheet if
there is convincing evidence that the Company will pay normal tax
after the tax holiday period and the resultant asset can be measured
reliably. The Company offsets, on a year on year basis, the current tax
assets and liabilities, where it has a legally enforceable right and where
it intends to settle such assets and liabilities on a net basis.
The differences that result between the profit considered for income
taxes and the profit as per the financial statements are identified,
and thereafter a deferred tax asset or deferred tax liability is recorded
for timing differences, namely the differences that originate in one
accounting period and reverse in another, based on the tax effect of the
aggregate amount of timing difference. The tax effect is calculated on
the accumulated timing differences at the end of an accounting period
based on enacted or substantively enacted regulations. Deferred tax
assets in situation where unabsorbed depreciation and carry forward
business loss exists, are recognized only if there is virtual certainty
supported by convincing evidence that sufficient future taxable
income will be available against which such deferred tax asset can be
realized. Deferred tax assets, other than in situation of unabsorbed
depreciation and carry forward business loss, are recognized only if
there is reasonable certainty that they will be realized. Deferred tax
assets are reviewed for the appropriateness of their respective carrying
values at each reporting date. Tax benefits of deductions earned on
to Profit and Loss account are credited to the share premium account.
23.1.12. Earnings per share
Basic earnings per share is computed by dividing the net profit after tax
by the weighted average number of equity shares outstanding during
the period. Diluted earnings per share is computed by dividing the
net profit after tax by the weighted average number of equity shares
considered for deriving basic earnings per share and also the weighted
average number of equity shares that could have been issued upon
conversion of all dilutive potential equity shares. The diluted potential
equity shares are adjusted for the proceeds receivable had the shares
been actually issued at fair value which is the average market value of
the outstanding shares. Dilutive potential equity shares are deemed
converted as of the beginning of the period, unless issued at a later
date. Dilutive potential equity shares are determined independently
for each period presented.
The number of shares and potentially dilutive equity shares are adjusted
retrospectively for all periods presented for any share splits and bonus
shares issues including for changes effected prior to the approval of
the financial statements by the Board of Directors.
23.1.13. Investments
Trade investments are the investments made to enhance the Companys
business interests. Investments are either classified as current or
long-term based on Managements intention at the time of purchase.
Current investments are carried at the lower of cost and fair value of
each investment individually. Cost for overseas investments comprises
the Indian rupee value of the consideration paid for the investment
translated at the exchange rate prevalent at the date of investment.
Long-term investments are carried at cost less provisions recorded to
recognize any decline, other than temporary, in the carrying value of
each investment.
23.1.14. Cash and cash equivalents
Cash and cash equivalents comprise cash and cash on deposit with
banks and corporations. The Company considers all highly liquid
months or less and that are readily convertible to known amounts of
cash to be cash equivalents.
23.1.15. Cash Flow statement
Cash flows are reported using the indirect method, whereby net profit
before tax is adjusted for the effects of transactions of a non-cash nature,
any deferrals or accruals of past or future operating cash receipts or
payments and item of income or expenses associated with investing
or financing cash flows. The cash flows from operating, investing and
financing activities of the Company are segregated.
23.1.16. Leases
Lease under which the Company assumes substantially all the risks
and rewards of ownership are classified as finance leases. Such assets
acquired are capitalized at fair value of the asset or present value of
is lower. Lease payments under operating leases are recognized as an
expense on a straight line basis in the Profit and Loss account over
the lease term.
23.2. Notes on accounts
Amounts in the financial statements are presented in rupees crore,
except for per share data and as otherwise stated. Certain amounts
that are required to be disclosed and do not appear due to rounding
off are detailed in note 23.3. All exact amounts are stated with the
suffix /-. One crore equals 10 million.
22 | Schedules
23.2.1. Aggregate expenses
The aggregate amounts incurred on expenses are as follows :
in rcrore
Year ended March 31,
2011 2010
Technical sub-contractors subsidiaries 1,568 1,210
Technical sub-contractors others 476 269
Office maintenance expenses 188 136
Rent 68 62
Consumables 23 22
Donations 1 43
Advertisements 6 3
Freight charges 1 1
Provision for bad and doubtful debts and
advances 3 (1)
Commission to non-whole-time directors 5 6
Auditors remuneration 0 0
16,971 13,780
23.2.2. Capital commitments and contingent liabilities
in rcrore
2011 2010
Estimated amount of
unexecuted capital contracts
(net of advances and
deposits)
742 267
Outstanding guarantees
and counter guarantees to
various banks, in respect of
the guarantees given by those
banks in favor of various
government authorities and
others
3 3
2011 2010
Claims against the Company,
not acknowledged as debts
(1)
271 28
[Net of amount paid to
statutory authorities R469
crore (R241 crore)]
in
million
in R
crore
in
million
in R
crore
Forward contracts
outstanding
In U.S. dollar 500 2,230 228 1,024
In Euro 20 127 16 97
In GBP 10 72 7 48
In AUD 10 46 3 12
Options contracts
outstanding
In U.S. dollar 200 898
2,475 2,079
Note :
(1)
Claims against the Company not acknowledged as debts include demand from
the Indian tax authorities for payment of additional tax of r671 crore (r214
crore), including interest of r177 crore (r39 crore) upon completion of their
tax review for fiscal 2005, fiscal 2006 and fiscal 2007. The tax demands are
mainly on account of disallowance of a portion of the deduction claimed by the
Company under Section 10A of the Income Tax Act. The deductible amount is
determined by the ratio of export turnover to total turnover. The disallowance
arose from certain expenses incurred in foreign currency being reduced from
export turnover but not reduced from total turnover. The tax demand for fiscal
2007 also includes disallowance of portion of profit earned outside India from
the STP units and disallowance of profits earned from SEZ units. The matter
for fiscal 2005, 2006 and 2007 is pending before the Commissioner of Income
Tax (Appeals), Bangalore.
The Company is contesting the demands and the Management, including its
tax advisors, believes that its position will likely be upheld in the appellate
process. No tax expense has been accrued in the financial statements for the
tax demand raised. The Management believes that the ultimate outcome of this
proceeding will not have a material adverse effect on the Companys financial
position and results of operations.
As of the Balance Sheet date, the Companys net foreign currency
exposures that are not hedged by a derivative instrument or otherwise
is R1,196 crore (R891 crore as at March 31, 2010).
The foreign exchange forward and option contracts mature between
1 to 12 months. The table below analyzes the derivative financial
instruments into relevant maturity groupings based on the remaining
period as of the Balance Sheet date :
in rcrore
Particulars As of March 31,
2011 2010
Not later than one month 413 242
Later than one month and not later than
three months 590 746
Later than three months and not later
than one year 1,472 1,091
2,475 2,079
The Company recognized a net gain on derivative financial instruments
of R53 crore and R276 crore during the year ended March 31, 2011
March 31, 2010, respectively, which are included in other income.
23.2.3. Quantitative details
The Company is primarily engaged in the development and
maintenance of computer software. The production and sale of such
software cannot be expressed in any generic unit. Hence, it is not
possible to give the quantitative details of sales and certain information
as required under paragraphs 3, 4C and 4D of part II of Schedule VI
to the Companies Act, 1956.
in rcrore
Schedules | 23
23.2.4. Imports (valued on the cost, insurance and
freight basis)
in rcrore
2011 2010
Capital goods 161 91
Software packages 4 10
165 101
23.2.5. Activity in foreign currency
in rcrore
2011 2010
Earnings in foreign currency (on receipts
basis)
Income from software services and
products 23,954 21,072
Interest received from banks and
others 6 3
Expenditure in foreign currency (on
payments basis)
Overseas travel expenses (including
visa charges) 535 404
Technical sub-contractors
subsidiaries 1,568 1,210
Overseas salaries and incentives 6,907 5,950
Other expenditure incurred overseas
for software development 1,431 675
Net earnings in foreign currency 13,360 12,686
23.2.6. Obligations on long-term, non-cancelable operating
leases
The lease rentals charged during the year and the maximum obligations
on long-term, non-cancelable operating leases payable as per the rentals
stated in the respective agreements are as follows :
in rcrore
2011 2010
Lease rentals recognized during the year 68 62
in rcrore
Lease obligations payable As at March 31,
2011 2010
five years 152 149
The operating lease arrangements, are renewable on a periodic basis
and extend up to a maximum of ten years from their respective dates
of inception and relates to rented overseas premises. Some of these
lease agreements have a price escalation clause.
Fixed assets provided on operating lease to Infosys BPO, a subsidiary
company, as at March 31, 2011 and March 31, 2010 are as follows :
Particulars Cost Accumulated
depreciation
Net book
value
Buildings 60 25 35
59 21 38
Plant and machinery 3 2 1
18 15 3
Computer equipment 1 1
1 1
Particulars Cost Accumulated
depreciation
Net book
value
Furniture and fixtures 1 1
3 2 1
Total 65 29 36
81 39 42
The aggregate depreciation charged on the above assets during the
year ended March 31, 2011 amounted to R6 crore (R7 crore for the
year ended March 31, 2010).
The rental income from Infosys BPO for the year ended March 31, 2011
amounted to R17 crore (R16 crore for the year ended March 31, 2010).
23.2.7. Related party transactions
List of related parties :
Name of subsidiaries Country Holding as at March 31,
2011 2010
Infosys China
(1)
China 100% 100%
Infosys Mexico
(2)
Mexico 100% 100%
Infosys Shanghai
(3)
China 100%
Infosys Brasil
(4)
Brazil 100% 100%
Infosys BPO s.r.o.
(5)
Czech
Republic 99.98% 99.98%
Sp.Z.o.o
(5)
Poland 99.98% 99.98%
Limited
(5)
Thailand 99.98%
Limited
(6)
India 100% 100%
(5) (7)
U.S. 99.98% 99.98%
Notes :
(1)
During the year ended March 31, 2011 the Company made an additional
investment of r42 crore (US$ 9 million) in Infosys China, which is a wholly-
owned subsidiary. As of March 31, 2011 and March 31, 2010, the Company
has invested an aggregate of r107 crore (US$ 23 million) and r65 crore
(US$ 14 million), respectively, in the subsidiary.
(2)
investment of r14 crore (Mexican Peso 40 million) in Infosys Mexico, which
is a wholly-owned subsidiary. As of March 31, 2011 and March 31, 2010, the
Company has invested an aggregate of r54 crore (Mexican Peso 150 million)
and r40 crore (Mexican Peso 110 million), respectively, in the subsidiary.
(3)
On February 21, 2011 the Company incorporated a wholly-owned subsidiary,
Infosys Technologies (Shanghai) Company Limited and invested r11 crore
(US$ 3 million) in the subsidiary. As of March 31, 2011 the Company has
invested an aggregate of r11 crore (US$ 3 million) in the subsidiary.
(4)
investment of r10 crore (BRL 4 million) in the subsidiary. As of March 31,
2011 and March 31, 2010 the Company has invested an aggregate of
r38 crore (BRL 15 million) and r28 crore (BRL 11 million), respectively, in
the subsidiary.
(5)
Infosys BPO s.r.o, Infosys BPO (Poland) Sp.Z.o.o, Infosys BPO (Thailand)
Limited and McCamish Systems LLC are wholly-owned subsidiaries of Infosys
BPO. During the year ended March 31, 2011 Infosys BPO (Thailand) Limited
was liquidated.
(6)
During the year ended March 31, 2010, Infosys Consulting incorporated a
wholly-owned subsidiary, Infosys Consulting India Limited. As of March 31,
2011 and March 31, 2010 Infosys Consulting has invested an aggregate of
r1 crore in the subsidiary.
(7)
During the year ended March 31, 2010, Infosys BPO acquired 100% of the
voting interests in McCamish Systems LLC (McCamish), a business process
solutions provider based in Atlanta, Georgia, in the United States. The
business acquisition was conducted by entering into Membership Interest
Purchase Agreement for a cash consideration of r173 crore and a contingent
consideration of r67 crore. The acquisition was accounted as a business
combination which resulted in goodwill of r227 crore.
24 | Schedules
Infosys guarantees the performance of certain contracts entered into
by its subsidiaries.
The details of amounts due to or due from as at March 31, 2011 and
in rcrore
2011 2010
Loans and advances
Infosys China 23 46
Infosys Brasil 9
Sundry debtors
Infosys China 39 19
Infosys Mexico 1 1
Infosys Brasil 1
Sundry creditors
Infosys China 32 18
Infosys Australia 20
Infosys Brasil
Infosys Consulting India 1 1
Infosys Mexico 1 5
Infosys Sweden 1 1
Deposit taken for shared services
Infosys BPO 7 7
The details of the related party transactions entered into by the
Company and maximum dues from subsidiaries, in addition to the
lease commitments described in note 23.2.6, for the year ended
in rcrore
2011 2010
Capital transactions
Financing transactions
Infosys China 42
Infosys Shanghai 11
Infosys Brasil 10 28
Infosys Public services 24
Infosys Consulting 50
Loans / Advances
Infosys Brasil 9
Infosys China (23)
Infosys China 240 134
Infosys Consulting India 5
Infosys Sweden 12 11
Infosys Brasil 3 5
Purchase of shared services including
facilities and personnel
Interest income
Infosys China 2 3
2011 2010
Sale of services
Infosys China 6 10
Sale of shared services including facilities
and personnel
Maximum balances of loans and advances
Infosys China 48 48
Infosys Brasil 9
Infosys Mexico 4 4
During the year ended March 31, 2011, an amount of Nil (R34 crore
for the year ended March 31, 2010) was donated to Infosys Foundation,
a not-for-profit foundation, in which certain directors of the Company
are trustees.
During the year ended March 31, 2011, an amount of R12 crore (R23
crore for the year ended March 31, 2010) has been granted to Infosys
Science Foundation, a not-for-profit foundation, in which certain
directors and officers of the Company are trustees.
23.2.8. Transactions with key management personnel
Key management personnel comprise directors and members of
executive council.
have been detailed in Schedule 23.4.
The aggregate managerial remuneration under Section 198 of the
Companies Act 1956, to the directors (including managing director)
is as follows :
in rcrore
2011 2010
Salary 2 2
funds 1
Perquisites and incentives 6 7
Non-whole-time directors
Commission 6 6
Reimbursement of expenses 1 1
Computation of net profit in accordance with Section 349 of the
Companies Act, 1956, and calculation of commission payable to
non-whole-time directors are as follows :
in rcrore
2011 2010
Net profit after tax before exceptional
item 6,443 5,755
Add : Whole-time directors
remuneration 9 9
directors 6 6
in rcrore
Schedules | 25
2011 2010
Provision for bad and doubtful debts
and advances 3 (1)
Depreciation as per books of accounts 740 807
9,579 8,293
Less : Depreciation as envisaged under
Section 350 of the Companies
Act
(1)
740 807
Net profit on which commission is
payable 8,839 7,486
Commission payable to non-whole-time
directors
Maximum allowed as per the Companies
Act, 1956 at 1% 88 75
Maximum approved by the share holders
at 1% (1%) 88 75
Commission approved by the Board 6 6
Note :
(1)
The Company depreciates fixed assets based on estimated useful lives that
are lower than those prescribed in Schedule XIV of the Companies Act, 1956.
Accordingly the rates of depreciation used by the Company are higher than the
minimum prescribed by Schedule XIV.
During the year ended March 31, 2011 and March 31, 2010 Infosys
BPO has provided for commission of R0.12 crore and R0.12 crore to
a non-whole-time director of Infosys.
23.2.9. Research and development expenditure
in rcrore
2011 2010
Capital 6 3
Revenue 521 437
23.2.10. Stock option plans
The Company has two Stock Option Plans.
The 1998 Plan was approved by the Board of Directors in December
1997 and by the shareholders in January 1998, and is for issue of
1,17,60,000 ADSs representing 1,17,60,000 equity shares. All options
under the 1998 Plan are exercisable for ADSs representing equity
shares. A compensation committee comprising independent members
of the Board of Directors administers the 1998 Plan. All options had
been granted at 100% of fair market value. The 1998 Plan lapsed on
January 6, 2008, and consequently no further shares will be issued to
employees under this plan.
In fiscal 2000, the Company instituted the 1999 Plan. The shareholders
and the Board of Directors approved the plan in September 1999,
which provides for the issue of 5,28,00,000 equity shares to the
employees. The compensation committee administers the 1999 Plan.
Options were issued to employees at an exercise price that is not less
than the fair market value. The 1999 Plan lapsed on June 11, 2009,
and consequently no further shares will be issued to employees under
this plan.
The activity in the 1998 Plan and 1999 Plan during the year ended
2011 2010
The 1998 Plan
Options outstanding, beginning of the year 2,42,264 9,16,759
Less : Exercised 1,88,675 6,14,071
Forfeited 3,519 60,424
Options outstanding, end of the year 50,070 2,42,264
The 1999 Plan
Options outstanding, beginning of the year 2,04,464 9,25,806
Less : Exercised 1,37,692 3,81,078
Forfeited 18,052 3,40,264
Options outstanding, end of the year 48,720 2,04,464
The weighted average share price of options exercised under the
1998 Plan during the year ended March 31, 2011 and March 31, 2010
was R 2,950 and R 2,266 respectively. The weighted average share
price of options exercised under the 1999 Plan during the year ended
March 31, 2011 and March 31, 2010 was R 2,902 and R 2,221
respectively.
The following tables summarize information about the 1998 and 1999
share options outstanding as at March 31, 2011 and March 31, 2010 :
Range of exercise prices
per share (R)
Number
of shares
arising out
of options
Weighted
average
remaining
contractual
life
Weighted
average
exercise
price
The 1998 Plan
300 700 24,680 0.73 587
701 1,400 25,390 0.56 777
50,070 0.65 683
The 1999 Plan
300 700 33,759 0.65 448
701 2,500 14,961 1.71 2,121
48,720 0.97 962
Range of exercise prices
per share (R)
Number
of shares
arising out
of options
Weighted
average
remaining
contractual
life
Weighted
average
exercise
price
The 1998 Plan
300 700 1,74,404 0.94 551
701 1,400 67,860 1.27 773
2,42,264 1.03 613
The 1999 Plan
300 700 1,52,171 0.91 439
701 2,500 52,293 1.44 2,121
2,04,464 1.05 869
The aggregate options considered for dilution are set out in note
23.2.19
The provision for taxation includes tax liabilities in India on the
Companys global income as reduced by exempt incomes and any tax
liabilities arising overseas on income sourced from those countries.
Infosys operations are conducted through Software Technology Parks
(STPs) and Special Economic Zones (SEZs). Income from STPs are tax
exempt for the earlier of 10 years commencing from the fiscal year in
which the unit commences software development, or March 31, 2011.
in rcrore
26 | Schedules
Income from SEZs is fully tax exempt for the first 5 years, 50% exempt
for the next 5 years and 50% exempt for another 5 years subject to
fulfilling certain conditions. For fiscal 2008 and 2009, the Company
had calculated its tax liability under Minimum Alternate Tax (MAT).
The MAT credit can be carried forward and set off against the future
tax payable. In fiscal 2010, the Company calculated its tax liability
under normal provisions of the Income Tax Act and utilized the brought
forward MAT Credit.
As at March 31, 2011, the Company has provided for branch profit
tax of R176 crore for its overseas branches, as the Company estimates
that these branch profits would be distributed in the foreseeable future.
23.2.12. Cash and bank balances
The details of balances as on Balance Sheet dates with non-scheduled
in rcrore
Balances with non-scheduled banks As at March 31,
2011 2010
In current accounts
ANZ Bank, Taiwan 3 2
Citibank NA, New Zealand
Deutsche Bank, Moscow (U.S. dollar account) 1
Deutsche Bank, Switzerland
(U.S. dollar account) 1
HSBC Bank, U.K. 1 1
444 776
The details of balances as on Balance Sheet dates with scheduled
in rcrore
2011 2010
In current accounts
Citibank Unclaimed dividend account 1
Deustche Bank 11 12
Deustche Bank EEFC (U.S. dollar account) 141 8
Deutsche Bank EEFC account in Swiss
Franc 2
HDFC Bank Unclaimed dividend account 1 1
ICICI Bank 18 121
ICICI Bank EEFC (U.S. dollar account) 14 7
ICICI bank Unclaimed dividend account 1 1
197 153
In deposit accounts
Andhra Bank 399 99
Axis Bank 476
2011 2010
Barclays Bank 100
DBS Bank 49
HDFC Bank 646
HSBC Bank 483
IDBI Bank 716 900
ING Vysya Bank 25
Oriental Bank of commerce 578 100
Vijaya Bank 95 95
Yes Bank 23
13,024 8,868
Total cash and bank balances as per Balance
Sheet 13,665 9,797
The details of maximum balances during the year with non-scheduled
in rcrore
Maximum balance with non-scheduled
banks during the year
2011 2010
In current accounts
ANZ Bank, Taiwan 3
ABN AMRO Bank, Taiwan 4
BNP Paribas Bank, Norway 1
Citibank NA, Singapore 45
Deutsche Bank, Moscow
(RUB account) 2
Deutsche Bank, Moscow
(U.S. dollar account) 1 1
Deutsche Bank, Switzerland
(U.S. dollar account) 11 14
HSBC Bank, U.K. 2 8
Morgan Stanley Bank, U.S. 6 8
in rcrore
Schedules | 27
Maximum balance with non-scheduled
banks during the year
2011 2010
Standard Chartered Bank, UAE 5 4
Svenska Handelsbanken, Sweden 3 3
The Bank of Tokyo Mitsubishi UFJ
Ltd., Japan 4 2
23.2.13. Loans and advances
in rcrore
2011 2010
Life Insurance Corporation of India (LIC) 344 281
1,844 1,781
The maximum balance (including accrued interest) held as deposits
with financial institutions is as follows :
in rcrore
2011 2010
Life Insurance Corporation of India 431 281
Deposit with LIC represents amount deposited to settle employee
benefit obligations as and when they arise during the normal course
of business (refer to note 23.2.23.b.).
23.2.14. Fixed assets
Profit / (loss) on disposal of fixed assets during the year ended
March 31, 2011 and March 31, 2010 is less than R 1 crore and
accordingly disclosed under note 23.3.
Depreciation charged to the Profit and Loss account includes a charge
relating to assets costing less than R5,000/- each and other low value
assets.
in rcrore
2011 2010
Depreciation charged during the year 33 86
The Company has entered into lease-cum-sale agreements to acquire
certain properties. In accordance with the terms of these agreements,
the Company has the option to purchase the properties on expiry of
the lease period. The Company has already paid 99% of the value of the
properties at the time of entering into the lease-cum-sale agreements.
These amounts are disclosed as Land leasehold under Fixed
assets in the financial statements. Additionally, certain land has been
purchased for which though the Company has possession certificate,
the sale deeds are yet to be executed as at March 31, 2011.
23.2.15. Details of investments
in rcrore
2011 2010
Long-term investments
OnMobile Systems Inc., (formerly
Onscan Inc.) U.S.
21,54,100 (21,54,100) common stock
at US$ 0.4348 each, fully paid, par
value US$ 0.001 each
4 4
2011 2010
Merasport Technologies Private
Limited
2,420 (2,420) equity shares at R8,052
each, fully paid, par value R10 each 2 2
6 6
Less : Provision for investment 2 2
4 4
The details of liquid mutual fund units as at March 31, 2010 is as
follows :
in rcrore
Particulars Number of
units
Amount
Tata Floater Fund Weekly
Dividend 27,28,06,768 275
Kotak Floater Long Term Plan
Weekly Dividend 20,93,66,402 211
Reliance Medium Term Fund
Weekly Dividend Plan D 13,68,30,703 234
Birla Sun Life Savings Fund
Institutional Weekly Dividend
Payout 26,71,60,366 267
ICICI Prudential Flexible
Income Plan Premium Weekly
Dividend Payout 2,93,92,648 310
IDFC Money Manager Fund
Treasury Plan Super
Institutional Plan C Weekly
Dividend 38,95,22,783 390
UTI Treasury Advantage Fund
Institutional Weekly Dividend
Plan Payout 38,86,168 389
HDFC Floating Rate Income
Fund Short Term Plan
Dividend Weekly 12,03,96,040 122
DWS Ultra Short Term Fund
Institutional Weekly Dividend 3,96,85,983 40
SBI SHF Ultra Short Term
Fund Institutional Plan
Weekly Dividend Payout 3,47,73,535 35
Franklin Templeton India
Ultra Short Bond Fund Super
Institutional Plan Weekly
Dividend Payout 1,09,36,513 11
DSP BlackRock Floating Rate
Fund Institutional Weekly
Dividend 99,866 10
Religare Ultra Short Term Fund
Institutional Weekly Dividend 2,25,53,650 23
153,74,11,425 2,317
At cost 1,413
At fair value 904
2,317
The balances held in certificates of deposit as at March 31, 2011 is
as follows :
in rcrore
Particulars Face value R Units Amount
State Bank of Hyderabad 1,00,000 7,500 71
Union Bank of India 1,00,000 5,000 48
12,500 119
28 | Schedules
The balances held in certificates of deposit as at March 31, 2010 is as follows :
in rcrore
Particulars Face value R Units Amount
Punjab National Bank 1,00,000 50,000 480
Bank of Baroda 1,00,000 27,500 265
HDFC Bank 1,00,000 25,000 236
Corporation Bank 1,00,000 20,000 189
Jammu and Kashmir Bank 1,00,000 1,000 10
1,23,500 1,180
The details of investments and disposal of securities during the year ended March 31, 2011 and March 31, 2010 are as follows :
In rcrore
2011 2010
Investment in securities
Subsidiary Infosys Consulting 50
Subsidiary Infosys China 42
Subsidiary Infosys Mexico 14 18
Subsidiary Infosys Brasil 10 28
Subsidiary Infosys Public Services 24
Subsidiary Infosys Shanghai 11
2,500 10,316
Redemption / disposal of investment in securities
Long-term investments 5
Certificates of deposit 1,901
5,801 6,704
Net movement in investments (3,301) 3,612
The details of investment purchased and sold during the year ended March 31, 2011 is as follows :
In rcrore
Name of the fund Face value R Units Cost
Birla Sun Life Cash Plus Institutional Premium Daily Dividend Reinvestment 10 17,46,98,810 175
Birla Sun Life Savings Fund Institutional Weekly Dividend Payout 10 9,19,03,006 92
ICICI Prudential Flexible Income Plan Premium Weekly Dividend 100 2,84,44,817 300
ICICI Prudential Liquid Super Institutional Plan Dividend Daily 100 3,67,95,966 368
IDFC Money Manager Fund Investment Plan Institutional Plan B Weekly Dividend 10 4,29,06,464 43
Kotak Floater Long Term Weekly Dividend 10 33,23,89,222 335
Kotak Liquid Institutional Premium Daily Dividend 10 6,38,19,533 78
Tata Floater Fund Weekly Dividend 10 8,42,88,604 85
Reliance Medium Term Fund Weekly Dividend Plan 10 2,16,35,163 37
Birla Sun Life Short Term Fund Institutional Fortnightly Dividend Payout 10 6,85,47,384 70
The details of investments purchased and sold during the year ended March 31, 2010 is as follows :
In rcrore
Birla Sun Life Short Term Fund Institutional Fortnightly Dividend 10 30,69,30,245 312
Birla Sun Life Savings Fund Institutional Weekly Dividend 10 44,96,87,618 450
DSP BlackRock Strategic Bond Fund Institutional Plan Monthly Dividend 1,000 4,90,830 50
DBS Chola Freedom Income Short Term Fund Weekly Dividend 10 8,19,67,368 86
HDFC Floating Rate Income Fund Short-term 10 50,78,57,424 515
ICICI Prudential Floating Rate Plan D Weekly Dividend 10 23,88,35,963 239
ICICI Prudential Flexible Income Plan Premium Weekly Dividend 100 4,17,36,593 440
IDFC Money Manager Fund Treasury Plan Super Institutional Plan C 10 61,62,18,874 617
Reliance Medium Term Fund Weekly Dividend Plan D 10 30,23,62,955 517
UTI Treasury Advantage Fund Institutional Weekly Dividend Payout 1,000 43,48,966 435
HSBC Floating Rate Long Term Institutional Weekly Dividend Payout 10 13,43,20,855 151
DWS Ultra Short Term Fund Institutional Weekly Dividend 10 100,27,38,474 1,011
Religare Ultra Short Term Fund Institutional Weekly Dividend 10 50,89,85,841 510
Principal Floating Rate Fund FMP Institutional Option Dividend Payout
Weekly 10 11,11,37,088 111
Schedules | 29
Tata Floater Fund Weekly Dividend 10 25,78,43,865 260
Kotak Floater Long Term Plan Weekly Dividend 10 44,64,32,595 450
SBI SHF Ultra Short Term Fund Institutional Plan Weekly Dividend Payout 10 41,66,63,413 420
Franklin Templeton India Ultra Short Bond Fund Super Institutional Plan
Weekly Dividend Payout 10 12,37,59,926 125
23.2.16. Segment reporting
The Companys operations predominantly relate to providing end-to-end business solutions that leverage technology thereby enabling clients
to enhance business performance, delivered to customers globally operating in various industry segments. Accordingly, revenues represented
along industry classes comprise the primary basis of segmental information set out in these financial statements. Secondary segmental reporting
is performed on the basis of the geographical location of customers.
The accounting principles consistently used in the preparation of the financial statements are also consistently applied to record income and
expenditure in individual segments. These are as set out in the significant accounting policies.
Industry segments at the Company are primarily financial services comprising customers providing banking, finance and insurance services;
manufacturing companies; companies in the telecommunications and the retail industries; and others such as utilities, transportation and logistics
companies.
Income and direct expenses in relation to segments is categorized based on items that are individually identifiable to that segment, while the
remainder of the costs are categorized in relation to the associated turnover of the segment. Certain expenses such as depreciation, which form
a significant component of total expenses, are not specifically allocable to specific segments as the underlying services are used interchangeably.
The Company believes that it is not practical to provide segment disclosures relating to those costs and expenses, and accordingly these expenses
are separately disclosed as unallocated and directly charged against total income.
Fixed assets used in the Companys business or liabilities contracted have not been identified to any of the reportable segments, as the fixed assets
and services are used interchangeably between segments. Accordingly, no disclosure relating to total segment assets and liabilities are made.
Industry segments
in rcrore
Particulars Financial
services
Manufacturing Telecom Retail Others Total
Revenues 9,293 4,686 3,134 3,757 4,515 25,385
7,354 3,988 3,234 2,989 3,575 21,140
Identifiable operating expenses 4,210 2,107 1,471 1,643 2,115 11,546
3,095 1,853 1,355 1,267 1,564 9,134
Allocated expenses 1,970 1,007 673 807 968 5,425
1,615 877 712 657 785 4,646
Segmental operating income 3,113 1,572 990 1,307 1,432 8,414
2,644 1,258 1,167 1,065 1,226 7,360
807
6,553
910
(9)
Net profit before taxes and exceptional item 8,821
7,472
Income taxes 2,378
1,717
Net profit after taxes before exceptional item 6,443
5,755
Exceptional item Income on sale of
investments, net of taxes
48
5,803
in rcrore
30 | Schedules
Geographic segments
in rcrore
Particulars North
America
World
Total
Revenues 16,815 5,252 594 2,724 25,385
14,170 4,633 269 2,068 21,140
Identifiable operating expenses 7,521 2,311 286 1,428 11,546
6,028 1,963 77 1,066 9,134
3,114 1,020 59 453 4,646
Segmental operating income 5,684 1,821 186 723 8,414
5,028 1,650 133 549 7,360
807
6,553
910
(9)
Net profit before taxes and exceptional item 8,821
7,472
Income taxes 2,378
1,717
Net profit after taxes before exceptional item 6,443
5,755
Exceptional item Income on sale of investments, net of taxes
48
5,803
23.2.17. Provision for doubtful debts
Periodically, the Company evaluates all customer dues to the Company
for collectability. The need for provisions is assessed based on various
factors including collectability of specific dues, risk perceptions of the
industry in which the customer operates, general economic factors,
which could affect the customers ability to settle. The Company
normally provides for debtor dues outstanding for 180 days or longer
as at the Balance Sheet date. As at March 31, 2011 the Company
has provided for doubtful debts of R 19 crore (R 21 crore as at
March 31, 2010) on dues from certain customers although the
outstanding amounts were less than 180 days old, since the amounts
were considered doubtful of recovery. The Company pursues the
recovery of the dues, in part or full.
23.2.18. Dividends remitted in foreign currencies
The Company remits the equivalent of the dividends payable to equity
shareholders and holders of ADS. For ADS holders the dividend
is remitted in Indian rupees to the depository bank, which is the
registered shareholder on record for all owners of the Companys
ADSs. The depositary bank purchases the foreign currencies and remits
dividends to the ADS holders.
The particulars of dividends remitted are as follows :
Particulars Number of shares to
which the dividends
relate
Year ended
March 31,
2011 2010
Interim and 30th year
special dividend for fiscal
2011 10,87,18,147 435
Interim dividend for fiscal
2010 10,70,15,201 107
Final dividend for fiscal
2010 10,68,22,614 160
Final dividend for fiscal
2009 10,73,97,313 145
23.2.19. Reconciliation of basic and diluted shares used in
computing earnings per share
2011 2010
Number of shares considered as
basic weighted average shares
outstanding 57,40,13,650 57,33,09,523
Add : Effect of dilutive issues of
shares / stock options 1,88,308 6,40,108
Number of shares considered
as weighted average shares and
potential shares outstanding 57,42,01,958 57,39,49,631
Schedules | 31
23.2.20. Provision for post-sales client support and warranties
The movement in the provision for post-sales client support and warranties is as follows :
in rcrore
2011 2010
Balance at the beginning 73 75
Provision recognized / (reversed) 5 (2)
Provision utilized
Exchange difference during the year
Provision for post-sales client support is expected to be utilized over a period of 6 months to 1 year.
23.2.21. Gratuity Plan
The following table set out the status of the Gratuity Plan as required under AS 15.
Reconciliation of opening and closing balances of the present value of the defined benefit obligation and plan assets :
in rcrore
2011 2010 2009 2008 2007
Obligations at year beginning 308 256 217 221 180
Transfer of obligation (2)
Service cost 171 72 47 47 44
Interest cost 24 19 15 16 14
Actuarial (gain) / loss 15 (4) (9)
Benefits paid (59) (33) (23) (21) (17)
Amendment in benefit plans (37)
Obligations at year end 459 308 256 217 221
Defined benefit obligation liability as at the Balance Sheet
date is fully funded by the Company
Plans assets at year beginning, at fair value 310 256 229 221 167
Expected return on plan assets 34 24 16 18 16
Actuarial gain / (loss) 1 1 5 2 3
Contributions 173 62 29 9 52
Benefits paid (59) (33) (23) (21) (17)
Plans assets at year end, at fair value 459 310 256 229 221
Reconciliation of present value of the obligation and the
fair value of the plan assets :
Fair value of plan assets at the end of the year 459 310 256 229 221
Present value of the defined benefit obligations at the end
of the year 459 308 256 217 221
Asset recognized in the Balance Sheet 2 12
Assumptions
Interest rate 7.98% 7.82% 7.01% 7.92% 7.99%
Estimated rate of return on plan assets 9.36% 9.00% 7.01% 7.92% 7.99%
Weighted expected rate of salary increase 7.27% 7.27% 5.10% 5.10% 5.10%
Net gratuity cost for the years ended March 31, 2011 and March 31, 2010 comprises of the following components :
2011 2010
Gratuity cost for the year
Service cost 171 72
Interest cost 24 19
Actuarial (gain) / loss 14 (5)
Plan amendment amortization (4) (3)
Actual return on plan assets 35 25
Gratuity cost, as disclosed above, is included under salaries and bonus and is segregated between software development expenses, selling and
marketing expenses and general and administration expenses on the basis of number of employees.
During the year ended March 31, 2010, a reimbursement obligation of R2 crore has been recognized towards settlement of gratuity liability of
Infosys Consulting India Limited.
32 | Schedules
As at March 31, 2011 and March 31, 2010, the plan assets have been
primarily invested in government securities. The estimates of future
salary increases, considered in actuarial valuation, take account of
inflation, seniority, promotion and other relevant factors such as
supply and demand factors in the employment market. The Company
expects to contribute approximately R100 crore to the gratuity trust
during the fiscal 2012.
Effective July 1, 2007, the Company revised the employee death
benefits provided under the gratuity plan, and included all eligible
employees under a consolidated term insurance cover. Accordingly,
the obligations under the Gratuity Plan reduced by R37 crore, which
is being amortized on a straight line basis to the net Profit and Loss
account over 10 years representing the average future service period
of the employees. The unamortized liability as at March 31, 2011 and
March 31, 2010 amounted to R22 crore and R26 crore, respectively
and is disclosed under Current Liabilities.
23.2.22.a Provident fund
The Guidance on Implementing AS 15, Employee Benefits (revised
2005) issued by Accounting Standards Board (ASB) states that benefits
involving employer established provident funds, which require
interest shortfalls to be recompensed are to be considered as defined
benefit plans. Pending the issuance of the final guidance note from
the Actuarial Society of India, the Companys actuary has expressed
an inability to reliably measure provident fund liabilities. Accordingly
the Company is unable to exhibit the related information.
The Company contributed R179 crore towards Provident Fund during
the year ended March 31, 2011. (R150 crore during the year ended
March 31, 2010).
23.2.22.b Superannuation
The Company contributed R57 crore to the Superannuation Trust
during the year ended March 31, 2011 (R54 crore during the year
ended March 31, 2010).
23.2.23 Cash Flow statement
23.2.23.a. Unclaimed dividend
The balance of cash and cash equivalents includes R 3 crore as at
March 31, 2011 (R2 crore as at March 31, 2010) set aside for payment
of dividends.
23.2.23.b. Restricted deposits
Deposits with financial institutions as at March 31, 2011 include
R344 crore (R281 crore as at March 31, 2010) deposited with Life
Insurance Corporation of India to settle employee-related obligations
as and when they arise during the normal course of business. This
amount is considered as restricted cash and is hence not considered
cash and cash equivalents.
23.2.24 Dues to micro and small enterprises
The Company has no dues to micro and small enterprises during the
year ended March 31, 2011 and March 31, 2010 and as at March 31,
2011 and March 31, 2010.
23.2.25 Exceptional item
During the year ended March 31, 2010, the Company sold 32,31,151
shares of OnMobile Systems Inc., U.S. (OMSI) at a price of R166.58
per share amounting to a total consideration of R53 crore, net of taxes
and transactions costs. The resultant income of R48 crore has been
appropriated to capital reserve.
23.3 Details of rounded off amounts
The financial statements are represented in Rcrore as per the approval
received from Department of Company Affairs (DCA) earlier. Those
items which were not represented in the financial statement due to
rounding off to the nearest Rcrore are given as follows :
Balance Sheet items
in rcrore
2011 2010
3 Fixed assets
Vehicles
Addition during the year 0.04
Depreciation on deletions 0.04
Deletion during the year 0.08
Depreciation on deletions 0.08
4 Investments
Investment in Infosys Sweden 0.06 0.06
23.2.7 Related party transactions
Debtors
Infosys Consulting India 0.29
Infosys Public Services 0.11
Infosys Sweden 0.08
Infosys Technologia do Brasil Ltda 0.62
Creditors
Infosys Technologia do Brasil Ltda 0.14
Infosys Mexico 0.31
23.2.12 Balances with non-scheduled banks
ABN AMRO Bank, Denmark 0.27 0.21
Bank of Baroda, Mauritius 0.02 0.02
Citibank NA, New Zealand 0.20 0.26
Schedules | 33
2011 2010
Deutsche Bank, Moscow 0.10 0.34
Deutsche Bank, Moscow (U.S. dollar) 0.11 1.21
Deutsche Bank, Singapore 0.66
Deutsche Bank, Zurich, Switzerland (U.S. dollar account) 0.01 1.40
Standard Chartered Bank, UAE 0.17 0.09
The Bank of Tokyo Mitsubishi UFJ, Ltd., Japan 0.41 0.16
23.2.12 Maximum balances with non-scheduled banks
ABN Amro Bank, Denmark 0.27 0.21
Deutsche Bank, Russia 0.37
Deutsche Bank, Russia (U.S. dollar account) 0.21
Profit and Loss items
in rcrore
Schedule Description Year ended March 31,
2011 2010
Profit and Loss Provision for investment 9.00
Additional dividend tax 0.04
23.2.1 Aggregate expenses
Provision for doubtful loans and advances 0.28
Statutory audit fees 0.69
Certification charges 0.06 0.05
Out-of-pocket expenses 0.04 0.03
Freight charges 1.01
Sales promotion expenses 0.28 1.00
Bank charges and commission 1.75
23.2.7 Related party transactions
Purchase of services Infosys BPO (Poland) 0.41 0.03
Purchase of services Infosys BPO s.r.o 0.44
Purchase of services Infosys Brasil 0.35
23.4 Transactions with key management personnel
Key management personnel comprise directors and members of Executive Council.
Particulars of remuneration and other benefits paid to whole-time directors and members of Executive Council during the year ended
in rcrore
Name Salary Contributions to
provident and
other funds
Perquisites and
incentives
Total
remuneration
Co-Chairman
(1)
Nandan M. Nilekani
0.09 0.02 0.23 0.34
0.32 0.08 0.61 1.01
S. D. Shibulal 0.34 0.08 0.66 1.08
0.31 0.08 0.56 0.95
K. Dinesh 0.34 0.08 0.68 1.10
0.32 0.08 0.61 1.01
T. V. Mohandas Pai 0.43 0.10 2.56 3.09
0.36 0.08 2.69 3.13
Srinath Batni 0.43 0.10 1.76 2.29
0.36 0.07 1.98 2.41
34 | Schedules
Name Salary Contributions to
provident and
other funds
Perquisites and
incentives
Total
remuneration
Executive Council Members

