An Analysis of IT Companies Before During and After Recession

CONTENT
CHAPTER 1
INTRODUCTION
CHAPTER 2
REVIEW LITERATURE
CHAPTER.3
3.1PRIMARY OBJECTIVE
3.2SECONDARY OBJECTIVE
CHAPTER 4
METHODLOGY
CHAPTER 5
WORK DONE
CHAPER 6
FINACIAL STATEMENTS
CHAPTER 7
LIMITATIONS
CHAPTER 8
FINDING AND SUGGESIONS
CHAPTER 9
REFERENCE
1
1 INTRODUCTION
At regular period Information Technology companies must prepare

documents called financial statements. Financial statements show the
financial performance of a company. They are used for both internal-, and
external purposes. When they are used internally, the management and
sometimes the employees use it for their own information. Managers use it to
plan ahead and set goals for upcoming periods. When they use the financial
statements that were published, the management can compare them with
their internally used financial statements. They can also use their own and
other enterprises’ financial statements for comparison with macro
economical data and forecasts, as well as to the market and industry in which
they operate in.
The four main types are balance sheets, profit and loss accounts, cash flow
statements, and income statements.
Balance sheets
Balance sheets provide the observant with a clear picture of the financial
condition of the company as a whole. It lists in detail the tangible and the
intangible goods that the company owns or owes. These good can be broken
further down into three main categories; the assets, the liabilities and the
shareholder’s equity
Assets: assets include anything that the company actually owns and has
disposal over. Examples of the assets of a company are its cash, lands,
buildings, and real estates, equipment, machinery, furniture, patents and
trademarks, and money owed by certain individuals or/and other businesses
to the particular company. Assets that are owed to the company are referred
to as accounts-, or notes receivables.
- Current Assets include anything that companies can quickly monetise.

Such current assets include cash, government securities, marketable
securities, accounts receivable, notes receivable (other than from officers or
employees), inventories, prepaid expenses, and any other item that could be
converted into cash within one year in the normal course of business.
2
- Fixed Assets are long-term investments of the company, such as land,
plant, equipment, machinery, leasehold improvements, furniture, fixtures,
and any other items with an expected useful business life usually measured
in a number of years or decades (as opposed to assets that wear out or are
used up in less than one year. Fixed assets are usually accounted as
expensed upon their purchase. They are normally not for resale and are
recorded in the Balance Sheet at their net cost less (less is accounting term
for minus) accumulated depreciation.
Other Assets include any intangible assets, such as patents, copyrights,

other intelectual property, royalties, exclusive contracts, and notes
receivable from officers and employees.
Liabilities
Liabilities are money or goods acquired from individuals, and/or other

corporate entities. Some examples of liabilities would be loans, sale of
property, or services to the company on credit. Creditors (those that loan to
the company) do not receive ownership in the business, only a (usually
written) promise that their loans will be paid back according to the term
agreed upon.
Current Liabilities are accounts-, and notes-, taxes payable to financial

institutions, accrued expenses (eg.: wages, salaries), current payment (due
within one year) of long-term debts, and other obligations to creditors due
within one year.
Long-Term Liabilities are mortgages, intermediate and long-term loans,

equipment loans, and other payment obligation due to a creditor of the
company. Long-term liabilities are due to be played in more than one year.
Shareholder’s equity (or net worth, or capital)
The shareholder’s equity is money or other forms of assets invested into the
business by the owner, or owners, to acquire assets and to start the
business. Any net profits that are not paid out in form of dividends to the
owner, or owners, are also added to the shareholder’s equity. Losses during
the operation of the business are subtracted from the shareholder’s equity.
Assets are calculated the following way:
3
Assets=Liabilities + Net worth
Balance sheets show how the assets, liabilities, and the net worth of a
business are distributed. They usually are prepared at set periods of time, for
example at the end of each quarter. It is always prepared at the end of fiscal
years.
The periodic preparation of the balance sheets, the owner and/or the
manager of the company can see historic-, and current trends andalsothe
general performance of the corporation. It allows decision makers to make
adjustments when needed, like the proportion of liabilities to assets.
All balance sheets contain the same categories of assets, liabilities and net
worth figures. Assets are arranged in decreasing order of their liquidity .
Liabilities are listed in order of how soon they must be repaid, followed by
retained earnings (net worth of owner’s equity).
The categories and formats of Balance Sheets are established by a system

known as Generally Accepted Accounting Principles (GAAP). The system is
applied to all companies, large or small, so anyone reading the Balance
Sheets can readily understand what it is saying.
Profit and Loss Account
Profit and loss accounts summarize the incomes and expenses of a company
in a given period of time. It also includes accruals too, which are incomes that
will be realized only after the particular Profit and Loss Account statement
was prepared.
Cash flow statements
These statements show how money is predicted to move around (hence the
phrase cash flow) at a given period of time. It is useful for planning future
expenses. It shows whether or not there will be enough money to carry out
the planned activities and whether or not the cash coming in are enough to
cover the expenses. The cash flow statement is useful in the determination of
the company’s liquidity in a given period of time.
Income statements
Income statements measure the company’s sales and expenses over a

specific period of time. They are prepared each month and fiscal year end.
4
Income statements show the results of operating during those accounting
periods. They are also prepared using the Generally Accepted Accounting
Principles (GAAP) and contain specific revenue and expense categories
regardless of the nature of the company.
2 REVIEW OF LITERATURE
Various literatures are reviewed to guide the study. These are

subsumed under headings such as theoretical literature, empirical
literature, summary of literatures review and value added.
2.1 Theoretical literature

This section consists of the concept of InformationTechnology, types,
applications and importance of information technology.
2.1.1 The concept of InformationTechnology (IT) in the emerging electronics

complex industrial sector, InformationTechnology forms part of a
constellation of industries which consist of various sub groups such as
semi conductors, computer components, telecommunications,
consumer electronic and office devices. It is the product of advances in
key areas of computing, telecommunications and microelectronics.
(Martin; 1988). Zijp (1994) described it as telecommunications and
computer-based technology. According to Hanna (1994).
InformationTechnology covers all activities and technologies which
involves the handling of information by electronic means. This
includes information acquisition, storage, retrieval, processing,
transmission and control. According to her, it includes the supply side
(which deals with computer hardware and software,
telecommunications equipment and micro electronics) and the demand
side (which includes applications of information technology of all
sectors including financial. manufacturing, education, transaction
system. management information systems, electronic publishing and
information services). hence InformationTechnology refers to the
5
acquisition, processing, storage, dissemination and use of vocal,
pITorial , textual and numerical information by a microelectronics
based combination of computing and telecommunications.
2.1.2 Types and applications of InformationTechnology

There are multifarious types of information technology with extensive
applications in various sectors. Some of the commonest types are as
follows:
i) Compact disc read only memory (CD ROM): This requires a micro
computer with a CD ROM drive, discs and electricity. It is basically
used as a reference tool.
ii) Computer Networks: This refers to computers at different location

linkedtomodern and to telecommunications networks. It is basically
used to link locations with typed messages and link users to sources of
data.
iii) Desktop Publishing: This makes use of microcomputers,

