1. Company overview
Infosys 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) Co. Limited (''Infosys
China''), Infosys Consulting India Limited (''Infosys Consulting
India''), 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''), Infosys
Technologies (Shanghai) Co. Limited (''Infosys Shanghai'') and
Lodestone Holding AG and its controlled subsidiaries (''Infosys
Lodestone''), is a leading global technology services corporation. The
Company provides business consulting, technology, engineering and
outsourcing services to help clients build tomorrow''s enterprise. In
addition, the Company offers software products for the banking
The abridged financial statements have been prepared pursuant to Rule
7A of the Companies (Central Government''s) General Rules and Forms,
1956 and are based on the annual accounts for the year ended March 31,
(Note 1 in the Notes to accounts of the annual standalone financial
2. Notes on accounts
Amounts in the abridged financial statements are presented in Rs.
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 13. All exact amounts are stated with
the suffix ''/-''. One crore equals 10 million.
The previous year''s figures have been regrouped / re-classified,
wherever necessary to conform to the current presentation.
(Note 2 in the Notes to accounts of the annual standalone financial
The Board, in its meeting on October 12, 2012, declared an interim
dividend of Rs. 15 per equity share. Further the Board, in its meeting
on April 12, 2013, proposed a final dividend of Rs. 27 per equity
share. The proposal is subject to the approval of shareholders at the
Annual General Meeting to be held on June 15, 2013. The total dividend
appropriation for the year ended March 31, 2013 amounted to Rs. 2,815
crore including corporate dividend tax of Rs. 403 crore.
During the year ended March 31, 2012, the amount of per share dividend
recognized as distributions to equity shareholders was Rs. 47. The
dividend for the year ended March 31, 2012 includes Rs. 22 per share of
final dividend, Rs. 15 per share of interim dividend and Rs. 10 per
share of special dividend - 10 years of Infosys BPO operations. The
total dividend appropriation amounted to Rs. 3,137 crore including
corporate dividend tax of Rs.438 crore.
(Note 2.1 in the Notes to accounts of the annual standalone financial
4. Investment in Lodestone Holding AG
On October 22, 2012, Infosys acquired 100% of the outstanding share
capital of Lodestone Holding AG, a global management consultancy firm
headquartered in Zurich, Switzerland. The acquisition was executed
through a share purchase agreement for an upfront cash consideration of
Rs. 1,187 crore and a deferred consideration of Rs. 608 crore.
The deferred consideration is payable to the selling shareholders of
Lodestone on the third anniversary of the acquisition date and is
contingent upon their continued employment for a period of three years.
The investment in Lodestone has been recorded at the acquisition cost
and the deferred consideration is being recognized on a proportionate
basis over a period of three years from the date of acquisition. An
amount of Rs. 50 crore and Rs. 85 crore,representing the proportionate
charge of the deferred consideration has been recognized as an expense
during the quarter ended March 31, 2013 and year ended March 31, 2013.
(Note 2.10.1 in the Notes to accounts of the annual standalone
Infosys guarantees the performance of certain contracts entered into by
List of key management personnel Whole-time Directors
S. Gopalakrishnan, S. D. Shibulal, Srinath Batni, V. Balakrishnan,
Ashok Vemuri, B. G. Srinivas.
Executive Council members
U. B. Pravin Rao, U. Ramadas Kamath, Chandrashekar Kakal, Nandita
Gurjar, Stephen R. Pratt, Basab Pradhan, Prasad Thrikutam, Rajiv Bansal
(effective November 1, 2012).
K. V. Kamath, Deepak M. Satwalekar, Dr. Omkar Goswami, David L. Boyles,
Sridar A. Iyengar (retired with effect from August 13, 2012), Prof.
Jeffrey S. Lehman, R. Seshasayee, Ann M. Fudge, Ravi Venkatesan.
During the year ended March 31, 2013, an amount of Rs. 10 crore (Rs. 20
crore for the year ended March 31, 2012) was donated to Infosys
Foundation, a not-for-profit foundation, in which certain Directors of
the Company are trustees.
5. Segment reporting
The Company''s operations predominantly relate to providing end-to-end
business solutions thereby enabling clients to enhance business
performance, delivered to customers globally operating in various
industry segments. Effective quarter ended June 30, 2011, the Company
reorganized its business to increase its client focus. Consequent to
the internal reorganization there were changes effected in the
reportable segments based on the ''management approach'', as laid
down in AS 17, Segment reporting. The Chief Executive Officer evaluates
the Company''s 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, industry being the primary segment. 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 Group are primarily Financial Services and
Insurance (FSI) comprising enterprises providing banking, finance and
insurance services, enterprises in Manufacturing (MFG), enterprises in
the Energy, Utilities, Communications and Services (ECS) and
enterprises in Retail, Consumer Packaged Goods, Logistics and Life
Sciences (RCL). Geographic segmentation is based on business sourced
from that geographic region and delivered from both onsite and
offshore. North America comprises the U.S., Canada and Mexico, Europe
includes continental Europe (both the east and the west), Ireland and
the U.K., and the Rest of the World comprising all other places except
those mentioned above and India. Consequent to the above change in the
composition of reportable segments, the prior year comparatives have
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 Company''s offshore software development
centers and onsite 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. The 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 Company''s 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. Geographical information on revenue and industry
revenue information are collated based on individual customers invoiced
or in relation to which the revenue is otherwise recognized.
(Note 2.27 in the Notes to accounts of the annual standalone financial
6. Exceptional item
During the years ended March 31, 2013 and March 31, 2012, the Company
received dividend of Rs. 83 crore and Rs. 578 crore (presented net of
taxes in the previous year) respectively from its wholly-owned
subsidiary Infosys Australia. The tax on dividend received for the
years ended March 31, 2013 and March 31, 2012 was Rs. 14 crore and Rs.
94 crore, respectively
(Note 2.36 in the Notes to accounts of the annual standalone financial
On May 23, 2011, we received a subpoena from a grand jury in the U.S.
District Court for the Eastern District of Texas. The subpoena requires
that we provide to the grand jury certain documents and records related
to our sponsorships for, and uses of, B1 business visas. We are
complying with the subpoena. In connection with the subpoena, during a
meeting with the U.S. Attorney''s Office for the Eastern District of
Texas, we were advised that we and certain of our employees are targets
of the investigation. We are engaged in discussions with the U.S.
Attorney''s Office regarding this matter, however, we cannot predict the
outcome of such discussions.
In addition, the U.S. Department of Homeland Security (DHS) has
reviewed our employer eligibility verifications on Form I-9 with
respect to our employees working in the U.S. In connection with this
review, we have been advised that the DHS has found errors in a
significant percentage of our Forms I-9 that the Department has
reviewed, and may impose fines and penalties on us related to such
alleged errors. At this time, we cannot predict the outcome of the
discussions with the DHS or other governmental authority regarding the
review of our Forms I-9.
In light of the fact that, among other things, the foregoing
investigation and review may not be complete and we remain in
discussions with the U.S. Attorney''s Office regarding these matters, we
are unable to make an estimate of the amount or range of loss that we
expect to incur in connection with the resolution of these matters.
Further, in the event that any governmental authority undertakes any
actions that limit any visa program that we utilize or imposes
sanctions, fines or penalties on us or our employees, this could
materially and adversely affect our business, results of operations,
and financial condition.
(Note 2.34 in the Notes to accounts of the annual standalone financial