V. Balakrishnan 0.38 0.08 2.15 2.61
0.30 0.08 2.06 2.44
2.09 2.79 4.88
0.28 0.06 1.73 2.07
B. G. Srinivas 1.94 2.99 4.93
1.81 2.75 4.56
Subhash B. Dhar 0.30 0.08 1.69 2.07
0.24 0.07 1.42 1.73
Note :
(1)
Effective July 9, 2009, Nandan M. Nilekani relinquished the positions of Co-Chairman and Member of the Board
Particulars of remuneration and other benefits of non-executive / independent directors for the years ended March 31, 2011 and March 31, 2010 :
in rcrore
Name Commission Sitting fees Reimbursement of
expenses
Total
remuneration
0.59 0.01 0.60
0.60 0.60
Prof. Marti G. Subrahmanyam 0.79 0.23 1.02
0.65 0.20 0.85
0.52 0.03 0.55
Claude Smadja
(1)
0.23 0.09 0.32
0.59 0.25 0.84
Rama Bijapurkar
(2)
0.04 0.04
0.49 0.02 0.51
0.62 0.21 0.83
0.59 0.15 0.74
0.61 0.24 0.85
K. V. Kamath 0.56 0.01 0.57
0.39 0.02 0.41
R. Seshasayee
(3)
0.10 0.10