Laserprinter,software and electricity for the production of high quality
texts and graphics.
iv) Expert systems; This consists of the use of micro computer with expert
system software and electricity. It is used for training and provision of
expert advice to less experienced users.
v) Geographic information system (GIS): this types of information

technology uses micro computer, ink jet printers or equivalent, GIS
software, digitizing tablet and electricity. Its applications are for data
organization and comparisons on geographic areas and for land use
planning and environmental impact assessment.
vi) Interactive video disc (IVD): This is used mainly for pITorial and verbal
6
communication. Its involves a combination of a micro computer with
internal video board linked to video disc player and speaker.
vii) Packet radio: It utilizes a micro computer, radio with modern antenna
and access to satellite link for link groups with poor communication to
others
viii) Radio and interactive radio: This requires the use of radio, radio
broadcasting station, broadcast materials for mass communication
and training purposes.
ix) Video technology: This makes use Video camera and tapes, editing
equipment, projectors and television to enables small groups
produce powerful visual materials
x) Satellite communication: This consists of a satellite dish for low

orbiting satellite (LEOS) and for geostationary orbiting satellite
(GEOS). It uses a satellite channel, user terminal and electricity for
access to television broadcasts, distance education, remote sensing
transmission of video pITures, life events, texts, graphics, etc.
2.1.3 The importance of InformationTechnology. We are currently in the

information age. According to the United Nations Center for S&T, the
distinction between information have and the basis for the
dichotomies between developed and developing, rich and poor; it is
within this context that the concept of development might be
understood in information terms. A synthesis of the works or Wellenius
(1995) and Hanna (1996) shows that IT accounts for a great
percentage of GNP. In the United States of America, more than 46% of
GNP and 53% of labor income are related to knowledge, information
and communication. In many other countries such as countries within
the organization for economic co-operation and development (OECD),
the information sector accounts for between one third to half of Gross
Domestic Product (GDP) and employment Wellenius (1994) noted that
7
by the year 2000 this sector is expected to grow the 60% of the
European community GDP.
The information sector is taking up such a large percentage of GDP

because the abundance of cheap labor and raw material is no longer
adequate for global competition. According to Hanna (1994)
information, flexibility, product quality and fast response are the key
new factors required and IT plays a critical role in these areas. Anotholt
(1993) has declared that information is just as important as a
production factor like lank, labor and capital. Adeola (1995) has
commended on the implications of the new General Agreement on
Trade and Tariffs (GATT) - the product of Uruguay round of multilateral
trade negotiations. According to her:
Effective communication links and computerized system are a sine qua

non for high quality service delivery. With instantaneous access to
information, indentified shortage in markets are quickly disseminated
throughout a global network, thereby ensuring efficiency,
competitiveness, strengthening of domestic services quality.
This agrees with Hanna (1994) who stipulated the importance of
information technology as follows:
1) It enhances access to global knowledge, markets and capital.

2) It is critical tool for competition in an information intensive
economy.
3) It transforms the way people do things
4) It increase the amount of information available to economic
agents
5) It increase information intensity of processes, occupations,
institutions, products and economics
6) It reduces transaction and coordination costs within and across
institutions.
Apex technology (1996) in his work stipulated that the use of
InformationTechnology is advantages because it develops a continuity
8
of thoughts especially for motion It also stimulates self activity for
pupils through the provision of realities of experience, makes learning
more permanent and kindles student's interest in subjects. It also
supplies meaningless word responses by pupils. noted that information
is the life blood of any form of education. according to him, any
problems cause by an exponential growth in information are offset by
the benefits of InformationTechnology to educational development.
Such benefits refer to marked increase in the amount of information
learning and enhancing of understanding. The essential significance of
Information technology lies in the role as a change agent, creator of
possibilities: and an enabling and liberating presence in our midst
which changes the relationship between learning and leisure.(Martin:
1988). According to craig (1984): "although it will be some time before
the full potential of IT is realized, the advantages are apparent and
include exposure to new ideas, experiences, development of logical
thinking and reasoning abilities, support for training in new skills such
as programming remedial activity and stimulation of real life
situations."
In summary, InformationTechnology is profoundly transforming

competitive strategies, product development, manufacturing processes
and procurement practices. It is upon this premise that Martin (1988)
stated emphatically that, "no important field of endeavor remains
immune to the influence of information technology and no corner of
life its left undisturbed at its short coming." The transformations
achieved by InformationTechnology according to Hanna (1994) induces
managerial and organizational innovations, new businesses practices
such as sourcing, de-layering, time based competition, just in time
procurement and flexible manufacturing. According to Gbade (1990)
and Antonello (1990) information communication technolo1gy is an
enabling technology, which blends traditional industrial structures,
based on small firms with trends towards quality enhancement. This is
because the success and efficiency of firms surely depends on timely
access to information.
9
2.2 Empirical Literature
Various empirical studies on information technology and its impact on
sectors in various countries have been conducted over the years.
Strassman (1990) studied the statistical correlation between IT
spending and profitability or stock value. He discovered that the
correlation between these two factors was insignificant which implies
that IT spending is unproductive. Morrison and Bernt (1991) compared
the marginal benefits of investment in InformationTechnology with the
marginal costs for the manufacturing industry. They discovered that
for each additional dollar spent in information technology equipment,
the marginal increase in measured output was only eighty cents.
3.1 PRIMARY OBJECTIVE:
To study the performance, achievements and problems of IT sector
3.2 SECONDARY OBJECTIVES
1. Analysis of the each item of financial statements with previous year

data using ratios and interpreting the same.
2. Identify the performance of the company year by year and item by

item
10
4 METHODOLOGY
For analyzing the financial statements the following ratios used to find out
the financial position of the companies
1. Per share Ratios
2. Profitability Ratios
3. Leverage Ratios
4. Liquidity Ratios
5. Payout Ratios
6. Coverage Ratios
7. Component Ratios
11
5. WORK DONE
Collection of 5 years Audited financial statements of 10 leading

IT companies. The list of the same is given under
1. Wipro Ltd
2. Aptech Ltd
3. Financial Technologies India Ltd
4. HCL Technologies Ltd
5. Infosys Technologies Ltd
6. IQ Infotech Ltd – Research Centre
7. Moser Baer India Ltd – Research Centre
8. Polaris Software Lab Ltd
9. Satyam Computer Service Ltd
10. TATA consultancy Service Ltd
Analyze the above financial statements with the help of Ratios and
interpreting the same.
12
6 FINANCIAL STATEMENTS
APTECH LTD Balance sheet Rs in Cr

Dec ‘ 09 Dec ' 08 Dec ' 07 Dec ' 06 Dec ' 05
Sources of funds
Owner's fund
Equity share capital 46.50 43.75 37.89 37.64 33.51
Share application money 0.14 3.61 8.14 2.02 0.01
Preference share capital - - - - -
Reserves & surplus 117.25 81.98 38.22 44.25 61.59
Loan funds
Secured loans 18.94 17.21 20.13 25.53 22.01
Unsecured loans - - - - -
Total 182.84 146.55 104.38 109.44 117.12
Uses of funds
Fixed assets
Gross block 75.27 116.21 103.75 101.00 101.61
Less : revaluation reserve - - - - -
Less : accumulated depreciation 36.76 79.07 66.98 55.01 27.64
Net block 38.50 37.13 36.78 45.99 73.97
Capital work-in-progress 0.28 4.15 0.11 - -
13
Investments 26.32 34.51 11.27 2.86 5.97
Net current assets
Current assets, loans & advances 181.13 137.32 139.13 144.99 153.04
Less : current liabilities & provisions 63.39 66.55 82.91 84.40 115.86
Total net current assets 117.74 70.76 56.22 60.59 37.18
Miscellaneous expenses not written - - - - -
Total 182.84 146.55 104.38 109.44 117.12
Notes:
Book value of unquoted investments 26.32 34.51 11.27 2.86 5.97
Market value of quoted investments - - - - -
Contingent liabilities 18.75 17.61 16.66 17.67 13.50
Number of equity sharesoutstanding (Lacs) 465.02 437.51 378.87 376.36 335.09
Profit loss account-Rs in Cr

