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 Company's Board of Directors.
Operating profit for the Group is computed considering the revenues, net of cost of sales, selling and marketing expenses and administrative expenses.
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.
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 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 net profit in the statement of comprehensive income over the lease term.
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.
Cash and cash equivalents consist of the following:
As of March 31, |
||
2010 | 2009 | |
Cash and bank deposits | 10,556 | 9,695 |
Deposits with corporations | 1,555 | 1,298 |
12,111 | 10,993 |
Cash and cash equivalents as of March 31, 2010 include restricted cash and bank balances of Rs. 71 crore. The restricted cash and bank balances as of March 31, 2009 was Rs. 2 crore. 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The deposits maintained by the Group with corporations comprise of time deposits, which can be withdrawn by the Group at any point without prior notice or penalty on the principal.
The table below provides details of cash and cash equivalents:
As of March 31, |
||
2010 | 2009 | |
Current Accounts | ||
ABN Amro Bank, China | 33 | 6 |
ABN Amro Bank, China (U.S. dollar account) | 14 | 14 |
ABN Amro Bank, Taiwan | 2 | 1 |
Bank of America, Mexico | 18 | 2 |
Bank of America, USA | 686 | 587 |
Banamex , Mexico | 2 | – |
China Merchants Bank, China | 1 | – |
Citibank NA, Australia | 25 | 33 |
Citibank NA, Brazil | 9 | – |
Citibank NA, Czech Republic (Euro account) | 2 | 3 |
Citibank NA, Czech Republic (U.S. dollar account) | – | 4 |
Citibank NA, New Zealand | 1 | – |
Citibank NA, Japan | 2 | 2 |
Citibank NA, Singapore | – | 7 |
Citibank NA, India | 2 | – |
Citibank NA, Thailand | 1 | 1 |
Citibank-Unclaimed dividend account | – | 1 |
Deustche Bank | 13 | 13 |
Deutsche Bank, Belgium | 18 | 6 |
Deutsche Bank, Poland | 2 | – |
Deutsche Bank, France | 1 | 1 |
Deutsche Bank, Germany | 12 | 5 |
Deutsche Bank, Moscow (U.S. dollar account) | 1 | – |
Deutsche Bank, Netherlands | 7 | 1 |
Deustche Bank, Philiphines | – | 1 |
Deustche Bank, Philiphines (U.S. dollar account) | 3 | 1 |
Deustche Bank, Poland (Euro account) | 1 | – |
Deutsche Bank, Spain | 1 | 1 |
Deutsche Bank, Singapore | 1 | – |
Deutsche Bank, Switzerland | 10 | – |
Deutsche Bank, Switzerland (U.S. dollar account) | 1 | – |
Deustche Bank, Thailand | 3 | 2 |
Deustche Bank, Thailand (U.S. dollar account) | 1 | – |
Deutsche Bank, UK | 29 | 58 |
Deustche Bank-EEFC (Euro account) | 3 | 27 |
Deustche Bank-EEFC (Swiss Franc account) | – | 3 |
Deutsche Bank-EEFC (United Kingdom Pound Sterling account) | 1 | – |
Deustche Bank-EEFC (U.S. dollar account) | 8 | 12 |
HSBC Bank, UK | 2 | 8 |
HDFC Bank-Unclaimed dividend account | 1 | - |
ICICI Bank | 133 | 18 |
ICICI Bank, UK | 1 | – |
ICICI Bank-EEFC (Euro account) | 1 | 1 |
ICICI Bank-EEFC (United Kingdom Pound Sterling account) | 2 | 6 |
ICICI Bank-EEFC (U.S. dollar account) | 10 | 42 |
ICICI bank-Unclaimed dividend account | 1 | 1 |
National Australia Bank Limited, Australia | 21 | 30 |
National Australia Bank Limited, Australia (U.S. dollar account) | 14 | 7 |
Nordbanken, Sweden | 1 | – |
Royal Bank of Canada, Canada | 20 | 6 |
The Bank of Tokyo-Mitsubishi UFJ,Ltd.,Japan | – | 1 |
Wachovia Bank, USA | 7 | – |
1,128 | 912 | |
Deposit Accounts | ||
Andhra Bank | 99 | 80 |
Allahabad Bank | 150 | – |
Bank of Baroda | 299 | 829 |
Bank of India | 881 | – |
Bank of Maharashtra | 500 | 537 |
Barclays Bank | 100 | 140 |
Canara Bank | 963 | 794 |
Central Bank of India | 100 | – |
Corporation Bank | 276 | 343 |
Citibank NA, Czech Republic | 9 | 4 |
Citibank (Euro account) | 3 | – |
Citibank (U.S. dollar account) | 4 | – |
Deustche Bank, Poland | 8 | – |
DBS Bank | 49 | 25 |
HSBC Bank | 483 | 283 |
ICICI Bank | 1,435 | 560 |
IDBI Bank | 909 | 550 |
ING Vysya Bank | 25 | 53 |
Indian Overseas Bank | 140 | – |
Jammu and Kashmir Bank | 10 | – |
Kotak Mahindra Bank | 61 | – |
Oriental Bank of Commerce | 100 | – |
Punjab National Bank | 994 | 480 |
Standard Chartered Bank | – | 38 |
State Bank of Hyderabad | 233 | 200 |
State Bank of India | 126 | 2,109 |
State Bank of Mysore | 496 | 500 |
Syndicate Bank | 475 | 500 |
The Bank of Nova Scotia | – | 350 |
Union Bank of India | 93 | 85 |
Vijaya Bank | 95 | 95 |
National Australia Bank Limited, Australia | 312 | 228 |
9,428 | 8,783 | |
Deposits with corporations | ||
HDFC Limited, India | 1,551 | 1,298 |
Sundaram BNP Paribus Home Finance Limited | 4 | – |
1,555 | 1,298 | |
Total | 12,111 | 10,993 |
Investments in liquid mutual fund units and unlisted equity instruments are classified as available-for-sale financial assets.
Investment in liquid mutual fund units is as follows:
As of March 31, |
||
2010 | 2009 | |
Cost and fair value | 2,518 | - |
Investment in unlisted equity instruments is as follows:
As of March 31, |
||
2010 | 2009 | |
Cost | 4 | - |
Gross unrealised holding gains | 34 | - |
Fair value | 38 | - |
During February 2010, Infosys sold 3,231,151 shares of OnMobile Systems Inc, U.S.A, at a price of Rs. 166.58 per share, derived from quoted prices of the underlying marketable equity instruments. The total consideration amounted to Rs. 53 crore, net of taxes and transaction costs. The resultant income of Rs. 48 crore is included in other income. Additionally the remaining 2,154,100 shares have been fair valued at Rs. 38 crore and the resultant unrealized gain of Rs. 26 crore, net of taxes of Rs. 8 crore has been recognized in other comprehensive income. The fair value of Rs. 38 crore has been derived based on an agreed upon exchange ratio between these unlisted equity instruments and quoted prices of the underlying marketable equity instruments.