0.57 0.57
Notes :
(1)
Retired from the board effective August 30, 2010
(2)
Resigned from the board effective April 13, 2010
(3)
Joined the board effective January 13, 2011
in rcrore
Financial statements as per IFRS | 35
Financial statements as per IFRS
Auditors report to the Board of Directors of Infosys Technologies Limited
We have audited the attached consolidated Balance Sheet of Infosys Technologies Limited (the Company) and subsidiaries (collectively referred
to as the Infosys Group) as at March 31, 2011, the related consolidated statements of comprehensive income for the year ended on that date, and
the related consolidated statement of changes in equity and cash flows for the year ended on that date, annexed thereto. These financial statements
are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform
principles used and significant estimates made by the Management, as well as evaluating the overall financial statement presentation. We believe
In our opinion and to the best of our information and according to the explanations given to us, the consolidated financial statements give a true
and fair view in conformity with the International Financial Reporting Standards as issued by International Accounting Standards Board (IFRS) :
in the case of the consolidated Balance Sheet, of the nancial position of the Infosys Group as of March 31, 2011;
in the case of the consolidated statement of comprehensive income, of the nancial performance of the Infosys Group for the year ended on
that date;
in the case of the consolidated statement of changes in equity, of the changes in equity of the Infosys Group for the year ended on that date;
and
in the case of the consolidated statement of cash ows, of the cash ows of the Infosys Group for the year ended on that date.
for B S R & Co.
Natrajh Ramakrishna
Partner
Bangalore
April 15, 2011
36 | Financial statements as per IFRS
Infosys Technologies Limited and subsidiaries
Consolidated Balance Sheet as of March 31,
in rcrore, except share data
Note 2011 2010
ASSETS
Current assets
Cash and cash equivalents 2.1 16,666 12,111
Available-for-sale financial assets 2.2 21 2,518
Investment in certificates of deposit 123 1,190
Trade receivables 4,653 3,494
Unbilled revenue 1,243 841
Derivative financial instruments 2.7 66 95
Prepayments and other current assets 2.4 917 641
Total current assets 23,689 20,890
Non-current assets
Property, plant and equipment 2.5 4,844 4,439
Goodwill 2.6 825 829
Intangible assets 2.6 48 56
Available-for-sale financial assets 2.2 23 38
Deferred income tax assets 2.17 378 346
Income tax assets 2.17 993 667
Other non-current assets 2.4 463 347
Total non-current assets 7,574 6,722
Total assets 31,263 27,612
LIABILITIES AND EQUITY
Current liabilities
Trade payables 44 10
Current income tax liabilities 2.17 817 724
Client deposits 22 8
Employee benefit obligations 2.8 140 131
Provisions 2.9 88 82
Other current liabilities 2.10 2,012 1,707
Total current liabilities 3,641 3,193
Non-current liabilities
Deferred income tax liabilities 2.17 114
Employee benefit obligations 2.8 259 171
Other non-current liabilities 2.10 60 61
Total liabilities 3,960 3,539
Equity
Share capital R5 par value 60,00,00,000 equity shares authorized, issued and
outstanding 57,13,17,959 and 57,09,91,592, net of 28,33,600 treasury shares each, as of
March 31, 2011 and March 31, 2010, respectively 286 286
Share premium 3,082 3,047
Retained earnings 23,826 20,668
Other components of equity 109 72
Total equity attributable to equity holders of the Company 27,303 24,073
Total liabilities and equity 31,263 27,612
Note : The accompanying notes form an integral part of the consolidated financial statements.
for B S R & Co.
Firm Reg No : 101248W
Natrajh Ramakrishna N. R. Narayana Murthy S. Gopalakrishnan S. D. Shibulal Deepak M. Satwalekar
Partner
Chairman and Chief Mentor Chief Executive Officer and
Managing Director
Director
Director
Prof. Marti G. Subrahmanyam Dr. Omkar Goswami Sridar A. Iyengar David L. Boyles
Director Director Director Director
Prof. Jeffrey S. Lehman K. V. Kamath R. Seshasayee K. Dinesh
Bangalore T. V. Mohandas Pai Srinath Batni V. Balakrishnan K. Parvatheesam
April 15, 2011
Director Director Chief Financial Officer Company Secretary
Consolidated statements of comprehensive income
Note Year ended March 31,
2011 2010
Revenues 27,501 22,742
Cost of sales 15,916 13,020
Operating expenses
Selling and marketing expenses 1,512 1,184
Administrative expenses 1,971 1,628
Total operating expenses 3,483 2,812
Operating profit 8,102 6,910
Other income, net 2.14 1,211 990
Profit before income taxes 9,313 7,900
Income tax expense 2.17 2,490 1,681
Net profit 6,823 6,219
Other comprehensive income
Reversal of impairment loss on available-for-sale financial asset 9
Gain transferred to net profit on sale of available-for-sale financial asset (5)
Fair value changes on available-for-sale financial asset, net of tax effect (refer note 2.2 and 2.17) (12) 26
Exchange differences on translating foreign operations 49 50
Total other comprehensive income 37 80
Total comprehensive income 6,860 6,299
Profit attributable to
Owners of the Company 6,823 6,219
Non-controlling interest
6,823 6,219
Total comprehensive income attributable to
6,860 6,299
Earnings per equity share
Basic (R) 119.45 109.02
Diluted (R) 119.41 108.90
Weighted average equity shares used in computing earnings per equity share 2.18
Basic 57,11,80,050 57,04,75,923
Diluted 57,13,68,358 57,11,16,031
for B S R & Co.
Partner
Managing Director
Director
Director
April 15, 2011
Consolidated statements of changes in equity
Shares Share capital Share
premium
Retained
earnings
Other
components
of equity
Total equity
attributable to
equity holders of
the Company
Balance as of April 1, 2009 57,28,30,043 286 2,944 15,972 (8) 19,194
Changes in equity for the year ended
March 31, 2010
Shares issued on exercise of employee stock
options 9,95,149 1 88 89
Share-based compensation 1 1
Treasury shares
(1)
(28,33,600) (1) 4 3
Reserves on consolidation of trusts 46 46
Income tax benefit arising on exercise of share
options 10 10
Dividends (including corporate dividend tax) (1,569) (1,569)
Reversal of impairment loss on available-for-
sale financial asset 9 9
Gain transferred to net profit on sale of
available-for-sale financial asset (5) (5)
Fair value changes on available-for-sale
financial assets, net of tax effect 26 26
Exchange differences on translating foreign
operations 50 50
Balance as of March 31, 2010 57,09,91,592 286 3,047 20,668 72 24,073
Changes in equity for the year ended March
31, 2011
Shares issued on exercise of employee stock
options 3,26,367 24 24
Income tax benefit arising on exercise of share
options 11 11
Dividends (including corporate dividend tax) (3,665) (3,665)
Fair value changes on available-for-sale
financial assets, net of tax effect
(refer note 2.2) (12) (12)
Exchange differences on translating foreign
operations 49 49
Balance as of March 31, 2011 57,13,17,959 286 3,082 23,826 109 27,303
(1)
Treasury shares held by controlled trusts consolidated effective July 1, 2009
for B S R & Co.
Partner
Managing Director
Director
Director
April 15, 2011
Consolidated statements of cash flows
in rcrore
Notes Year ended March 31,
2011 2010
Operating activities :
Adjustments to reconcile net profit to net cash provided by operating activities :
Depreciation and amortization 2.5 and 2.6 862 942
Income tax expense 2.17 2,490 1,681
Share based compensation 1
Income on available-for-sale financial assets and certificates of deposit (101) (169)
Profit on sale of property, plant and equipment (2)
Other non-cash item 4 2
Changes in working capital
Trade receivables (1,158) 193
Prepayments and other assets (236) (233)
Unbilled revenue (401) (92)
Trade payables 34 (17)
Unearned revenue (14) 199
Other liabilities and provisions 447 (100)
Cash generated from operations 8,763 8,627
Income taxes paid 2.17 (2,856) (1,754)
Net cash provided by operating activities 5,907 6,873
Investing activities :
Payment for acquisition of business (2) (173)
Expenditure on property, plant and equipment, including changes in retention money 2.5 and 2.10 (1,301) (657)
Proceeds on sale of property, plant and equipment 1 2
Loans to employees (31) 7
Non-current deposits placed with corporation (100) (28)
Income on available-for-sale financial assets 21 106
Investment in certificates of deposit (840) (1,180)
Redemption of certificates of deposit 1,985
Investment in available-for-sale financial assets (1,932) (9,901)
Redemption of available-for-sale financial assets 4,430 7,436
Net cash provided by / (used in) investing activities 2,231 (4,388)
Financing activities :
Proceeds from issuance of common stock on exercise of employee stock options 24 89
Payment of dividends (3,141) (1,346)
Payment of dividend tax (524) (223)
Net cash used in financing activities (3,641) (1,480)
Effect of exchange rate changes on cash and cash equivalents 58 63
Net increase / (decrease) in cash and cash equivalents 4,497 1,005
Cash and cash equivalents at the beginning 2.1 12,111 10,993
Opening cash and cash equivalents of controlled trusts 50
Cash and cash equivalents at the end 2.1 16,666 12,111
Supplementary information :
Restricted cash balance 2.1 108 71
Note : The accompanying notes form an integral part of the consolidated financial statements
for B S R & Co.
Partner
Managing Director
Director
Director
April 15, 2011
1. Company overview and significant
accounting policies
1.1 Company overview
Infosys Technologies Limited (Infosys or the Company) along
with its controlled trusts, majority-owned and controlled subsidiary,
Infosys BPO Limited (Infosys BPO) and wholly-owned and
controlled subsidiaries, Infosys Technologies (Australia) Pty. Limited
(Infosys Australia), Infosys Technologies (China) Company Limited
(Infosys China), Infosys Consulting, Inc. (Infosys Consulting),
Infosys Technologies S. de R. L. de C. V. (Infosys Mexico), Infosys
Technologies (Sweden) AB (Infosys Sweden), Infosys Tecnologia do
Brasil Ltda (Infosys Brasil), Infosys Public Services, Inc., (Infosys
Public Services) and Infosys Technologies (Shanghai) Company
Limited (Infosys Shanghai) is a leading global technology services
Company. The Infosys group of companies (the Group) provides
end-to-end business solutions that leverage technology thereby
enabling its clients to enhance business performance. The Groups
operations are to provide solutions that span the entire software life
cycle encompassing technical consulting, design, development, re-
engineering, maintenance, systems integration, package evaluation and
implementation, testing and infrastructure management services. In
addition, the Group offers software products for the banking industry
and business process management services.
The Company is a public limited Company incorporated and domiciled
in India and has its registered office at Bangalore, Karnataka, India.
The Company has its primary listing on the Bombay Stock Exchange and
National Stock Exchange in India. The Companys American Depositary
Shares representing equity shares are also listed on the NASDAQ
Global Select Market. The Companys consolidated financial statements
were authorized for issuance by the Companys Board of Directors on
April 15, 2011.
1.2 Basis of preparation of financial statements
These consolidated financial statements have been prepared in
compliance with the International Financial Reporting Standards
as issued by the International Accounting Standards Board (IFRS),
under the historical cost convention on the accrual basis except for
certain financial instruments and prepaid gratuity benefits which have
been measured at fair values. Accounting policies have been applied
consistently to all periods presented in these consolidated financial
statements.
1.3 Basis of consolidation
Infosys consolidates entities which it owns or controls. Control exists
when the Group has the power to govern the financial and operating
policies of an entity so as to obtain benefits from its activities. In
assessing control, potential voting rights that are currently exercisable
are also taken into account. Subsidiaries are consolidated from the date
control commences until the date control ceases.
The financial statements of the Group companies are consolidated on a
line-by-line basis and intra-group balances and transactions including
unrealized gain / loss from such transactions are eliminated upon
consolidation. These financial statements are prepared by applying
uniform accounting policies in use at the Group. Non-controlling
interests which represent part of the net profit or loss and net assets
of subsidiaries that are not, directly or indirectly, owned or controlled
by the Company, are excluded.
1.4 Use of estimates
The preparation of the financial statements in conformity with IFRS
requires management to make estimates, judgments and assumptions.
These estimates, judgments and assumptions affect the application of
accounting policies and the reported amounts of assets and liabilities,
the disclosures of contingent assets and liabilities at the date of the
financial statements and reported amounts of revenues and expenses
during the period. Application of accounting policies that require
critical accounting estimates involving complex and subjective
judgments and the use of assumptions in these financial statements
have been disclosed in Note 1.5. Accounting estimates could change
from period to period. Actual results could differ from those estimates.
Appropriate changes in estimates are made as the Management becomes
aware of changes in circumstances surrounding the estimates. Changes
in estimates are reflected in the financial statements in the period in
which changes are made and, if material, their effects are disclosed in
the notes to the consolidated financial statements.
1.5 Critical accounting estimates
a. Revenue recognition
The Company uses the percentage-of-completion method in accounting
for its fixed-price contracts. Use of the percentage-of-completion
method requires the Company to estimate the efforts expended to date
as a proportion of the total efforts to be expended. Efforts expended
have been used to measure progress towards completion as there is
a direct relationship between input and productivity. Provisions for
estimated losses, if any, on uncompleted contracts are recorded in the
period in which such losses become probable based on the expected
contract estimates at the reporting date.
b. Income taxes
The Companys two major tax jurisdictions are India and the
U.S., though the Company also files tax returns in other overseas
jurisdictions. Significant judgments are involved in determining
the provision for income taxes, including amount expected to be
paid / recovered for uncertain tax positions (refer to note 2.17).
c. Business combinations and intangible assets
Business combinations are accounted for using IFRS 3 (Revised),
Business Combinations. IFRS 3 requires the identifiable intangible
assets and contingent consideration to be fair valued in order to
ascertain the net fair value of identifiable assets, liabilities and
contingent liabilities of the acquiree. Significant estimates are required
to be made in determining the value of contingent consideration and
intangible assets. These valuations are conducted by independent
valuation experts.
1.6 Revenue recognition
The Company derives revenues primarily from software development
and related services, from business process management services and
from the licensing of software products. Arrangements with customers
for software development and related services and business process
management services are either on a fixed-price, fixed-timeframe or
on a time-and-material basis.
the Balance Sheet date is recognized as unbilled revenues. Revenue from
fixed-price, fixed-timeframe contracts, where there is no uncertainty
as to measurement or collectability of consideration, is recognized as
per the percentage-of-completion method.
When there is uncertainty as to measurement or ultimate collectability
revenue recognition is postponed until such uncertainty is resolved.
Efforts expended have been used to measure progress towards
completion as there is a direct relationship between input and
productivity. Provisions for estimated losses, if any, on uncompleted
contracts are recorded in the period in which such losses become
probable based on the current contract estimates.
Notes to the consolidated financial statements
Costs and earnings in excess of billings are classified as unbilled
revenue while billings in excess of costs and earnings are classified as
unearned revenue. Maintenance revenue is recognized ratably over
the term of the underlying maintenance arrangement.
In arrangements for software development and related services
and maintenance services, the Company has applied the guidance
in IAS 18 Revenue, by applying the revenue recognition criteria
for each separately, identifiable component of a single transaction.
The arrangements generally meet the criteria for considering
software development and related services as separately identifiable
components. For allocating the consideration, the Company has
measured the revenue in respect of each separable component of a
transaction at its fair value, in accordance with principles given in IAS
18. The price that is regularly charged for an item when sold separately
is the best evidence of its fair value.
In cases where the Company is unable to establish objective and reliable
evidence of fair value for the software development and related services,
the Company has used a residual method to allocate the arrangement
consideration. In these cases the balance of the consideration, after
allocating the fair values of undelivered components of a transaction
has been allocated to the delivered components for which specific fair
values do not exist.
License fee revenues are recognized when the general revenue
recognition criteria given in IAS 18 are met. Arrangements to
deliver software products generally have three elements : license,
implementation and Annual Technical Services (ATS). The Company
has applied the principles given in IAS 18 to account for revenues
from these multiple element arrangements. Objective and reliable
evidence of fair value has been established for ATS. Objective and
reliable evidence of fair value is the price charged when the element
is sold separately. When other services are provided in conjunction
with the licensing arrangement and objective and reliable evidence of
their fair values have been established, the revenue from such contracts
are allocated to each component of the contract in a manner, whereby
revenue is deferred for the undelivered services and the residual
amounts are recognized as revenue for delivered elements.
In the absence of objective and reliable evidence of fair value
for implementation, the entire arrangement fee for license and
implementation is recognized using the percentage-of-completion
method as the implementation is performed. Revenue from client
training, support and other services arising due to the sale of software
products is recognized as the services are performed. ATS revenue is
recognized ratably over the period in which the services are rendered.
Advances received for services and products are reported as client
deposits until all conditions for revenue recognition are met.
The Company accounts for volume discounts and pricing incentives
to customers as a reduction of revenue based on the ratable allocation
of the discounts / incentives amount to each of the underlying revenue
transaction that results in progress by the customer towards earning
increases in levels of revenue transactions, the Company recognizes
the liability based on its estimate of the customers future purchases.
If it is probable that the criteria for the discount will not be met, or
if the amount thereof cannot be estimated reliably, then discount is
not recognized until the payment is probable and the amount can be
estimated reliably.
The Company recognizes changes in the estimated amount of
obligations for discounts in the period in which the change occurs.
The discounts are passed on to the customer either as direct payments
or as a reduction of payments due from the customer.
The Company presents revenues net of value-added taxes in its
statement of comprehensive income.
1.7 Property, plant and equipment
Property, plant and equipment are stated at cost, less accumulated
depreciation and impairments, if any. The direct costs are capitalized
until the property, plant and equipment are ready for use, as intended
by the Management.
The Company depreciates property, plant and equipment over their
estimated useful lives using the straight-line method. The estimated
useful lives of assets for current and comparative periods are as follows :
Buildings 15 years
Computer equipment 2 5 years
Vehicles 5 years
Advances paid towards the acquisition of property, plant and equipment
outstanding at each Balance Sheet date and the cost of assets not put
to use before such date are disclosed under Capital work-in-progress.
Subsequent expenditures relating to property, plant and equipment
is capitalized only when it is probable that future economic benefits
associated with these will flow to the Group and the cost of the item
can be measured reliably.
Repairs and maintenance costs are recognized in net profit in the
statement of comprehensive income when incurred. The cost and
related accumulated depreciation are eliminated from the financial
statements upon sale or retirement of the asset and the resultant gains
or losses are recognized in net profit in the statement of comprehensive
income. Assets to be disposed of are reported at the lower of the
carrying value or the fair value less cost to sell.
1.8 Business combinations
Business combinations have been accounted for using the acquisition
method under the provisions of IFRS 3 (Revised), Business
Combinations.
The cost of an acquisition is measured at the fair value of the assets
transferred, equity instruments issued and liabilities incurred or
assumed at the date of acquisition. The cost of acquisition also
includes the fair value of any contingent consideration. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a
business combination are measured initially at their fair value on the
date of acquisition.
Transaction costs that the Group incurs in connection with a business
combination such as finders fees, legal fees, due diligence fees, and
other professional and consulting fees are expensed as incurred.
1.9 Goodwill
Goodwill represents the cost of business acquisition in excess of the
Groups interest in the net fair value of identifiable assets, liabilities and
contingent liabilities of the acquiree. When the net fair value of the
identifiable assets, liabilities and contingent liabilities acquired exceeds
the cost of business acquisition, a gain is recognized immediately in
net profit in the statement of comprehensive income. Goodwill is
measured at cost less accumulated impairment losses.
1.10 Intangible assets
Intangible assets are stated at cost less accumulated amortization and
impairments. Intangible assets are amortized over their respective
individual estimated useful lives on a straight-line basis, from the date
that they are available for use. The estimated useful life of an identifiable
intangible asset is based on a number of factors including the effects of
obsolescence, demand, competition, and other economic factors (such
as the stability of the industry, and known technological advances), and
the level of maintenance expenditures required to obtain the expected
future cash flows from the asset.
The costs which can be capitalized include the cost of material, direct
labor, overhead costs that are directly attributable to preparing the asset
for its intended use. Research and development costs and software
development costs incurred under contractual arrangements with
customers are accounted as cost of sales.
1.11 Financial instruments
Financial instruments of the Group are classified under the following
categories : non-derivative financial instruments comprising of loans
and receivables, available-for-sale financial assets and trade and other
payables; derivative financial instruments under the category of
financial assets or financial liabilities at fair value through profit or
loss; share capital and treasury shares. The classification of financial
instruments depend on the purpose for which those were acquired. The
Management determines the classification of its financial instruments
at initial recognition.
a. Non-derivative financial instruments
(i) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or
determinable payments that are not quoted in an active market. They
are presented as current assets, except for those maturing later than 12
months after the Balance Sheet date which are presented as non-current
assets. Loans and receivables are measured initially at fair value plus
transaction costs and subsequently carried at amortized cost using
the effective interest method, less any impairment loss or provisions
for doubtful accounts. Loans and receivables are represented by trade
receivables, net of allowances for impairment, unbilled revenue, cash
and cash equivalents, prepayments, certificates of deposit and other
assets.
Cash and cash equivalents comprise cash and bank deposits and
deposits with corporations. The Company considers all highly liquid
months or less and that are readily convertible to known amounts
of cash to be cash equivalents. Certificates of deposit is a negotiable
money market instrument for funds deposited at a bank or other
eligible financial institution for a specified time period.
(ii) Available-for-sale financial assets
Available-for-sale financial assets are non-derivatives that are either
designated in this category or are not classified in any of the other
categories. Available-for-sale financial assets are recognized initially at
fair value plus transactions costs. Subsequent to initial recognition these
are measured at fair value and changes therein, other than impairment
losses and foreign exchange gains and losses on available-for-sale
monetary items are recognized directly in other comprehensive income.
When an investment is de-recognized, the cumulative gain or loss in
other comprehensive income is transferred to net profit in the statement
of comprehensive income. These are presented as current assets unless
the Management intends to dispose of the assets after 12 months from
the Balance Sheet date.
(iii) Trade and other payables
Trade and other payables are initially recognized at fair value, and
subsequently carried at amortized cost using the effective interest
method.
b. Derivative financial instruments
Financial assets or financial liabilities, at fair value through profit or loss
This category has two sub-categories wherein, financial assets or
financial liabilities are held for trading or are designated as such upon
initial recognition.
A financial asset is classified as held for trading if it is acquired
principally for the purpose of selling in the short-term. Derivatives are
categorized as held for trading unless they are designated as hedges.
The Company holds derivative financial instruments such as foreign
exchange forward and option contracts to mitigate the risk of changes
in foreign exchange rates on trade receivables and forecasted cash
flows denominated in certain foreign currencies. The counterparty for
these contracts is generally a bank or a financial institution. Although
the Company believes that these financial instruments constitute
hedges from an economic perspective, they do not qualify for hedge
accounting under IAS 39, Financial Instruments : Recognition and
Measurement. Any derivative that is either not designated as a hedge,
or is so designated but is ineffective as per IAS 39, is categorized as a
financial asset, at fair value through profit or loss.
Derivatives are recognized initially at fair value and attributable
transaction costs are recognized in net profit in the statement
of comprehensive income when incurred. Subsequent to initial
recognition, derivatives are measured at fair value through profit or
loss and the resultant exchange gains or losses are included in other
income. Assets / liabilities in this category are presented as current
assets / current liabilities if they are either held for trading or are
expected to be realized within 12 months after the Balance Sheet date.
c. Share capital and treasury shares
Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issuance of new ordinary shares and share options
are recognized as a deduction from equity, net of any tax effects.
Treasury shares
When any entity within the Group purchases the Companys ordinary
shares, the consideration paid including any directly attributable
incremental cost is presented as a deduction from total equity, until
they are cancelled, sold or reissued. When treasury shares are sold or
reissued subsequently, the amount received is recognized as an increase
in equity, and the resulting surplus or deficit on the transaction is
transferred to / from retained earnings.
1.12 Impairment
a. Financial assets
The Group assesses at each Balance Sheet date whether there is
objective evidence that a financial asset or a group of financial assets
is impaired. A financial asset is considered impaired if objective
evidence indicates that one or more events have had a negative effect
on the estimated future cash flows of that asset. Individually significant
financial assets are tested for impairment on an individual basis.
The remaining financial assets are assessed collectively in groups that
share similar credit risk characteristics.
(i) Loans and receivables
Impairment loss in respect of loans and receivables measured at
amortized cost are calculated as the difference between their carrying
amount, and the present value of the estimated future cash flows
discounted at the original effective interest rate. Such impairment loss
is recognized in net profit in the statement of comprehensive income.
(ii) Available-for-sale financial assets
Significant or prolonged decline in the fair value of the security
below its cost and the disappearance of an active trading market
for the security are objective evidence that the security is impaired.
An impairment loss in respect of an available-for-sale financial asset is
calculated by reference to its fair value and is recognized in net profit
in the statement of comprehensive income. The cumulative loss that
was recognized in other comprehensive income is transferred to net
profit in the statement of comprehensive income upon impairment.
b. Non-financial assets
(i) Goodwill
Goodwill is tested for impairment on an annual basis and whenever
there is an indication that goodwill may be impaired, based on a
number of factors including operating results, business plans and
future cash flows. For the purpose of impairment testing, goodwill
acquired in a business combination is allocated to the Groups Cash
Generating Units (CGU) expected to benefit from the synergies arising
from the business combination.
A CGU is the smallest identifiable group of assets that generates
cash inflows that are largely independent of the cash inflows
from other assets or group of assets. Impairment occurs when the
carrying amount of a CGU including the goodwill, exceeds the
estimated recoverable amount of the CGU. The recoverable amount
of a CGU is the higher of its fair value less cost to sell and its
value-in-use. Value-in-use is the present value of future cash flows
expected to be derived from the CGU.
Total impairment loss of a CGU is allocated first to reduce the carrying
amount of goodwill allocated to the CGU and then to the other assets
of the CGU pro-rata on the basis of the carrying amount of each asset
in the CGU. An impairment loss on goodwill is recognized as net
profit in the statement of comprehensive income and is not reversed
in the subsequent period.
(ii) Intangible assets and property, plant and equipment
Intangible assets and property, plant and equipment are evaluated for
recoverability whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable. For the purpose
of impairment testing, the recoverable amount, i.e. the higher of the
fair value less cost, to sell and the value-in-use is determined on an
individual asset basis unless the asset does not generate cash flows
that are largely independent of those from other assets. In such cases,
the recoverable amount is determined for the CGU to which the asset
belongs.
If such assets are considered to be impaired, the impairment to be
recognized in net profit in the statement of comprehensive income
is measured by the amount by which the carrying value of the assets
exceeds the estimated recoverable amount of the asset.
c. Reversal of impairment loss
An impairment loss for financial assets is reversed if the reversal can
be related objectively to an event occurring after the impairment loss
was recognized. An impairment loss in respect of goodwill is not
reversed. In respect of other assets, an impairment loss is reversed
if there has been a change in the estimates used to determine the
recoverable amount. The carrying amount of an asset other than
goodwill is increased to its revised recoverable amount, provided
that this amount does not exceed the carrying amount that would
have been determined (net of any accumulated amortization or
depreciation) had no impairment loss been recognized for the asset
in prior years. A reversal of impairment loss for an asset other than
goodwill and available-for-sale financial assets that are equity securities
is recognized in net profit in the statement of comprehensive income.
For available-for-sale financial assets that are equity securities, the
reversal is recognized in other comprehensive income.
1.13 Fair value of financial instruments
In determining the fair value of its financial instruments, the Company
uses a variety of methods and assumptions that are based on market
conditions and risks existing at each reporting date. The methods used
to determine fair value include discounted cash flow analysis, available
quoted market prices and dealer quotes. All methods of assessing fair
value result in general approximation of value, and such value may
never actually be realized.
For all other financial instruments the carrying amounts approximate
fair value due to the short maturity of those instruments.
The fair value of securities, which do not have an active market and
where it is not practical to determine the fair values with sufficient
reliability, are carried at cost less impairment.
1.14 Provisions
A provision is recognized if, as a result of a past event, the Group
has a present legal or constructive obligation that can be estimated
reliably, and it is probable that an outflow of economic benefits will
be required to settle the obligation. Provisions are determined by
discounting the expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money and the risks
specific to the liability.
a. Post-sales client support
The Company provides its clients with a fixed-period, post-sales
support for corrections of errors and telephone support on all its
fixed-price, fixed-timeframe contracts. Costs associated with such
support services are accrued at the time related revenues are recorded
and included in cost of sales. The Company estimates such costs based
on historical experience and estimates are reviewed on a periodic basis
for any material changes in assumptions and likelihood of occurrence.
b. Onerous contracts
benefits to be derived by the Group from a contract are lower than
the unavoidable costs of meeting the future obligations under the
contract. The provision is measured at the present value of the lower
of the expected cost of terminating the contract and the expected net
cost of continuing with the contract. Before a provision is established
the Group recognizes any impairment loss on the assets associated
with that contract.
1.15 Foreign currency
Functional currency
The functional currency of Infosys and Infosys BPO is the Indian
rupee. The functional currencies for Infosys Australia, Infosys China,
Infosys Consulting, Infosys Mexico, Infosys Sweden, Infosys Brasil,
Infosys Public Services and Infosys Shanghai are the respective
local currencies. These financial statements are presented in Indian
rupees, rounded off to the nearest crore; one crore equals 10 million.
Transactions and translations
Foreign currency denominated monetary assets and liabilities are
translated into the relevant functional currency at exchange rates
in effect at the Balance Sheet date. The gains or losses resulting
from such translations are included in net profit in the statement
of comprehensive income. Non-monetary assets and non-monetary
liabilities denominated in a foreign currency and measured at
fair value are translated at the exchange rate prevalent at the date
when the fair value was determined. Non-monetary assets and
non-monetary liabilities denominated in a foreign currency and
measured at historical cost are translated at the exchange rate prevalent
at the date of transaction.
Transaction gains or losses realized upon settlement of foreign currency
transactions are included in determining net profit for the period in
which the transaction is settled. Revenue, expense and cash-flow items
denominated in foreign currencies are translated into the relevant
functional currencies using the exchange rate in effect on the date of
the transaction.
The translation of financial statements of the foreign subsidiaries to
the functional currency of the Company is performed for assets and
liabilities using the exchange rate in effect at the Balance Sheet date and
for revenue, expense and cash-flow items using the average exchange
rate for the respective periods. The gains or losses resulting from such
translation are included in currency translation reserves under other
components of equity.
When a subsidiary is disposed of, in part or in full, the relevant amount
is transferred to net profit in the statement of comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a
foreign entity are treated as assets and liabilities of the foreign entity
and translated at the exchange rate in effect at the Balance Sheet date.
1.16 Earnings per equity share
Basic earnings per equity share is computed by dividing the net profit
attributable to the equity holders of the Company by the weighted
average number of equity shares outstanding during the period. Diluted
earnings per equity share is computed by dividing the net profit
attributable to the equity holders of the Company by the weighted
average number of equity shares considered for deriving basic earnings
per equity share and also the weighted average number of equity shares
that could have been issued upon conversion of all dilutive potential
equity shares. The diluted potential equity shares are adjusted for the
proceeds receivable had the equity shares been actually issued at fair
value which is the average market value of the outstanding equity
shares. Dilutive potential equity shares are deemed converted as of the
beginning of the period, unless issued at a later date. Dilutive potential
equity shares are determined independently for each period presented.
The number of equity shares and potentially dilutive equity shares are
adjusted in retrospect for all periods presented for any share splits and
bonus shares issues including for changes effected prior to the approval
of the financial statements by the Board of Directors.
1.17 Income tax
Income tax expense comprises current and deferred income tax.
Income tax expense is recognized in net profit in the statement of
comprehensive income except to the extent that it relates to items
recognized directly in equity, in which case it is recognized in other
comprehensive income. Current income tax for current and prior
periods is recognized at the amount expected to be paid to or recovered
from the tax authorities, using the tax rates and tax laws that have been
enacted or substantively enacted by the Balance Sheet date.
Deferred income tax assets and liabilities are recognized for all
temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the financial statements except
when the deferred income tax arises from the initial recognition of
goodwill or an asset or liability in a transaction that is not a business
combination and affects neither accounting nor taxable profit or loss
at the time of the transaction. Deferred tax assets are reviewed at each
reporting date and are reduced to the extent that it is no longer probable
that the related tax benefit will be realized.
Deferred income tax assets and liabilities are measured using tax rates
and tax laws that have been enacted or substantively enacted by the
Balance Sheet date and are expected to apply to taxable income in the
years in which those temporary differences are expected to be recovered
or settled. The effect of changes in tax rates on deferred income tax
assets and liabilities is recognized as income or expense in the period
that includes the enactment or the substantive enactment date.
A deferred income tax asset is recognized to the extent that it is probable
that future taxable profit will be available against which the deductible
temporary differences and tax losses can be utilized. Deferred income
taxes are not provided on the undistributed earnings of subsidiaries
and branches where it is expected that the earnings of the subsidiary or
branch will not be distributed in the foreseeable future. The Company
offsets current tax assets and current tax liabilities, where it has a
legally enforceable right to set off the recognized amounts and where
it intends either to settle on a net basis, or to realize the asset and
settle the liability simultaneously. Tax benefits of deductions earned on
to income are credited to share premium.
1.18 Employee benefits
1.18.1 Gratuity
In accordance with the Payment of Gratuity Act, 1972, Infosys provides
for gratuity, a defined benefit retirement plan (the Gratuity Plan)
covering eligible employees. The Gratuity Plan provides a lump sum
payment to vested employees at retirement, death, incapacitation or
termination of employment, of an amount based on the respective
employees salary and the tenure of employment.
valuation, performed by an independent actuary, at each Balance
Sheet date using the projected unit credit method. The Company
fully contributes all ascertained liabilities to the Infosys Technologies
Limited Employees Gratuity Fund Trust (the Trust). In case of Infosys
BPO, contributions are made to the Infosys BPO Employees Gratuity
Fund Trust. Trustees administer contributions made to the Trusts
and contributions are invested in specific designated instruments as
permitted by law and investments are also made in mutual funds that
invest in the specific designated instruments.
The Group recognizes the net obligation of a defined benefit plan in its
Balance Sheet as an asset or liability, respectively in accordance with IAS
19, Employee benefits. The discount rate is based on the government
securities yield. Actuarial gains and losses arising from experience
adjustments and changes in actuarial assumptions are charged or
credited to net profit in the statement of comprehensive income in the
period in which they arise. When the computation results in a benefit
to the Group, the recognized asset is limited to the net total of any
unrecognized past service costs and the present value of any future
refunds from the plan or reductions in future contributions to the plan.
1.18.2 Superannuation
Certain employees of Infosys are also participants in a defined
contribution plan. The Company has no further obligations to the
Plan beyond its monthly contributions. Certain employees of Infosys
BPO are also eligible for superannuation benefit. Infosys BPO has no
further obligations to the superannuation plan beyond its monthly
contribution which are periodically contributed to a trust fund, the
corpus of which is invested with the Life Insurance Corporation of
India.
Certain employees of Infosys Australia are also eligible for
superannuation benefit. Infosys Australia has no further obligations to
the superannuation plan beyond its monthly contribution.
1.18.3 Provident fund
Eligible employees of Infosys receive benefits from a provident fund,
which is a defined benefit plan. Both the employee and the Company
Limited Employees Provident Fund Trust. The remaining portion
is contributed to the government administered pension fund.
The rate at which the annual interest is payable to the beneficiaries by
the trust is being administered by the government. The Company has
an obligation to make good the shortfall, if any, between the return
from the investments of the Trust and the notified interest rate.
In respect of Infosys BPO, eligible employees receive benefits from
a provident fund, which is a defined contribution plan. Both the
employee and Infosys BPO make monthly contributions to this
provident fund plan equal to a specified percentage of the covered
employees salary. Amounts collected under the provident fund plan are
deposited in a government administered provident fund. The Company
has no further obligation to the plan beyond its monthly contributions.
1.18.4 Compensated absences
The Group has a policy on compensated absences which are both
accumulating and non-accumulating in nature. The expected cost
of accumulating compensated absences is measured based on the
additional amount expected to be paid / availed as a result of the
unused entitlement that has accumulated at the Balance Sheet date.
Expense on non-accumulating compensated absences is recognized
in the period in which the absences occur.
1.19 Share-based compensation
The Group recognizes compensation expense relating to share-based
payments in net profit using a fair-value measurement method in
accordance with IFRS 2, Share-Based Payment. Under the fair value
method, the estimated fair value of awards is charged to income
on a straight-line basis over the requisite service period for each
separately, treating the vesting portion of the award as if the award
was in-substance, multiple awards. The Group includes a forfeiture
estimate in the amount of compensation expense being recognized.
The fair value of each option is estimated on the date of grant using
the Black-Scholes-Merton valuation model. The expected term of an
option is estimated based on the vesting term and contractual term of
the option, as well as expected exercise behavior of the employee who
receives the option. The expected volatility during the expected term of
the option is based on historical volatility, during a period equivalent to
the expected term of the option, of the observed market prices of the
Companys publicly traded equity shares. Expected dividends during
the expected term of the option are based on recent dividend activity.
Risk-free interest rates are based on the government securities yield
in effect at the time of the grant over the expected term.
1.20 Dividends
Final dividends on shares are recorded as a liability on the date of
approval by the shareholders and interim dividends are recorded as a
liability on the date of declaration by the Companys Board of Directors.
1.21 Operating profit
Operating profit for the Group is computed considering the revenues,
net of cost of sales, selling and marketing expenses and administrative
expenses.
1.22 Other income
Other income is comprised primarily of interest income and dividend
income. Interest income is recognized using the effective interest
method. Dividend income is recognized when the right to receive
payment is established.
1.23 Leases
Leases under which the Company assumes substantially all the risks
and rewards of ownership are classified as finance leases. When
acquired, such assets are capitalized at fair value or present value of
is lower. Lease payments under operating leases are recognized as
an expense on a straight line basis in net profit in the statement of
comprehensive income over the lease term.
1.24 Government grants
The Group recognizes government grants only when there is reasonable
assurance that the conditions attached to them shall be complied
with, and the grants will be received. Government grants related
to depreciable fixed assets are treated as deferred income and are
recognized in net profit in the statement of comprehensive income
on a systematic and rational basis over the useful life of the asset.
Government grants related to revenue are recognized on a systematic
basis in net profit in the statement of comprehensive income over the
periods necessary to match them with the related costs which they
are intended to compensate.
1.25 Recent accounting pronouncements
1.25.1 Standards issued but not yet effective
IFRS 9 Financial Instruments : In November 2009, International
Accounting Standards Board issued IFRS 9, Financial Instruments :
Recognition and Measurement, to reduce complexity of the current
rules on financial instruments as mandated in IAS 39. The effective
date for IFRS 9 is annual periods beginning on or after January 1, 2013
with permission for early adoption. IFRS 9 has fewer classification and
measurement categories as compared to IAS 39 and has eliminated,
held to maturity, available for sale and loans and receivables. Further
it eliminates the rule based requirement of segregating embedded
derivatives and tainting rules pertaining to, held to maturity
investments. For an investment in an equity instrument which is not
held for trading, the standard permits an irrevocable election, on initial
recognition, on an individual share-by-share basis, to present all fair
value changes from the investment in other comprehensive income.
No amount recognized in other comprehensive income would ever
be reclassified to Profit or Loss. The Group is required to adopt the
standard by accounting year commencing April 1, 2014. The Group
is currently evaluating the requirements of IFRS 9, and has not yet
determined the impact on the consolidated financial statements.
2. Notes to the consolidated financial
statements
2.1 Cash and cash equivalents
Cash and cash equivalents consist of the following :
in rcrore
As of March 31,
2011 2010
Cash and bank deposits 15,095 10,556
Deposits with corporations 1,571 1,555
16,666 12,111
Cash and cash equivalents as of March 31, 2011 and March 31, 2010
include restricted cash and bank balances of R108 crore and R71 crore
respectively. The restrictions are primarily on account of cash and bank
balances held by irrevocable trusts controlled by the Company and
unclaimed dividends.
The deposits maintained by the Group with banks and corporations
comprise of time deposits, which can be withdrawn by the Group at
any point without prior notice or penalty on the principal.
The following table provides details of cash and cash equivalents :
in rcrore
As of March 31,
2011 2010
Current Accounts
ABN Amro Bank, China 17 33
ABN Amro Bank, China (U.S. dollar
account) 24 14
ABN Amro Bank, Taiwan 3 2
Bank of America, Mexico 4 18
Banamex, Mexico 2 2
China Merchants Bank, China 1
Citibank NA, Brazil 5 9
Citibank NA, China (U.S. dollar account) 11
Citibank NA, Czech Republic (Euro
account) 2
Citibank NA, Czech Republic (U.S. dollar
account)
Citibank NA., Czech Republic 1
Citibank NA, India 2 2
Citibank NA, India, Unclaimed dividend
account 1
Deustche Bank, India 12 13
Deutsche Bank, Czech Republic 1
Deutsche Bank, Poland 2
Deutsche Bank, Moscow (U.S. dollar
account) 1
Deustche Bank, Philippines 1
Deustche Bank, Philippines (U.S. dollar
account) 1 3
Deutsche Bank, Poland 1
Deustche Bank, Poland (Euro account) 2 1
Deutsche Bank, Switzerland (U.S. dollar
account) 1
Deustche Bank, Thailand 3
Deustche Bank, Thailand (U.S. dollar
account) 1
Deutsche Bank, United Kingdom 40 29
Deutsche Bank EEFC (United Kingdom
Pound Sterling account) 1
Deustche Bank EEFC (Swiss Franc
account) 2
Deustche Bank EEFC (U.S. dollar
account) 143 8
HSBC Bank, U.K. 10 2
HDFC Bank Unclaimed dividend
account 1 1
ICICI Bank, India 32 133
ICICI Bank, U.K. 1 1
ICICI Bank EEFC (Euro account) 1
ICICI Bank EEFC (United Kingdom
Pound Sterling account) 1 2
ICICI Bank EEFC (U.S. dollar account) 22 10
As of March 31,
2011 2010
ICICI bank Unclaimed dividend
account 1 1
National Australia Bank Limited,
Australia 1 21
Australia (U.S. dollar account) 14
Nordbanken, Sweden 5 1
Shanghai Pudong Development Bank,
China 2
Wachovia Bank, U.S. 7
777 1,128
Deposit Accounts
ABN Amro Bank, China 14
Andhra Bank 399 99
Axis Bank 536
Bank of America 82
Bank of America, Mexico 17
Barclays Bank 100
Citibank NA, Czech Republic 5 9
Citibank NA, Czech Republic,
U.S. dollar 1
Citibank (Euro account) 3
Citibank (U.S. dollar account) 4
Citibank Brazil 3
Deustche Bank, Poland 21 8
DBS Bank 49
HDFC Bank 646
HSBC Bank 483
HSBC Bank, U.K. 18
IDBI Bank 770 909
ING Vysya Bank 25
Australia 546 312
Oriental Bank of Commerce 653 100
Vijaya Bank 144 95
Yes Bank 33
14,318 9,428
Deposits with corporations
Sundaram BNP Paribas Home Finance
Limited 4
1,571 1,555
Total 16,666 12,111
in rcrore
2.2 Available-for-sale financial assets
Investments in liquid mutual fund units and unlisted equity securities
are classified as available-for-sale financial assets.
Cost and fair value of investment in liquid mutual fund units and
unlisted equity securities are as follows :
in rcrore
As of March 31,
2011 2010
Current
Liquid mutual fund units :
Cost and fair value 21 2,518
Non Current
Unlisted equity securities :
Cost 4 4
Gross unrealized holding gains 19 34
Fair value 23 38
Total available-for-sale financial assets 44 2,556
During February 2010, Infosys sold 32,31,151 shares of OnMobile Systems
Inc., U.S., at a price of R166.58 per share, derived from quoted prices
of the underlying marketable equity securities. The total consideration
amounted to R53 crore, net of taxes and transaction costs. The resultant
income of R48 crore was included under other income for the year ended
March 31, 2010. Additionally, the remaining 21,54,100 shares had been
fair valued at R38 crore as at March 31, 2010.
As of March 31, 2011 the 21,54,100 shares were fair valued at
R23 crore and the resultant unrealized loss of R12 crore, net of taxes of
R3 crore has been recognized in other comprehensive income for the
year ended March 31, 2011. The fair value of R23 crore has been derived
based on an agreed upon exchange ratio between these unlisted equity
securities and quoted prices of the underlying marketable equity securities.
2.3 Business combinations
During the year ended March 31, 2010 Infosys BPO acquired 100%
of the voting interests in McCamish Systems LLC (McCamish),
a business process solutions provider based in Atlanta, Georgia, in the
United States. The business acquisition was conducted by entering
into Membership Interest Purchase Agreement for a cash consideration
of R173 crore and a contingent consideration of up to R93 crore.
The fair value of contingent consideration and its undiscounted value
on the date of acquisition were R40 crore and R67 crore, respectively.
During the year ended March 31, 2011, the liability related to contingent
consideration increased by R4 crore due to the passage of time.
This business acquisition is expected to enable Infosys BPO to deliver
growth in platform-based services in the insurance and financial services
industry and is also expected to enable McCamish to service larger
portfolios of transactions for clients and expand into global markets.
Consequently, the excess of the purchase consideration paid over the
fair value of assets acquired has been accounted for as goodwill.
The purchase price has been allocated based on the Managements estimates
and independent appraisal of fair values as follows :
in rcrore
Component Acquirees
carrying
amount
Fair value
adjustments
Purchase
price
allocated
Property, plant and
equipment 5 5
Net current assets 9 9
Intangible assets-
Customer contracts and
relationships 48 48
Intangible assets-
Computer software
platform 13 13
14 61 75
Goodwill 138
Total purchase price 213
Of the goodwill stated above, goodwill to the extent of R95 crore is
deductible for tax purposes.
The amount of trade receivables acquired from the above business
acquisition was R 16 crore. The entire amount has been collected
subsequently.
The identified intangible customer contracts and relationships are
being amortized over a period of nine years whereas the identified
intangible computer software platform has been amortized over a
period of four months, based on the Managements estimate of the
useful life of the assets.
The acquisition date fair value of each major class of consideration as
of the acquisition date is as follows :
in rcrore
Particulars Consideration settled
Fair value of total consideration
Cash paid 161
Liabilities settled in cash 12
Contingent consideration 40
Total 213
The payment of contingent consideration is dependent upon the
achievement of certain revenue targets and net margin targets by McCamish
over a period of 4 years ending March 31, 2014. Further, contingent
to McCamish signing any deal with a customer with total revenues of
US$ 100 million or more, the aforesaid period will be extended by
2 years. The total contingent consideration can range between R67 crore
and R93 crore.
The fair value of the contingent consideration is determined by discounting
the estimated amount payable to the previous owners of McCamish on
achievement of certain financial targets. The key inputs used for the
determination of fair value of contingent consideration are the discount
rate of 13.9% and the probabilities of achievement of the net margin and
the revenue targets ranging from 50% to 100%.
2.4 Prepayments and other assets
Prepayments and other assets consist of the following :
in rcrore
As of March 31,
2011 2010
Current
Security deposits with service providers 63 63
Loans to employees 137 106
Prepaid expenses
(1)
47 39
Withholding taxes
(1)
548 343
Advance payments to vendors for supply
of goods
(1)
36 19
Other assets 22 26
917 641
Non-current
Loans to employees 4 6
Deposit with corporation 437 337
Prepaid expenses
(1)
20
Prepaid gratuity and other benets
(1)
2 4
463 347
1,380 988
Financial assets in prepayments and other
assets 727 583
(1)
Non-financial assets
Withholding taxes primarily consist of input tax credits. Other assets
primarily represent travel advances and other recoverable from
customers. Security deposits with service providers relate principally
to leased telephone lines and electricity supplies.
Deposit with corporation represents amounts deposited to settle certain
employee-related obligations as and when they arise during the normal
course of business.
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2.5 Property, plant and equipment
Following are the changes in the carrying value of property, plant and equipment for the year ended March 31, 2011 :
in rcrore
Land Buildings Plant and
machinery
Computer
equipment
Furniture and
fixtures
Vehicles Capital work-
in-progress
Total
Gross carrying value as of April 1, 2010 327 3,300 1,263 1,251 765 5 409 7,320
Additions 224 326 170 291 126 2 116 1,255
Deletions (147) (219) (123) (489)
Translation difference 9 3 12
Gross carrying value as of March 31, 2011 551 3,626 1,286 1,332 771 7 525 8,098
Accumulated depreciation as of April 1, 2010 (745) (648) (1,046) (440) (2) (2,881)
Depreciation (233) (237) (236) (147) (1) (854)
Accumulated depreciation on deletions 147 219 123 489
Translation difference 1 (7) (2) (8)
Accumulated depreciation as of March 31, 2011 (978) (737) (1,070) (466) (3) (3,254)
Carrying value as of April 1, 2010 327 2,555 615 205 325 3 409 4,439
Carrying value as of March 31, 2011 551 2,648 549 262 305 4 525 4,844
Following are the changes in the carrying value of property, plant and equipment for the year ended March 31, 2010 :
in rcrore
Land Buildings Plant and
machinery
Computer
equipment
Furniture and
fixtures
Vehicles Capital work-
in-progress
Total
Gross carrying value as of April 1, 2009 285 2,913 1,183 1,233 774 4 677 7,069
Additions 42 387 212 199 101 1 (268) 674
Acquisition through business combination 5 5
Deletions (133) (186) (110) (429)
Translation difference 1 1
Gross carrying value as of March 31, 2010 327 3,300 1,263 1,251 765 5 409 7,320
Accumulated depreciation as of April 1, 2009 (535) (521) (960) (387) (1) (2,404)
Depreciation (210) (259) (272) (163) (1) (905)
Accumulated depreciation on deletions 132 186 110 428
Accumulated depreciation as of March 31, 2010 (745) (648) (1,046) (440) (2) (2,881)
Carrying value as of April 1, 2009 285 2,378 662 273 387 3 677 4,665
Carrying value as of March 31, 2010 327 2,555 615 205 325 3 409 4,439
During the years ended March 31, 2011 and March 31, 2010, certain assets which were not in use having gross book value of R488 crore and R387 crore, respectively, (carrying value nil) were retired.
The depreciation expense for the years ended March 31, 2011 and March 31, 2010 is included in cost of sales in the statement of comprehensive income.
Carrying value of land includes R146 crore and R149 crore as of March 31, 2011 and March 31, 2010 respectively, towards deposits paid under certain lease-cum-sale agreements to acquire land
including agreements where the Company has an option to purchase the properties on expiry of the lease period. The Company has already paid 99% of the market value of the properties prevailing at
the time of entering into the lease-cum-sale agreements with the balance payable at the time of purchase. The contractual commitments for capital expenditure were R814 crore and R301 crore, as of
March 31, 2011 and March 31, 2010 respectively.
2.6 Goodwill and intangible assets
Following is a summary of changes in the carrying amount of goodwill :
in rcrore
As of March 31,
2011 2010
Carrying value at the beginning 829 692
Goodwill recognized on
acquisition (refer note 2.3) 138
Translation differences pertaining
to foreign subsidiary (4) (1)
Carrying value at the end 825 829
Goodwill has been allocated to the cash generating units (CGU),
identified to be the operating segments as follows :
in rcrore
Segment As of March 31,
2011 2010
Financial services 400 403
Manufacturing 96 94
Telecom 14 15
Retail 226 228
Others 89 89
Total 825 829
The entire goodwill relating to Infosys BPOs acquisition of McCamish
has been allocated to the Financial services segment.
For the purpose of impairment testing, goodwill acquired in a business
combination is allocated to the CGU which are operating segments
regularly reviewed by the chief operating decision maker to make
decisions about resources to be allocated to the segment and to assess
its performance.
The recoverable amount of a CGU is the higher of its fair value less
cost to sell and its value-in-use. The fair value of a CGU is determined
based on the market capitalization. The value-in-use is determined
based on specific calculations. These calculations use pre-tax cash
flow projections over a period of five years, based on financial budgets
approved by the Management and an average of the range of each
assumption mentioned below.
As of March 31, 2011, the estimated recoverable amount of the CGU
exceeded its carrying amount. The recoverable amount was computed
based on the fair value being higher than value-in-use and the carrying
amount of the CGU was computed by allocating the net assets to
operating segments for the purpose of impairment testing. The key
assumptions used for the calculations are as follows :
In %
Long-term growth rate 8 10
Operating margins 17 20
Discount rate 13
The above discount rate is based on the Weighted Average Cost of
Capital (WACC) of the Company. These estimates are likely to differ
from future actual results of operations and cash flows.
Following is a summary of changes in the carrying amount of acquired
intangible assets :
in rcrore
As of March 31,
2011 2010
Gross carrying value at the
beginning 117 56
Customer contracts and
relationships (refer note 2.3) 48
Computer software platform
(refer note 2.3) 13
Gross carrying value at the end 117 117