Income
Operating income 112.99 99.26 81.21 100.28 99.71
Expenses
Material consumed - - - - -
Manufacturing expenses 34.78 34.25 33.20 42.42 29.57
Personnel expenses 23.79 19.68 18.42 11.85 15.26
Selling expenses 25.97 11.20 7.24 3.18 3.10
Adminstrative expenses 26.20 18.95 17.10 52.45 59.58
Expenses capitalised - - - - -
Cost of sales 110.74 84.08 75.97 109.91 107.51
Operating profit 2.25 15.18 5.24 -9.62 -7.80
Other recurring income 1.39 0.69 3.23 12.75 5.76
Adjusted PBDIT 3.65 15.87 8.47 3.12 -2.04
Financial expenses 1.28 2.34 2.51 6.01 3.18
Depreciation 13.07 12.19 12.58 19.51 17.17
Other write offs - - - - -
Adjusted PBT -10.71 1.34 -6.62 -22.40 -22.39
Tax charges -21.34 0.66 0.58 0.42 -1.28
Adjusted PAT 10.63 0.68 -7.19 -22.82 -21.11
14
Non recurring items -6.47 0.40 -0.18 -10.69 -40.55
Other non cash adjustments 0.59 1.38 0.64 1.27 0.39
Reported net profit 4.75 2.46 -6.74 -32.23 -61.27
Earnigs before appropriation 7.12 -36.51 -38.97 -32.23 -28.03
Equity dividend - - - - -
Preference dividend - - - - -
Dividend tax - - - - -
Retained earnings 7.12 -36.51 -38.97 -32.23 -28.03
Ratios
Per share ratios
Adjusted EPS (Rs) 2.29 0.15 -1.90 -6.06 -6.30
Adjusted cash EPS (Rs) 5.10 2.94 1.42 -0.87 -1.18
Reported EPS (Rs) 1.02 0.56 -1.78 -8.56 -18.28
Reported cash EPS (Rs) 3.83 3.35 1.54 -3.38 -13.16
Dividend per share - - - - -
Operating profit per share (Rs) 0.48 3.47 1.38 -2.56 -2.33
Book value (excl rev res) per share (Rs) - 28.74 20.09 21.76 28.38
Book value (incl rev res) per share (Rs.) - 28.74 20.09 21.76 28.38
Net operating income per share (Rs) 24.30 22.69 21.44 26.65 29.76
Free reserves per share (Rs) 22.33 16.00 7.59 9.09 15.33
Profitability ratios
Operating margin (%) 1.99 15.28 6.45 -9.59 -7.81
Gross profit margin (%) -9.57 3.00 -9.03 -29.05 -25.03
Net profit margin (%) 4.15 2.45 -7.97 -28.51 -58.08
Adjusted cash margin (%) 20.72 12.87 6.37 -2.92 -3.73
Adjusted return on net worth (%) 6.48 0.53 -9.45 -27.86 -22.19
Reported return on net worth (%) 2.90 1.95 -8.85 -39.36 -64.41
Return on long term funds (%) -5.74 2.81 -4.63 -15.84 -18.82
Leverage ratios
Long term debt / Equity - 0.03 0.16 0.26 0.07
Total debt/equity 0.11 0.13 0.26 0.31 0.23
Owners fund as % of total source 89.63 87.96 79.08 76.22 81.20
Fixed assets turnover ratio 2.82 1.12 1.01 1.25 1.21
15
Liquidity ratios
Current ratio 2.86 2.06 1.68 1.72 1.32
Current ratio (inc. st loans) 1.80 1.51 1.42 1.57 1.05
Quick ratio 2.48 2.03 1.66 1.70 1.22
Inventory turnover ratio 61.39 51.40 50.58 82.66 78.42
Payout ratios
Dividend payout ratio (net profit) - - - - -
Dividend payout ratio (cash profit) - - - - -
Earning retention ratio 100.00 100.00 - - -
Cash earnings retention ratio 100.00 100.00 100.00 - -
Coverage ratios
Adjusted cash flow time total debt 0.79 1.34 3.74 - -
Financial charges coverage ratio 2.84 6.79 3.38 0.51 -0.64
Fin. charges cov.ratio (post tax) 14.89 7.27 3.33 -1.12 -12.87
Component ratios
Material cost component (% earnings) - - - - -
Selling cost Component 22.98 11.28 8.92 3.17 3.11
Exports as percent of total sales 17.79 14.96 18.35 40.47 20.33
Import comp. in raw mat. consumed - - - - -
Long term assets / total Assets 0.14 0.25 0.15 0.16 0.28
Bonus component in equity capital (%) - - - - -
16
Financial Technologies (India) Ltd
Balance sheet-Rs in Cr
Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06
Sources of funds
Owner's fund
Share application money - - - - -
Reserves & surplus 1,705.26 1,460.20 189.84 142.22 129.85
Loan funds
Secured loans - - - - -
Unsecured loans 461.10 399.45 434.42 - -
Total 2,175.54 1,868.83 633.08 151.02 138.65
Uses of funds
Fixed assets
Gross block 67.80 45.80 23.20 12.86 9.91
Net block 53.17 38.05 17.34 8.36 6.40
Capital work-in-progress 230.94 169.21 51.72 0.82 -
Investments 1,444.47 1,374.33 414.38 160.25 123.23
Net current assets
Total net current assets 446.96 287.24 149.63 -18.40 9.02
Total 2,175.54 1,868.83 633.08 151.02 138.65
Notes:
Book value of unquoted investments 1,442.62 1,374.33 412.64 160.25 123.23
Market value of quoted investments 1.85 - - - -
17
Number of equity sharesoutstanding
458.84 458.84 440.95 440.09 440.09
(Lacs)

Income
Expenses
Material consumed 8.68 4.54 2.35 - -
Cost of sales 169.56 86.44 55.30 31.74 18.06
Operating profit 164.76 51.12 43.53 58.94 13.89
Adjusted PBDIT 253.50 112.02 110.00 63.52 14.82
Financial expenses 0.14 10.93 0.28 - -
Depreciation 7.24 2.35 1.54 1.13 0.98
Adjusted PBT 246.12 98.74 108.19 62.38 13.84
Tax charges 101.99 280.29 17.88 14.90 3.48
Adjusted PAT 144.13 -181.55 90.31 47.48 10.36
Non recurring items 218.70 1,142.81 10.30 -1.04 -0.48
Other non cash adjustments 5.76 - - -3.98 -0.57
Reported net profit 368.60 961.25 100.61 42.47 9.31
Earnigs before appropriation 1,200.14 1,035.59 125.38 59.88 20.17
Equity dividend 45.88 91.50 35.26 26.41 1.76
Dividend tax 7.80 15.55 5.68 3.70 0.25
Retained earnings 1,146.46 928.54 84.44 29.77 18.16
18
Ratios
Per share ratios
Adjusted EPS (Rs) 31.41 -39.57 20.48 10.79 2.35
Adjusted cash EPS (Rs) 32.99 -39.06 20.83 11.05 2.58
Reported EPS (Rs) 80.33 209.50 22.45 10.59 2.25
Reported cash EPS (Rs) 81.91 210.01 22.79 10.85 2.48
Dividend per share 10.00 20.00 8.00 6.00 0.40
Operating profit per share (Rs) 35.91 11.14 9.87 13.39 3.16
Book value (excl rev res) per share
15.54 48.17 45.05 34.32 31.51
(Rs)
Book value (incl rev res) per share
15.54 48.17 45.05 34.32 31.51
(Rs.)
Operating margin (%) 49.28 37.16 44.04 64.99 43.47
Gross profit margin (%) 47.11 35.45 42.48 63.74 40.40
Net profit margin (%) 87.12 484.36 59.87 48.91 30.14
Adjusted cash margin (%) 35.78 -90.29 55.56 51.03 34.48
Adjusted return on net worth (%) 8.40 -12.35 45.46 31.44 7.46
Reported return on net worth (%) 21.49 65.41 49.81 30.85 7.14
Return on long term funds (%) 11.31 5.86 17.13 41.30 9.97
Leverage ratios
Long term debt / Equity 0.26 0.27 2.19 - -
Total debt/equity 0.26 0.27 2.19 - -
Liquidity ratios
Current ratio 3.21 3.21 2.98 0.74 1.64
Quick ratio 3.18 3.17 2.95 0.71 1.61
Inventory turnover ratio - 3,667.00 - - -
Payout ratios
Dividend payout ratio (net profit) 14.56 11.13 41.36 64.61 20.24
Dividend payout ratio (cash profit) 14.28 11.10 40.73 63.08 18.42
19
Earning retention ratio 62.76 158.96 54.67 36.59 80.62
Cash earnings retention ratio 64.54 88.97 55.43 38.07 82.30
Coverage ratios
Adjusted cash flow time total debt 3.05 0.41 4.73 - -
Financial charges coverage ratio 1,814.04 10.25 395.36 20,394.65 40,857.32
Fin. charges cov.ratio (post tax) 2,690.49 89.15 362.23 15,326.25 30,040.15
Component ratios
Material cost component (% earnings) 2.58 3.32 2.37 - -
Bonus component in equity capital
- - - - -
(%)
HCL Technologies Ltd

Jun ' 10 Jun ' 09 Jun ' 08 Jun ' 07 Jun ' 06
Sources of funds
Owner's fund
20
Share application money 0.47 1.71 - 1.33 1.64
Reserves & surplus 3,353.72 3,079.85 3,292.28 2,511.18 2,796.14
Loan funds
Secured loans 123.81 25.24 40.77 13.17 96.42
Unsecured loans 389.92 0.09 0.12 0.21 0.27
Total 4,001.97 3,240.16 3,465.91 2,590.58 2,958.31
Uses of funds
Fixed assets
Gross block 1,957.86 1,599.61 1,332.67 1,014.08 632.06
Less : accumulated depreciation 1,100.88 874.32 662.58 488.40 272.11
Net block 856.98 725.29 670.09 525.68 359.95
Capital work-in-progress 417.56 419.03 212.86 163.63 71.78
Investments 562.75 1,797.34 1,988.86 1,907.76 2,654.66
Net current assets
Current assets, loans & advances 4,760.07 2,850.89 2,027.86 1,128.61 556.96
Less : current liabilities & provisions 2,595.39 2,552.39 1,433.76 1,135.10 685.04
Total net current assets 2,164.68 298.50 594.10 -6.49 -128.08
Total 4,001.97 3,240.16 3,465.91 2,590.58 2,958.31
Notes:
Book value of unquoted investments 562.75 1,797.34 1,988.86 1,323.33 2,622.08
Market value of quoted investments - - - 10.11 33.26
Contingent liabilities 3,317.46 469.36 418.65 331.01 511.56
6702.57 6663.40 6636.83 3234.42 3192.15
(Lacs)

Income
Operating income 4,675.09 4,615.39 3,768.62 3,032.92 1,447.01
21
Expenses
Personnel expenses 1,874.10 1,621.35 1,322.59 1,123.51 488.54
Cost of sales 3,285.42 3,388.43 2,831.54 2,223.16 1,090.48
Operating profit 1,389.67 1,226.96 937.08 809.76 356.53
Adjusted PBDIT 1,548.34 1,289.81 953.15 816.31 382.06
Depreciation 251.89 217.87 178.21 138.80 67.56
Adjusted PBT 1,261.10 1,047.01 754.34 659.70 302.92
Tax charges 196.61 94.60 75.87 15.45 12.15
Adjusted PAT 1,064.49 952.41 678.47 644.25 290.77
Non recurring items -67.18 -171.76 423.35 -5.87 36.01
Other non cash adjustments - - - - 2.49
Reported net profit 997.31 780.65 1,101.82 638.38 329.27
Earnigs before appropriation 2,570.04 2,351.09 2,287.81 1,838.31 1,439.05
Equity dividend 469.61 598.58 525.59 516.10 501.75
Dividend tax 79.73 101.72 81.60 72.38 68.17
Retained earnings 2,020.70 1,650.79 1,680.62 1,249.83 869.13
Ratios
Per share ratios
Adjusted EPS (Rs) 15.88 14.29 10.22 19.92 9.11
Adjusted cash EPS (Rs) 19.64 17.56 12.91 24.21 11.23
Reported EPS (Rs) 14.88 11.72 16.60 19.74 10.31
22
Book value (excl rev res) per share (Rs) - 48.22 51.61 79.64 89.59
Book value (incl rev res) per share (Rs.) - 48.22 51.61 79.64 89.59
Adjusted cash margin (%) 27.23 25.01 22.63 25.76 24.33
Adjusted return on net worth (%) 30.52 29.64 19.80 25.01 10.16
Leverage ratios
Long term debt / Equity 0.03 0.01 0.01 0.01 0.03
Liquidity ratios
Current ratio 1.83 1.12 1.41 0.99 0.81
Quick ratio 1.71 1.06 1.39 0.97 0.80
Inventory turnover ratio 53.73 - - - -
Payout ratios
Earning retention ratio 48.40 26.48 10.51 8.66 -96.00
Cash earnings retention ratio 58.27 40.16 29.13 24.85 -59.04
Coverage ratios
Adjusted cash flow time total debt 0.39 0.02 0.04 0.01 0.26
Financial charges coverage ratio 43.80 51.74 46.27 45.83 32.99
Fin. charges cov.ratio (post tax) 36.34 41.05 63.14 44.64 35.27
Component ratios
Bonus component in equity capital (%) 60.93 61.29 61.54 25.66 26.00
23
Infosys Technologies Ltd
Sources of funds
Owner's fund
Loan funds
Secured loans - - - - -
Total 17,809.00 13,490.00 11,162.00 6,897.00 5,241.73
Uses of funds
Fixed assets
Gross block 5,986.00 4,508.00 3,889.00 2,837.00 2,182.72
24
Less : accumulated depreciation 2,187.00 1,837.00 1,739.00 1,275.00 1,005.82
Net block 3,799.00 2,671.00 2,150.00 1,562.00 1,176.90
Capital work-in-progress 615.00 1,260.00 957.00 571.00 317.52
Investments 1,005.00 964.00 839.00 876.00 1,328.70
Net current assets
Current assets, loans & advances 15,732.00 12,326.00 9,040.00 6,105.00 3,764.65
Less : current liabilities & provisions 3,342.00 3,731.00 1,824.00 2,217.00 1,346.04
Total net current assets 12,390.00 8,595.00 7,216.00 3,888.00 2,418.61
Total 17,809.00 13,490.00 11,162.00 6,897.00 5,241.73
Notes:
Book value of unquoted investments 1,005.00 964.00 839.00 876.00 1,328.70
5728.30 5719.96 5712.10 2755.55 2705.71
(Lacs)