Accumulated amortization at the
beginning 61 21
Amortization expense 8 37
Translation differences 3
Accumulated amortization at
the end 69 61
Net carrying value 48 56
The intangible customer contracts recognized at the time of acquisition
of Philips BPO operations are being amortized over a period of seven
years, being the Managements estimate of its useful life, based on
the life over which economic benefits are expected to be realized.
However, during the year ended March 31, 2010 the amortization of
this intangible asset has been accelerated based on the usage pattern
of the asset. As of March 31, 2011, the customer contracts have a
remaining amortization period of approximately four years.
The intangible customer contracts and relationships recognized at the
time of McCamish acquisition are being amortized over a period of
nine years, being managements estimate of its useful life, based on
the life over which economic benefits are expected to be realized. As
of March 31, 2011, the customer contracts and relationships have a
remaining amortization period of eight years.
The intangible computer software platform recognized at the time
of McCamish acquisition having a useful life of four months, being
managements estimate of its useful life, based on the life over which
economic benefits were expected to be realized, has been fully
amortized.
The aggregate amortization expense included in cost of sales, for the
years ended March 31, 2011 and March 31, 2010 was R8 crore and
R37 crore respectively.
Research and development expense recognized in net profit in the
statement of comprehensive income, for the years ended March 31,
2011 and March 31, 2010 was R528 crore and R435 crore respectively.
2.7 Financial instruments
Financial instruments by category
The carrying value and fair value of financial instruments by categories as of March 31, 2011 were as follows :
in rcrore
Loans and
receivables
Financial
assets /
liabilities at
fair value
through profit
and loss
Available
for sale
Trade and
other payables
Total carrying
value / fair
value
Assets
Cash and cash equivalents (refer note 2.1) 16,666 16,666
Available-for-sale financial assets (refer note 2.2) 44 44
Investment in certificates of deposit 123 123
Unbilled revenue 1,243 1,243
Prepayments and other assets (refer note 2.4) 727 727
Derivative financial instruments 66 66
Total 23,412 66 44 23,522
Liabilities
Employee benefit obligations (refer note 2.8) 399 399
Other liabilities (refer note 2.10) 1,678 1,678
Liability towards acquisition of business on a discounted
basis (refer note 2.10) 43 43
Total 2,186 2,186
The carrying value and fair value of financial instruments by categories as of March 31, 2010 were as follows :
in rcrore
Loans and
receivables
Financial
assets /
liabilities at
fair value
through profit
and loss
Available
for sale
Trade and
other payables
Total carrying
value / fair
value
Assets
Cash and cash equivalents (refer note 2.1) 12,111 12,111
Available-for-sale financial assets (refer note 2.2) 2,556 2,556
Investment in certificates of deposit 1,190 1,190
Unbilled revenue 841 841
Prepayments and other assets (refer note 2.4) 583 583
Total 18,219 95 2,556 20,870
Liabilities
Client deposits 8 8
Employee benefit obligations (refer note 2.8) 302 302
Other liabilities (refer note 2.10) 1,452 1,452
Liability towards acquisition of business on a discounted
basis (refer note 2.10) 40 40
Total 1,812 1,812
Fair value hierarchy
Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or
indirectly (derived from prices).
Level 3 Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
The following table presents fair value hierarchy of assets and liabilities measured at fair value on a recurring basis as of March 31, 2011 :
in rcrore
As of
March 31,
2011
Fair value measurement at end of the reporting
period / year using
Level 1 Level 2 Level 3
Assets
Available-for-sale financial asset investments in liquid mutual fund units
(refer note 2.2) 21 21
Available-for-sale financial asset investments in unlisted equity
instruments (refer note 2.2) 23 23
Derivative financial instruments gains on outstanding foreign exchange
forward and option contracts 66 66
The following table presents fair value hierarchy of assets and liabilities measured at fair value on a recurring basis as of March 31, 2010 :
in rcrore
As of
March 31,
2010
Fair value measurement at end of the reporting
period / year using
Level 1 Level 2 Level 3
Assets
Available-for-sale financial asset investments in liquid mutual fund units
(refer note 2.2) 2,518 2,518
Available-for-sale financial asset investments in unlisted equity
instruments (refer note 2.2) 38 38
Derivative financial instruments gains on outstanding foreign exchange
Income from financial assets or liabilities that are not at fair value through profit or loss is as follows :
in rcrore
2011 2010
Interest income on deposits and certificates of deposit 1,133 779
Income from available-for-sale financial assets 23 160
1,156 939
Derivative financial instruments
The Company uses derivative financial instruments such as foreign exchange forward and option contracts to mitigate the risk of changes in
foreign exchange rates on trade receivables and forecasted cash flows denominated in certain foreign currencies. The counterparty for these
contracts is generally a bank or a financial institution. These derivative financial instruments are valued based on quoted prices for similar assets
and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace. The following table gives details in respect
of outstanding foreign exchange forward and option contracts :
As of As of
March 31, 2011 March 31, 2010
In million In Rcrore In million In Rcrore
Forward contracts
In U.S. dollars 546 2,433 267 1,199
In Euro 28 177 22 130
In GBP 15 108 11 71
In AUD 10 46 3 12
Option contracts
In U.S. dollars 200 898
2,764 2,310
The Company recognized a net gain on derivative financial instruments of R56 crore during the year ended March 31, 2011 as against a net
gain on derivative financial instruments of R299 crore during the year ended March 31, 2010, respectively, which are included as other income.
The foreign exchange forward and option contracts mature between
1 to 12 months. The table below analyzes the derivative financial
instruments into relevant maturity groupings based on the remaining
period as of the Balance Sheet date :
in rcrore
As of March 31,
2011 2010
Not later than one month 435 280
Later than one month and not
later than three months 649 825
Later than three months and not
later than one year 1,680 1,205
2,764 2,310
Financial risk management
Financial risk factors
The Companys activities expose it to a variety of financial risks :
market risk, credit risk and liquidity risk. The Companys primary
focus is to foresee the unpredictability of financial markets and seek
to minimize potential adverse effects on its financial performance.
The primary market risk to the Company is foreign exchange risk.
The Company uses derivative financial instruments to mitigate foreign
exchange related risk exposures. The Companys exposure to credit
risk is influenced mainly by the individual characteristic of each
customer and the concentration of risk from the top few customers.
The demographics of the customer, including the default risk of the
industry and country in which the customer operates also has an
influence on the credit risk assessment.
Market risk
The Company operates internationally and a major portion of the
business is transacted in several currencies and consequently the
Company is exposed to foreign exchange risk through its sales and
services in the United States and elsewhere, and purchases from
overseas suppliers in various foreign currencies. The Company uses
derivative financial instruments such as foreign exchange forward and
option contracts to mitigate the risk of changes in foreign exchange
rates on trade receivables and forecasted cash flows denominated
in certain foreign currencies. The exchange rate between the rupee
and foreign currencies has changed substantially in recent years and
may fluctuate substantially in the future. Consequently, the results
of the Companys operations are adversely affected as the rupee
appreciates / depreciates against these currencies.
The following table gives details in respect of the outstanding foreign
exchange forward and option contracts :
in rcrore
As of March 31,
2011 2010
Aggregate amount of outstanding
forward and option contracts 2,764 2,310
Gains / (losses) on outstanding
The outstanding foreign exchange forward and option contracts as of
March 31, 2011 and March 31, 2010, mature between one to twelve
months.
The following table analyzes foreign currency risk from financial instruments as of March 31, 2011 :
in rcrore
U.S. dollars Euro United Kingdom
Pound Sterling
Australian
dollars
Other
currencies
Total
Cash and cash equivalents 589 40 69 532 138 1,368
Trade receivables 3,095 407 475 294 221 4,492
Unbilled revenue 731 180 97 65 71 1,144
Other assets 589 12 61 38 700
Trade payables (1) (1) (11) (13)
Client deposits (20) (1) (21)
Accrued expenses (232) (17) 15 (37) (271)
Accrued compensation to employees (134) (14) (60) (208)
Other liabilities (1,468) (180) (28) (4) (68) (1,748)
Net assets / (liabilities) 3,149 442 674 887 291 5,443
The following table analyzes foreign currency risk from financial instruments as of March 31, 2010 :
in rcrore
U.S. dollars Euro United Kingdom
Pound Sterling
Australian
dollars
Other
currencies
Total
Cash and cash equivalents 764 46 31 315 123 1,279
Trade receivables 2,446 254 370 204 177 3,451
Unbilled revenue 567 72 110 32 39 820
Other assets 481 13 11 1 45 551
Trade payables (1) (1) (7) (9)
Client deposits (7) (7)
Accrued expenses (254) (16) (26) (296)
Accrued compensation to employees (149) (2) (48) (199)
Other liabilities (1,128) (137) (56) (36) (1,357)
Net assets / (liabilities) 2,719 229 466 552 267 4,233
For the year ended March 31, 2011 and March 31, 2010, every percentage point depreciation / appreciation in the exchange rate between the
Indian rupee and U.S. dollar, has affected the Companys operating margins by approximately 0.5% and 0.6% respectively.
Sensitivity analysis is computed based on the changes in the income and expenses in foreign currency upon conversion into functional currency,
due to exchange rate fluctuations between the previous reporting period and the current reporting period.
Credit risk
Credit risk refers to the risk of default on its obligation by the
counterparty resulting in a financial loss. The maximum exposure to
the credit risk at the reporting date is primarily from trade receivables
amounting to R4,653 crore and R3,494 crore as of March 31, 2011
and March 31, 2010, respectively and unbilled revenue amounting to
R 1,243 crore and R 841 crore as of March 31, 2011 and
March 31, 2010, respectively.
Trade receivables are typically unsecured and are derived from revenue
earned from customers primarily located in the United States. Credit
risk is managed through credit approvals, establishing credit limits and
continuously monitoring the creditworthiness of customers to which
the Company grants credit terms in the normal course of business.
The following table provides details in respect of percentage of revenues
generated from the top customer and the top five customers :
in %
2011 2010
Revenue from top customer 4.7 4.6
Revenue from top five customers 15.4 16.4
Financial assets that are neither past due nor impaired
Cash and cash equivalents, available-for-sale financial assets and
investment in certificates of deposits are neither past due nor
impaired. Cash and cash equivalents include deposits with banks
and corporations with high credit-ratings assigned by international
and domestic credit-rating agencies. Available-for-sale financial assets
include investment in liquid mutual fund units and unlisted equity
securities. Certificates of deposit represent funds deposited at a bank
or other eligible financial institution for a specified time period.
Of the total trade receivables, R3,350 crore and R2,444 crore as of
March 31, 2011 and March 31, 2010, respectively, were neither past
due nor impaired.
Financial assets that are past due but not impaired
There is no other class of financial assets that is not past due but
impaired except for trade receivables of R 3 crore and nil as of
March 31, 2011 and March 31, 2010, respectively.
The Companys credit period generally ranges from 30 45 days.
The age analysis of the trade receivables have been considered from
the due date.
The age-wise break up of trade receivables, net of allowances that are
past due, is as follows :
in rcrore
Period (in days) As of March 31,
2011 2010
Less than 30 929 800
31 60 193 152
61 90 61 43
More than 90 117 55
1,300 1,050
The allowance for impairment of trade receivables for the years ended
March 31, 2011 and March 31, 2010 was R2 crore and less than R1
crore, respectively. The movement in the allowance for impairment of
trade receivables is as follows :
in rcrore
2011 2010
Translation differences (5) 2
Impairment loss recognized
(refer note 2.11) 2
Trade receivables written off (13) (6)
Liquidity risk
As of March 31, 2011, the Company had a working capital of R20,048
crore including cash and cash equivalents of R16,666 crore, available-
for-sale financial assets of R21 crore and investments in certificates
of deposit of R123 crore. As of March 31, 2010, the Company had a
working capital of R17,697 crore including cash and cash equivalents
of R12,111 crore, available-for-sale financial assets of R2,518 crore
and investments in certificates of deposit of R1,190 crore.
As of March 31, 2011 and March 31, 2010, the outstanding employee
benefit obligations were R399 crore and R302 crore, respectively, which
have been fully funded. Further, as of March 31, 2011 and March 31,
2010, the Company had no outstanding bank borrowings. Accordingly,
no liquidity risk is perceived.
The table below provides details regarding the contractual maturities of significant financial liabilities as of March 31, 2011 :
in rcrore
Particulars Less than 1 year 1 2 years 2 4 years 4 7 years Total
Other liabilities (refer note 2.10) 1,658 20 1,678
Liability towards acquisition of business on an
undiscounted basis (refer note 2.10) 4 10 43 8 65
The table below provides details regarding the contractual maturities of significant financial liabilities as of March 31, 2010 :
in rcrore
Particulars Less than 1 year 1 2 years 2 4 years 4 7 years Total
Client deposits 8 8
Other liabilities (refer note 2.10) 1,431 21 1,452
Liability towards acquisition of business on an
undiscounted basis (refer note 2.10) 9 27 31 67
As of March 31, 2011 and March 31, 2010, the Company had outstanding financial guarantees of R21 crore and R18 crore, respectively, towards
leased premises. These financial guarantees can be invoked upon breach of any term of the lease agreement. To the Companys knowledge, there
has been no breach of any term of the lease agreement as of March 31, 2011 and March 31, 2010.
2.8 Employee benefit obligations
Employee benefit obligations comprise the following :
in rcrore
As of March 31,
2011 2010
Current
Compensated absence 140 131
140 131
Non-current
Compensated absence 259 171
259 171
399 302
2.9 Provisions
Provisions comprise the following :
in rcrore
As of March 31,
2011 2010
Provision for post-sales client support 88 82
Provision for post-sales client support represents cost associated with
providing post-sales support services which are accrued at the time of
recognition of revenues and are expected to be utilized over a period
of 6 months to 1 year. The movement in the provision for post-sales
client support is as follows :
in rcrore
2011 2010
Provision recognized / (reversed)
(refer note 2.11) 5 (2)
Provision utilized (8)
Translation difference 1
Provision for post-sales client support for the years ended March 31,
2011 and March 31, 2010 is included in cost of sales in the statement
of comprehensive income.
2.10 Other liabilities
Other liabilities comprise the following :
in rcrore
As of March 31,
2011 2010
Current
Accrued compensation to employees 732 667
Accrued expenses 771 606
Withholding taxes payable
(1)
329 250
Retainage 26 72
Unamortized negative past service cost
(refer note 2.12.1)
(1)
22 26
Liabilities arising on consolidation of trusts 119 74
Liability towards acquisition of business 3
Others 10 12
2,012 1,707
Non-current
Liability towards acquisition of business 40 40
Incentive accruals 20 21
60 61
2,072 1,768
Financial liabilities included in other
liabilities (excluding liability towards
acquisition of business) 1,678 1,452
As of March 31,
2011 2010
Financial liability towards acquisition of
business on a discounted basis 43 40
Financial liability towards acquisition
of business on an undiscounted basis
(refer note 2.3) 65 67
(1)
Non financial liabilities
Accrued expenses primarily relates to cost of technical sub-contractors,
telecommunication charges, legal and professional charges, brand
building expenses, overseas travel expenses and office maintenance.
Others include unclaimed dividend balances.
2.11 Nature of expenses
in rcrore
2011 2010
Employee benefit costs (refer note 2.12.4) 14,856 12,093
Depreciation and amortization charges
(refer note 2.5 and 2.6) 862 942
Travel costs 954 692
Consultancy and professional charges 344 278
delivery 139 17
Communication costs 237 225
Cost of technical sub-contractors 603 372
Repairs and maintenance 134 95
Commission 15 16
Branding and marketing expenses 104 73
Consumables 27 25
(refer note 2.9) 5 (2)
Allowance for impairment of trade
receivables (refer note 2.7) 2
Operating lease payments (refer note 2.15) 146 125
Others 118 149
Total cost of sales, selling and marketing
expenses and administrative expenses 19,399 15,832
2.11.1 Break up of expenses
Cost of sales
in rcrore
2011 2010
Employee benefit costs 12,971 10,617
delivery 139 17
Cost of technical sub-contractors 603 372
Consumables 27 25
Operating lease payments 90 73
in rcrore
2011 2010
Provision for post-sales client support 5 (2)
Other expenses 44 40
Total 15,916 13,020
Sales and marketing expenses
in rcrore
2011 2010
Employee benefit costs 1,218 935
Branding and marketing 97 73
Commission 15 16
Others 3 1
Total 1,512 1,184
Administrative expenses
in rcrore
2011 2010
Employee benefit costs 667 541
Travel costs 136 98
Allowance for impairment of trade
receivables 2
Branding and marketing 7
Other expenses 71 108
Total 1,971 1,628
2.12 Employee benefits
2.12.1 Gratuity
The following tables set out the funded status of the gratuity plans and the amounts recognized in the Companys financial statements as of
March 31, 2011, March 31, 2010, March 31, 2009 and March 31, 2008 :
in rcrore
As of March 31,
2011 2010 2009 2008
Change in benefit obligations
Benefit obligations at the beginning 325 267 224 225
Service cost 178 80 51 50
Interest cost 25 19 16 17
Actuarial (gains) / losses 17 (5) 1 (8)
Benefits paid (65) (36) (25) (23)
Amendment in benefit plan (37)
Benefit obligations at the end 480 325 267 224
Fair value of plan assets at the beginning 327 268 236 225
Expected return on plan assets 36 25 17 18
Actuarial gains 1 5 2
Employer contributions 182 69 35 14
Benefits paid (65) (36) (25) (23)
Fair value of plan assets at the end 480 327 268 236
Funded status 2 1 12
Prepaid gratuity benefit 2 4 1 12
Accrued gratuity (2) (2)
Net gratuity cost for the years ended March 31, 2011 and March 31, 2010 comprises the following components :
in rcrore
2011 2010
Service cost 178 80
Interest cost 25 19
Actuarial (gains) / Losses 17 (6)
Plan amendments (4) (3)
in rcrore
The net gratuity costs have been apportioned between cost of sales,
selling and marketing expenses and administrative expenses on the
basis of direct employee cost as follows :
in rcrore
2011 2010
Cost of sales 157 57
Selling and marketing expenses 15 5
Administrative expenses 8 3
180 65
Effective July 1, 2007, the Company amended its Gratuity Plan, to
suspend the voluntary defined death benefit component of the Gratuity
Plan. This amendment resulted in a negative past service cost amounting
to R37 crore, which is being amortized on a straight-line basis over the
average remaining service period of employees which is 10 years. The
unamortized negative past service cost of R22 crore and R26 crore as of
March 31, 2011 and March 31, 2010, respectively, has been included
under other current liabilities.
The weighted-average assumptions used to determine benefit
obligations as of March 31, 2011, March 31, 2010, March 31, 2009 and
As of March 31,
2011 2010 2009 2008
Discount rate 8.0% 7.8% 7.0% 7.9%
Weighted average rate of increase
in compensation levels 7.3% 7.3% 5.1% 5.1%
The weighted-average assumptions used to determine net
periodic benefit cost for the year ended March 31, 2011 and
2011 2010
Discount rate 7.8% 7.0%
Weighted average rate of increase in
compensation levels 7.3% 7.3%
Rate of return on plan assets 9.4% 9.0%
The Company contributes all ascertained liabilities towards gratuity
to the Infosys Technologies Limited Employees Gratuity Fund Trust.
In case of Infosys BPO, contributions are made to the Infosys BPO
Employees Gratuity Fund Trust. Trustees administer contributions
made to the trust and contributions are invested in specific designated
instruments as permitted by Indian law and investments are also made
in mutual funds that invest in the specific designated instruments.
As of March 31, 2011 and March 31, 2010 the plan assets have been
primarily invested in government securities.
Actual return on assets for the year ended March 31, 2011 and
March 31, 2010 was R36 crore and R26 crore, respectively.
The Company assesses these assumptions with its projected long-term
plans of growth and prevalent industry standards. The Companys
overall expected long-term rate-of-return on assets has been
determined based on consideration of available market information,
current provisions of Indian law specifying the instruments in which
investments can be made, and historical returns. Historical returns
during the year ended March 31, 2011 and March 31, 2010 have not
been lower than the expected rate of return on plan assets estimated
for those years. The discount rate is based on the government securities
yield. The Company expects to contribute approximately R106 crore
to the gratuity trusts during fiscal 2012.
Assumptions regarding future mortality experience are set in
accordance with the published statistics by the Life Insurance
Corporation of India.
2.12.2 Superannuation
The Company contributed R 109 crore and R 91 crore to the
superannuation plan during the year ended March 31, 2011 and
March 31, 2010, respectively.
Superannuation contributions have been apportioned between cost
of sales, selling and marketing expenses and administrative expenses
on the basis of direct employee cost as follows :
in rcrore
2011 2010
Cost of sales 95 80
109 91
2.12.3 Provident fund
The Company has an obligation to fund any shortfall on the yield of
the trusts investments over the administered interest rates on an annual
basis. These administered rates are determined annually predominantly
considering the social rather than economic factors and in most cases
the actual return earned by the Company has been higher in the past
years. In the absence of reliable measures for future administered rates
and due to the lack of measurement guidance, the Companys actuary
has expressed its inability to determine the actuarial valuation for
such provident fund liabilities. Accordingly, the Company is unable
to exhibit the related information.
The Company contributed R198 crore and R171 crore to the provident
fund during the year ended March 31, 2011 and March 31, 2010,
respectively.
Provident fund contributions have been apportioned between cost of
sales, selling and marketing expenses and administrative expenses on
the basis of direct employee cost as follows :
in rcrore
2011 2010
Cost of sales 173 150
198 171
2.12.4 Employee benefit costs include :
in rcrore
2011 2010
Salaries and bonus 14,369 11,765
Defined contribution plans 128 112
Defined benefit plans 359 215
Share based compensation 1
14,856 12,093
The employee benefit cost is recognized in the following line items in
the statement of comprehensive income :
in rcrore
2011 2010
Selling and marketing expenses 1,218 935
14,856 12,093
2.13 Equity
Share capital and share premium
The Company has only one class of shares referred to as equity
shares having a par value of R5/-. The amount received in excess
of the par value has been classified as share premium. Additionally,
share-based compensation recognized in net profit in the statement
of comprehensive income is credited to share premium. 28,33,600
shares were held by the controlled trust, each as of March 31, 2011
and March 31, 2010.
Retained earnings
Retained earnings represent the amount of accumulated earnings of
the Company.
Other components of equity
Other components of equity consist of currency translation and fair
value changes on available-for-sale financial assets.
The Companys objective when managing capital is to safeguard its
ability to continue as a going concern and to maintain an optimal
capital structure so as to maximize shareholder value. In order to
maintain or achieve an optimal capital structure, the Company may
adjust the amount of dividend payment, return capital to shareholders,
issue new shares or buy back issued shares. As of March 31, 2011,
the Company has only one class of equity shares and has no debt.
Consequent to the above capital structure there are no externally
imposed capital requirements.
The rights of equity shareholders are set out below.
2.13.1 Voting
Each holder of equity shares is entitled to one vote per share.
The equity shares represented by American Depositary Shares (ADS)
carry similar rights to voting and dividends as the other equity shares.
Each ADS represents one underlying equity share.
2.13.2 Dividends
The Company declares and pays dividends in Indian rupees. Indian law
mandates that any dividend declared out of accumulated distributable
profits can be done only after the transfer to a general reserve of a
specified percentage of net profit computed in accordance with current
regulations. The remittance of dividends outside India is governed
by the Indian law on foreign exchange and is subject to applicable
distribution taxes.
The amount of per share dividend recognized as distributions to equity
shareholders for the years ended March 31, 2011 and March 31, 2010
was R55.00 and R23.50, respectively. The dividend for the year ended
March 31, 2011 includes R15.00 per share of final dividend for the
year ended March 31, 2010 and R10.00 per share of interim dividend
and R30.00 per share of 30th year special dividend, authorized by
the Board on its meeting held on October 15, 2010. The dividend for
the year ended March 31, 2010 includes R13.50 per share of final
dividend for the year ended March 31, 2009 and R10.00 per share
of interim dividend.
The Board of Directors, in their meeting on April 15, 2011, proposed a
final dividend of approximately R20 per equity share. The proposal is
subject to the approval of shareholders at the Annual General Meeting
to be held on June 11, 2011, and if approved, would result in a cash
outflow of approximately R1,336 crore, inclusive of corporate dividend
tax of R187 crore.
2.13.3 Liquidation
In the event of liquidation of the Company, the holders of shares shall
be entitled to receive any of the remaining assets of the Company, after
distribution of all preferential amounts. However, no such preferential
amounts exist currently, other than the amounts held by irrevocable
controlled trusts. The amount distributed will be in proportion to the
number of equity shares held by the shareholders.
For irrevocable controlled trusts, the corpus would be settled in favor
of the beneficiaries.
2.13.4 Share options
There are no voting, dividend or liquidation rights to the holders of
options issued under the Companys share option plans.
2.14 Other income
Other income consists of the following :
in rcrore
2011 2010
Interest income on deposits and certificates
of deposit 1,133 779
Exchange gains / (losses) on forward and
Exchange gains / (losses) on translation of
other assets and liabilities (14) (269)
Income from available-for-sale financial
assets / investments 23 160
Others 13 21
1,211 990
2.15 Operating leases
The Company has various operating leases, mainly for office buildings,
that are renewable on a periodic basis. Rental expense for operating
leases was R146 crore and R125 crore for the years ended March 31,
2011 and March 31, 2010, respectively.
The schedule of future minimum rental payments in respect of non-
cancellable operating leases is as follows :
in rcrore
As of March 31,
2011 2010
five years 251 249
The operating lease arrangements extend up to a maximum of ten years
from their respective dates of inception, and relates to rented overseas
premises. Some of these lease agreements have a price escalation clause.
2.16 Employees Stock Option Plans (ESOP)
1998 Employees Stock Option Plan (the 1998 Plan)
The Companys 1998 Plan provides for the grant of non-statutory share
options and incentive share options to employees of the Company.
The establishment of the 1998 Plan was approved by the Board of
Directors in December 1997 and by the shareholders in January
1998. The Government of India has approved the 1998 Plan, subject
to a limit of 1,17,60,000 equity shares representing 1,17,60,000
ADS to be issued under the 1998 Plan. All options granted under
the 1998 Plan are exercisable for equity shares represented by ADSs.
The options under the 1998 Plan vest over a period of one through
four years and expire five years from the date of completion of vesting.
The 1998 Plan is administered by a compensation committee
comprising four members, all of whom are independent members of
the Board of Directors. The term of the 1998 Plan ended on January 6,
2008, and consequently no further shares will be issued to employees
under this plan.
1999 Employees Stock Option Plan (the 1999 Plan)
In the year 2000, the Company instituted the 1999 Plan. The Board
of Directors and shareholders approved the 1999 Plan in June 1999.
The 1999 Plan provides for the issue of 5,28,00,000 equity shares
to employees. The 1999 Plan is administered by a compensation
committee comprising four members, all of whom are independent
members of the Board of Directors.
Under the 1999 Plan, options will be issued to employees at an exercise price, which shall not be less than the Fair Market Value (FMV) of the
underlying equity shares on the date of grant. Under the 1999 Plan, options may also be issued to employees at exercise prices that are less than
FMV only if specifically approved by the shareholders of the Company in a general meeting. All options under the 1999 Plan are exercisable for
equity shares. The options under the 1999 Plan vest over a period of one through six years, although accelerated vesting based on performance
conditions is provided in certain instances and expire over a period of six months through five years from the date of completion of vesting.
The term of the 1999 Plan ended on June 11, 2009, and consequently no further shares will be issued to employees under this plan.
The activity in the 1998 Plan and 1999 Plan during the year ended March 31, 2011 and March 31, 2010 are set out as follows :
Year ended March 31, 2011 Year ended March 31, 2010
Shares arising
out of options
Weighted
average
exercise price
Shares arising
out of options
Weighted
average
exercise price
1998 Plan :
Outstanding at the beginning 2,42,264 613 9,16,759 904
Forfeited and expired (3,519) 722 (60,424) 1,550
Exercised (1,88,675) 600 (6,14,071) 854
Outstanding at the end 50,070 683 2,42,264 613
Exercisable at the end 50,070 683 2,42,264 613
1999 Plan :
Outstanding at the beginning 2,04,464 869 9,25,806 1,253
Forfeited and expired (18,052) 964 (3,40,264) 1,968
Exercised (1,37,692) 823 (3,81,078) 821
Outstanding at the end 48,720 962 2,04,464 869
Exercisable at the end 40,232 717 1,84,759 735
The weighted average share price of options exercised under the
1998 Plan during the year ended March 31, 2011 and March 31, 2010 was
R2,950 and R2,266, respectively. The weighted average share price of options exercised under the 1999 Plan during the year ended March 31,
2011 and March 31, 2010 was R2,902 and R2,221 respectively.
The cash expected to be received upon the exercise of vested options for the 1998 Plan and 1999 Plan is R3 crore each.
The following table summarizes information about share options outstanding and exercisable as of March 31, 2011 :
Range of exercise prices per share (R) Options outstanding Options exercisable
No. of shares
arising out of
options
Weighted
average
remaining
contractual life
Weighted
average
exercise price
No. of shares
arising out of
options
Weighted
average
remaining
contractual life
Weighted
average
exercise price
1998 Plan :
300 700 24,680 0.73 587 24,680 0.73 587
701 1,400 25,390 0.56 777 25,390 0.56 777
50,070 0.65 683 50,070 0.65 683
1999 Plan :
300 700 33,759 0.65 448 33,759 0.65 448
701 2,500 14,961 1.71 2,121 6,473 1.71 2,121
48,720 0.97 962 40,232 0.82 717
The following table summarizes information about share options outstanding and exercisable as of March 31, 2010 :
Range of exercise prices per share (R) Options outstanding Options exercisable
No. of shares
arising out of
options
Weighted
average
remaining
contractual life
Weighted
average
exercise price
No. of shares
arising out of
options
Weighted
average
remaining
contractual life
Weighted
average
exercise price
1998 Plan :
300 700 1,74,404 0.94 551 1,74,404 0.94 551
701 1,400 67,860 1.27 773 67,860 1.27 773
2,42,264 1.03 613 2,42,264 1.03 613
1999 Plan :
300 700 1,52,171 0.91 439 1,52,171 0.91 439
701 2,500 52,293 1.44 2,121 32,588 1.20 2,121
2,04,464 1.05 869 1,84,759 0.97 735
The share-based compensation recorded for the year ended March 31, 2011 was nil and for year ended March 31, 2010 was R1 crore.
2.17 Income tax
Income tax expense in the statement of comprehensive income
comprises :
in rcrore
2011 2010
Current taxes
Domestic taxes 2,060 1,594
Overseas taxes 564 465
2,624 2,059
Deferred taxes
Domestic taxes (95) (474)
Overseas taxes (39) 96
(134) (378)
Income tax expense 2,490 1,681
The entire deferred income tax for the years ended March 31, 2011
and March 31, 2010 relates to origination and reversal of temporary
differences.
A reversal of deferred tax liability of R 3 crore for the year
ended March 31, 2011 respectively, relating to an available-
f or- sal e f i nanci al asset has been recogni zed i n ot her
comprehensive income (refer note 2.2). For the year ended
March 31, 2010 a deferred tax liability of R 8 crore relating to
an available-for-sale financial asset has been recognized in other
comprehensive income.
A reconciliation of the income tax provision to the amount computed
by applying the statutory income tax rate to the income before income
taxes is summarized as follows :
in rcrore
2011 2010
Enacted tax rates in India 33.22% 33.99%
Computed expected tax expense 3,094 2,685
Tax effect due to non-taxable income for
Indian tax purposes (788) (1,058)
Overseas taxes, net 399 394
Tax reversals (236) (489)
Tax effect due to set off provisions on
brought forward losses (104)
Effect of exempt income (3) (51)
Interest and penalties 22
Effect of unrecognized deferred tax assets 19 16
Effect of differential overseas tax rates (7) (16)
Temporary difference related to branch
profits 247
Effect of non-deductible expenses 4 26
Others 8 9
Income tax expense 2,490 1,681
The overseas tax expense is due to income taxes payable overseas,
principally in the U.S. The Company benefits from certain significant
tax incentives provided to software firms under Indian tax laws. These
incentives include those for facilities set up under the Special Economic
Zones Act, 2005 and software development facilities designated as
Software Technology Parks (the STP Tax Holiday). The STP Tax
Holiday is available for ten consecutive years, beginning from the
financial year when the unit started producing computer software or
April 1, 1999, whichever is earlier. The Indian government, through the
Finance Act, 2009, has extended the tax holiday for the STP units until
March 31, 2011. Most of the Companys STP units have already
completed the tax holiday period and for the remaining STP units the
tax holiday will expire by the end of March 31, 2011.
Under the Special Economic Zones Act, 2005 scheme, units in
designated special economic zones which begin providing services on
or after April 1, 2005 are eligible for a deduction of 100% of profits or
gains derived from the export of services for the first five years from
commencement of provision of services and 50% of such profits or
gains for a further five years. Certain tax benefits are also available for
a further period of five years subject to the STP unit meeting defined
conditions.
Infosys is subject to a 15% Branch Profit Tax (BPT) in the U.S. to
the extent of the U.S. branchs net profit during the year is greater
than the increase in the net assets during the year, computed in
accordance with the Internal Revenue Code. As of March 31,
2011, Infosys U.S. branch net assets amounted to approximately
R2,647 crore. As of March 31, 2011, the Company has provided for
branch profit tax of R176 crore for its U.S. branch, as the Company
estimates that these branch profits are expected to be distributed in
the foreseeable future.
Deferred income tax liabilities have not been recognized on temporary
differences amounting to R 1,466 crore and R 1,052 crore as of
March 31, 2011 and March 31, 2010 respectively, associated with
investments in subsidiaries and branches as it is probable that the
temporary differences will not reverse in the foreseeable future.
The gross movement in the current income tax asset / (liability) for
the years ended March 31, 2011 and March 31, 2010 is as follows :
in rcrore
2011 2010
Net current income tax asset / (liability)
at the beginning (57) (307)
Translation differences (10) (4)
Income tax benefit arising on exercise of
stock options 11 10
Income tax paid 2,856 1,754
Minimum Alternate Tax credit utilized
(1)
549
Current income tax expense
(refer note 2.17) (2,624) (2,059)
Net current income tax asset / (liability)
at the end 176 (57)
(1)
Minimum alternate tax of R288 crore was recognized and utilized
during the year ended March 31, 2010
The tax effects of significant temporary differences that resulted in
deferred income tax assets and liabilities are as follows :
in rcrore
As of March 31,
2011 2010
Deferred income tax assets
Property, plant and equipment 257 217
Minimum alternate tax credit carry-
forwards 63 42
Computer software 24 25
Accrued compensation to employees 26
Trade receivables 20 28
Compensated absences 104 50
Accumulated subsidiary losses 39 86
Others 28 26
Total deferred income tax assets 561 474
Deferred income tax liabilities
Intangible asset (2) (2)
Temporary difference related to branch
profits (176) (232)
Available-for-sale financial asset (5) (8)
Total deferred income tax liabilities (183) (242)
Total deferred income tax assets 378 232
As of March 31,
2011 2010

Deferred income tax assets to be
recovered after 12 months 392 368
Deferred income tax liability to be settled
after 12 months (63) (175)
Deferred income tax assets to be
recovered within 12 months 169 106
Deferred income tax liability to be settled
within 12 months (120) (67)
378 232
In assessing the realization capability of deferred income tax assets,
the Management considers whether some portion or all of the deferred
income tax assets will not be realized. The ultimate realization of
deferred income tax assets is dependent upon the generation of future
taxable income during the periods in which the temporary differences
become deductible. Management considers the scheduled reversals
of deferred income tax liabilities, projected future taxable income,
and tax planning strategies in making this assessment. Based on the
level of historical taxable income and projections for future taxable
income over the periods in which the deferred income tax assets are
deductible, management believes that the Company will realize the
benefits of those deductible differences. The amount of the deferred
income tax assets considered realizable, however, could be reduced
in the near term if estimates of future taxable income during the carry
forward period are reduced.
The gross movement in the deferred income tax account for the years
ended March 31, 2011 and March 31, 2010 is as follows :
in rcrore
2011 2010
Net deferred income tax asset at the
beginning 232 408
Translation differences 9 3
Minimum alternate tax credit utilized (549)
Credits relating to temporary differences
(refer note 2.17) 134 378
Temporary difference on available-for-
sale financial asset (refer note 2.2) 3 (8)
Net deferred income tax asset at the end 378 232
The credits relating to temporary differences during the year ended
March 31, 2011 and March 31, 2010 are primarily on account of
compensated absences, accrued compensation to employees and
property, plant and equipment.
Pursuant to the enacted changes in the Indian Income Tax Laws
effective April 1, 2007, a Minimum Alternate Tax (MAT) has been
extended to income in respect of which a deduction may be claimed
under sections 10A and 10AA of the Income Tax Act. Consequent
to the enacted change, Infosys BPO has calculated its tax liability for
current domestic taxes after considering MAT. The excess tax paid
under MAT provisions being over and above regular tax liability can
be carried forward and set off against future tax liabilities computed
under regular tax provisions. Infosys BPO was required to pay
MAT, and, accordingly, a deferred income tax asset of R63 core and
R42 crore has been recognized on the Balance Sheet as of March 31,
2011 and March 31, 2010, respectively, which can be carried forward
for a period of ten years from the year of recognition.
2.18 Earnings per equity share
The following is a reconciliation of the equity shares used in the
computation of basic and diluted earnings per equity share :
2011 2010
Basic earnings per equity share
weighted average number of
equity shares outstanding
(1)
57,11,80,050 57,04,75,923
Effect of dilutive common
equivalent shares share options
outstanding 1,88,308 6,40,108
Diluted earnings per equity share
weighted average number
of equity shares and common
equivalent shares outstanding 57,13,68,358 57,11,16,031
(1)
Excludes treasury shares
For the year ended March 31, 2011, and March 31, 2010 there were
no outstanding options to purchase equity shares which had an
anti-dilutive effect.
2.19 Related party transactions
List of subsidiaries :
Particulars Country Holding as of
March 31,
2011
March 31,
2010
Infosys BPO Limited India 99.98% 99.98%
(Australia) Pty. Limited Australia 100% 100%
Company Limited China 100% 100%
Infosys Consulting, Inc. U.S. 100% 100%
S. de R. L. de C. V. Mexico 100% 100%
Infosys BPO s.r.o.
(1)
Czech
Republic 99.98% 99.98%
Sp.Z.o.o
(1)
Poland 99.98% 99.98%
Limited
(1) (3)
Thailand 99.98%
(Sweden) AB Sweden 100% 100%
Ltda Brazil 100% 100%
Limited
(2)
India 100% 100%
(Shanghai) Company
Limited
(4)
China 100%
(1)

(refer note 2.3) U.S. 99.98% 99.98%
Notes :
(1)
Infosys BPO s.r.o., Infosys BPO (Poland) Sp.Z.o.o, Infosys BPO (Thailand)
Limited and McCamish Systems LLC are wholly-owned subsidiaries of Infosys
BPO.
(2)
Infosys Consulting India Limited is a wholly-owned subsidiary of Infosys
Consulting.
(3)
During the year ended March 31, 2011 Infosys BPO (Thailand) Limited was
liquidated.
(4)
On February 21, 2011 Infosys incorporated a wholly-owned subsidiary, Infosys
Shanghai.
Infosys has provided guarantee for performance of certain contracts
entered into by its subsidiaries.
in rcrore
List of other related parties :
Particulars Country Nature of relationship
Infosys Technologies Limited Employees Gratuity Fund Trust India Post-employment benefit plan of Infosys
Infosys Technologies Limited Employees Provident Fund Trust India Post-employment benefit plan of Infosys
Infosys Technologies Limited Employees Superannuation Fund Trust India Post-employment benefit plan of Infosys
Infosys BPO Limited Employees Superannuation Fund Trust India Post-employment benefit plan of Infosys BPO
Infosys BPO Limited Employees Gratuity Fund Trust India Post-employment benefit plan of Infosys BPO
Infosys Technologies Limited Employees Welfare Trust India Employee Welfare Trust of Infosys
Infosys Science Foundation India Controlled trust
Note : Refer note 2.12 for information on transactions with post-employment benefit plans mentioned above.
Transactions with key management personnel
The table below describes the compensation to key management
personnel who comprise directors and members of the executive
council :
in rcrore
2011 2010
Salaries and other employee benefits 33 31
2.20 Segment reporting
IFRS 8 establishes standards for the way that public business enterprises
report information about operating segments and related disclosures
about products and services, geographic areas, and major customers.
The Companys operations predominantly relate to providing IT
solutions, delivered to customers located globally, across various
industry segments.
The Chief Operating Decision Maker evaluates the Companys
performance and allocates resources based on an analysis of
various performance indicators by industry classes and geographic
segmentation of customers. Accordingly, segment information has been
presented both along industry classes and geographic segmentation of
customers. The accounting principles used in the preparation of the
financial statements are consistently applied to record revenue and
expenditure in individual segments, and are as set out in the significant
accounting policies.
Industry segments for the Company are primarily financial
services comprising enterprises providing banking, finance and
insurance services, manufacturing enterprises, enterprises in the
telecommunications (telecom) and retail industries, and others such
as utilities, transportation and logistics companies.
Geographic segmentation is based on business sourced from that
geographic region and delivered from both on-site and off-shore.
North America comprises the United States of America, Canada and
Mexico, Europe includes continental Europe (both the east and the
west), Ireland and the United Kingdom, and the Rest of the World
comprising all other places except those mentioned above and India.
Revenue and identifiable operating expenses in relation to segments
are categorized based on items that are individually identifiable to that
segment. Allocated expenses of segments include expenses incurred for
rendering services from the Companys offshore software development
centers and on-site expenses, which are categorized in relation to the
associated turnover of the segment.
Certain expenses such as depreciation, which form a significant
component of total expenses, are not specifically allocable to
specific segments as the underlying assets are used interchangeably.
Management believes that it is not practical to provide segment
disclosures relating to those costs and expenses, and accordingly these
expenses are separately disclosed as unallocated and adjusted against
the total income of the Company.
Fixed assets used in the Companys business are not identified to any
of the reportable segments, as these are used interchangeably between
segments. Management believes that it is currently not practical to
provide segment disclosures relating to total assets and liabilities since
a meaningful segregation of the available data is onerous.
Geographical information on revenue and industry revenue
information is collated based on individual customers invoiced or in
relation to which the revenue is otherwise recognized.
2.20.1 Industry segments
in rcrore
Year ended March 31, 2011 Financial
services
Revenues 9,862 5,393 3,549 3,898 4,799 27,501
Allocated expenses 2,456 1,370 899 990 1,218 6,933
Segment profit 3,284 1,712 1,230 1,261 1,481 8,968
Operating profit 8,102
Profit before income taxes 9,313
Income tax expense 2,490
Net profit 6,823
Depreciation and amortization 862
Non-cash expenses other than
depreciation and amortization 4
Industry segments (Contd.)
in rcrore
Year ended March 31, 2010 Financial
services
Revenues 7,731 4,506 3,661 3,035 3,809 22,742
Allocated expenses 1,953 1,139 926 767 964 5,749
Segment profit 2,710 1,374 1,451 1,025 1,301 7,861
Other income, net 990
Net profit 6,219
Non-cash expenses other than
depreciation and amortization 3
2.20.2 Geographic segments
in rcrore
Year ended March 31, 2011 North America Europe India Rest of the
World
Total
Revenues 17,958 5,927 599 3,017 27,501
Identifiable operating expenses 7,658 2,467 281 1,194 11,600
Segment profit 5,745 1,972 174 1,077 8,968
Net profit 6,823
Non-cash expenses other than depreciation and amortization 4
in rcrore
Year ended March 31, 2010 North
America
World
Total
Revenues 14,972 5,237 270 2,263 22,742
Identifiable operating expenses 6,067 2,093 80 892 9,132
Segment profit 5,121 1,819 122 799 7,861
Other income, net 990
Net profit 6,219
Non-cash expenses other than depreciation and amortization 3
2.20.3 Significant clients
No client individually accounted for more than 10% of the revenues in the year ended March 31, 2011 and March 31, 2010.
2.21 Litigation
The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The Companys management
does not reasonably expect that legal actions, when ultimately concluded and determined, will have a material and adverse effect on the results
of operations or the financial position of the Company.
2.22 Tax contingencies
The Company has received demands from the Indian taxation authorities for payment of additional tax of R671 crore including interest of
R177 crore, upon completion of their tax review for fiscal 2005, 2006 and 2007. The tax demands are mainly on account of disallowance of a
portion of the deduction claimed by the Company under Section 10A of the Income tax Act. The deductible amount is determined by the ratio of
export turnover to total turnover. The disallowance arose from certain expenses incurred in foreign currency being reduced from export turnover
but not reduced from total turnover. The tax demand for fiscal 2007 also includes disallowance of portion of profit earned outside India from
the STP units and disallowance of profits earned from SEZ units. The matter for fiscal 2005, fiscal 2006 and fiscal 2007 is pending before the
Commissioner of Income tax (Appeals), Bangalore.
The Company is contesting the demands and management and its tax advisors believe that its position will likely be upheld in the appellate
process. No additional provision has been accrued in the financial statements for the tax demands raised. The Management believes that the
ultimate outcome of this proceeding will not have a material adverse effect on the Companys financial position and results of operations.
64 | Additional information
Additional information
Employee strength and revenue growth since 1996
Fiscal Employees Growth % IFRS (US$ million)
(1)
IFRS (Rcrore)
(2)
Revenues Growth % Net
Income
(2)

Growth % Income Growth % PAT

Growth %
1996 1,172 30 27 47 7 72 89 60 21 58
1997 1,705 45 40 49 9 27 139 57 34 60
1998 2,605 53 68 73
(3)
13 60 258 85 60 79
1999 3,766 45 121 77
(3)
30 119 509 98 133 120
2000 5,389 43 203 68 61 102 882 73 286 115
2001 9,831 82 414 103 132 115 1,901 115 623 118
2002 10,738 9 545 32 164 25 2,604 37 808 30
2003 15,876 48 754 38 195 18 3,640 40 955 18
2004 25,634 61 1,063 41 270 39 4,853 33 1,244 30
2005 36,750 43 1,592 50 419 55 7,130 47 1,846 48
2006 52,715 43 2,152 35 555 32 9,521 34 2,458 33
2007 72,241 37 3,090 44 850 53 13,893 46 3,850 57
2008 91,187 26 4,176 35 1,155 36 16,692 20 4,659 21
2009 1,04,850 15 4,663 12 1,281 11 21,693 30 5,975 28
2010 1,13,796 9 4,804 3 1,313 2 22,742 5 6,219 4
2011 1,30,820 15 6,041 26 1,499 14 27,501 21 6,823 10
5-year CAGR 20 23 22 24 23
(1)
The data for the year 2007 and prior years is as per U.S. GAAP.
(2)
The data for the year 2008 and prior years is as per consolidated Indian GAAP.
(3)
Excludes a one-time deferred stock compensation expense arising from a stock split amounting to US$ 13 million and US$ 2 million in fiscal 1999 and 1998 respectively.
Employee strength of the Infosys group
2011 2010
Functional
classification
Software
professionals 1,23,811 94.6% 1,06,864 93.9%
Sales and
support 7,009 5.4% 6,932 6.1%
1,30,820 100.0% 1,13,796 100.0%
Gender
Male 86,604 66.2% 75,674 66.5%
Female 44,216 33.8% 38,122 33.5%
1,30,820 100.0% 1,13,796 100.0%
Age profile
20 25 59,897 45.8% 55,334 48.6%
26 30 45,182 34.5% 38,162 33.5%
31 40 23,021 17.6% 18,208 16.0%
41 50 2,219 1.7% 1,729 1.5%
51 60 452 0.3% 333 0.4%
60 and above 49 0.1% 30
1,30,820 100.0% 1,13,796 100.0%
Software development centers of the Infosys group
We have 63 global development centers of which 30 are in
India nine in Bangalore, four each in Chennai and Pune,
three in Mangalore, two each in Bhubaneswar, Chandigarh and
Thiruvananthapuram, and one each in New Delhi, Hyderabad, Jaipur
and Mysore. We have a global development center in Toronto, Canada.
In addition, we have eleven proximity development centers in the
United States Fremont, Quincy, Lisle, Bridgewater, Phoenix, Plano,
Atlanta, Charlotte, Houston, Hartford and Bentonville; six in China;
three in Australia; two each in Mexico and United Kingdom; and one
each in Czech Republic, Japan (Tokyo), Mauritius, Poland, Philippines,
Singapore, France and Brazil. Infosys BPO Limited, Infosys Australia,
Infosys China, Infosys Shanghai, Infosys Consulting, Infosys Mexico,
Infosys Sweden, Infosys Brasil and Infosys Public Services are our
wholly-owned subsidiaries.
Marketing offices of the Infosys group
We have 64 marketing offices around the world of which 60 are
located outside India 19 in the United States, four each in Australia
and Germany, three each in Switzerland, U.A.E. and the U.K.,
two each in Canada, Czech Republic and France and one each in
Belgium, Denmark, Finland, Hong Kong, Ireland, Japan, Norway,
Spain, Sweden, Greece, The Netherlands, Mauritius, Mexico, Brazil,
Russia, New Zealand, Singapore, and Malaysia. Addresses of offices are
provided in the Global presence section of the Annual Report.
American Depositary Share (ADS)
About ADS
An American Depositary Share (ADS) is a negotiable certificate
evidencing ownership of an outstanding class of stock in a
non-U.S. company. ADSs are created when ordinary shares are
delivered to a custodian bank in the domestic market, which then
instructs a depositary bank in the United States to issue ADSs based
on a predetermined ratio. ADSs are SEC-registered securities and may
trade freely, just like any other security, either on an exchange or in
the over-the-counter market.
Difference between an ADS and a GDR
ADSs and Global Depositary Receipts (GDRs) have the same
functionality they both evidence ownership of foreign securities
deposited with a custodian bank. ADSs represent securities that are
listed in the United States, while GDRs represent securities listed
outside the United States, typically in the United Kingdom.
Voting rights of ADS holders
In the event of a matter submitted to the holders of ordinary shares for
a vote, the ADS holders on record as at a particular date will be allowed
to instruct the depositary bank to exercise the vote with respect to the
equity shares representing the ADSs held by them.
Entitlement to cash dividends
Whenever dividends are paid to ordinary shareholders, cash dividends
to ADS holders are declared in local currency and paid in U.S. dollars,
based on the prevailing exchange rate, by the depositary bank, net of
the depositarys fees and expenses.
Disclosure policy
We have a written disclosure policy, which covers interaction with
external constituents such as analysts, fund managers and the media.
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Select historical data
in rcrore, except per share data, other information and ratios
1982 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Financial performance
Income 0.12 2,604 3,623 4,761 6,860 9,028 13,149 15,648 20,264 21,140 25,385
Operating profit (PBIDTA) 0.04 1,038 1,272 1,584 2,325 2,989 4,225 4,963 6,906 7,360 8,414
Interest
Depreciation 161 189 231 268 409 469 546 694 807 740
Provision for taxation 135 201 227 325 303 352 630 895 1,717 2,378
Profit after tax
(1)
0.04 808 958 1,243 1,859 2,421 3,777 4,470 5,819 5,755 6,443
Dividend 132 179 196 310 412 649 758 1,345 1,434 1,723
One-time / special dividend 668 830 1,144 1,722
Margins (%)
Operating profit margin (PBIDTA) 33.3 39.9 35.1 33.3 33.9 33.1 32.1 31.7 34.1 34.8 33.1
Net profit margin
(1)
33.3 31.0 26.4 26.1 27.1 26.8 28.7 28.6 28.7 27.2 25.4
Return on average net worth
(1)
96.9 46.6 38.8 40.7 43.8 39.9 41.9 36.3 37.2 28.9 27.7
Return on average capital employed 96.9 54.4 46.9 48.1 51.4 44.9 45.7 41.4 42.9 37.2 37.6
Per share data (R)
(2)

Basic EPS
(1)
15.27 18.09 23.43 34.63 44.34 67.82 78.24 101.65 100.37 112.26
Dividend 2.50 3.38 3.69 5.75 7.50 11.50 13.25 23.50 25.00 30.00
One-time / special dividend 12.50 15.00 20.00 30.00
Book value 39.29 53.98 61.03 96.87 125.15 195.41 235.84 310.90 384.01 426.73
Financial position
Share capital 33 33 33 135 138 286 286 286 287 287
Reserves and surplus 0.04 2,047 2,828 3,220 5,107 6,759 10,876 13,204 17,523 21,749 24,214
Net worth 0.04 2,080 2,861 3,253 5,242 6,897 11,162 13,490 17,809 22,036 24,501
Debt
Gross block 961 1,273 1,570 2,183 2,837 3,889 4,508 5,986 6,357 6,934
Capital expenditure 323 219 430 794 1,048 1,443 1,370 1,177 581 1,152
Cash and cash equivalents 0.02 1,027 1,639 1,819 1,683 3,779 5,610 7,689 10,289 11,297 15,165
Investment in liquid mutual funds and certificate of deposits 930 1,168 684 3,497 119
Net current assets 0.06 1,293 2,018 1,220 2,384 3,832 7,137 8,496 12,288 13,141 18,391
Total assets 0.04 2,080 2,861 3,253 5,242 6,897 11,162 13,490 17,846 22,268 24,677
Shareholding related
Number of shareholders 7 88,650 77,010 66,945 1,58,725 1,95,956 4,88,869 5,55,562 4,96,907 3,81,716 4,16,623
Market capitalization period end NA 24,654 26,847 32,909 61,073 82,154 1,15,307 82,362 75,837 1,50,110 1,86,100
Public shareholding (%)
(3)
68.08 68.32 65.56 70.20 66.55 64.35 64.31 64.38 65.32 66.36
Credit rating
Standard & Poors BBB BBB BBB BBB+ BBB+ BBB+ BBB+
Dun & Bradstreet 5A1 5A1 5A1 5A1 5A1 5A1 5A1 5A1
Corporate governance rating
CRISIL (GVC) Level 1 Level 1 Level 1 Level 1 Level 1 Level 1 Level 1 Level 1
ICRA CGR 1 CGR 1 CGR 1 CGR 1 CGR 1 CGR 1 CGR 1 CGR 1
Notes : The above figures are based on Indian GAAP (standalone).
(1)
Excluding extraordinary activities / exceptional items