Income
Expenses
Material consumed 20.00 18.00 22.00 16.00 13.55
Manufacturing expenses 1,822.00 1,549.00 1,378.00 854.00 603.67
Personnel expenses 9,975.00 7,771.00 6,316.00 4,274.00 3,183.25
Adminstrative expenses 1,456.00 1,257.00 1,144.00 839.00 650.65
Cost of sales 13,356.00 10,684.00 8,923.00 6,038.00 4,533.46
Operating profit 6,908.00 4,964.00 4,226.00 2,990.00 2,326.20
Adjusted PBDIT 7,782.00 5,642.00 4,559.00 3,211.00 2,444.88
Depreciation 694.00 546.00 469.00 409.00 268.22
25
Adjusted PBT 7,086.00 5,095.00 4,089.00 2,801.00 2,175.57
Tax charges 895.00 630.00 352.00 303.00 325.30
Adjusted PAT 6,191.00 4,465.00 3,737.00 2,498.00 1,850.27
Non recurring items -372.00 5.00 46.00 -77.00 54.11
Other non cash adjustments -1.00 - -5.00 - -4.59
Reported net profit 5,818.00 4,470.00 3,778.00 2,421.00 1,899.79
Equity dividend 1,345.00 1,902.00 649.00 1,238.00 309.80
Dividend tax 228.00 323.00 102.00 174.00 42.17
Retained earnings 10,887.00 7,089.00 5,222.00 2,437.00 1,618.33
Ratios
Per share ratios
Adjusted EPS (Rs) 108.08 78.06 65.42 90.65 68.38
Reported EPS (Rs) 101.58 78.15 66.23 87.86 70.38
Book value (excl rev res) per share (Rs) 27.51 25.96 29.13 26.56 28.91
Book value (incl rev res) per share (Rs.) 27.51 25.96 29.13 26.56 28.91
26
Leverage ratios
Long term debt / Equity - - - - -
Total debt/equity - - - - -
Liquidity ratios
Current ratio 4.71 3.30 4.96 2.75 2.80
Quick ratio 4.67 3.28 4.91 2.73 2.77
Inventory turnover ratio - - - - -
Payout ratios
Coverage ratios
Adjusted cash flow time total debt - - - - -
Financial charges coverage ratio 3,891.00 5,642.00 4,559.00 3,211.00 2,243.01
Fin. charges cov.ratio (post tax) 3,257.50 5,017.00 4,253.00 2,831.00 1,994.21
Component ratios
Material cost component (% earnings) 0.09 0.11 0.16 0.17 0.19
27
IQ Infotech Ltd
Sources of funds
Owner's fund
Loan funds
Secured loans 2.29 1.56 1.89 2.01 1.28
Unsecured loans 0.07 0.11 0.20 0.21 -
Total 14.99 15.13 16.35 16.84 16.04
Uses of funds
Fixed assets
Gross block 11.19 16.82 16.83 16.22 4.74
Net block 4.85 11.57 12.70 12.80 1.99
Capital work-in-progress 5.61 - - - 11.11
Investments 0.51 0.51 0.51 0.51 0.51
Net current assets
Miscellaneous expenses not written 0.01 0.01 0.02 0.02 0.03
Total 14.99 15.13 16.35 16.84 16.04
Notes:
28
104.68 104.68 104.68 106.47 106.47
(Lacs)

Income
Expenses
Material consumed 0.51 1.21 0.95 0.91 0.54
Selling expenses 0.08 0.03 - - 0.09
Cost of sales 1.46 2.46 1.86 1.69 1.08
Operating profit 0.41 -0.55 0.43 0.23 0.52
Other recurring income - 1.30 0.25 0.44 0.43
Adjusted PBDIT 0.41 0.76 0.68 0.67 0.96
Depreciation 1.08 1.12 0.72 0.66 0.66
Other write offs 0.01 0.01 0.01 0.01 0.06
Adjusted PBT -1.04 -0.73 -0.45 -0.26 -0.04
Tax charges -0.21 0.06 -0.09 0.01 -
Adjusted PAT -0.83 -0.79 -0.36 -0.27 -0.04
Non recurring items - - - - -
Other non cash adjustments - -0.01 - - 0.09
Reported net profit -0.83 -0.80 -0.36 -0.27 0.05
Earnigs before appropriation -4.23 -3.39 -2.90 -2.63 -2.36
Equity dividend - - - - -
Dividend tax - - - - -
Retained earnings -4.23 -3.39 -2.90 -2.63 -2.36
29
Ratios
Per share ratios
Adjusted EPS (Rs) -0.79 -0.75 -0.34 -0.25 -0.04
Reported EPS (Rs) -0.79 -0.76 -0.10 -0.25 0.04
Dividend per share - - - - -
Operating profit per share (Rs) 0.39 -0.52 0.40 0.21 0.49
Free reserves per share (Rs) -4.04 -3.25 -2.50 -2.41 3.92
Operating margin (%) 21.95 -28.51 18.71 11.75 32.49
Gross profit margin (%) -36.04 -86.91 -12.57 -22.87 -8.28
Net profit margin (%) -44.57 -24.78 -4.40 -11.47 2.43
Adjusted return on net worth (%) -6.60 -5.85 -2.54 -1.85 -0.29
Reported return on net worth (%) -6.60 -5.92 -0.78 -1.85 0.33
Return on long term funds (%) -4.52 -2.42 -0.27 -0.01 1.51
Leverage ratios
Liquidity ratios
Current ratio 3.35 2.55 2.69 3.19 2.34
Quick ratio 2.39 1.90 1.98 2.46 1.96
Payout ratios
Dividend payout ratio (net profit) - - - - -
Dividend payout ratio (cash profit) - - - - -
Earning retention ratio - - - - 100.00
Coverage ratios
30
Component ratios
Selling cost Component 4.04 1.39 - - 5.82
Exports as percent of total sales - - - - 2.09
Bonus component in equity capital (%) - - - - -
Moser Baer India Ltd

Sources of funds
Owner's fund
31
Share application money - - - - 18.14
Loan funds
Secured loans 1,487.53 1,612.50 1,725.02 1,646.54 1,603.79
Unsecured loans 854.88 1,004.83 - 8.92 16.83
Total 4,025.78 4,586.88 3,821.83 3,660.32 3,633.52
Uses of funds
Fixed assets
Gross block 4,757.05 4,508.36 3,899.32 3,493.67 3,191.96
Less : accumulated depreciation 2,317.42 1,842.77 1,417.66 1,061.74 744.79
Net block 2,439.64 2,665.59 2,481.66 2,431.94 2,447.17
Investments 277.01 370.89 241.81 87.95 207.52
Net current assets
Total net current assets 1,141.99 1,378.30 811.57 1,012.49 937.00
Total 4,025.78 4,586.88 3,821.83 3,660.32 3,633.52
Notes:
1683.06 1682.31 1116.01 1115.13 1115.13
(Lacs)

Income
Expenses
32
Material consumed 1,216.25 966.70 1,010.94 985.49 682.76
Cost of sales 1,871.49 1,481.50 1,455.45 1,310.74 953.07
Adjusted PBDIT 363.18 476.58 554.42 406.19 372.59
Depreciation 497.14 431.59 357.87 316.76 282.05
Adjusted PBT -339.28 -134.37 72.07 -4.12 16.91
Tax charges -7.75 1.94 10.06 -1.42 -30.48
Adjusted PAT -331.53 -136.31 62.00 -2.71 47.40
Non recurring items 176.22 36.04 45.93 6.04 8.95
Other non cash adjustments 4.45 21.37 1.85 1.33 4.38
Reported net profit -150.87 -78.91 109.79 4.67 60.72
Earnigs before appropriation -124.86 45.72 149.75 52.67 60.72
Equity dividend 10.11 16.85 16.74 11.15 11.15
Dividend tax 1.72 2.86 2.84 1.56 1.56
Retained earnings -136.68 26.01 130.16 39.96 48.01
Ratios
Per share ratios
Adjusted EPS (Rs) -19.70 -8.10 5.56 -0.24 4.25
Reported EPS (Rs) -8.96 -4.69 9.84 0.41 5.45
Book value (excl rev res) per share (Rs) -3.21 -1.57 187.88 179.79 178.88
Book value (incl rev res) per share (Rs.) -3.21 -1.57 187.88 179.79 178.88
33
Gross profit margin (%) -8.60 -0.79 8.47 2.17 3.52
Net profit margin (%) -6.75 -4.02 5.46 0.27 4.58
Adjusted return on net worth (%) -19.69 -6.92 2.95 -0.13 2.37
Reported return on net worth (%) -8.96 -4.00 5.23 0.23 3.04
Return on long term funds (%) -4.30 1.15 5.77 2.76 2.79
Leverage ratios
Liquidity ratios
Current ratio 2.71 4.07 2.86 4.83 3.34
Quick ratio 1.77 2.69 1.62 3.14 2.18
Payout ratios
Dividend payout ratio (net profit) - - 17.83 272.50 20.93
Earning retention ratio - - 68.42 569.42 73.18
Coverage ratios
Component ratios
Import comp. in raw mat. consumed 75.34 70.10 64.37 81.56 71.94
34
Polaris Software Lab Ltd
Sources of funds
Owner's fund
Loan funds
Secured loans 0.36 0.83 1.29 - -
Total 694.37 602.13 571.14 531.26 529.36
Uses of funds
Fixed assets
Gross block 162.66 178.52 377.07 364.86 311.16
Less : accumulated depreciation - - 205.47 166.95 124.09
Net block 162.66 178.52 171.60 197.90 187.08
35
Investments 321.68 169.29 107.88 79.04 110.69
Net current assets
Total 694.37 602.13 571.14 531.26 529.36
Notes:
Book value of unquoted investments 87.03 - 83.68 58.85 54.33
Market value of quoted investments 234.66 - 24.25 20.20 56.36
986.76 986.75 985.82 982.30 980.10
(Lacs)

Income
Operating income 1,171.34 938.02 904.30 683.94 668.97
Expenses
Selling expenses - - 5.74 4.31 6.99
Cost of sales 965.79 852.87 771.13 620.40 586.08
Adjusted PBDIT 236.13 104.78 136.84 66.59 93.36
Depreciation 42.70 39.07 43.30 46.44 38.40
Adjusted PBT 192.88 65.10 92.97 19.60 54.14
Tax charges 15.03 11.44 14.26 7.10 6.28
Adjusted PAT 177.85 53.66 78.71 12.50 47.86
Non recurring items -66.66 -1.03 0.88 0.79 5.57
36
Other non cash adjustments - - - - -
Reported net profit 111.19 52.63 79.59 13.30 53.43
Earnigs before appropriation 333.57 244.97 225.58 161.32 172.98
Equity dividend 27.14 14.80 22.18 12.28 17.15
Dividend tax 4.61 2.51 3.11 1.72 2.45
Retained earnings 301.83 227.65 200.29 147.32 153.37
Ratios
Per share ratios
Adjusted EPS (Rs) 18.02 5.44 7.98 1.27 4.88
Reported EPS (Rs) 11.27 5.33 8.07 1.35 5.45
Leverage ratios
37
Liquidity ratios
Current ratio 1.98 2.74 2.93 3.21 3.29
Quick ratio 1.98 2.74 2.93 3.19 3.29
Payout ratios
Earning retention ratio 82.15 67.73 67.88 -11.97 59.04
Coverage ratios
Adjusted cash flow time total debt - 0.01 0.01 - -
Component ratios
Selling cost Component - - 0.63 0.63 1.04
Exports as percent of total sales - - 90.45 88.17 86.97
38
Satyam Computer Services Ltd
Balance sheet – Rs in Cr
Sources of funds
Owner's fund
Loan funds
Secured loans 23.67 13.79 12.57 9.87 7.30
Total 7,381.31 5,803.15 4,347.99 3,227.34 2,588.25
Uses of funds
Fixed assets
Gross block 1,486.53 1,280.40 1,153.16 937.70 847.16
Less : accumulated depreciation 1,062.04 930.45 803.74 685.41 597.76
Net block 424.49 349.95 349.42 252.29 249.40
Investments 493.80 201.15 155.74 78.48 74.75
Net current assets
Less : current liabilities & provisions 1,446.74 1,041.75 707.27 451.64 353.59
Total 7,381.31 5,803.15 4,347.99 3,227.34 2,588.25
Notes:
Market value of quoted investments - - - - 1.00
6704.79 6671.96 3244.50 3192.65 3162.52
(Lacs)
39
Income
Expenses
Adminstrative expenses 1,170.83 873.42 612.45 456.35 416.19
Cost of sales 6,306.97 4,698.56 3,439.97 2,573.96 1,847.75
Operating profit 1,830.31 1,529.91 1,194.34 890.27 693.80
Adjusted PBDIT 2,108.18 1,697.98 1,311.60 992.09 787.68
Depreciation 137.94 129.89 122.81 103.94 111.62
Adjusted PBT 1,964.30 1,560.48 1,186.07 887.39 675.31
Tax charges 226.12 150.00 206.14 116.74 106.15
Adjusted PAT 1,738.18 1,410.48 979.93 770.65 569.16
Non recurring items -22.44 12.75 259.82 -20.86 -15.27
Other non cash adjustments - - - 0.47 1.90
Reported net profit 1,715.74 1,423.23 1,239.75 750.26 555.79
Equity dividend 234.89 231.85 229.56 159.63 126.72
Dividend tax 39.86 37.55 32.02 20.86 16.24
Ratios
40
Per share ratios
Adjusted EPS (Rs) 25.92 21.14 30.20 24.14 18.00
Reported EPS (Rs) 25.59 21.33 38.21 23.50 17.57
Leverage ratios
Liquidity ratios
Current ratio 5.15 5.76 6.32 7.27 7.34
Quick ratio 5.09 5.70 6.32 7.25 7.33
Payout ratios
Coverage ratios
Financial charges coverage ratio 354.91 223.12 482.21 1,310.04 1,051.92
Fin. charges cov.ratio (post tax) 313.07 205.09 501.94 1,128.96 892.30
Component ratios
41
TATA Consultancy Services Ltd