(2)
Calculated on a per share basis, adjusted for bonus issues in previous years
(3)
Total public shareholding as defined under Clause 40A of the Listing Agreement (excludes shares held by founders and American Depositary Receipt holders)
66 | Revenue segmentation
Revenue segmentation
Geographic segmentation
in %
2011 2010 2009 2008 2007
North America 65.3 65.8 63.2 62.0 63.3
Europe 21.5 23.0 26.4 28.1 26.4
India 2.2 1.2 1.3 1.3 1.6
Rest of the World 11.0 10.0 9.1 8.6 8.7
Total 100.0 100.0 100.0 100.0 100.0
Industry segmentation
in %
2011 2010 2009 2008 2007
Manufacturing 19.6 19.8 19.7 14.7 13.5
Banking, financial
services and insurance 35.8 34.0 33.9 35.7 37.4
Banking and financial
services 27.7 26.3 26.7 28.5 30.2
Insurance 8.1 7.7 7.2 7.2 7.2
Telecom 12.9 16.1 18.1 21.6 19.3
Retail 14.2 13.3 12.6 11.8 10.0
Energy and utilities 6.1 5.9 5.7 5.2 5.3
Transportation and
logistics 1.9 2.0 2.3 2.5 2.4
Others 9.5 8.9 7.7 8.5 12.1
Total 100.0 100.0 100.0 100.0 100.0
Project type
(1)
in %
2011 2010 2009 2008 2007
Fixed price 40.3 38.5 35.4 31.0 26.7
Time and material 59.7 61.5 64.6 69.0 73.3
Total 100.0 100.0 100.0 100.0 100.0
(1)
Excluding products
Service offering
in %
2011 2010 2009 2008 2007
Services
Application
Development and
Maintenance 39.0 41.3 42.4 45.4 48.0
Application
Development 16.0 18.0 20.5 21.7 23.1
Application
Maintenance 23.0 23.3 21.9 23.7 24.9
Business Process
Management 5.6 6.1 6.0 5.7 4.7
Consulting Services and
Package Implementation 25.5 24.4 24.9 23.8 21.1
Infrastructure
Management 6.3 7.2 6.3 4.9 4.4
Product Engineering
Services 2.4 2.2 2.2 1.6 1.6
Systems Integration 5.4 4.2 3.6 2.8 2.3
Testing Services 7.5 6.4 6.8 7.5 6.9
Others 3.4 4.0 3.9 4.7 7.1
Total services 95.1 95.8 96.1 96.4 96.1
Product revenues 4.9 4.2 3.9 3.6 3.9
Total 100.0 100.0 100.0 100.0 100.0
Note : The above figures are based on IFRS (audited) financial statements
Statutory obligations | 67
Statutory obligations
Software Technology Park scheme
We have set up Software Technology Parks (STPs), which are 100%
export-oriented units, for the development of software at Bangalore,
Bhubaneswar, Chandigarh, Chennai, Hyderabad, Mangalore, Mysore,
Pune and Thiruvananthapuram (all in India). Certain capital items
purchased for these centers are eligible for 100% customs and excise
duty exemption, subject to fulfillment of stipulated export obligations,
which was five times the value of duty-free imports of capital goods,
or duty-free purchase of goods subject to excise, over a period of five
years on a yearly basis. Beginning April 2001, the export obligation
on duty-free import of capital goods, or duty-free purchase of goods
subject to excise is thrice the value of such goods over a period of five
years. Beginning April 2002, the export obligation on duty-free import
of capital goods or duty-free purchase of goods subject to excise is
thrice the value of such goods over a period of three years. Beginning
April 2003, the units are required to achieve positive Net Foreign
Exchange earnings (NFE) only. The period to achieve the net positive
NFE is five years from the date of commencement of production /
renewal of the license for the unit.
The non-fulfillment of export obligations or positive net foreign
exchange earnings (NFE) may result in penalties as stipulated by the
government, which may have an impact on future profitability.
We have fulfilled our export obligations and achieved a positive net
foreign exchange earnings for all our operations under the Software
Technology Park scheme.
Special Economic Zone scheme
Our first Special Economic Zone (SEZ) unit, became operational at
Mahindra World City (a private multi-product Special Economic Zone),
Chennai, in the financial year 2005-06 and our second SEZ Unit in
this SEZ become operational during the financial year 2010-11, with
a total approved area of about 129.00 acres. We established our SEZ
unit at Chandigarh (Rajiv Gandhi Chandigarh Technology Park), with
an approved area of about 30.21 acres, in the financial year 2006-
07. During the financial year 2007-08, SEZ units were established
in Pune and Mangalore, with an approved area of about 77.81 acres
and 305.58 acres respectively. During the financial year 2009-10 our
SEZ unit at Thiruvananthapuram, with an approved area of about
50 acres, commenced production. During the financial year 2010-
11 we have commenced our operations at SEZ units in Mysore and
Hyderabad, with an approved area of about 54.64 acres and 447.33
acres respectively. The SEZ Units came into existence under the new
Special Economic Zones Act, 2005 (the SEZ Act).
As per the SEZ Act, the unit will be eligible for a deduction of 100%
of profits or gains derived from the export of services for the first five
years from commencement of provision of services and 50% of such
profits or gains for a further five years. Certain tax benefits are also
available for a further five years, subject to the unit meeting defined
conditions. Other fiscal benefits including indirect tax waivers are
being extended for setting up, operating and maintaining the unit.
The units operating under the SEZ scheme are required to achieve
positive net foreign exchange earnings (NFE) over a period of five
years from the date of commencement. We have achieved positive
foreign exchange earnings for all our operations under the SEZ Scheme.
However, in case of SEZs operationalized during the year, the positive
foreign exchange earnings will be met in the future.
Taxation
We benefit from certain significant tax incentives provided to the
software industry under Indian tax laws. These currently include :
(i) deduction of export profit from the operation of software
development facilities designated as Software Technology Parks
(the STP tax deduction) and
(ii) deduction of export profits from units in Special Economic Zones.
The period for which STP tax deduction is available to each STP was
restricted to ten consecutive years, starting from the financial year
when the unit started producing computer software or March 31,
2011, whichever is earlier.
The details regarding the commencement of operations at our STP
locations and the year up to which the deduction under the STP
scheme was availed are as follows :
Software Technology
Park
Year of
commencement
(1)
Tax exemption
Claimed
from
(1)
Available
up to
(1)
Infosys
Electronics City,
Bangalore 1995 1997 2004
Mangalore 1996 1999 2005
Pune 1997 1999 2006
Bhubaneswar 1997 1999 2006
Chennai 1997 1999 2006
Phase I, Electronics
City, Bangalore 1999 1999 2008
Phase II, Electronics
Hinjawadi, Pune 2000 2000 2009
Mysore 2000 2000 2009
Hyderabad 2000 2000 2009
Sholinganallur,
Chennai 2001 2001 2010
Konark, Bhubaneswar 2001 2001 2010
Mangala, Mangalore 2001 2001 2010
Infosys BPO
Phase I, Electronics
Pune 2003 2003 2011
Phase II, Electronics
Jaipur 2006 2006 2011
Gurgaon 2006 2006 2011
Chennai 2004 2004 2011
(1)
Financial year
68 | Statutory obligations
The details regarding the commencement of operations at our SEZ
locations and the year up to which the deduction under the SEZ
scheme is available are as follows :
Special Economic Zone Year of
commencement
(1)
Tax exemption
Claimed
from
(1)
Available
up to
(1)
Infosys
Mahindra City
unit 1, Chennai 2006 2006 2020
Mangalore 2008 2008 2022
Pune 2008 2008 2022
Mysore 2011 2011 2025
Hyderabad 2011 2011 2025
Mahindra City
unit 2, Chennai 2011 2011 2025
Infosys BPO
Pune 2007 2007 2021
Jaipur 2008 2008 2022
Gurgaon 2008 2008 2022
(1)
Financial year
The benefits of these tax incentive programs have historically resulted
in an effective tax rate, well below the statutory rates for us. There is
no assurance that the Government of India will continue to provide
these incentives.
The government may reduce or eliminate the tax exemptions provided
to Indian exporters at any time in the future. This may result in our
export profits being fully taxed, and may adversely affect the post-tax
profits in the future.
On a full tax-paid basis, without any duty concessions on equipment,
hardware and software, our post-tax profits for the relevant years are
estimated as follows :
2011 2010 2009
Profit before tax 9,313 7,900 6,894
Less : Additional depreciation on
duty waived for certain assets 49 70 90
Reduction in other income 53 49 67
Adjusted profit before tax 9,211 7,781 6,737
Less : Income tax on the above on
full tax basis 3,162 2,776 2,400
Restated profit after tax 6,049 5,005 4,337
Restated basic EPS (R) 105.89 87.74 76.15
Note : The figures above are based on IFRS financial statements. However, it may be
noted that this is only an academic exercise. We have provided for income tax
in full in the respective years and there is no carried-forward liability on this
account.
Human resource valuation | 69
Human resource valuation
A fundamental dichotomy in accounting practices is between human and non-human capital. As a standard practice, non-human capital is
considered as assets and reported in the financial statements, whereas human capital is mostly ignored by accountants. The definition of wealth
as a source of income inevitably leads to the recognition of human capital as one of the several forms of wealth such as money, securities and
physical capital.
We have used the Lev & Schwartz model to compute the value of human resources. The evaluation is based on the present value of future earnings
of employees and on the following assumptions :
a) Employee compensation includes all direct and indirect benets earned both in India and overseas
b) The incremental earnings based on group / age have been considered
c) The future earnings have been discounted at the cost of capital of 11.21% (previous year 10.60%).
in rcrore, unless stated otherwise
2011 2010
Employees (no.)
Software professionals 1,23,811 1,06,864
Support 7,009 6,932
Total 1,30,820 1,13,796
Value of human resources
Software professionals 1,22,539 1,06,173
Support 12,566 7,114
Total 1,35,105 1,13,287
Total income
(1)
27,501 22,742
Total employee cost
(1)
14,856 12,093
Value-added 25,031 20,935
Net profit
(1)
6,823 6,219
Ratios
Value of human resources per employee 1.03 1.00
Total income / human resources value (ratio) 0.20 0.20
Employee cost / human resources value (%) 11.0 10.7
Value-added / human resources value (ratio) 0.19 0.18
Return on human resources value (%) 5.1 5.5
(1)
As per IFRS (audited) financial statements
70 | Value-added statement
Value-added statement
in rcrore
2011 % 2010 % Growth %
Value-added
Income 27,501 22,742 20.9
Less : Operating expenses excluding personnel costs
Software development and business process
management expenses 2,083 1,461
General and administration expenses 1,304 1,087
3,681 2,797
Value-added from operations 23,820 19,945 19.4
Other income (including exceptional items) 1,211 990
Total value-added 25,031 20,935 19.6
Distribution of value-added
Human resources
Salaries and bonus 14,856 59.4 12,093 57.8 22.8
Providers of capital
Dividend
(1)
3,445 13.8 1,434 6.8 140.2
Minority interest
Interest on debt
3,445 13.8 1,434 6.8 140.2
Taxes
Corporate income taxes 2,490 9.9 1,681 8.0 48.1
Dividend tax
(1)
568 2.3 240 1.2 136.7
3,058 12.2 1,921 9.2 59.2
Income retained in business
Depreciation and amortization 862 3.4 942 4.5 (8.5)
Retained in business 2,810 11.2 4,545 21.7 (38.2)
3,672 14.6 5,487 26.2 (33.1)
Total 25,031 100.0 20,935 100.0 19.6
Note : The figures above are based on IFRS financial statements.

(1)
Considered on accrual basis
Brand valuation | 71
The strength of the invisible
From time to time, we have used various models for evaluating assets
of the Balance Sheet to bring certain advances in financial reporting
to the notice of our shareholders. The aim of such modeling is
to lead the debate on the Balance Sheet of the next millennium.
These models are still the subject of debate among researchers and
using the data in projecting the future is risky. We are not responsible
for any direct, indirect or consequential losses suffered by any person
using these models or data.
A Balance Sheet discloses the financial position of a company.
The financial position of an enterprise is influenced by the economic
resources it controls, its financial structure, liquidity and solvency, and
its capacity to adapt to changes in the business environment. However,
it is becoming increasingly clear that intangible assets have a significant
role in defining the growth of a high-tech company.
Valuing the brand
The wave of brand acquisitions in the late 1980s exposed the hidden
value of highly branded companies, and brought brand valuation
to the fore. The values associated with a product or service are
communicated to the consumer through the brand. Consumers no
longer want just a product or service, they want a relationship based
on trust and familiarity.
A brand is much more than a trademark or a logo. It is a trust mark
a promise of quality and authenticity that clients can rely on. Brand
equity is the value addition provided to a product or a company by
its brand name. It is the financial premium that a buyer is willing to
pay for the brand over a generic or less worthy brand. Brand equity
is not created overnight. It is the result of the relentless pursuit of
quality in manufacturing, selling, servicing, advertising and marketing.
It is integral to the quality of client experiences in dealing with the
Company and its services over a period.
The sixth annual BRANDZ Top 100 Most Valuable Global Brands
ranking published in conjunction with Bloomberg and Kantar
Worldpanel was announced in 2011 by Millward Brown. According to
the report, Apple topped the ranking with a brand value of US$ 153.3
billion. The market capitalization of Apple as on 31st March 2011 was
US$ 322.26 billion. Thus, 47.6% of market capitalization represented
its brand value. The contribution of brand value in commanding price
premiums and decreased cost of entry into new markets and categories
is significant. Companies adopt strategic approaches and best practice
methodologies to improve their brand value.
Approach to brand valuation
The task of measuring brand value is a complex process. Several
models are available for assessing brand value. The most widely used
is the brand-earnings-multiple model. There are several variants of
this model.
We have adapted the generic brand-earnings-multiple model
(reference : Valuation of Trademarks and Brand Names by Michael Birkin
in the book, Brand Valuation, edited by John Murphy and published
by Business Books Limited, London) to value our corporate brand,
Infosys. The methodology followed for valuing our brand is as follows :
Determine brand prots by eliminating the non-brand prots from
the total prots
Restate the historical prots at present-day values
Provide for the remuneration of capital to be used for purposes
other than promotion of the brand
Adjust for taxes
Determine the brand-strength or brand-earnings multiple.
Brand valuation
Brand-strength multiple is a function of several factors such as
leadership, stability, market, internationality, trend, support and
protection. We have evaluated these factors on a scale of 1 to 100
internally, based on the information available.
Brand valuation
in rcrore
2011 2010 2009
Profit before interest and tax 9,313 7,900 6,894
Less : Non-brand income 1,090 891 426
Adjusted profit before tax 8,223 7,009 6,468
Inflation factor 1.000 1.103 1.217
Present value of brand profits 8,223 7,732 7,871
Weightage factor 3 2 1
Weighted average profits 8,001
Remuneration of capital 1,284
Brand-related profits 6,717
Tax 2,231
Brand earnings 4,486
Brand multiple 9.03
Brand value 40,509
Assumptions
The gures above are based on IFRS nancial statements.
Brand revenue is total revenue excluding other income after
adjusting for cost of earning such income, since this is an exercise
to determine our brand value as a Company and not for any of our
products or services.
Ination is assumed at 9.35% per annum; 5% of the average
capital employed is used for purposes other than promotion of the
brand and tax rate is at 33.22%.
The earnings multiple is based on our ranking against the
industry average based on certain parameters (exercise undertaken
internally and based on available information).
in rcrore
2011 2010 2009
Brand value 40,509 36,907 32,345
Market capitalization 1,86,100 1,50,110 75,837
Brand value as a percentage
of market capitalization (%) 21.8 24.6 42.7
Brand value / revenue (x) 1.47 1.62 1.49
72 | Economic Value-Added (EVA
) statement
) statement
Economic Value-Added is the surplus generated by an entity after meeting an equitable charge towards providers of capital. It is the post-tax
return on capital employed (adjusted for the tax shield on debt) less the cost of capital employed. Companies which earn higher returns than
cost of capital create value, and companies which earn lower returns than cost of capital are deemed harmful for shareholder value.
2011 2010 2009 2008 2007
Cost of capital
Return on risk-free investment (%) 7.66 7.20 7.00 8.00 8.00
Market premium (%) 5.00 5.00 7.00 7.00 7.00
Beta variant 0.71 0.68 0.74 0.76 0.99
Cost of equity (%) 11.21 10.60 12.18 13.32 14.97
Average debt / total capital (%)
Cost of debt net of tax (%) NA NA NA NA NA
Weighted Average Cost of Capital (WACC) (%) 11.21 10.60 12.18 13.32 14.97
Average capital employed 25,688 21,634 17,431 12,527 9,147
)
Operating profits 8,102 6,910 6,421 4,640 3,877
Less : Tax 2,490 1,681 919 685 386
Cost of capital 2,880 2,293 2,123 1,669 1,369
Economic Value-Added 2,732 2,936 3,379 2,286 2,122
Enterprise value
Market value of equity 1,86,100 1,50,110 75,837 82,362 1,15,307
Add : Debt
Less : Cash and cash equivalents 16,810 15,819 10,993 8,307 6,033
Enterprise value 1,69,290 1,34,291 64,844 74,055 1,09,274
Return ratios
PAT / average capital employed (%) 26.6 28.7 34.3 37.2 42.2
EVA
/ average capital employed (%) 10.6 13.6 19.4 18.2 23.2

Enterprise value / average capital employed (x) 6.6 6.2 3.7 5.9 11.9
Growth (%)
Operating profits 17.3 7.6 38.4 19.7 46.1
Average capital employed 18.7 24.1 39.1 37.0 48.1
EVA
(6.9) (13.1) 47.8 7.7 37.8

Market value of equity 24.0 97.9 (7.9) (28.6) 40.4
Enterprise value 26.1 107.1 (12.4) (32.2) 41.1
Notes : Cost of equity = return on risk-free investment + expected risk premium on equity investment adjusted for our beta variant in India.
Figures above are based on IFRS financial statements. The data for year 2008 and 2007 is as per consolidated Indian GAAP.
Cash and cash equivalents include investments in liquid mutual funds and certificate of deposits.
Balance sheet including intangible assets | 73
Balance Sheet including intangible assets
As at March 31,
in rcrore
2011 2010
ASSETS
Current assets
Cash and cash equivalents 16,666 12,111
Available-for-sale financial assets 21 2,518
Investment in certificates of deposit 123 1,190
Unbilled revenue 1,243 841
Prepayments and other current assets 917 641
Non-current assets
Property, plant and equipment 4,844 4,439
Goodwill 825 829
Intangible assets
Brand value 40,509 36,907
Human resources value 1,35,105 1,13,287
Other intangible assets 48 56
Available-for-sale financial assets 23 38
Deferred income tax assets 378 346
Income tax assets 993 667
Other non-current assets 463 347
Total non-current assets 1,83,188 1,56,916
Total assets 2,06,877 1,77,806
Current liabilities
Current income tax liabilities 817 724
Employee benefit obligations 140 131
Provisions 88 82
Other current liabilities 2,012 1,707
Total current liabilities 3,641 3,193
Deferred income tax liabilities 114
Other non-current liabilities 60 61
Total liabilities 3,960 3,539
Equity
Share capital 286 286
Share premium 3,082 3,047
Capital reserves-intangible assets 1,75,614 1,50,194
Other components of equity 109 72
Total equity attributable to equity holders of the Company 2,02,917 1,74,267
Total liabilities and equity 2,06,877 1,77,806
Notes : The figures above are based on IFRS financial statements.
This Balance Sheet is provided for the purpose of information only. We accept no responsibility for any direct, indirect or consequential losses or damages suffered by any person
relying on the same.
74 | Intangible assets score sheet
Intangible assets score sheet
We caution investors that this data is provided only as additional
information to them. We are not responsible for any direct, indirect or
consequential losses suffered by any person using this data.
From the 1840s to the early 1990s, a corporates value was mainly
driven by its tangible assets values presented in the corporate Balance
Sheet. The managements of companies valued these resources and
linked all their performance goals and matrices to these assets Return
on Investment and capital turnover ratio. The market capitalization
of companies also followed the value of tangible assets shown in the
Balance Sheet with the difference seldom being above 25%. In the
latter half of the 1990s, the relationship between market value and
tangible asset value changed dramatically. By early 2000, the book
value of the assets represented less than 15% of the total market value.
In short, intangible assets are the key drivers of market value in this
new economy.
A knowledge-intensive company leverages know-how, innovation
and reputation to achieve success in the marketplace. Hence, these
attributes should be measured and improved upon year after year
to ensure continual success. Managing a knowledge organization
necessitates a focus on the critical issues of organizational adaptation,
survival, and competence in the face of ever-increasing, discontinuous
environmental change. The profitability of a knowledge firm depends
on its ability to leverage the learnability of its professionals, and
to enhance the reusability of their knowledge and expertise. The
intangible assets of a company include its brand, its ability to attract,
develop and nurture a cadre of competent professionals, and its ability
to attract and retain marquee clients.
Intangible assets
The intangible assets of a company can be classified into four major
categories : human resources, intellectual property assets, internal
assets and external assets.
Human resources
Human resources represent the collective expertise, innovation,
leadership, entrepreneurship and managerial skills of the employees
of an organization.
Intellectual property assets
Intellectual property assets include know-how, copyrights, patents,
products and tools that are owned by a corporation. These assets are
valued based on their commercial potential. A corporation can derive
its revenues from licensing these assets to outside users.
Internal assets
Internal assets are systems, technologies, methodologies, processes
and tools that are specific to an organization. These assets give
the organization a unique advantage over its competitors in the
marketplace. These assets are not licensed to outsiders. Examples of
internal assets include methodologies for assessing risk, methodologies
for managing projects, risk policies and communication systems.
External assets
External assets are market-related intangibles that enhance the fitness
of an organization for succeeding in the marketplace. Examples are
customer loyalty (reflected by the repeat business of the Company)
and brand value.
The score sheet
We published models for valuing two of our most important intangible
assets human resources and the Infosys brand. This score sheet is
broadly adopted from the intangible asset score sheet provided in the
book titled, The New Organizational Wealth, written by Dr. Karl-Erik
Sveiby and published by Berrett-Koehler Publishers Inc., San Francisco.
We believe such representation of intangible assets provides a tool to
our investors for evaluating our market-worthiness.
Clients
The growth in revenue is 25.8% this year, compared to 3% in the
previous year (in U.S. dollar). Our most valuable intangible asset is our
client base. Marquee clients or image-enhancing clients contributed
49.8% of revenues during the year. They gave stability to our revenues
and also reduced our marketing costs.
The high percentage of revenues 98.0% from repeat orders during the
current year is an indication of the satisfaction and loyalty of our clients.
The largest client contributed 4.7% to our revenue, compared to 4.6%
during the previous year. The top 5 and 10 clients contributed around
15.4% and 25.7% to our revenue respectively, compared to 16.4% and
26.2% respectively, during the previous year. Our strategy is to increase
our client base and, thereby, reduce the risk of depending on a few
large clients. During the year, we added 139 new clients compared to
141 in the previous year. We derived revenue from customers located
in 71 countries against 66 countries in the previous year. Sales per
client grew by around 16.6 % from US$ 8.35 million in the previous
year to US$ 9.74 million this year. Days Sales Outstanding (DSO) was
63 days this year compared to 59 days in the previous year.
Organization
During the current year, we invested around 2.57% of the value-added
(2.34% of revenues) in technology infrastructure, and around 2.13%
of the value-added (1.94% of revenues) on R&D activities.
A young, fast-growing organization requires efficiency in the area of
support services. The average age of support employees is 31.8 years,
as against the previous years average age of 30.4 years. The sales per
support staff has increased during the year compared to the previous
year and the proportion of support staff to the total organizational
staff, has marginally decreased over the previous year.
People
We are in a people-oriented business. We added 43,120 employees
this year on gross basis (net 17,024) from 27,639 (net 8,946) in the
previous year. We added 15,883 laterals this year against 4,895 in
the previous year. The education index of employees has gone up
substantially to 3,43,407 from 2,96,586. This reflects the quality of
our employees. Our employee strength comprises people from 88
nationalities as at March 31, 2011. The average age of employees as at
March 31, 2011 was 27. Attrition was 17.0% for this year compared
to 13.4% in the previous year (excluding subsidiaries).
Notes
Marquee or image-enhancing clients are those who enhance the
Companys market-worthiness, typically, Fortune 500 clients.
They are often reference clients for us.
Sales per client is calculated by dividing total revenue by the total
number of clients.
Repeat business revenue is the revenue during the current year
from those clients who contributed to our revenue during the
previous year too.
Value-added statement is the revenue less payment to all outside
resources. The statement is provided in the Value-added statement
section of this document.
Technology investment includes all investments in hardware
and software, while total investment in the organization is the
investment in our xed assets.
The average proportion of support staff is the average number of
support staff to average total staff strength.
Sales per support staff is our revenue divided by the average number
of support staff (support staff excludes technical support staff)
Intangible assets score sheet | 75
The education index is shown as at the year end, with primary
education calculated as 1, secondary education as 2 and tertiary
education as 3.
External structure our clients
2011 2010
Growth / renewal
Revenue growth (%)
In U.S. dollar terms 26 3
In rupee terms 21 5
Exports / total revenue (%) 98 99
Clients
Total 620 575
Added during the year 139 141
Marquee clients
Total 138 126
Added during the year 22 19
Revenue contribution (%) 50 50
Revenue derived number of countries 71 66
Efficiency
Sales / Client
US$ million 9.74 8.35
R crore 44.36 39.55
Sales and marketing expenses / revenue (%) 5.50 5.21
DSO (days) 63 59
Provision for debts / revenue (%) 0.01
Stability
Repeat business (%) 98.0 97.3
No. of clients accounting > 5% of revenue
Client concentration
Top client (%) 4.7 4.6
Top five clients (%) 15.4 16.4
Top ten clients (%) 25.7 26.2
Client distribution
1 million dollar + 366 338
Internal structure our organization
2011 2010
Growth / renewal
R&D
R&D / total revenue (%) 1.94 1.93
R&D / value-added (%) 2.13 2.09
Technology investment
Investment / revenue (%) 2.33 2.37
Investment / value-added (%) 2.56 2.58
Total investment
Total investment / total revenue (%) 4.73 2.89
Total investment / value-added (%) 5.20 3.14
Efficiency
Sales per support staff
US$ million 0.92 0.84
Rcrore 4.20 4.00
General and administrative expenses /
revenue (%) 7.17 7.16
Average proportion of support staff (%) 5.35 5.36
Stability
Average age of support staff (years) 31.8 30.4
Competence our people
2011 2010
Growth / renewal
Total employees added during the year 1,30,820 1,13,796
Gross 43,120 27,639
Net 17,024 8,946
Laterals added 15,883 4,895
Staff education index 3,43,407 2,96,586
Employees number of nationalities 88 83
Gender classification (%)
Male 66.2 66.5
Female 33.8 33.5
Number of non-Indian national employees 7,805 6,064
Efficiency
Value-added / employee (Rcrore)
Software professionals 0.22 0.21
Total employees 0.20 0.20
Value-added / employee (US$ million)
Software professionals 0.05 0.04
Total employees 0.05 0.04
Stability
Average age of employees (years) 27 27
Attrition excluding subsidiaries (%) 17.0 13.4
Attrition excluding involuntary
separation (%) 15.5 10.4
Note : The above figures are based on IFRS financial statements.
76 | ValueReporting
ValueReporting
At Infosys, we have always believed that information asymmetry between the Management and shareholders should be minimized. Accordingly,
we have always been at the forefront in practicing progressive and transparent disclosures. We were the first in India to adopt the U.S. Generally
Accepted Accounting Principles (U.S. GAAP). Further, we were the first foreign private issuer in India to file primary financial statements with
the Securities and Exchange Commission (SEC) in accordance with the International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board. Thereafter, we rapidly progressed to additional disclosures that give deeper insights to the way we
run our business and into our value creation. We continue to provide additional information even though it is not mandated by law because we
believe that it will enable investors to make more informed choices about our performance.
The book, The Value Reporting Revolution : Moving Beyond the Earnings Game, authored by Robert Eccles, Robert Herz, Mary Keegan and David
Phillips, associated to the accounting firm, PricewaterhouseCoopers, (published by John Wiley & Sons, Inc., U.S., 2001), acknowledged the
need to go beyond GAAP in providing information to shareholders. In their book, Building Public Trust : The Future of Corporate Reporting (published
by John Wiley & Sons, Inc., U.S., 2002 PricewaterhouseCoopers), our business model and reporting were referred to in detail.
We believe the following Value Reporting paradigm applies to us :
The ValueReporting paradigm
We identified the need to provide a range of non-financial parameters early in our existence before our Indian public offering in 1993.
To reduce information asymmetry, we make the following disclosures in addition to the mandated Indian and IFRS financial statements and
supplementary data as required by the relevant statutes :
Brand valuation
Balance Sheet including intangible assets
) statement
Intangible asset scorecard
Risk management report
Human resource accounting and value-added statement
ValueReporting | 77
The Corporate Reporting framework
By adopting similar internal measures to evaluate business performance, our employees are adjudged based on metrics that are additional to the
financials. This balances financial and non-financial performance across all levels of the organization. Accordingly, we seek to align the measures
by which stakeholders measure our performance with what results in employee rewards.
In addition to the Annual Report, a Sustainability Report measuring compliance against the Global Reporting Initiative (GRI) is also being
published since fiscal 2008.
In fiscal 2005, we adopted and furnished eXtensible Business Reporting Language (XBRL) data to the United States Securities and Exchange
Commission (SEC) for the first time. We are the fourth Company worldwide to adopt XBRL. As the SEC website is under preparation for the
acceptance of IFRS XBRL filings, we have not been furnishing our IFRS filings after March 31, 2009 although we have completed a pilot testing
on XBRL statements in IFRS. We have been invited by the International Accounting Standards Board to conduct pilot testing of the new versions
of the IFRS taxonomy.
The book, One Report : Integrated Reporting for a Sustainable Strategy, authored by Robert Eccles and Michael Krzus, (published by John Wiley &
Sons, Inc., U.S., 2010), analyses the need to give one integrated report for nancial and non-nancial measures for providing information to
shareholders. Although we give all the information through multiple reports today, we would be striving towards an integrated report in future.
In an endeavor to achieve the same we have signicantly enhanced the involvement of social media network by having a Company presence on
Facebook
TM
and Twitter
TM
for interacting with a wider and larger part of the stakeholder community. We have also adopted a social media policy
that provides guidelines for participating in social media responsibly without compromising the Company interest by deliberate or inadvertent
disclosure of Company condential / proprietary information.
In the coming years, we will continue in our commitment to furnish additional qualitative information to help our shareholders better understand
the Management of our business.
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Management structure
Infosys Foundation | 79
Infosys Foundation
It is every mans obligation to put back into the world at least the equivalent
of what he takes out of it.
Albert Einstein
The Infosys Foundation was set up in 1996 with the noble intention
of supporting the underprivileged sections of the society and enriching
their lives.
Promoted by Infosys Technologies Limited, the Foundation started
small, but has now spread its work across various parts of India.
A small but dedicated team of the Foundation has sustained and
nurtured developmental programs across the most needy areas. The
Foundations activities range from making healthcare accessible, to
spreading education, sponsoring the arts and rehabilitation of affected
communities, especially in the rural and underdeveloped regions of
India.
The key focus areas of the Foundation are :
Social rehabilitation and rural uplift
Learning and education
Healthcare
Arts and culture
The highlights of some of the projects the Foundation was involved
in during 2010-11 are :
Learning and education
Education is a strong empowering factor in improving the quality
of life of the underprivileged and to bring about grass root
socio-economic change. The Foundation believes that by providing the
platform to support primary, secondary, higher education, vocational
and professional learning through public and private agencies, we
can empower our people to realize their full potential. Some of the
work that the Foundation has done in this field during 2010-11 are :
Distributed Kannada and English illustrated story book series
Chandamama in 3,158 schools across rural Karnataka
Awarded a cash reward of R10,000 to each team that participated
in the Olympiad Science Congress through the Tata Institute of
Fundamental Research
Awarded scholarships to 4,000 meritorious students from
economically weaker backgrounds
Awarded 10 scholarships to meritorious Ph.D students in various
faculties at Gulbarga University
Supplied books and education materials to the Door Step mobile
school that provides free education to underprivileged children
in Pune
Helped in part in the construction of school buildings and toilets
in Andhra Pradesh, Chennai, Maharashtra, Bihar and Madhya
Pradesh
Donated furniture to colleges, schools and libraries in
Maharashtra and Karnataka
Donated computers to schools in Karnataka, Andhra Pradesh and
Maharashtra
Assisted in the renovation of the library at the Gokhale Institute
of Public Affairs that houses 50,000 books
Through the Manohar Grantha Mala, helped publish the
unpublished works of writers of yesteryear for the purpose of
documentation
Sponsored the rst International Sanskrit Book Fair held in
Bangalore
Healthcare
Developing countries such as India face an acute need in the areas of
accessible and affordable healthcare. The Infosys Foundation regularly
supports programs that address this need. In 2010-11, the Foundation
has supported the following initiatives and programs :
Completed the construction of Standard Care & Rehabilitation
Centre for mentally ill homeless persons run by the Chittaprakash
Trust in H. D. Kote, Karnataka
Supplied mobile incubators to different hospitals on an
experimental basis for the care of poor patients
Supplied food to in-patients suffering from leprosy, tuberculosis,
HIV and eye conditions in rural Karnataka
Arts and culture
With rapid urbanization and advances in technology, local crafts and
arts are becoming endangered, and the lack of sponsorship and support
is making their survival even more difficult. The Infosys Foundation
identifies, nurtures and promotes rare and vanishing folk arts of the
country, and supports them through various scholarships. In the year,
2010-11, the Foundation supported the following initiatives :
Sponsored the publication of a book on Kantha embroidery that
speaks of the tradition of Kantha and its evolution into a highly
valued art form
Sponsored Yakshagana Puppet Shows by Kogga Kamath and Sri
Gopalakrishna Yakshagana Bombeyata Sangha, Kasaragod and
Surabhi troops from Hyderabad
Sponsored stage theatre events and shows by various troupes,
both local and international, for a year
Sponsored music concerts by 50 musicians through the Bharatiya
Vidya Bhavan
Sponsored the publication of Karnataka Kala Darshana through
the Navakarnataka Publication Pvt. Ltd.
Sponsored the publication of Kannada plays, short stories and
novels by Masti Venkatesh Iyengar by the M. V. J. K Trust (Reg.)
Social rehabilitation and rural welfare
The Foundation works closely with partners and communities that
strive towards the mitigation of social inequality. In the year 2010-11,
we were involved in the following activities :
Constructed 2,541 houses for ood victims in Raichur
and Yadgir districts
Donated sewing machines to 500 destitute women in rural
Karnataka and Andhra Pradesh and helped them earn a living
and lead respectable lives
Supported the rehabilitation of 914 street children in Delhi
through the NGO, Sathi
Supported the rehabilitation of 920 devadasi women and 1,240
devadasi children
Sponsored the training of 300 tribal persons in agriculture,
horticulture, sericulture, oriculture bee-keeping, farm
machinery operation and maintenance, shery, dairy and poultry
farming, welding and carpentry
Supported orphanages and schools for the physically
handicapped, the visually impaired and the hearing impaired in
Karnataka, Tamil Nadu and Maharashtra
Provided support to development work in Bihar, Madhya
Pradesh, Orissa and Andhra Pradesh through the Sri Kottala
Basaveshwara Bharatiya Sikshana Samiti Sedam
Empowered over 7,50,000 women in three districts in Karnataka
by training them in hygiene, health, nutrition, infant care,
livelihood, literacy and sanitation through an experimental
program called Jnanavikasa.
80 | Report on health, safety and environment
Report on health, safety and environment
In managing Health, Safety and Environment (HSE) during the year,
we focused our efforts on better design, smarter operations, reduction
in wastage of resources and strengthening systems to reduce potential
health and safety incidents.
OZONE
OZONE Infosys Health, Safety and Environmental Management
System (HSEMS) enunciates our philosophy and commitment
towards environmental protection and management of health and
safety of our employees, contractors and visitors. During March 2011,
we were recertified compliant to ISO 140001: 2004 standard and
OHSAS 18001: 2007 specifications at all our development centers in
India. These certifications are a testament to our consistent pursuit of
excellence in HSE management at Infosys.
Some of the most signicant HSE initiatives undertaken during the
year are listed below:
Awareness and employee engagement
We encourage our employees to get actively involved in initiatives
that work towards the improvement of society and the environment
around us. Several employee-driven eco groups have been instituted
at our development centers and we encourage them to participate in
campaigns that inculcate eco-friendly lifestyles. Some of the major
environmental campaigns conducted successfully during 2010-11 by
our eco groups are:
The global work party on climate change conducted by 350.org
which saw participation by thousands of employees
The Earth hour week which culminated in Earth hour observed
globally by the WWF
The deployment of an interactive sustainability portal. This was
developed by the Hyderabad Eco Club and helps in tracking the
carbon footprint of the campus
Energy
Opportunities for energy conservation were identied in all our
operations, for both the physical and IT infrastructure. Some of the
signicant initiatives that have been taken up during the year are
listed here:
Installation of wind turbines at our campuses in Pune, Bangalore
and Mangalore
Installation of occupancy sensors in conference rooms and
rest rooms
Introduction of LED lamps in lieu of uorescent tubes
Installed Variable Frequency Drives (VFD) in condenser pumps
on chillers
Initiative to replace old and inefcient utilities such as DG sets,
pumps and motors
Setting up of a strong monitoring system for the Environmental
Management System as per ISO 14001 guidelines
These measures have resulted in a reduction of the per capita power
consumption by over 3.85% during the year.
Infrastructure development
Our persistent efforts to build the most sustainable infrastructure
were acknowledged last year with two of our buildings, one each
in Jaipur and Thiruvananthapuram campuses, being awarded the
LEED Platinum rating, the highest standard for Green Buildings
by the Indian Green Building Council (IGBC). Continuing this
commitment, all our new buildings that are under construction have
been registered for LEED rating from the IGBC and are designed with
a high performance envelope. This reduces the solar heat gain, while
providing natural light. The energy performance of all the buildings
designed in the previous year has been found to be more efcient
than the globally accepted ASHRAE efciency standards.
The following are some of the measures implemented during the
year:
A new building at our Hyderabad campus has been commissioned
with radiant cooling, a method of cooling used for the rst time in
a commercial building in India.
A chilled water storage tank of 300 KL capacity has been built
in our Mangalore campus to increase the efciency of the air-
conditioning system. This system is under testing and is expected
to reduce peak load as well as energy consumption. Initial results
of this system have been very encouraging.
Chilled beam systems, which are expected to be more efcient than
the conventional air-conditioning systems are being implemented
in three new buildings in our Pune campus.
High efciency chillers which consume considerably lesser power
have been selected for all new upcoming projects, thus reducing
peak demand as well as energy consumption.
IT infrastructure
As part of our efforts towards reducing power consumption and
increasing operational efciency, the following are some of the
signicant efforts pursued during the year:
The optimized desktop power management conguration has been
extended to around 80,000 desktops. An in-house application,
Terminator, was designed to force-schedule the shutdown of
desktops. This is being enhanced to achieve further reduction in
power demand by desktops. In addition to this, around 10,000
older desktops have been replaced this year with newer power
efcient models.
We have continued our efforts towards restructuring the existing
data centers and server rooms. Around twelve server rooms have
been revamped this year and about 4,400 sq. ft. of server room / lab
space has been released. Further, adoption of internal enterprise
cloud, a shared, secure and virtualized computing environment
with an easy-to-use self-service portal, by projects has been swift.
On an average 90% of the virtual instances are in use at any given
time and we are planning to augment the capacity shortly.
Video Conference (VC) usage has increased steadily this year and
currently on an average around 2,500 VC calls are scheduled
per month. Further, we have introduced Telepresence, an ultra
high denition (1080p) capability VC facility, in three locations.
Telepresence relays true life-size images and employs spatial audio
to provide an immersive experience to the participants. Usage of
this facility would help us connect with customers at CXO levels
using VC and reduce travel requirements.
Green power
During the year we worked with electricity and power regulators
in Karnataka and at the Centre for making green power cheaper,
an achievement that is signicant not only for Infosys but would
also benet the community at large. A similar initiative is being
taken up in other parts of the country. Infosys purchased about
14.52 million units of green power during the previous year and
this gure is expected to increase substantially in the coming years.
On renewable energy, a solar photo voltaic system of about
200 KW and 125 KW are being installed at the Jaipur and
Thiruvananthapuram campuses respectively. These together are
expected to generate about 4,50,000 units of electricity annually,
Report on health, safety and environment | 81
thus reducing the burden on the grid.
Water
Recognizing the immense importance of water as a natural resource,
we have successfully achieved our target of reducing our employee
per capita fresh water consumption in our Indian campuses
by 6.80% during 2010-11 through various water conservation
initiatives. As part of our corporate goal to become a water-neutral
organization, we have built rainwater harvesting reservoirs in our
Mysore, Hyderabad, Pune and Mangalore campuses with a combined
water holding capacity of over 300 million liters. We have also built
state-of-the art waste water treatment plants to recycle and reuse the
waste water generated in our campuses for ushing, landscaping and
air-conditioning requirements.
Carbon emissions
Our goal is to become carbon-neutral. Several energy reduction
programs have been initiated, such as campaigns promoting the use
of mass transport and car-pooling among employees. We encourage
our employees to use teleconferencing and video conferencing
facility to avoid long-distance travel, thus minimizing the impact on
the environment.
Chemical substances
In order to minimize the harmful environmental impact of chemicals
used in our facilities primarily for housekeeping, landscaping and
pest control, we have standardized the chemicals used across our
Indian campuses. This has resulted in a 75% reduction in the number
of chemicals being used. We have introduced green seal products for
housekeeping and are working on nding eco-friendly alternatives
in other areas.
Waste management
We have embarked on recycling all organic waste generated at our
campuses with the establishment of a biogas plant in our Mysore
campus. A second plant is under construction in our Pune campus.
The biogas generated will be used as cooking fuel in the food
courts and the nal treated waste will be used as manure in our
gardens. Effective waste management has been achieved by ensuring
environment friendly methods of disposal and / or disposal as per
regulations.
Biodiversity
We planted about 40,000 trees during 2010-11, taking the total
number of trees in our Indian locations to more than 1,80,000. We are
trying to ensure that most of the trees are native to the geographical
locations of our campuses, which helps to promote local biodiversity
and contributes to water conservation. Our sustainable practices
have made our Mysore campus home to more than 52 species of
birds including many endangered ones.
Health and safety
Safety
Safety is every employees responsibility and concern. Employees are
expected to report incidents or workplace hazards. An Occupational
Health & Safety (OH&S) Committee is set up in each development
center. This committee is made up of OH&S representatives who
represent employees of a designated work group and its role is to
take a proactive approach in assisting the employer to develop and
implement the best possible OH&S policies, plans and procedures
for eliminating or minimizing the occupational risks that are inherent
in the business. Hazard and risk identication exercises are carried
out and programs / measures for the reduction or mitigation of the
same are ensured.
Health Assessment and Lifestyle Enrichment (HALE)
HALE is a best in class initiative aimed at improving organizational
productivity through employee health and wellbeing. Starting as
a response to increasing instances of lifestyle ailments like heart
disease and stress, HALE has expanded its programs that span across
several Development Centers. During the year, the HALE team held
several health interventions, leisure interventions and innumerable
awareness and information campaigns such as the Health Week,
Safety Week, Health Matters Arrest Hypertension, specials on our
corporate television channel, InfyTV, online interventions, quizzes,
puzzles, chat sessions with doctors and specialists, information
mailers and sharing of health tips.
While Infosys continues on its journey to becoming a world-class
employer, the HALE team is striving to ensure that it does so with
employees who are healthy, able to balance work and life effectively.
Online health and wellness support
We have a tie-up with ChiHealth, a Health and wellness information
portal, which offers online Integrated Wellness Services. Our
employees can access this platform from the HALE portal. The
ChiHealth is a one-stop solution that offers holistic preventive
healthcare online services and addresses pertinent issues related to
health and wellbeing. This portal has a wealth of information on
wellness, preventive health, nutrition, diet, tness, diseases and
disorders. Employees visiting the portal are provided information on
health and wellness by a team of experts in the respective areas.
Assessments and reviews
Periodic reviews and audits of the HSEMS are conducted for
evaluating the HSE performance and the suitability and effectiveness
of processes and programs in achieving the objectives and targets set
for the year.
PHOENIX The Business Continuity Management System
(BCMS) at Infosys
During the year, all development centers in India were certied
compliant to the BS25999 standard. Our Business Continuity
program Management System (BCMS) comprises three phases:
Emergency Response Phase : This is an incident management
phase which refers to the initial reaction to an incident, focused on
protecting life and organizational assets.
Business Continuity Phase : This phase refers to the resumption
of the most time-sensitive or critical business operations following
an incident.
Disaster Recovery Phase : This phase refers to bringing back
business operations to a normal / sustainable level, following an
incident.
Mock drills and exercises are carried out as per schedules and the
learning from exercises, incidents and threats are analyzed and
appropriate preventive and corrective actions are undertaken.
For additional details on our sustainability initiatives, refer to the
Sustainability Report available on our website, www.infosys.com.
82 | Multi-country GAAP
Financial statements (unaudited) presented in substantial compliance with
GAAP requirements of various countries and International Financial Reporting
Standards and reports of substantial compliance with the respective corporate
governance standards
Over the past decades, technology and information revolutions have
fundamentally transformed economic and political relationships
between nations. Thanks to the opening up of financial markets
across the globe, investors today have a wide choice of capital markets
to invest in. Consequently, the global investor must have access to
information about the performance of any company, in any market
that he or she chooses to invest in. However, differences in language,
accounting practices, and reporting requirements in various countries
render performance reports by many companies rather investor-
unfriendly.
Today, the strength of a global company lies in its ability to access
high-quality capital at the lowest cost from a global pool of investors.
Such companies study the needs of global investors and publish
financial information in a language and form understood by their
existing as well as prospective investors. In the process, financial
statistics may have to be restated and financial terminology may need
to be translated. Indeed, a key issue in international financial analysis
is the restatement and translation of financial reports that describe
operations conducted in one environment, but which are the subject
of review and analysis in another.
The International Financial Reporting Standards (IFRS) have gained
significant momentum across the globe. Many countries have adopted
IFRS and some of them, including India, are in the process of adopting
the same. The U.S. Securities and Exchange Commission (SEC) permits
foreign private issuers to file financial statements in accordance with
IFRS without any reconciliation with U.S. GAAP. We have fully adopted
IFRS as issued by the International Accounting Standards Board for our
filings with SEC, effective March 31, 2009. Audited IFRS statements
are available in our Annual Report on Form 20-F, filed with SEC for
the year ended March 31, 2011. The details are also available on our
website www.infosys.com.
Australia, France, Germany and United Kingdom have adopted IFRS.
We are presenting extracts of the unaudited consolidated financial
statements for these countries presented in substantial compliance with
IFRS in their respective local currencies. Canada is in the process of
adopting IFRS in full with effect from the year 2011. Canadian GAAP
financial statements have been presented on the same basis as earlier
years. The financial information presented in Japanese GAAP in this
annual report has been translated from our audited IFRS financial
statements. The information will be included in the Securities Report
to be filed with the Ministry of Finance, Japan. Further, keeping
in mind their local regulations and practices, these countries have
formulated their own corporate governance standards. We have
provided statements on substantial compliance with these standards
in the respective national languages of these countries.
The unaudited consolidated Balance Sheets and Income Statements,
excluding notes to the financial statements, have been presented
by converting the various financial parameters, reported in our
consolidated Balance Sheets and Income Statements, into the respective
currencies of the above countries.
In addition, appropriate adjustments have been made for differences,
if any, in accounting principles, and in formats, between India, these
countries and IFRS.
Corporate governance report Australia,
Canada, France, Germany, Japan and
United Kingdom
Australia
ASX Corporate Governance Council Principles
of good corporate governance and best practices
recommendations
The Australian Stock Exchange (ASX) Corporate Governance Council
(the Council) was formed on August 15, 2002 to develop and deliver
an industry-wide, support framework for corporate governance which
could provide a practical guide for listed companies, their investors, the
wider market and the Australian community. The Council published its
first edition of Principles of Good Corporate Governance and Best Practice
Recommendations document in March 2003. The Council undertook
an extensive review of the first edition and issued a revised Corporate
Governance Principles and Recommendations (second edition Corporate
Governance Guidelines) in August 2007. Further, amendments
were made to the second edition in 2010, and were applicable to an
entitys first financial year commencing on or after January 1, 2011,
though early application was encouraged. The Company has adopted
these amendments early. The corporate governance principles and
recommendations of the council are not mandatory, but Australian
listed entities must disclose those principles that are not in compliance
and the reasons for non-compliance.
The council proposed eight core principles which it believes underlie
good corporate governance. We comply substantially with all
recommendations made by the council, except the following :
1. Recommendation 2.2 The Chair should be an independent
director : The current policy of the Company is to have an
appropriate mix of executive and independent directors to
maintain the independence of the Board, and to separate the
board functions of governance and management. The Board
consists of 14 members, 5 of who are executive or full-time
directors, 1 is non-executive and 8 are independent directors.
Mr. N. R. Narayana Murthy, who is the Non-Executive Member of
the Board, is our Chairman and Chief Mentor. Further, Prof. Marti G.
Subrahmanyam has been appointed as the Lead Independent Director.
Effective August 21, 2011, the Board has appointed
Mr. K. V. Kamath, who is our independent director, as Chairman
of the Board.
The financial information provided in this section is unaudited. Financial information presented in substantial compliance with the GAAP requirements of countries and IFRS may not
meet all the regulatory requirements to be characterized as financial statements presented in explicit and unreserved compliance with such requirements. The statements on compliance or
substantial compliance with corporate governance standards of various countries may not meet all the relevant regulatory requirements to be characterized as statements of explicit and
unreserved compliance with corporate governance requirements. The financial information provided in this section does not contain sufficient information to allow full understanding of our
results or our state of affairs. In the event of a conflict in interpretation, the Audited Indian GAAP financial statements section and the Corporate governance report section of the Annual
Report should be considered. We caution investors that these reports are provided only as additional information to our global investors. Using such reports for predicting our future, or of any
other company, is risky. We are not responsible for any direct, indirect or consequential losses suffered by any person using these corporate governance reports, financial statements or data.
Multi-country GAAP | 83
2. Recommendation 3.3 and 3.4 The diversity policy : The
Company is committed to providing a work environment free
of discrimination and harassment. The Company is an equal
opportunities employer and makes employment decisions based
on merit and business needs. The Company believes in equal work
opportunities for all employees and does not condone favoritism
or the appearance of favoritism at the workplace. These are
included in the Companys code of conduct. Further, internally the
Company has an Infosys Womens Inclusivity Network (IWIN)
sponsored by the non-executive chairman. The objective of IWIN
is to create a gender sensitive and inclusive work environment,
help women in their career lifecycle and develop women for
managerial and leadership roles, thereby maintaining gender
ratios at all levels in the organization. The Company also discloses
the percentage of women employees in the organization in the
Additional Information to the Annual Report.
3. Recommendation 5.1 Ensure compliance with ASX listing rule
disclosure requirements : We are not listed on the Australian Stock
Exchange. However, we have established necessary policies and
procedures to ensure that announcements are made in a timely
manner, are factual, do not omit any material information and are
expressed in a clear and objective manner that allows investors
to assess the impact of the information when making investment
decisions.
4. Recommendation 7.3 Declaration in relation to the listed entitys
nancial statements by Chief Executive Ofcer (CEO) and Chief
Financial Ofcer (CFO) provided in accordance with section
295A of the Corporation Act : We are not listed on the Australian
Stock Exchange and hence this recommendation is not applicable
to the Company. However, our CEO and CFO provide necessary
certications with respect to the Companys nancial statements
and internal controls. The certication is provided in compliance
with the Indian and U.S. regulatory requirements.
Canada
Corporate governance : A guide to good disclosure, issued
by the the Toronto Stock Exchange
In December 2003, The Toronto Stock Exchange (TSX) issued
guidelines which would help issuers prepare meaningful disclosure
that complies with its requirements. TSX only requires companies to
explain their practices, and not to adopt the practices in the guidelines.
These guidelines were updated in January 2006.
We substantially comply with all the recommendations.
France
La gouvernance dentreprise des socits cotes
Dcembre 2008
Les principes de la gouvernance dentreprises des socits cotes tirent
leur origine des rapports VIENOT de juillet 1995 et juillet 1999, des
rapports BOUTON de septembre 2002, janvier 2007 et octobre 2008
sur les recommandations concernant la rmunration des dirigeants
des socits cotes. Cet ensemble de recommandations fut prpar par
des groupes de travail de LAssociation Franaise des Entreprises Prives
(AFEP) et le Mouvement des Entreprises de France (MEDEF). Cette
consolidation des travaux mens par des prsidents de grandes
socits franaises constitue une rponse la communication de la
Commission Europenne sur la gouvernance dentreprise et le droit
des socits, qui prconise que chaque Etat membre dsigne un code
de rfrence auquel les socits devront se conformer ou expliquer en
quoi leurs pratiques diffrent et pour quelles raisons.
Ce rapport avait fait plusieurs recommandations. Notre socit se
conforme strictement ces recommandations, lexception des points
ci-dessous :
7.1 La reprsentation des salaries et des salaries actionnaires La
politique actuelle de la socit est davoir 14 membres du conseil.
Dans ce conseil, 8 sont des directeurs indpendants, 1 un directeur
non-cadre et 5 des directeurs cadres. De ces directeurs cadres, 3 sont
des directeurs fondateurs et 2 sont des directeurs employs.
14.2.1. Revue des comptes par un comit daudit La socit a un
comit daudit qui comprend 4 directeurs indpendants. Tous les
membres du comit sont des financiers et un membre est lexpert
financier. Le comit se runit au moins une fois par trimestre (un jour
avant la runion du conseil dadministration) pour revoir et examiner
les tats financiers.
17. Dontologie pour les directeurs La lgislation locale des entreprises
ne demande pas que les directeurs dtiennent personnellement des
actions de la socit. Cependant, la plupart des directeurs, except un,
dtiennent personnellement des parts de la socit.
Germany
Deutscher Corporate Governance Kodex, in der Fassung
vom 26. Mai 2010
Der Deutsche Corporate Governance Kodex stellt wesentliche
gesetzliche Vorschriften zur Leitung und berwachung deutscher
brsennotierter Gesellschaften dar. Der Kodex wurde entwickelt,
um das deutsche Corporate Governance System transparent
und nachvollziehbar zu machen. Er will das Vertrauen der
internationalen und nationalen Anleger, der Kunden, der Mitarbeiter
und der ffentlichkeit in die Leitung und berwachung deutscher
brsennotierter Gesellschaften frdern.
Der Kodex enthlt zahlreiche Empfehlungen. Grundstzlich folgt unser
Unternehmen diesen Empfehlungen der Regierungskommission, es
gibt jedoch folgende Ausnahmen:
1. Empfehlungen 3, 4 and 5 Das duale System der
Unternehmenseinheit Das Unternehmen hat ein einstuges
Fhrungssystem, in welches sowohl leitende, als auch
berwachende Positionen integriert sind. Zurzeit besteht das
System aus 14 Vorstnden, darunter 5 geschftsfhrende, 1 nicht
geschftsfhrender und 8 unabhngige Vorstnde.
2. Empfehlung 4.1.5 Vielfalt in den Fhrungsfunktionen Der
Ernennungsausschuss des Aufsichtsrats ist verantwortlich
fr die berwachung des Ernennungsprozesses der hchsten
Vorstandspositionen im Unternehmen und dafr, solche
qualizierten Personen zu nden, zu berprfen und dem Ausschuss
zu empfehlen, die als geschftsfhrender, nicht geschftsfhrender
oder unabhngiger Vorstand, nach den vom Ausschuss festgelegten
Anforderungen geeignet erscheinen. Der Ernennungsausschuss
hat bei der Besetzung von Fhrungspositionen das Kriterium der
Vielfalt in die berlegungen mit einbezogen.
Japan
4452
http://www.tse.or.jp/rules/cg/
principles/index.html
United Kingdom
The U.K. corporate governance code supersedes and replaces the
combined code on corporate governance issued in June, 2008.
It follows a review by the Financial Reporting Council of the
implementation of the code in 2008 and subsequent consultation on
possible amendments to the code. This new code is applicable for
reporting years beginning on or after June 29, 2010.
We substantially comply with all recommendations of the combined
code except for the following:
1. Code B.1.1 Board balance and independence The independent
directors annually afrm their independence as per the denition
of the Indian and U.S. listing rules. The Board of Directors also
annually determine the independence of these directors. The local
listing rules also prescribe a maximum tenure of nine years for an
independent director to serve on a companys board. The rule was
effective January 2006. None of our independent directors have
served for more than nine years from the date of the rule becoming
effective.
2. Code B.2.4 Appointments to the Board The nominations
committee of the Board of Directors is responsible to oversee the
Companys nomination process for the top level management
positions and to identify, screen and recommend to the Board
individuals qualied to serve as executive directors, non-executive
directors and independent directors consistent with the criteria
approved by the Board. The Nominations Committee believes
that sound succession planning of senior leadership is the most
important ingredient for creating a robust future for the Company.
Therefore, the Committee has adopted a rigorous process to ensure
that the Board selects the right candidates for senior leadership
positions. The Company does not appoint external search
consultants nor openly advertises for appointment of Chairman or
non-executive director.
3. Code B.4.1 Induction on joining the Board All new non-executive
directors inducted into the Board are given an orientation. Presentations
are made by various executive directors giving an overview of our
operations to familiarize the new non-executive directors with the
operations. The new non-executive directors are given orientation on
our services, group structure and subsidiaries, our constitution, Board
procedures and matters reserved for the Board, our major risks as well as
our risk management strategies.
The Boards policy is to have separate meetings regularly with
other members of the senior management make presentations on
relevant issues.
4. Code B.6.2 Evaluation of Board The Company is not listed on
the London Stock Exchange and is not part of FTSE 350. However,
the compensation committee of the Company, together with the
CEO, reviews the performance of all the executive directors
and senior management each quarter, on the basis of detailed
performance parameters set for each of the executive directors at
the beginning of the year. The compensation committee may from
time-to-time, also evaluate the usefulness of such performance
parameters, and make necessary amendments. The Board
evaluates the performance of non-executive directors through a
peer-evaluation process every year.
5. Code D.1.2 Remuneration policy The Company has a policy
to allow its executive directors to serve on the board of two other
business entities with the prior consent of the Chairperson of the
Board of Directors. Remuneration earned by virtue of such board
membership is retained by the directors concerned.
6. Code E1 Dialogue with institutional investors Our
communication policy addresses the needs of all investors. We
use various forums to communicate with our investors and share
long-term and short-term plans and our corporate strategies. As a
policy, we do not differentiate between small and large investors.
Non-executive directors do not meet with large investors as
required under the code.
7. Code E.1.1. and E.1.2 Relations with shareholders The CEO,
COO, CFO, members of the Executive Council and the Investor
Relations team meet investors on a regular basis to understand
their views and perspectives. The Company also has a practice of
conducting analyst meets both in India and abroad. Views obtained
from investors and analysts during the course of such meetings
are communicated to the Board of Directors at the ensuing Board
meeting.
Consolidated Balance Sheets (unaudited) as of March 31,
Australian Dollar (AUD) in million
2011 2010
Assets
Investments in certificates of deposit 26 289
Trade receivables 1,009 849
Prepayments and other assets 199 156
Intangible assets 190 213
Deferred tax assets 82 85
Liabilities
Trade payables 10 2
Derivative financial instruments
Current tax payable 177 176
Client deposits 5 2
Employee benefits 30 32
Provisions 19 20
Other current liabilities 436 415
Total current liabilities 789 776
Deferred tax liabilities 28
Employee benefits 56 41
Total non-current liabilities 70 83
Total liabilities 859 859
Net assets 5,922 5,848
Equity
Share capital 600,000,000
equity shares authorized, issued
and outstanding 571,317,959 and
570,991,592 as at March 31, 2011
and March 31, 2010, respectively
(including share premium) 844 836
Other components of equity (1,541) (18)
Total equity attributable to equity holders
of the Company 5,922 5,848
Financial information presented in substantial compliance with Australian
Accounting Standards Board (AASB)
(unaudited) for the years ended March 31,
Australian dollar (AUD) in million, except share data
2011 2010
Revenues 6,405 5,654
Operating expenses
Operating profit 1,886 1,719
Other income, net 283 246
Profit before income tax 2,169 1,965
Income tax expense 580 419
Net Profit 1,589 1,546
Other Comprehensive income
Reversal of impairment loss on
available-for-sale financial asset 2
Gain transferred to net profit on
sale of available-for-sale financial
asset (1)
Fair value changes on available-
for-sale financial asset, net of tax
effect (2) 7
Exchange differences on
translating foreign operations 76 793
Total other comprehensive
income 74 801
Total comprehensive income for
the year 1,663 2,347
Profit attributable to :
Owners of the company 1,589 1,546
Profit for the year 1,589 1,546
Total comprehensive income
attributable to:
Non- controlling interest
Total comprehensive income for
the year 1,663 2,347
Basic (AUD) 2.78 2.71
Diluted (AUD) 2.78 2.71
Weighted average number
of shares used in computing
earnings per equity share
Basic 571,180,050 570,475,923
Diluted 571,368,358 571,116,031
Notes :
1. The functional currency of the Company is the Indian Rupee. These financial statements
have been presented by translating revenue and expenditure at an average rate during
the year; assets, liabilities, property, plant and equipment, long-term borrowings at the
year-end rate; and accretions to stockholders equity at an average rate for the year.
The difference arising on translation is shown under other components of equity.
2. Exchange rates (1 AUD =)
in r
2011 2010
Average rate 42.95 40.30
Period end rate 46.11 41.16
Canadian dollars (CAD) in million, except share data
2011 2010
Assets
Current Assets
Investments in liquid mutual
fund units 5 570
Investment in certificate of
deposits 26 269
Trade accounts receivable 1,011 791
Prepaid expenses and other
current assets 214 167
Goodwill 179 186
Intangible assets, net 11 12
Investments in liquid mutual
fund units 5 8
Deferred tax assets 82 79
Other assets 101 78
Liabilities and stockholders
equity
Current liabilities
Accounts payable 10 2
Income taxes payable 177 164
Client deposits 5 2
Parent company stockholders
equity
Common stock, R5/- par
value 600,000,000 equity
shares authorized, issued and
outstanding 571,317,959
and 570,991,592 as of
March 31, 2011 and 2010
respectively 73 73
Additional paid-in capital 681 705
Accumulated other
comprehensive income (279) (397)
Total parent company
stockholders equity 5,937 5,221
Total equity 5,937 5,221
Total liabilities and stockholders
equity 6,798 6,247
Financial information presented in substantial compliance with GAAP
requirements of Canada
Consolidated statement of earnings and retained earnings
CAD in million, except share data
2011 2010
Sales 6,144 5,232
Gross margin 2,588 2,238
Expenses
Selling, general and
administration expenses 778 648
Income from operations 1,810 1,590
Interest and other income 272 215
Gain on sale of long term
investment 12
Earnings before income taxes 2,082 1,818
Provision for income taxes 556 388
Net earnings before non-
controlling interest 1,526 1,430
Net earnings after non-
controlling interest 1,526 1,430
Cash dividend declared 904 379
622 1,051
Retained earnings, beginning of
the year 4,840 3,778
Reserves on consolidation of
trusts
(1)
11
Retained earnings, end of the
year 5,462 4,840
Earnings per share
Net earnings
Basic (CAD) 2.67 2.51
Fully diluted (CAD) 2.67 2.50
Weighted average number of
shares
Basic 571,180,050 570,475,923
Fully diluted 571,368,358 571,116,031
(1)
Effective fiscal 2010 treasury shares held by controlled trusts were consolidated
Notes :
have been presented by translating revenue and expenditure at an average rate for the
year; assets, liabilities, property, plant and equipment, long-term borrowings at the
year-end rate; and accretions to stockholders equity at an average rate for the year.
The difference arising on translation is shown under accumulated other comprehensive
income.
2. Exchange rates (1 CAD =)
in r
2011 2010
Bilan consolid (non-audit) au 31 mars
en millions deuros, sauf rsultat par action
2011 2010
ACTIF
Actif circulant
Disponibilits 2,630 2,004
Valeurs mobilires de placement 4 417
Certificats de dpt 19 197
Clients 734 578
Factures tablir 196 139
Instruments financiers drivs 11 16
Charges constats davance et autres
actifs circulants 145 105
Total actif circulant 3,739 3,456
Actif non-circulant
Installations techniques, matriels et
outillages industriels 764 735
Fonds de commerce 130 136
Immobilisations incorporelles 8 9
Immobilisations financires
disponibles 4 6
Impt diffr actif 60 58
Impt sur les socits actif 157 110
Autre actif non-circulant 72 56
Total actif non-circulant 1,195 1,110
Total actif 4,934 4,566
PASSIF ET CAPITAUX PROPRES
Passif circulant
Fournisseurs 7 1
Impts sur les socits passif 129 120
Acompte client 4 1
Produits constats davance 82 88
Avantages des salaries obligatoires 22 22
Provisions 14 13
Autre passif circulant 317 282
Total passif circulant 575 527
Passif non circulant
Impt diffr passif 19
Avantages des salaries obligatoires 41 28
Autre passif non circulant 10 10
Total passif 626 584
Capitaux propres
Capital 5/- par valeur 600,000,000
actions autorises, mises et comprises
571,317,959 et 570,991,592
jusquau 31 mars, 2011 et 1, 2010,
respectivement 48 48
Prime dmission 521 515
Report nouveau 4,560 3,425
Autres capitaux propres (821) (6)
Total des capitaux propres attribu la
part groupe 4,308 3,982
Total passif et capitaux propres 4,934 4,566
Etats financiers prpars en conformit avec les normes IFRS (International
Financial Reporting Standards) France
Compte de rsultat consolid des lments latents (non-
audit) pour les annes finissant au 31 mars
En millions deuros, sauf rsultat par action
2011 2010
Produits 4,574 3,400
Cot des ventes 2,648 1,945
Rsultat brut 1,926 1,455
Charges dexploitation :
Cot des ventes et de marketing 251 178
Charges administratives 328 243
Total des charges dexploitation 579 421
Rsultat dexploitation 1,347 1,034
Autre produits, net 202 148
Rsultat avant impt 1,549 1,182
Impt sur les bnfices 414 252
Rsultat net 1,135 930
Autre rsultat Elments latents
Extourne des pertes de valeur
des immobilisations financires
disponibles 1
Gain transfr au rsultat net sur
les ventes des immobilisations
financires disponibles
(1)
Gain latent sur les
immobilisations financires
disponibles, net de limpact de
limpt
(2) 4
Diffrence de change 55 423
Total autre rsultat Elments
latents 53 427
Total rsultat lment latent 1,188 1,357
Rsultat attribu :
Part du groupe 1,135 930
Intrts minoritaires
1,135 930
Total rsultat lment latent
attribu :
Part du groupe 1,188 1,357
Intrts minoritaires
1,188 1,357
Rsultat par action
Base (euros) 1.99 1.63
Diliu (euros) 1.99 1.63
Nombre moyen pondr
dactions
Base 571,180,050 570,475,923
Dilu 571,368,358 571,116,031
Notes :
1. La devise fonctionnelle de la socit est la roupie indienne. Ces tats financiers ont
t prsents en convertissant les produits et les charges avec un taux moyen pondr
pendant lanne ; lactif circulant, le passif circulant, les installations techniques, les
matriels et outillages industriels, les emprunts long terme, avec un taux la fin de
lanne ; et toutes les augmentations des capitaux propres, avec un taux moyen pour
lanne. La diffrence obtenue avec la conversion est comptabilise dans les autres
capitaux propres.
2. Taux de change (1 EURO =)
in r
2011 2010
Konsolidierte Bilanzen (ungeprft) zum 31. Mrz,
Euros in Millionen, auer Angaben zu Aktien
2011 2010
VERMGENSWERTE
Kurzfristige Vermgenswerte
Zahlungsmittel und
Zahlungsmittelquivalente 2,630 2,004
Zur Veruerung verfgbare finanzielle
Vermgenswerte 4 417
Festverzinsliche Wertpapiere 19 197
Forderungen aus Lieferung und
Leistung 734 578
Geleistete Anzahlungen 196 139
Derivate 11 16
Anzahlungen und sonstige
Vermgenswerte 145 105
Summe kurzfristige Vermgenswerte 3,739 3,456
Langfristige Vermgenswerte
Sachanlagen 764 735
Geschfts- oder Firmenwert 130 136
Immaterielle Vermgenswerte 8 9
Zur Veruerung verfgbare finanzielle
Vermgenswerte 4 6
Latente Steueransprche 60 58
Steueransprche (Ertragsteuern) 157 110
Sonstige langfristige Vermgenswerte 72 56
Summe langfristige Vermgenswerte 1,195 1,110
Summe Vermgenswerte 4,934 4,566
SCHULDEN UND EIGENKAPITAL
Kurzfristige Schulden
Verbindlichkeiten aus Lieferung und
Leistung 7 1
Steuerschulden (Ertragsteuern) 129 120
Kundenanzahlungen 4 1
Verbindlichkeiten aus
Fertigungsauftrgen / erhaltene
Anzahlungen 82 88
Verpflichtungen zu Leistungen an
Arbeitnehmer 22 22
Rckstellungen 14 13
Sonstige kurzfristige Schulden 317 282
Summe kurzfristige Schulden 575 527
Langfristige Schulden
Latente Steuerschulden 19
Verpflichtungen zu Leistungen an
Arbeitnehmer 41 28
Sonstige langfristige Schulden 10 10
Summe Schulden 626 584
Eigenkapital
Gezeichnetes Kapital R5/-
Nennwert 600,000,000 genehmigte
Stammaktien, ausgegeben und
ausstehend 571,317,959 und
570,991,592 zum 31. Mrz 2011 und
31. Mrz 2010, entsprechend 48 48
Kapitalrcklage 521 515
Bilanzgewinn 4,560 3,425
Sonstige Teile des Eigenkapitals (821) (6)
Summe Eigenkapital, den Anteilseignern
des Unternehmens zurechenbar 4,308 3,982
Summe Schulden und Eigenkapital 4,934 4,566
Finanzielle Information, dargestellt in wesentlicher bereinstimmung mit den
IFRS (International Financial Reporting Standards) Deutschland
Konsolidierte Gesamtergebnisrechnung (ungeprft) fr die
Jahre endend zum 31. Mrz,
Euros in Millionen, auer Angaben zu Aktien
2011 2010
Umsatzerlse 4,574 3,400
Herstellungskosten 2,648 1,945
Bruttoergebnis vom Umsatz 1,926 1,455
Betriebliche Aufwendungen:
Vertriebs- und
Marketingaufwendungen 251 178
Verwaltungskosten 328 243
Summe betriebliche Aufwendungen 579 421
Betriebsergebnis 1,347 1,034
Sonstige Ertrge, netto 202 148
Gewinn vor Ertragsteuern 1,549 1,182
Ertragsteueraufwand 414 252
Jahresberschuss 1,135 930
Sonstiges Ergebnis
Umkehr von Abwertungsverlusten
von zur Veruerung verfgbaren
finanziellen Vermgenswerten
1
Gewinn aus dem Verkauf von
zur Veruerung verfgbaren
finanziellen Vermgenswerten,
der auf den Jahresberschuss
bertragen wurde
(1)
nderungen des beizulegenden
Zeitwerts der zur Veruerung
verfgbaren finanziellen
Vermgenswerte, bereinigt um
Steuereffekte
(2) 4
Wechselkursdifferenzen aus der
Umrechnung von Transaktionen in
fremder Whrung 55 423
Summe sonstiges Ergebnis 53 427
Summe Ergebnis 1,188 1,357
Gewinn, zuzurechnen den:
Anteilseignern des Unternehmens 1,135 930
Minderheitsbeteiligten
1,135 930
Summe Ergebnis, zuzurechnen den:
Anteilseignern des Unternehmens 1,188 1,357
Minderheitsbeteiligten
1,188 1,357
Ergebnis pro Aktie
Einfach (Euro) 1.99 1.63
Verwssert (Euro) 1.99 1.63
Gewichtete durchschnittliche
Anteilsaktien, aus denen sich das
Ergebnis pro Aktie errechnet
Einfach 571,180,050 570,475,923
Verwssert 571,368,358 571,116,031
Anmerkung :
1. Die funktionale Whrung des Unternehmens ist die Indische Rupie. Diese
Jahresabschlsse wurden durch Umrechnung von Ertrgen und Aufwendungen unter
Zugrundelegung eines jahresdurchschnittlichen Wechselkurses erstellt; kurzfristige
Vermgenswerte, kurzfristige Schulden, Sachanlagen und langfristige Anleihen wurden
mit dem Jahresendkurs umgerechnet; Zuwchse im Eigenkapital wurden mit dem
Jahresdurchschnittskurs umgerechnet. Sich aus der Umrechnung ergebende Differenzen
sind in den sonstigen Teilen des Eigenkapitals enthalten.
2. Wechselkurse (1 EURO =)
in r
2011 2010
Durchschnittskurs 60.14 67.02
Periodenendkurs 63.38 60.45
331
2011
331
2010
331
310,732 224,339
416 46,647
2,245 22,035
86,725 64,691
23,199 15,549
1,247 1,746
17,129 11,890
441,693 386,897
90,301 82,235
15,383 15,216
915 998
416 665
7,068 6,486
18,542 12,306
8,564 6,403
141,189 124,309
582,882 511,206
832 166
15,216 13,387
416 166
9,645 9,812
2,578 2,411
1,663 1,497
37,501 31,597
67,850 59,037
2,162
4,823 3,160
1,164 1,081
73,837 65,439
1
13
600,000,000
2011331
571,317,959 2010
331570,991,592

2,833,600
5,322 5,322
58,371 57,706
440,196 383,405
5,155 (665)
509,044 445,767
582,882 511,206
Financial information presented in substantial compliance with the
International Financial Reporting Standards (IFRS) Japan
331

2010 2009
502,309 399,453
290,776 228,579
211,534 170,873
27,606 20,871
36,004 28,604
63,610 49,474
147,924 121,399
22,201 17,378
170,125 138,777
45,483 29,601
124,642 109,176
166
(83)
(166) 499
5,987 46,148
5,821 46,730
130,462 155,906
124,642 109,176

124,642 109,176
130,462 155,906

130,462 155,906
1
218 191
218 191
1
571,180,050 570,475,923
571,368,358 571,116,031
2011331
UFJ
83.15
United Kingdom Pound Sterling (GBP) in millions except share data
2011 2010
ASSETS
Current assets
Available-for-sale financial
assets 3 371
Investment in certificates of
deposit 17 175
Trade receivables 648 514
Derivative financial
instruments 9 14
Prepayments and other assets 128 93
Non-current assets
Property, plant and equipment 675 653
Goodwill 115 121
Available-for-sale financial
assets 3 5
Total non-current assets 1,055 987
Current liabilities
Trade payables 6 1
Client deposits 3 1
Provisions 12 12
Equity
Share capital R5/- par
value 600,000,000 equity
shares authorized, issued and
outstanding 571,317,959 and
570,991,592 as of March 31,
2011 and March 31, 2010,
respectively
33 33
Share premium 464 459
Other components of equity (704) 4
Total equity attributable to
equity holders of the Company 3,803 3,542
Total liabilities and equity 4,354 4,061
Financial information presented in substantial compliance with the
International Financial Reporting Standards (IFRS) United Kingdom
GBP in millions except share data
2011 2010
Revenues 3,887 3,008
Operating expenses
Total operating expenses 493 372
Operating profit 1,144 915
Net profit 964 823
available-for-sale financial asset 1
Gain transferred to net profit on
sale of available-for-sale financial
asset (1)
Fair value changes on available-
for-sale financial asset , net of
tax effect (1) 4
Exchange differences on
translating foreign operations 46 390
Total other comprehensive
income 45 394
Total comprehensive income 1,009 1,217
Profit attributable to:
Owners of the company 964 823
964 823
attributable to:
1,009 1,217
Basic (GBP) 1.69 1.44
Diluted (GBP) 1.69 1.44
Weighted average equity shares
used in computing earnings per
equity share
Basic 571,180,050 570,475,923
Diluted 571,368,358 571,116,031
Notes :
have been presented by translating revenue and expenditure at an average rate during
the year; current assets, current liabilities, property, plant and equipment, long-term
borrowings at the year-end rate; and accretions to stockholders equity at an average
rate for the year. The difference arising on translation is shown under Other components
of equity.
2. Exchange rates (1 GBP =)
in r
2011 2010
Extract of audited IFRS nancial statements | 91
Extract of audited IFRS financial statements
Financial statements included in our annual ling with the U.S.
Securities and Exchange Commission (SEC) in the Form 20-F
have been prepared in compliance with the International Financial
Reporting Standards as issued by International Accounting Standards
Board (IFRS).
As in the previous year we will be availing NASDAQs rule amendment
which allows a company to furnish its annual reports to its ADS
holders on its website in lieu of physical distribution. Accordingly
the annual report and the ling with the SEC in the Form 20-F is
available on our website www.infosys.com. However, a physical copy
will be made available to shareholders on request.
The extract of the audited Balance Sheet and Statement of
Comprehensive Income as per IFRS is provided here under :
Consolidated Balance Sheets as of March 31,
United States Dollar (US$) in million, except share data
2011 2010
ASSETS
Current assets
Cash and cash equivalents $3,737 $2,698
Available-for-sale nancial assets 5 561
Investment in certicates of deposit 27 265
Trade receivables 1,043 778
Derivative nancial instruments 15 21
Prepayments and other current assets 206 143
Non-current assets
Property, plant and equipment 1,086 989
Goodwill 185 183
Available-for-sale nancial assets 5 8
Total assets $7,010 $6,148
Current liabilities
Trade payables $10 $2
Client deposits 5 2
Employee benet obligations 31 29
Provisions 20 18
Employee benet obligations 58 38
Equity
Share capital- R5 ($0.16) par value
600,000,000 equity shares authorized,
issued and outstanding 571,317,959,
and 570,991,592, net of 2,833,600
treasury shares as of March 31, 2011
and 2010, respectively 64 64
Share premium 702 694
Other components of equity 62 (8)
2011 2010
Total equity attributable to equity holders
of the Company 6,122 5,361
Total liabilities and equity $7,010 $6,148
Consolidated statements of comprehensive income for
the years ended March 31,
United States Dollar (US$) in million, except share data
2011 2010
Revenues $6,041 $4,804
Gross prot 2,544 2,055
Operating expenses :
Total operating expenses 765 595
Operating prot 1,779 1,460
Prot before income taxes 2,046 1,669
Net prot $1,499 $1,313
available-for-sale nancial asset $2
Gain transferred to net prot on sale
of available-for-sale nancial asset (1)
Fair value changes on available-for-
sale nancial asset, net of tax effect (2) 6
Exchange differences on translating
foreign operations 72 555
Total other comprehensive income $70 $562
Total comprehensive income $1,569 $1,875
Prot attributable to :
$1,499 $1,313
attributable to :
$1,569 $1,875
Basic ($) 2.62 2.30
Diluted ($) 2.62 2.30
Weighted average equity shares used
in computing earnings per equity
share
Basic 571,180,050 570,475,923
Diluted 571,368,358 571,116,031
Note :
1. The functional currency of the Company is the Indian rupee. These financial
statements have been presented by translating revenue and expenditure at an
average rate during the year; current assets, current liabilities, property, plant
and equipment, long-term borrowings at the year-end rate; and accretions to
stockholders equity at an average rate for the year. The difference arising on
translation is shown under other components of equity.
2. Exchange rates (1 US$ =)
in R
2011 2010
92 | Global presence
Global presence
Asia Pacific
Hong Kong
2 Exchange Square
8 / F, 8 Connaught Place
Central, Hong Kong
Tel. : 852 2297 2231
Fax : 852 2297 0066
Japan
Izumi Garden Wing 2F
1-6-3, Roppongi, Minato-ku
Tokyo 106 0032
Tel. : 81 3 5545 3251
Fax : 81 3 5545 3252
Malaysia
Merak Block, Suite B
Persiaran Multimedia
1st Floor, Cyberjaya,
Kuala Lumpur 63000
Tel. : 60 383 203 829
Mauritius
4th Floor, B Wing
Ebne Cyber Towers
Reduit, Mauritius
Tel. : 230 401 9200
Fax : 230 464 1318
Singapore
04-01 / 06,
1 Changi Business Park
Crescent,
Singapore 486025
Tel. : 65 6572 8400
Fax : 65 6572 8405
Level 43, Unit 2
Suntec Tower 2
9 Temasek Blvd
Singapore 038989
Tel. : 65728400
Fax : 65728400
United Arab Emirates
Dubai
506 and 805
Liberty House, DIFC
P. O. Box 506846
Dubai
Tel. : 971 4 508 0200
Fax : 971 4 508 0225
Sharjah
Z3 Office 11, SAIF Zone
P. O. Box 8230, Sharjah
Tel. : 971 6 557 1068
Fax : 971 6 557 3768
Europe
Belgium
Regus Park Atrium
11, Rue des Colonies
Kolonienstraat
B 1000 Brussels
Tel. : 32 2 517 62 30
Fax : 32 2 517 67 00
Czech Republic
Prague Stock Exchange
Rybna Street 682 / 14
11005 Prague 1
Tel. : 420 222 191 387
Fax : 420 222 191 700
Denmark
Regus Copenhagen
Larsbjoernsstraede 3
1454 Copenhagen
Tel. : 45 33 3772 94
Fax : 45 33 3243 70
Finland
Regus Mannerheimintie 12 B
00100 Helsinki
Tel. : 358 925 166 239
Fax : 358 925 166 100
France
Paris
Tour Opus 12, 4th Floor
77 Esplanade du Gnral
de Gaulle
92 914 Paris La Defense 9
Tel. : 33 1 56 39 12 00
Fax : 33 1 56 39 12 01
Toulouse
7, Avenue Didier Daurat
2nd Floor, Blagnac
31700 Toulouse
Tel. : 33 5 34 50 92 77
Fax : 33 5 34 50 91 90
Germany
Eschborn
Topas 1, Merganthalleralle
77 65760 Eschborn
Tel. : 49 6196 9694 0
Fax : 49 6196 9694 200
Frankfurt
Opernturm, 22nd Floor,
Bokenheimer Landstrasse,
60306 Frankfurt am Main
Tel. : 49 0 69 269566 000
Fax : 49 0 69 269566 200
Stuttgart
Liebknechtstrasse 33
D 70565 Stuttgart
Tel. : 49 711 7811 570
Fax : 49 711 7811 571
Walldorf
Partner Port
Altrottstr. 31, 69190 Walldorf
Tel. : 49 6227 73 4350
Fax : 49 6227 73 4359
Greece
Greek Branch,Regus Hellas
S.A. 166A Kifissias Avenue &
2, Sofokleous str
Maroussi GR 151 26
Tel : 30 210 727 9055
Fax : 30 210 7279200
Ireland
Regus Prembroke House
30 Pembroke Street Upper
Dublin 2
Tel. : 353 1 234 2470
Fax : 353 1 234 2575
Norway
Ibsen AS
C. J. Hambrosplass 2C
1st Floor, Oslo 0164
Tel. : 47 22 99 60 42
Fax : 47 22 99 60 10
Russia
4 / 430, 4. Lesnoy Pereulok,
Moscow 125047
Tel. : 7 495 642 8710
Fax : 7 495 225 8500
Spain
Regus CUZCO IV
Paseo de la Castellana 141-8
28046, Madrid
Tel. : 34 91 503 0644
Fax : 34 91 503 0530
Sweden
Stureplan 4C, 4tr
114 35, Stockholm
Tel. : 46 8 463 1112
Fax : 46 8 463 1114
Switzerland
Basel
Regus Basel City Centre
Innere Margarethenstrasse 5
Basel 4051
Tel. : 41 0 61 204 4545
Fax : 41 0 61 204 4500
Geneva
18, Avenue Louis-Casai
1209 Geneva
Tel. : 41 22 747 7894
Fax : 41 22 747 7900
Zurich
3rd Floor, Badenerstrasse 530
8048 Zurich
Tel. : 41 43 817 4170
Fax : 41 43 817 4150
The Netherlands
World Trade Center
H-Tower, 23rd Floor
Zuidplein 190
1077 XV Amsterdam
Tel. : 31 20 796 5500
Fax : 31 20 796 5501
United Kingdom
Aberdeen
CBXII West Wing
382 - 390 Midsummer
Boulevard
Milton Keynes MK9 2RG
Tel. : 44 1908 84 74 00
Fax : 44 1908 84 74 01
London
14th and 15th Floor
Canary Wharf
London E 14 5NP
Tel. : 44 20 7715 3300
Fax : 44 20 7715 3301
Swindon
Part First Floor
Wakefield House
Aspect Park, Pipers Way
Swindon SN 31RE
Tel. : 44 179 352 8766
Fax : 44 179 352 3714
India
Bangalore
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Infosys Center Point
Offshore Development Center
Plot No. 26A
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Reddy Building
K 310, 1st Main
5th

Block, Koramangala
Bangalore 560 095
Tel. : 91 80 2553 2591
Fax : 91 80 2553 0391
Salarpuria Infozone
3rd and 4th Floor
Wing A, No. 39 (P),
No. 41 (P) and No. 42 (P)
Bangalore 560 100
Tel. : 91 80 2852 0261
Fax : 91 80 2852 0362
Bhubaneswar
Plot No. E / 4, Info City
Bhubaneswar 751 024
Tel. : 91 674 232 0032
Fax : 91 674 232 0100
Chandigarh
Block A and B, Ground Floor
DLF Building, Plot No. 2
Kishangarh
Chandigarh 160 101
Tel. : 91 172 502 1100
Fax : 91 172 504 6222
Plot No. 1
Kishangarh
Chandigarh 160 101
Tel. : 91 172 503 8000
Fax : 91 172 504 6860
Chennai
138 Old Mahabalipuram Road
Sholinganallur
Chennai 600 119
Tel. : 91 44 2450 9530
Fax : 91 44 2450 0390
Mahindra Industrial Park
TP 1 / 1, Central Avenue
Techno Park SEZ
Mahindra World City
Natham Sub Post, Chengelpet
Kancheepuram District
Chennai 603 002
Tel. : 91 44 4741 1111
Fax : 91 44 4741 5151
Hyderabad
Survey No. 210
Manikonda Village
Lingampally
Rangareddy (Dist.)
Hyderabad 500 032
Tel. : 91 40 6642 0000
Fax : 91 40 2300 5223
Mangalore
Kuloor Ferry Road, Kottara
Mangalore 575 006
Tel. : 91 824 245 1485
Fax : 91 824 245 1504
IT and ITeS SEZ
Kamblapadavu
Kurnad Post, Pajeeru Village
Bantwal Taluk 574 153
Dakshina Kannada (Dist.)
Tel. : 91 824 228 4492
Fax : 91 824 228 4491
Mumbai
85, C, Mittal Towers
8th Floor, Nariman Point
Mumbai 400 021
Tel. : 91 22 2284 6490
Fax : 91 22 2284 6489
Mysore
No. 350, Hebbal
Electronics City
Mysore 570 018
Tel. : 91 821 240 4101
Fax : 91 821 240 4200
New Delhi
K30, Green Park Main
Behind Green Park Market
New Delhi 110 016
Tel. : 91 11 2651 4829
Fax : 91 11 2685 3366
Pune
Plot No. 1, Rajiv Gandhi
Infotech Park,
Hinjawadi, Taluka Mulshi,
Pune 411 057
Tel. : 91 20 2293 2800
Fax : 91 20 2293 2832
Plot No. 24
Tel. : 91 20 3982 7000
Fax : 91 20 3982 8000
Thiruvananthapuram
3rd

Floor, Bhavani Technopark
Tel. : 91 471 398 2222
Fax : 91 471 270 0889
Plot No. 1,
Technopark Campus II,
Attipara Village
Tel. : 91 471 398 2222
Fax : 91 471 270 0889
North America
Canada
Calgary
Suite 1000, 888-3rd Street SW
Bankers Hall,West Tower
Calgary, AB T2P 5C5
Tel. : 1 403 444 6896
Fax : 1 403 444 6699
Toronto
5140 Yonge Street
Suite 1400 Toronto
Ontario, M2N 6L7
Tel. : 1 416 224 7400
Fax : 1 416 224 7449
United States
Atlanta
400 Galleria Parkway
Suite 1490, Atlanta
GA 30339
Tel. : 1 770 799 1860
Fax : 1 770 799 1861
Bellevue
3326 160th Avenue SE
Suite 300, Bellevue
WA 98008
Tel. : 1 425 256 6200
Fax : 1 425 256 6201
Bentonville
2700 SE S Street, Suite 200
Bentonville, AR 72712
Tel. : 1 479 271 4600
Fax : 1 479 271 4601
Bridgewater
Suite 101, Bridgewater
NJ 08807
Tel. : 1 908 450 8200
Fax : 1 908 450 8201
Global presence | 93
North America (contd.)
Charlotte
13777 Ballantyne Corporate PL
Suite 250, Charlotte, NC
28277
Tel. : 1 704 972 0320
Fax : 1 704 972 0311
Fremont
6607 Kaiser Drive
Fremont, CA 94555
Tel. : 1 510 742 3000
Fax : 1 510 742 3090
Hartford
95 Glastonbury Blvd
Glastonbury, CT 06033
Tel. : 1 860 494 4139
Fax : 1 860 494 4140
Houston
14800 St. Marys Lane
Suite 160, Houston
TX 77079
Tel. : 1 281 493 8698
Fax : 1 281 493 8601
Lake Forest
One Spectrum Pointe
Suite 350, Lake Forest
CA 92630
Tel. : 1 949 206 8400
Fax : 1 949 206 8499
Lisle
2300 Cabot Drive
Suite 250, Lisle
IL 60532
Tel. : 1 630 482 5000
Fax : 1 630 505 9144
Minneapolis
80 South, 8th Street
Suite 900
Minneapolis, MN 55402
Tel. : 1 612 349 5258
Fax : 1 510 248 2022
New York
630 Fifth Avenue
Suite 1600, Rockefeller Center
New York, NY 10111
Tel. : 1 646 254 3100
Fax : 1 646 254 3101
Phoenix
10835 N 25th Avenue
Suite 200, Phoenix
AZ 85029
Tel. : 1 480 655 3598
Fax : 1 480 655 3501
Plano
Suite 200, Plano
TX 75024
Tel. : 1 469 229 9400
Fax : 1 469 229 9598
Quincy
Two Adams Place
Quincy, MA 02169
Tel. : 1 781 356 3100
Fax : 1 781 356 3150
Reston
12021 Sunset Hills Road
Suite 340, Reston
VA 20190
Tel. : 1 703 234 3798
Fax : 1 703 234 3701
Southfield
3000 Town Center
Suite 2850
Southfield, MI 48075
Tel. : 1 248 603 4300
Fax : 1 248 208 3315
(Australia) Pty. Limited
Brisbane
Level 12, 259 Queen Street
Brisbane QLD 4000
Tel. : 61 7 3231 9800
Fax : 61 7 3231 9899
Melbourne
Level 5, 818 Bourke Street
Docklands VIC 3008
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2999
Melbourne (Lonsdale Street)
Level 21
150 Lonsdale Street
Melbourne VIC 3000
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2997
Perth
Level 18, Central Park Building
152-158 St. Georges Terrace,
Perth WA 6000
Tel. : 61 8 9288 1750
Fax : 61 8 9288 1753
Sydney
Level 3, 77 Pacific Highway
North Sydney NSW 20060
P. O. Box 1885
Tel. : 61 2 8912 1500
Fax : 61 2 8912 1555
New Zealand
Level 27, PWC Tower
188 Quay Street
Auckland New Zealand 1010
Tel. : 64 9 363 2700
Fax : 64 9 363 2727
Ltda
Brazil
Rua Da Paisagem, 220
Edificio Lumiere, Andar : 5 E 6
Vila Da Serra, Nova Lima
Minas Gerais - CEP
34.000-000-Brazil
Tel. : 55 31 33068900
Fax : 55 31 33068901
Company Limited
Beijing
No. 7 Guang Hua Road
Floor 28th
B1- 1 HanWei Building.
ChaoYang District
Beijing, China
Tel. : 010 57335000
Dalian
No. 1001-1006, No. 1 Hui
Xian Garden
Dalian Hi-Tech Industry Park
Dalian, China
Tel : 86 21 58843000
Fax : 86 21 58843001
Hangzhou
Bldg A2, No. 301 Binxing
Road Binjiang District
Hangzhou 310052
Tel. : 86 571 87930030
Fax : 86 571 87930001
Shanghai
Bldg A, No. 6, 3158 Long
Dong Road,
Shanghai 201203
Tel : 86 21 58843000
Fax : 86 21 58843006
Bldg 18,
1387 Zhang Dong Road,
Shanghai 201203
Tel : 86 21 58843000
Fax : 86 21 58843001
(Shanghai) Company Limited
Room 401, 501, Building Wu,
No. 555 Dong Chuan Road,
Min Hang District,
Shanghai, China
Tel : 86 21 58843000
Fax : 86 21 58843001
Infosys Technologies S. de R
L. de C. V.
Mexico
Ave. Acueducto No. 2610
4piso Col. Del Paseo
Residencial
Monterrey, N. L. C. P. 64920
Tel. : 521 81 1253 8400
Fax : 521 81 1253 8401
Corporativo Santa Maria
Boulevard Diaz
Ordaz Numero 130
Monterrey, Mexico CP 64650
Tel. : 521 81 8850 9300
Fax : 521 81 8850 9301
North America
Suite 200, Plano, TX 75024
Tel. : 1 469 229 9400
Fax : 1 469 229 9598
United Kingdom
14th and 15th Floor
Canary Wharf
London E 14 5NP
Tel. : 44 20 7715 3300
Fax : 44 20 7715 3301
Subsidiary of Infosys
Consulting, Inc.
Limited
Plot No. 26-A, Ground Floor
Electronic City, Hosur Road,
Bangalore 560 100
Tel : 91 80 6688 1144
Fax : 91 80 6688 2140
(Sweden)
AB Stureplan 4C, 4tr
114 35, Stockholm
Tel. : 46 8 463 1112
Fax : 46 8 463 1114
Infosys BPO Limited
Australia - Melbourne
Level 5, 818, Bourke Street
Docklands VIC 3008
P. O. Box 528
Collins Street West
Melbourne VIC 8007
Tel. : 61 3 9860 2000
Fax : 61 3 9860 2999
Canada - Toronto
5140, Yonge Street
Suite 1400
Toronto ON M2N 6L7
Tel. : 416 224 7400
Fax : 416 224 7449
India - Bangalore
Bangalore 560 100
Tel. : 91 80 2852 2405
Fax : 91 80 2852 2411
Pavithra Complex, No. 1
27th Main, 2nd Cross
1st Stage, BTM Layout
Bangalore 560 068
Tel. : 91 80 3021 3600
Fax : 91 80 4171 4808
Salarpuria Infozone
Wing A, No. 39 (P)
41 (P) and 42 (P)
Electronic City, Hosur Road
Bangalore 560100
Tel. : 91 80 4067 0035
Fax : 91 80 4067 0034
27, SJR Towers
Bannerghatta Road
J. P. Nagar, III Phase
Bangalore 560 078
Tel. : 91 80 5103 2000
Fax : 91 80 2658 8676
India - Chennai
Temple Steps 6th and 7th
Floor
No. 184, Annasalai Saidapet
Chennai 600 015
Tel. : 91 44 6600 7000
Fax : 91 44 6600 7005
India - Gurgaon
7th floor Tower A, B and C
Building No. 6
DLF Cyber City
Developer Limited
Sector 24 and 25 DLF PH-3
Gurgaon
Tel. : 91 124 4583 700
Fax : 91 124 4583 701
India - Jaipur
Plot No. E-142-143
Sitapura Industrial Area
Jaipur 302022
Tel. : 91 141 2771 325
Fax : 91 141 2771 325
IT-A-001
Mahindra World City
Village Kalwara
Tahsil Sanganer
Jaipur 302029
Tel. : 91 141 3956 000
Fax : 91 141 3956 100
India - Pune
Plot No. 1, Building No. 4
Pune Infotech Park
Hinjawadi, Taluka Mulshi
Pune 411 057
Tel. : 91 20 2293 2900
Fax : 91 20 2293 4540
Plot No. 24
Tel. : 91 20 2293 2800
Fax : 91 20 2293 4540
Philippines
2nd and 3rd Floor
Trade Hall Metro
Market, Bonifacio Global City
Fort Bonifacio Taguig City
Metro Manila, Philippines
Tel. : 632 856 3319
Fax : 632 856 3320
United Kingdom
14th Floor
Canary Wharf
London E14 5NP
Tel. : 44 20 7715 3388
Fax : 44 20 7715 3301
United States - Bridgewater
1st Floor, Bridgewater
NJ 08807
Tel. : 1 908 450 8209
Fax : 1 908 842 0284
BPO
Infosys BPO s.r.o
Czech Republic
Holandka 9,63900, Brno
Tel. : 420 542 212406
Fax : 420 543 236349
Infosys BPO Poland Sp.Z o.o.
Al. Pisudskiego 22 90-051
Lodz, Poland
Tel. : 48 42 291 8000
Fax : 48 42 291 8081
UL. Gdanska 47
90-729 Lodz, Poland
Tel. : 48 42 291 8205
Fax : 48 42 291 80 73
6425 Powers Ferry Road
3rd Floor
Atlanta, GA 30339
Tel. : 1 800 366 0819
Fax : 1 770 690 1800
Global presence
Creative concept and design by Communication Design Group, Infosys.
2011 Infosys Technologies Limited, Bangalore, India. Infosys acknowledges the proprietary rights in the trademarks and product names of other companies mentioned in the Annual Report.
142 | Notes
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30 years of Infosys
Annual Report 2010-11 Additional Information

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30 years of Infosys

Annual Report 2010-11

Open World and Sapphire. Our

/ average capital employed (%) 10.6 13.6 19.4 18.2 23.2

(6.9) (13.1) 47.8 7.7 37.8

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