Balance sheet Rs in Cr
Sources of funds
Owner's fund
Preference share capital 100.00 100.00 - - -
Loan funds
Secured loans 32.63 9.27 41.76 26.52 111.01
42
Unsecured loans 7.74 8.98 8.98 8.98 9.73
Total 13,486.62 11,023.06 8,109.73 5,644.83 3,441.79
Uses of funds
Fixed assets
Gross block 4,359.24 3,240.64 2,315.36 1,695.13 1,041.09
Less : accumulated depreciation 1,690.16 1,300.11 854.75 525.35 132.93
Net block 2,669.08 1,940.53 1,460.61 1,169.78 908.16
Investments 5,936.03 4,509.33 3,252.04 1,963.52 1,404.42
Net current assets
Total 13,486.62 11,023.06 8,109.73 5,644.83 3,441.79
Notes:
Book value of unquoted investments 5,992.44 4,095.69 2,852.58 1,583.63 1,024.53
Market value of quoted investments 251.41 661.29 957.53 416.10 481.54
Contingent liabilities 2,924.33 2,726.11 3,003.25 851.64 407.76
9786.10 9786.10 9786.10 4893.05 4801.15
(Lacs)
Profit loss account Rs in Cr

Income
Expenses
Material consumed 53.67 45.85 24.81 157.36 -
Manufacturing expenses 7,167.34 5,823.39 3,189.71 859.86 531.77
Adminstrative expenses 1,768.64 1,596.05 1,206.07 1,750.24 1,135.07
43
Cost of sales 16,381.09 13,508.11 10,638.49 7,893.09 5,642.65
Adjusted PBDIT 6,253.45 5,190.62 4,387.86 3,401.96 2,447.92
Depreciation 417.46 458.78 343.41 257.38 133.22
Adjusted PBT 5,828.55 4,728.42 4,041.02 3,140.09 2,304.30
Tax charges 443.48 457.58 410.80 319.45 280.76
Adjusted PAT 5,385.07 4,270.84 3,630.22 2,820.64 2,023.54
Non recurring items -688.86 275.44 129.66 -65.74 -192.12
Other non cash adjustments - -37.52 -2.59 -38.03 -
Equity dividend 1,370.05 1,370.05 1,125.39 660.56 552.13
Preference dividend 7.00 0.08 - - -
Dividend tax 234.02 232.85 169.48 92.64 74.46
Ratios
Per share ratios
Adjusted EPS (Rs) 54.96 43.64 37.10 57.65 42.15
Reported EPS (Rs) 47.92 46.07 38.39 55.52 38.15
44
Leverage ratios
Long term debt / Equity 0.01 0.01 - - -
Liquidity ratios
Current ratio 1.83 1.99 1.99 2.25 1.77
Quick ratio 1.83 1.97 1.98 2.22 1.77
Inventory turnover ratio 1,321.77 1,137.21 1,412.30 536.84 -
Payout ratios
Coverage ratios
Adjusted cash flow time total debt 0.01 - 0.01 0.01 0.05
Financial charges coverage ratio 840.52 1,517.73 1,279.26 757.67 235.38
Fin. charges cov.ratio (post tax) 688.32 1,453.50 1,196.54 663.42 189.91
Component ratios
Material cost component (% earnings) 0.23 0.24 0.14 1.43 -
Import comp. in raw mat. consumed 79.74 80.43 70.79 80.37 -
45
46
Wipro Ltd
Balance sheet – Rs in Cr
Sources of funds
Owner's fund
Loan funds
Secured loans - 4.00 23.20 45.06 21.59
Unsecured loans 5,013.90 3,818.40 214.80 5.10 40.50
Total 17,528.90 15,433.10 9,558.40 6,478.10 4,955.74
Uses of funds
Fixed assets
Gross block 3,179.60 2,282.20 1,645.90 2,364.53 1,763.49
Less : accumulated depreciation - - - 1,246.27 855.53
Net block 3,179.60 2,282.20 1,645.90 1,118.25 907.96
Capital work-in-progress 1,311.80 1,335.00 989.50 612.36 250.24
Investments 6,884.50 4,500.10 4,348.70 3,459.20 2,859.51
Net current assets
Total net current assets 6,153.00 7,315.80 2,574.30 1,288.29 938.03
Total 17,528.90 15,433.10 9,558.40 6,478.10 4,955.74
Notes:
Book value of unquoted investments 6,884.50 - 1,234.10 514.23 782.71
Market value of quoted investments - - - 2,956.87 2,088.71
14650.00 14615.00 14590.00 14257.54 7035.71
(Lacs)
Profit loss account- Rs in Cr
47
Income
Expenses
Material consumed 3,376.70 2,952.30 1,889.00 1,367.67 1,185.48
Manufacturing expenses - 299.80 120.50 1,020.70 558.07
Selling expenses - 532.10 - 171.05 107.15
Adminstrative expenses 4,129.60 2,583.70 2,651.70 904.78 685.80
Expenses capitalised - - - - -37.12
Cost of sales 16,748.50 13,777.00 10,429.40 7,743.22 5,377.92
Other recurring income -480.40 326.90 288.70 113.59 75.44
Adjusted PBDIT 4,278.40 4,042.50 3,543.20 2,597.49 1,930.68
Depreciation 533.70 456.00 359.80 292.26 185.97
Adjusted PBT 3,547.90 3,469.70 3,176.20 2,302.10 1,739.15
Tax charges 574.10 406.40 334.10 286.10 255.15
Adjusted PAT 2,973.80 3,063.30 2,842.10 2,016.00 1,484.00
Non recurring items - - - 38.33 17.88
Other non cash adjustments - - - -33.85 -7.06
Equity dividend 586.00 876.50 873.70 712.88 351.79
Dividend tax 99.60 148.90 126.80 99.98 49.34
Ratios
Per share ratios
Adjusted EPS (Rs) 20.30 20.96 19.48 14.14 21.09
Reported EPS (Rs) 20.30 20.96 19.48 14.17 21.25
48
Free reserves per share (Rs) - - - 42.65 66.69
Leverage ratios
Long term debt / Equity 0.40 0.33 0.02 - -
Liquidity ratios
Current ratio 1.83 2.54 1.68 1.46 1.54
Quick ratio 1.76 2.44 1.61 1.40 1.45
Payout ratios
Coverage ratios
Component ratios
Selling cost Component - 3.04 - 1.67 1.48
Exports as percent of total sales - - - 69.25 74.29
Import comp. in raw mat. consumed - - - 62.12 51.39
49
7 LIMITATIONS
Some of the limitations of the financial statements are as follows:
As the historical costs and money measurement concepts govern the

preparation of the balance sheet and income statements, hence these
financial statements are essentially statements reflecting historical facts. It
ignore inflationary trend and does not reflect the true current worth of the
enterprise,
Certain important qualitative elements are omitted from the financial

statements because they are incapable of being measured in monetary
terms like the quality and reputation of the management team, employee
and other,
50
There are still items in the assets side of the balance sheet which has no real
value and are merely deferred charges to future incomes like preliminary /
pre-incorporation expenses and other.
There are still the following issues or challenges in preparing the financial
statements which may amount to overstatement of the accounting profit
of an entity:
When to and how much to recognize revenue in the Income statement,
The constant challenge of when to expense or to capitalize the expenses. It is

important to determine definitely what is revenue expenditure and capital
expenditure otherwise the accounting profit will be overstated or
understated - for example, capitalization of borrowing costs,etc
Method of depreciations and the rates to depreciate into the income statement are
selected by management to suit their business needs. Are the rates
intentionally been made lower or the depreciation rates are higher to
accelerate the depreciation of the fixed assets,
Adequacy of provisions and method of providing for doubtful debts. Are the trade
debtors recoverable and to what extent the accounting method for provision
for doubtful debts shows the realistic picture,
Basis of valuation of assets- when can costs change to reflect current values?
Using replacement or current costs?
· Consolidation challenges -what to eliminates to reflects the overall group performance.

Some items might be omitted to show a higher accounting profits
8. FINDINGS AND SUGGESTIONS:
8.1 Aptech Ltd:

Adjusted EPS of Aptech Ltd slowly increased and reached at
2.29. Compare with Gross profit Margin % Net profit Margin %
(4.15) is good position at Dec 2009. Total Debt Equity Ratio
comes down from 0.23 to 0.11.Current Ratio comes up from
1.32 to 2.86. Over all company position is good.
8.2 Financial Technologies (India) Ltd:

There is a fluctuation in Adjusted EPS for Financial Technologies
(India) Ltd during 2006 to 2010. Gross Profit and Net profit
51
Margin % are increased well. Total Debt Equity Ratio reached
0.26 at 2010. Current ratio comes up from 1.64 to 3.21. Over all
company financial position is better.
8.3 HCL Technologies Ltd:

Adjusted EPS of HCL Technologies Ltd stood Rs. 15.88 at 2010.
There is a fluctuation in Gross Profit and Net Profit Margin %. But
they showed 24.33 % and 20.63 % respectively at 2010. Total
Debt Equity Ratio comes up from 0.03 to 0.14. Current Ratio
showed good position compare with 2006. Over all company
position is excellent.
8.4 Infosys Technologies Ltd:

Adjusted EPS of Infosys Technologies Ltd showed Rs. 108.08
compare with Rs. 68.38 at 2006. Gross Profit and Net Profit
Margin % are 30.66 & 27.52. There is steady increase in year by
year. Current Ratio is 4.71 compare with 2.80 at 2006. Over all
company performance reached outstanding position in recent
years.
8.5 IQ Infotech Ltd:

Adjusted EPS of IQ Infotech Ltd showed Negative. Gross Profit
and Net Profit Margin % also showed Negative. Total Debt Equity
Ratio is 0.18 at 2010. Current Ratio comes up 3.35 from 2.34.
Over all company is position is not good.
8.6 Moser Baer India Ltd:

Adjusted EPS of Moser Baer India Ltd showed Negative. Gross
Profit and Net Profit Margin % also showed Negative. Total Debt
Equity Ratio is 1.39 at 2010. Current Ratio comes down to 2.71
from 3.34. Over all company position is not good.
52
8.7 Polaris Software Lab Ltd:
Adjusted EPS of Polaris Software Lab Ltd comes up to 18.02 from
4.88. Gross Profit and Net Profit Margin % showed 13.90 & 9.25
respectively at 2010. Current ratio comes down to 1.98 at 2010.
Over all company position is not bad.
8.8 Satyam Computer Services Ltd:

Adjusted EPS of Satyam computer Services Ltd showed Rs 25.92
at 2009.Gross Profit and Net Profit Margin % decreased at 2009.
Current ratio comes down at 5.15 from 7.34. Over all company
position went to bad position.
8.9 TATA Consultancy Services Ltd:

Adjusted EPS of TCS showed Rs 54.96 at 2010. Gross Profit and
Net Profit Margin % looked 25.01 & 20.74 at 2010. There is no
change in Total Debt Equity Ratio for the past Four years.
Current ratio comes up to 1.83 from 1.77. Over all company
position is good.
8.10 Wipro Ltd:

Adjusted EPS of Wipro Ltd is Rs. 20.30 at 2010. Gross profit and
Net profit Margin % decreased. Total Debt Equity ratio showed
0.40 at 2010. Current ratio comes up to 1.83 from 1.54. Over all
company position is good.
Overall IT companies’ Financial Position:
After analyzing the financial reports of10 IT companies showed

the performance of their financial condition for the past 5 five
years. It is clearly demonstrated the effectiveness of recession.
53
But they are retrieved slowly from the recession. Compare with
other service sectors Information Technology stood at good
position now.
9 REFERENCES
A. Management Accounting and Financial Control – Dr S.N.

Maheshwari
Published by Sultan Chan New Delhi
B. Statistical Method – SP Gupta Published by Sultan Chan New

Delhi
54
55

An Analysis of IT Companies Before During and After Recession

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CONTENT

At regular period Information Technology companies must prepare

- Current Assets include anything that companies can quickly monetise.

Other Assets include any intangible assets, such as patents, copyrights,

Liabilities are money or goods acquired from individuals, and/or other

Current Liabilities are accounts-, and notes-, taxes payable to financial

Long-Term Liabilities are mortgages, intermediate and long-term loans,

Shareholder’s equity (or net worth, or capital)

Assets are calculated the following way:

The categories and formats of Balance Sheets are established by a system

Profit and Loss Account

Cash flow statements

Income statements measure the company’s sales and expenses over a

Various literatures are reviewed to guide the study. These are

2.1 Theoretical literature

2.1.1 The concept of InformationTechnology (IT) in the emerging electronics

2.1.2 Types and applications of InformationTechnology

ii) Computer Networks: This refers to computers at different location

iii) Desktop Publishing: This makes use of microcomputers,

v) Geographic information system (GIS): this types of information

x) Satellite communication: This consists of a satellite dish for low

2.1.3 The importance of InformationTechnology. We are currently in the

The information sector is taking up such a large percentage of GDP

Effective communication links and computerized system are a sine qua

1) It enhances access to global knowledge, markets and capital.

In summary, InformationTechnology is profoundly transforming

3.1 PRIMARY OBJECTIVE:

To study the performance, achievements and problems of IT sector

3.2 SECONDARY OBJECTIVES

1. Analysis of the each item of financial statements with previous year

2. Identify the performance of the company year by year and item by

1. Per share Ratios

Collection of 5 years Audited financial statements of 10 leading

3. Financial Technologies India Ltd

4. HCL Technologies Ltd

5. Infosys Technologies Ltd

6. IQ Infotech Ltd – Research Centre

7. Moser Baer India Ltd – Research Centre

8. Polaris Software Lab Ltd

9. Satyam Computer Service Ltd

10. TATA consultancy Service Ltd

APTECH LTD Balance sheet Rs in Cr

Profit loss account-Rs in Cr

Profit loss account-Rs in Cr

HCL Technologies Ltd

Profit loss account-Rs in Cr

Profit loss account-Rs in Cr

Profit loss account-Rs in Cr

Moser Baer India Ltd

Profit loss account-Rs in Cr

Profit loss account-Rs in Cr

TATA Consultancy Services Ltd

Profit loss account Rs in Cr

Some of the limitations of the financial statements are as follows:

As the historical costs and money measurement concepts govern the

Certain important qualitative elements are omitted from the financial

When to and how much to recognize revenue in the Income statement,

The constant challenge of when to expense or to capitalize the expenses. It is

· Consolidation challenges -what to eliminates to reflects the overall group performance.

8. FINDINGS AND SUGGESTIONS:

8.1 Aptech Ltd:

8.2 Financial Technologies (India) Ltd:

8.3 HCL Technologies Ltd: