niit tech annual report 2007 08
TRANSCRIPT
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 1/100
A N N U A L R E P O R T 2 0 0 7 - 0 8
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 2/100
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 3/100
3
6-7
8-9
12-18
20-26
28-40
41-71
72
73-96
Corporate Information
Corporate Profile
The year gone by
Directors’ Report
Management Discussion and Analysis
Report on Corporate Governance
Financial Statements - NIIT Technologies Ltd.
Statements of Subsidiaries
Consolidated Financial Statements
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 4/100
Our VisiOnValues, MOtiVes and Beliefs
We, NIIT, belIeve ThaT our groWTh Is The derIvaTIve of The groWTh
of each oNe of us. IT Is The duTy of each oNe of us To espouse aNd
gIve acTIve effecT To The values, moTIves aNd belIefs We sTaTe here
•
niit is peOpleWe have posITIve regard for each oNe of us
•
We WIll fosTer career-buIldINg by creaTINg opporTuNITIes ThaT
demaNd learNINg, ThINkINg aNd INNovaTIoN from each oNe of us.
•
We expecT each of us To coNTrIbuTe To The process of
orgaNIsaTIoN buIldINg aNd Thus derIve prIde, loyalTy aNd
emoTIoNal oWNershIp.
•We recogNIse The NecessITy of makINg mIsTakes aNd rIsk-TakINg
WheN IT coNTrIbuTes To The learNINg, INNovaTIoN aNd groWTh of
each oNe of us.
•
niit is quality and Valueeach of us WIll eNsure ThaT IN aNy assocIaTIoN WITh socIeTy,
socIeTy beNefITs subsTaNTIally more ThaN:
(a) WhaT socIeTy gIves To us.
(b) WhaT socIeTy Would gaIN from aNy oTher sImIlar assocIaTIoN
•We WIll meeT aNy aNd every commITmeNT made To socIeTy
IrrespecTIve of aNy cosT ThaT may have To be INcurred.
•
We WIll eNsure our profITabIlITy, loNg-Term groWTh aNd
fINaNcIal sTabIlITy, Through The process of delIverINg The besT,
beINg seeN as The besT aNd beINg The besT.
•
We WIll be faIr IN all our dealINgs aNd promoTe hIgh sTaNdards
of busINess eThIcs.
•
niit is a MissiOnWe WIll groW IN The recogNITIoN aNd respecT We commaNd,
Through pIoNeerINg aNd leadINg IN The effecTIve deploymeNT of TechNology
aNd kNoW-hoW.
•
We WIll seek To play a key-role IN The dIrecTIoNs aNd deploymeNT
of TechNology aNd kNoW-hoW for The beNefIT of maNkINd.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 5/1003
A N N U A L R E P O R T 2 0 0 7 - 0 8
Corporate
Information
Company Secretary
Surender Varma
Group Chief Financial Officer
Ashok Arora
Chief Financial OfficerK T S Anand
Auditors
Price Waterhouse
Financial Institutions/Bankers
Indian Overseas Bank
ICICI Bank Limited
Standard Chartered Bank Limited
Citibank NA
Wachovia Bank of Georgia
Lloyds TSB Bank Plc
NatWestING
Registered Office
NIIT Technologies Ltd.
NIIT House,
C-125 Okhla Phase - 1
New Delhi 110 020, India
Email: [email protected]
Tel : +91-11-41407000
Fax : +91-11-26817344
Corporate Office
NIIT Technologies Ltd.
A-43, MCIA, Mathura Road
New Delhi 110 044, India
Email: [email protected]
Tel : +91-11-46694555/777
Fax : +91-11-40570933
Registrar & Share Transfer Agent
Alankit Assignments Ltd.
Unit - NIIT Technologies Ltd.
2E/21
Jhandewalan Extn.,
New Delhi-110 055Tel : +91-11-23541234, 42541234
Fax : +91-11-42541967
NIIT Technologies Website
Corporate Website : www.niit-tech.com
In this Report, we have used terms that we
use for NIIT Technologies staff. Staff
members are NIITians, family members of staff
are AffiNIITians.
All trademarks acknowledged.
Rajendra S Pawar
Chairman & Managing Director
Vijay K Thadani
Director
Subroto Bhattacharya
Director
Surendra Singh
Director
Amit Sharma
Director
Board of Directors
Arvind Thakur
Chief Executive Officer
& Joint Managing Director
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 6/100
This page is intentionally left blank.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 7/100
Focus makes us bigger than the sum of our parts
At NIIT Technologies the focus is on developing specific Industry
verticals and within each vertical perfecting and building
appropriate intellectual property. This focus on creating
differentiation through specialisation has helped us position NIIT
Technologies in a zone where we can leverage our strengths and
grow our foot print across geographies
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 8/100
A n n u A l R e p o R t 2 0 0 7 - 0 8
AN OVERVIEW
NIIT Technologies Limited is a global IT solutions
organisation servicing customers in North America, Europe,
Asia and Australia. We ocus on customers in the Banking,
Financial Services and Insurance, Travel Transportation &Logistics and Retail & Distribution sectors, oering services
in Application Development & Management, Enterprise
Solutions & Business Process Outsourcing.
Our subsidiaries, NIIT SmartServe Limited and NIIT GIS
Limited, oer Business Process Outsourcing and GIS
Solutions, respectively. Counted amongst the premier
sotware exporting organisations in India, we have built a
signifcant customer base worldwide, including leading
global enterprises.
On the quality ront, we adhere to all global benchmarks and
standards, having bagged the ISO 9001:2000 certifcation
and the ISO: 27001 Inormation Security Managementaccreditation. We have been one o the frst ew organisations
to be assessed at Level 5 o SEI-CMMi ver 1.2. We have
also been assessed at Level 5 o People-CMM Frameworks
and are an Approved Scanning Vendor or PCI DSS. Our
Thailand acility conorms to the international ISO: 20000 IT
management standard, making it the frst company in the
ASEAN region to be so assessed.
NIIT SmartServe conorms to the highest quality standards
such as COPC and Six Sigma.
Our alliance with international IT giants including IBM,
Microsot, Oracle, SAP and Sun—which have enabled us
to gain technology leadership and build expertise on all keyhardware and sotware platorms—are proving benefcial or
our global customer base.
CHOSEN VERTICALS
Banking and Financial Services: NIIT Technologies
specialises in areas o retail and wholesale banking
operations, mortgages, credit risks and operational data
store, investment management, having worked with leading
banks and fnancial service companies across the world.
Insurance: NIIT Technologies has built expertise in the
areas o lie insurance, pensions, annuity, non-lie insurance,
policy administration and claims management and re-
insurance, working or top insurance companies across
the world. ROOM Solutions, a leading name in the Lloyd’s
market in the UK, acquired by NIIT Technologies in 2006,
has strengthened its presence in the commercial insurance
space by bringing in deep domain expertise
Travel, Transportation and Logistics (TTL): NIIT Technologies has vast domain expertise and experience in
the TTL industry, having executed diverse projects across
dierent segments o the business. Our clients include some
o the largest airlines and airports, global leaders in the
travel and distribution industry, leading reight and logistics
companies and sophisticated surace transport players.
The acquisition o Sotec, GmbH has reinorced the position
o the company as a domain leader in the TTL industry.
Retail and Distribution: We specialise in providing diverse
IT services to global specialty retail chains in the domains
o customer acing e-business and selservice portals, in-
store applications, back-end supply chain management
and related analytics.
SERVICE OFFERINGS
Application Development and Management: NIIT
Technologies provides Application Development Services
and Solutions to meet the diverse requirements o globally
dispersed customers in custom sotware development,
business intelligence, migration and modernisation. We
help customers manage their mission and time critical
applications by providing cost eective application
management services over a wide range o technologies.
We specialise in unctional and regression testing, system
testing (load testing, volume testing and compatibility testing)
and ull liecycle testing o complex sotware applications aspart o our testing services.
Enterprise Solutions: The Enterprise Solutions range
around SAP oerings. Aided by our experience in
manuacturing domains, we have created a Framework
called QuickStart, which enables rapid implementation o
SAP in the microelectronics and semiconductor industries.
We also manage and maintain the operations and
applications that have been deployed in the customers’
Managed Services portolio. Our Managed Services helps
organisations simpliy their IT operational and investment
challenges by delivering IT inrastructure and applications
as complete administered services.
Geographic Information Systems (GIS): NIIT GIS
has been providing end-to-end GIS-based solutions to
customers worldwide. NIIT GIS’ oerings in this sphere
range rom sotware products, training, technical support,
data conversion and application development to complete
geo-spatial image processing and consulting solutions. NIIT
GIS, which commenced operations in 1996, is a strategic
alliance between ESRI Inc., USA and NIIT Technologies
Ltd.
Business Process Outsourcing: NIIT Technologies’
subsidiary, NIIT SmartServe, a global business process
management organisation, oers outsourcing solutions that
Corporate
Profile
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 9/100
A n n u A l R e p o R t 2 0 0 7 - 0 8
manage back ofce operations, contact centers and provide
help desk support to clients in diverse industry verticals
such as fnance and insurance, media and entertainment,
real estate, technology and education.
ALLIANCES
We have developed strong alliances with leading global
IT majors such as BEA, Computer Associates, IBM,
Inormatica, Metalogic, Microsot, NetIQ, Oracle, SAP, SEEC
and TIBCO, enabling development o core competencs on
state-o-the-art sotware platorms and oer solutions in
cutting-edge technologies to customers across the globe.
Awards and Achievements
• NIIT Technologies ranked among India’s Top 20 IT
Sotware and Service Exporters in the NASSCOM 2007
survey
• NIIT Technologies ranked in ET 500, 2007 among the
Top 20 wealth creator companies o India
• NIIT Technologies has been listed among the ‘Best 200
under a billion companies’ 2007 by Forbes Asia
• NIIT Technologies awarded the Banking & Finance ICT
Innovation recognition or Belgium and Luxemburg
• NIIT Technologies re-assesed at the highest level o
maturity (level 5), in accordance with the new version1.2 o the CMMi
• The Company ranked among Business Today’s listing
o “India’s Most Valuable Companies-2007”
• The Company moved rom mid-cap to large cap by
Dalal Street Journal’s annual listing o the Golden 400
Indian Companies 2007
• NIIT Technologies ranked 36th in The Black Book Top
50 Best Managed Global Outsourcing Vendors
• NIIT Technologies was elicitated with the Employer
Branding Awards or Excellence in HR through
technology and or innovation in career development by
the Asia Pacifc HRM Congress at the regional level.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 10/100
A n n u A l R e p o R t 2 0 0 7 - 0 8
The year 2007-08 was a period o signifcant activity or
NIIT Technologies, one marked by high momentum and
improvement in turnover and proftability. The Company
grew well above the Indian IT-BPO industry average and
continued to rank among the top 20 IT-BPO exporters in thecountry. We participated in and launched numerous initiatives
that established our thought and business leadership within
the IT-BPO domain. Some o the key highlights o the year
included the ollowing:
Participating in the 16th Indo-German Joint
Commission
As a member o CII/FICCI’s delegation that accompanied
India’s Finance Minister, P. Chidambaram to the 16th Indo-
German Joint Commission, NIIT Technologies reiterated its
commitment to building international IT trade and making the
Indian IT-BPO industry a global orce. We were represented
by Pramod Srivastava, CEUR Head, who joined other Indian
industry leaders in interacting with European businessesand deliberating on how bilateral trade ties and mutual trade
could be enhanced between India and the continent.
Going Live with VAA
The NIIT Technologies-Virgin Atlantic Airways partnership
touched new heights during 2007-08, with the company
developing a unique, speedy and hassle ree check-in
solution or the global airliner’s Upper Class Passengers
and greatly upliting their experience. NIIT Technologies,
which has been working with Virgin Atlantic Airways since
2003, demonstrated innovativeness, a high level o airline
experience and key technology skills, in understanding the
pain points o customers and building the solution. Today,
VAA is the only international airline with such a system.
The innovation has bagged the award or being the astest
airport check in system.
Bagging awards and recognitions
During the year NIIT Technologies was elicitated with
numerous awards. The company was presented the
prestigious Banking & Finance ICT Innovation Award or
Belgium/Luxembourg, along with the KBC bank.
The NIIT Technologies’ PPFSR team meanwhile bagged
the DB Systel GmbH Quality Award or achieving 100
percent satisaction levels within the German Group.Our HRdepartment was recognised or its pioneering work by the
Asia Pacifc HRM Congress. The HRM Congress conerred
on NIIT Technologies its Employer Branding Award or
Excellence in HR through Technology and or Innovation in
Career Development.
Continuing on the M&A path
As part o its inorganic growth strategy, NIIT Technologies
added yet another member, Sotec GmbH, to its old in
the last quarter o 2007-08. The Reichenschwand based
Sotec GmbH, with its expertise in the area o AirlineRevenue Accounting and Flight Operations, will strengthen
NIIT Technologies’ domain leadership in the TTL industry.
Forging alliances and partnerships
A new dimension was added to the Company’s Joint
Venture with Ajilon Holding Europe BV - an Adecco Group
Company, with the inauguration o a acility dedicated to
Adecco-NIIT Technologies at Kalkaji, New Delhi. This acility
will provide Application Development and Maintenance
solutions exclusively to Adecco and its clients. Adecco SA
is a Fortune Global 500 organisation and a leader in Human
Resource services.
The year
gone by2007-0 at a glance
Pramod Srivastava, CEUR Head, at the 16th Indo-German Joint Commission as part of the CII/FICCI delegation
Rajeev Kumar & Anil Batra receiving the Asia Pacifc HRM Congress
Employer Branding Award
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 11/100
A n n u A l R e p o R t 2 0 0 7 - 0 8
Celebrating deep and enduring customer
relationships Year 2007-08 was important rom the customer perspective,
with the Company deepening its engagements with existing
customers.
NIIT Technologies celebrated the 10th anniversary o its
relationship with ING Europe. A partnership that has emerged
stronger, bigger and better over time. The maturity o the
relationship has been demonstrated by NIIT Technologies’
deep understanding o the ING culture and the special
partnership that’s virtually “service-on-demand.” NIIT
Technologies has been leveraging its domain expertise and
knowledge o the Banking and Insurance vertical to deliver
the right solutions, at the right price and right quality to ING.
It has gone beyond the customer-vendor relationship, to
emerge as a trusted partner o ING.
Our relationship with the ING Group USA, also crossed
a milestone, completing fve years in 2007-08. The
achievement was commemorated with an event or ING in
Connecticut. NIIT’s Partnership with ING has transcended
all cultures and become stronger by the day, paving way or
urther growth opportunities.
Arvind Thakur – CEO, NIIT Technologies and Jean-Manuel Bullukian,
President – IT and Engineering Services Business Adecco, inaugurating the new Adecco-NIIT Technologies facility
Arvind Thakur – CEO, NIIT Technologies and Rajendra S Pawar – President,NIIT Technologies, celebrating the 10th anniversary of our relationship with
ING Europe.
We also celebrated the rollout o the TopServ Dealer
Management System or customer TMT by hosting an
exclusive relationship event. The deployment marked the
culmination o months o eort by the combined teams o
TMT and NIIT Technologies. The companies worked closely
to ensure the successul implementation o the application
within Budget and defned timelines. NIIT Technologies has
executed multiple projects or TMT over the past decade,
securing repeat business rom the company and constantly
growing the relationship.
Drawing attention from business intelligence giant,
Forrester Research
Research and analysis giant, Forrester, in its latest report
titled, “Bigger might not always be better or IT inrastructure
services” profled NIIT Technologies as a signifcant
Managed Services player, with a strategic direction to grow
the inrastructure business.
The Forrester Study highlights how global inrastructuremanagement clients are benefting rom lower cost remote
service delivery in selective outsourcing deals delivered
by smaller Indian frms. NIIT Technologies eatured in the
Forrester list o seven smaller India-based frms providing IT
inrastructure management services.
Showcasing strengths at the NASSCOM 2008 global
conclave
NIIT Technologies participated in NASSCOM 2008, the
Indian IT-BPO sector’s premier global conerence as the
Platinum Sponsor. British Airways, UK’s largest international
airline and a client o NIIT Technologies, was awarded
the prestigious NASSCOM “Business Transormation
Award” 2007-08 or innovative use o technology within
the organisation, acknowledging the contribution o NIIT
Technologies to BA’s growth story.
Hosting the annual global User Conference
NIIT Technologies hosted its 2007-08 biennial user
conerence in the US, with “Partnering or success” as its
theme. The theme paid tribute to NIIT Technologies’ long-
term customer relationships, some o which crossed the
fve and ten year landmarks.
The conerence provided a platorm or our customers to
connect & interact with the company and brainstorm on
key global sourcing trends that were expected to defnethe Outsourcing business in the years to come. The
conerence drew an excellent response rom participants
and opened up new avenues o business opportunity or
NIIT Technologies.
Signing off the Indian Navy project
During 2007-08, we obtained the ofcial project completion
signo or the prestigious and operationally critical
Comprehensive Maintenance Management System (CMMS)
o the Indian Navy which was executed at the Western Navy
Headquarters o the Indian Navy at Mumbai by the Delivery
Team o the India (Government) line o business in the APAC
and India Business Unit.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 12/100
This page is intentionally left blank.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 13/100
Fueling a growth spiral through Innovation
At NIIT Technologies Innovation helps us to quickly implement
new functionality and re-align processes to seize opportunities
as they arise across industry segments. Thus creating a
competitive edge and providing the fuel to grow our service
offerings portfolio
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 14/10012
A n n u A l R e p o R t 2 0 0 7 - 0 8
Dear Shareholders,
The Board o Directors o your company take pleasure in
presenting the Annual Report o NIIT Technologies Limited
or the fnancial year ended March 31, 2008.
Fiacial Reslts
The highlights o the fnancial results or the fnancial year
2007-08 are as ollows –
(Rs. M.)
Particlars FY 2007-08 FY 2006-07
Consolidated Revenues 9,415 8,859
Standalone fnancials:
Income rom operations 4,447 2,972
Other Income 510 121
Total Icome 4,957 3,093
Proft beore deprecation and taxes 1,722 1,356
Depreciation 230 218
Provision or tax & (deerred tax) 61 32
Proft Ater Tax 1,431 1,106
Earning Per Share (Basic) (In Rs.) 24.39 18.99
Review of global operatios
Your Company and its subsidiaries (Group’s) total revenue
grew by 6% rom Rs.8,859 Mn in the previous year to
Rs.9,415 Mn or the year 2007-08. The proft beore taxes
or the same period is down rom Rs.1,516 Mn to Rs.1,509
Mn. The consolidated net proft ater taxes or the year
2007-08 attributable to equity shareholders ater minority
interest stood at Rs.1,353 Mn.
During the year, your Group’s ocus on the chosen industry
verticals & endeavor to improve its perormance in businessesin all geographies, helped ensure moderate growth rates
in revenue & maintain proftability despite adverse global
macroeconomic conditions. It has also added to the robust
list o clients including a ew large global corporations.
The revenue profle o the Company is well diversifed across
the three main geographic areas with Europe contributing
50 percent to revenues, 32 percent rom Americas and the
balance rom Asia and Australia.
Otlook
Your Group continues to pursue its strategy to ocus on
its oerings in three chosen verticals - BFSI, transportation
and retail services. Continuous innovation in newer service
oerings, strong domain capabilities and inorganic initiatives
to expand its market access shall be the key to the growth
o the Group in the uture years. In the last couple o years,
we have undertaken a number o initiatives to turn our
business model rom a linear IT Services-centric one to a
non-linear one. We believe these initiatives will be the key
growth drivers & will also aid in improving proftability in the
uture.
Your Company continues to scale up its inrastructure to
support its long term strategy or growth, including setting
up a SEZ in Greater Noida, phase I o which is expected to
be operational in the coming fscal year.
Iorgaic Growth
During the year under review your Company acquired
a controlling stake in SoTec GmbH, a German based
company having a ocus on providing IT solutions and
services worldwide in the airline revenue accounting and
operations space and having a major market share o about 40 ‘small to medium airlines’ within Europe, Arica
and Asia. Founded in 1982, by Intro Group Sotec today is
a leader in the airline revenue accounting space or ‘small
to medium sized airlines’ with a market leadership in this
segment. This acquisition will strengthen the Company’s
domain leadership to reinorce its position in the Travel,
Transportation and Logistics space.
Share Capital
During the year, 38,400 equity shares o the Company o
Rs. 10/- each, ully paid up, were allotted under the
Employee Stock Option Plan 2005 o the Company on
exercise o stock options.During the year under review your Company also issued
19,559,465 equity shares to its members as bonus shares
as was approved by the members in the Annual General
Meeting held on July 25, 2007.
As on March 31, 2008, the issued and paid up share capital
o the Company was Rs. 586,983,950 (previous year:
Rs. 391,005,300) comprising o 58,698,395 (previous year:
39,100,530) equity shares o Rs. 10/- each ully paid up.
Further, on June 11, 2008, 7,300 equity shares o the
Company o Rs. 10/- each ully paid up were allotted under
the Employee Stock Option Plan 2005 o the Company on
exercise o stock option.
Reserves
The Company has transerred an amount o Rs. 143 Mn to
General Reserve (Rs. 111 Mn last year) and has transerred
an amount o Rs. 18 Mn rom the Debenture Redemption
Reserve (last year Rs. 24 Mn).
Divided
In view o the confdence in the uture, the Board is pleased
to recommend a dividend o Rs. 6.50 per equity share o Rs.
10/- each (previous year Rs. 6.50 per equity share) on the
enhanced capital, subject to approval o the shareholders at
the ensuing Annual General Meeting.
Directors’
Report
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 15/10013
A n n u A l R e p o R t 2 0 0 7 - 0 8
Particlars of sbsidiaries
During the year under review your Company incorporated a
subsidiary in Canada.
As on March 31, 2008, your Company had subsidiaries
in the United States o America, Japan, United Kingdom,
Netherlands, Belgium, Germany, Switzerland, Austria, India,Singapore, Thailand and Australia.
NIIT SmartServe Limited (NSSL) is the BPO arm o the
group and enables your Company to provide and oer the
customers a whole array o ITES services. This not only
gives the Company an extra advantage in positioning itsel
as an end-to-end IT services company but is also vital or
composite oerings to the customers
A statement containing brie fnancial details o the
subsidiaries is included in the Annual Report. As required
under the Listing Agreement with the stock exchange(s) a
consolidated fnancial statement o the Company and all
its subsidiaries has been prepared and attached hereto.
The Company has been granted exemption, or the yearended March 31, 2008 by the Ministry o Company Aairs
vide its letter No.47/185/2008-CL-III dated April 11, 2008
rom attaching the audited accounts o the subsidiaries to
the annual accounts o your Company. In accordance with
the terms o the aoresaid exemption letter, a statement
containing brie fnancial details o the subsidiary companies
or the year ended March 31, 2008 is included in the Annual
Report. The annual accounts o the subsidiary companies
and related detailed inormation will be made available to
any member o the Company or subsidiary company upon
request and are also available or inspection by any member
o the Company, during business hours, at the registered
ofce o the Company and that o the subsidiary companyconcerned.
Corporate Goverace ad Maagemet Discssio
ad Aalysis Statemet
In order to enhance customer satisaction and stakeholder
value, the Company continues to benchmark its corporate
governance practices with the best in the industry, at par
with international norms.
The Company has complied with all the mandatory
requirements regarding corporate governance as stipulated
under Clause 49 o the listing agreement with the stock
exchange(s). For the fnancial year ended March 31,
2008, the compliance report is included in the CorporateGovernance Report which orms part o the annual report.
The certifcate issued by the statutory auditors o the
Company on compliance o the conditions o corporate
governance stipulated in clause 49 o the listing agreement
with the stock exchange(s) orms part o the Corporate
Governance Report.
The Company’s philosophy on Corporate Governance
envisages the attainment o the highest levels o transparency,
accountability and equity in all acets o its operations and in
all interactions with its stakeholders including shareholders,
NIITians, lenders and the regulatory authorities.
The report on Corporate Governance and Management
Discussion and Analysis statement is included in the annual
report.
Delistig of Shares
The Equity shares o your Company are currently listed at
Bombay Stock Exchnage Ltd., National Stock Exchange o
India Ltd, Ahmedabad Stock Exchange Ltd., Madras StockExchange Ltd., The Delhi Stock Exchange Association
Ltd. and The Calcutta Stock Exchange Association Ltd.
As per the available data, the Company’s equity shares are
being mostly traded at National Stock Exchange o India
Limited and the Bombay Stock Exchange Ltd., which have
nationwide trading terminals. In view o the above and also
considering the cost beneft analysis, it is proposed, subject
to the approval o the shareholders, to delist the Company’s
share rom the ollowing stock exchanges –
1. Ahmedabad Stock Exchange Ltd.
2. Madras Stock Exchange Ltd.
3. The Delhi Stock Exchange Association Ltd.
4. The Calcutta Stock Exchange Association Ltd.
The proposed delisting shall not in any way aect the interest
o the investors in respective regions in view o the continued
listing at National Stock Exchange and the Bombay Stock
Exchange. A resolution in relation to the above orms part
o the notice o the ensuing annual general meeting or the
approval o the shareholders.
Directors
As per the provisions o the Companies Act, 1956 and
Articles 67, 68 and 69 o the Articles o Association
o the Company, Mr. Surendra Singh and Mr. Subroto
Bhattacharya, directors o the Company, retire by rotation at
the orthcoming Annual General Meeting and being eligible,oer themselves or reappointment.
Directors’ resposibility statemet
As required under Section 217 (2AA) o the Companies
Act, 1956, your Board o Directors o the Company hereby
states and confrms -
a) That in preparation o Annual Accounts or the fnancial
year, applicable Accounting Standards have been
ollowed along with the proper explanations relating to
material departures;
b) That they have selected the accounting policies
described in the notes to accounts, which have been
consistently applied, except where otherwise statedand made judgments and estimates that are reasonable
and prudent so as to give a true and air view o the
state o aairs o the Company as at March 31, 2008
and o the proft or loss o the Company or that year;
c) That they have taken proper and sufcient care or
the maintenance o adequate accounting records in
accordance with the provisions o the Companies Act,
1956, or saeguarding the assets o the Company
and or preventing and detecting raud and other
irregularities; and
d) That the Annual Accounts have been prepared on the
historical cost convention, as a going concern basis
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 16/10014
A n n u A l R e p o R t 2 0 0 7 - 0 8
and on accrual basis.
Iformatio relatig to Coservatio of Eergy,
Techology Absorptio, Research ad Developmet
ad Eports ad Foreig Echage Earigs ad
Otgo ad other iformatio formig part of the
Directors’ Report i terms of Sectio 217(1)(e) of theCompaies Act, 1956, ad Rles made there-der.
- Coservatio of eergy
The operations o the Company involve low energy
consumption. However, adequate measures, wherever
possible, have been initiated to conserve energy. The
Company is continuously evaluating new technologies
and invests in them to make its inrastructure more energy
efcient.
- Techology absorptio
In today’s world, perpetually evolving technologies and
increasing competition defne the global market space. In
order to maintain its position o leadership, the Companyhas continuously and successully developed innovative
methods or absorbing, adapting and eectively deploying
new technologies.
- Research & Developmet
During the year, the Company continued its research
in sotware engineering. These eorts have resulted in
innovative products in sotware engineering to support both
maintenance and development projects. Expenditure on
research and development is not signifcant in relation to
the nature and size o operations o the Company.
- Eport ad Foreig Echage Earigs ad Otgo
The details o oreign exchange earnings and outgo arementioned in Note Nos.11 to 13 contained in the Notes
to Accounts (Schedule No.18) orming part o the Balance
Sheet as at March 31, 2008 and Proft and Loss Account
or the year ended on that date.
Pblic Deposits
The Company has not accepted any fxed deposits and as
such, no amount o principal or interest was outstanding on
the date o the Balance Sheet.
Hma resorces Iitiatives ad Employee Stock
Optio Scheme
The human resource unctions and initiatives o the Company
are driven by a strong set o values and policies. In the year
under review many o the key HR initiatives taken ocused
on the critical issue o meeting career aspiration o sta
members. Policies enabling job rotation and processes to
acilitate career growth were instrumental in ensuring better
productivity and retention. This also resulted in improvement
in the overall employee satisaction scores as compared to
the previous year. There was a quantum decrease in the
attrition rate and the average days o training per sta
member was increased in the year under review.
Your Company has maintained a competitive, healthy and
harmonious work environment at all levels. Your Company
has taken new initiatives to strengthen the Company’s
recruitment process, values and vision programmes,
leadership and perormance management.
In view o your Company’s continuous endeavour toprovide learning and development to its sta members
your Company added behavioral, Technical & Management
courses to its existing bouquet o online courses. Your
Company also institutionalized new modes o training like
Synchronous learning through NIIT Imperia, mentoring
programs and tie ups with leading management institutes
and technology providers
Your Company was elicitated at the Employer Branding
Awards or Excellence in HR through Technology and or
Innovation in Career Development by the Asia Pacifc HRM
Congress.
The statement o employees pursuant to Section 217(2A) o
the Companies Act, 1956, read with Companies (Particularso Employees) Rules, 1975 is appended as Annexure A
hereto and orms an integral part o this report.
Details o options granted under ESOP 2005 are annexed to
this Report in accordance with SEBI (Employee Stock Option
Scheme & Employee Stock Purchase Scheme) Guidelines,
1999 and any modifcations thereto as Annexure B.
Aditors
M/s. Price Waterhouse, Chartered Accountants, the
Auditors o the Company, retire at the conclusion o the
ensuing Annual General Meeting and being eligible, oer
themselves or re-appointment.
Aditors Report
The Report o the Auditors’ on the Annual Accounts o
your Company orms part o the Annual Report and is sel
explanatory.
Ackowledgemet
Your Directors take this opportunity to thank all investors,
business partners, clients, technology partners, vendors,
fnancial institutions/banks, regulatory and government
authorities, media and Stock Exchanges or their continued
support during the year. Your Directors place on record
their appreciation o the contribution made by NIITians
at all levels or their commendable teamwork, dedicated
and wholehearted eorts, without which your Company’sconsistent growth would not have been possible.
For and on behal o the Board
Place : New Delhi Rajendra S Pawar
Dated : June 18, 2008 Chairman
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 17/10015
A n n u A l R e p o R t 2 0 0 7 - 0 8
AnnExuRE – A
Statement pursuant to Section 217(2A) of the Companies Act, 1956 for the nancial year April 1, 2007 to March 31, 2008
name Age(Years)
Qualication Experi-ece
(Years)
Desigatio GrossRemuera-
tio
(i Rs.)
Date ofJoiig
PreviousEmploymet /
Positio Held
Rajendra Singh Pawar 57 B.Tech. 36 Chairman & Managing
Director
9,362,500 12-Jun-04 NIIT Limited, Chairman
& Managing Director*
Ashok Kumar Arora 53 B.Com 31 Group Chie Financial
Ofcer
4,832,315 1-Apr-03 NIIT Limited, Chie
Financial Ofcer
Arvind Thakur 53 BE, MBA 30 Chie Executive Ofcer &
Joint Managing Director
13,702,549 12-Jun-04 NIIT Limited, Whole-
time Director
Vijay Ghei 49 BE 27 Vice President 2,609,588 1-Apr-03 NIIT Limited, General
Manager
Kawaljit Singh 47 B.Com(H), FCA 24 Financial Controller
- Corp.Centre
4,103,123 1-Apr-03 NIIT Limited, Financial
Controller
Bhaskar Chavali 49 BE, ME 26 Executive Vice President 4,949,024 1-Apr-03 NIIT Limited, Vice
President
Arvind Mehrotra 46 MBE 24 Senior Vice President-SSB, APAC & India
3,955,422 1-Apr-03 NIIT Limited, GeneralManager
Parag Jaikrishna Rajadhaksha 49 B.Com, MBA 24 General Manager 2,510,383 1-Apr-03 Silverline Technologies
Ltd., Assistant General
Manager
Kul Taran Singh Anand 49 M.Com, FCA 26 Chie Financial Ofcer 5,777,498 4-Apr-03 TCNS Ltd., Vice
President (Finance &
Manuacturing) and
SBU Head
Rosita Rabindra 47 B.Sc., MSW 25 Executive Vice President
- Human Resources
4,868,987 1-Apr-03 NIIT Limited, Sr. Vice
President - Human
Resources
Piyush Srivastava 52 M.A. 28 Senior Vice President
– Commercial Services
4,045,416 1-Apr-03 NIIT Limited, President
- Commercial
Vijay Kumar 56 BE, B.Tech.,
MBA
31 Group Executive Vice
President - M&A
3,665,503 1-Apr-03 NIIT Limited, Sr. Vice
President
Satish Kumar Syal 58 B.E., M.Tech 34 Executive Vice President
- Managed Services
4,846,995 1-Apr-03 NIIT Limited, Chie
Inormation Ofcer
Anil Batra 40 BE, B.Tech 19 General Manager 2,488,201 1-Apr-03 NIIT Limited,Senior
Project Manager
R Manickavasagam 52 M.Sc 28 Vice President 2,609,161 24-May-
06
Vizual Business
Tools Pvt. Ltd., Head
Delivery/Operations
Umamaheshwaran Shastry 41 MBA 21 Vice President 3,573,633 26-Feb-07 Mercator Dubai-
Manager, IT, Sales &
Accounts
Udayan Banerjee 52 BE, B.Tech 31 Vice President 2,817,174 1-Apr-03 BHEL, Manager
Dinesh Verma 40 BE, B.Tech 19 General Manager 2,447,437 1-Apr-03 Enpro India Ltd.,
Associate Consultant
Amit Kumar Chakraborty 49 BE, B.Tech 30 Vice President 3,003,621 1-Apr-03 HCL Europe Ltd.,
Manager Technical
Services
Ritu Gupta 40 BA, MBA 18 Business Solutions
Architect
2,411,071 1-Apr-03 TATA Consultancy
Pulok Kumar Nandi 46 MSc, ME, M.Tech 22 Practice Leader 2,569,246 1-Apr-03 Churchill India
Alok Jauhary 48 B.E, B.Tech, MBA 26 Vice President 2,710,279 19-July-
04
Perot Systems TSI
(India) Ltd., General
Manager
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 18/10016
A n n u A l R e p o R t 2 0 0 7 - 0 8
Employed for part of the year
name Age
(Years)
Qualication Experi-
ece
(Years)
Desigatio Gross
Remuera-
tio(i Rs.)
Date of
Joiig
Previous
Employmet /
Positio Held
Ajay Dixit** 39 B.Sc, MCA 16 Program Manager 1,510,745 1-April-03 Wipro Inotech Ltd.
Khagendra Nath Jana*** 52 B.E, M.Tech 22 General Manager 1,980,875 1-Apr-03 NIIT Limited, Divisional
Manager
Kapil Raina** 57 BE, B.Tech, MBA 38 General Manager 1,725,154 1-Apr-03 Appollo Tyres Ltd.
Arvind Madhav Gangal** 51 BE, B.Tech 28 Vice President 2,767,776 8-May-06 SIEMENS Inormations
Systems Ltd.-DGM
Radha Raman Chaudhary** 51 ME, M.Tech 23 Practice Leader-
Transportation Practice-
SSB
1,409,831 11-July-06 Hexaware
Technologies Ltd.
Harish Kumar Sharma+ 47 ME, M.Tech 25 Vice President-Travel &
Transport USA
1,435,903 1-Oct-07 Perot Systems TSI
(India) Ltd. Tarun Malik*** 45 BE, MBA 21 Vice President 1,279,277 1-Apr-03 NIIT Limited,
General Manager
* Continuing as Chairman and Managing Director
** Resigned during the year
+ Joined during the year
*** Ceased to be an employee o the Company, during the year
Notes:
1. The Gross remuneration shown above comprises salary, allowances, incentives & monetary value o perquisites as per Income Tax Rules and Company’s
contribution to Provident Fund and Superannuation Fund.
2. The above does not include provision or gratuity and provision or leave encashment and benefts rom stock options, i applicable
3. None o the above mentioned employees are related to any o the Directors o the Company.
4. The nature o employment is contractual in all the above cases.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 19/10017
A n n u A l R e p o R t 2 0 0 7 - 0 8
AnnExuRE B
Disclosure uder SEBI (Employee Stock Optio Scheme & Employee Stock Purchase Scheme) Guidelies, 1999
(a) options granted; Grant I : 660,750 (August 2, 2005)*
Grant II : 70,600 (August 11, 2005)*
Grant III : 280,000 (June 20, 2007)*
Total : 1,011,350*
*The options were granted prior to the issuance o bonus shares.
(b) the pricing ormula; At a price not less than the then existing ace value o the share o the
Company.
Grant Price Market Price Discount
Grant I : Rs. 115.00 Rs. 149.50 23% o Market Price
Grant II : Rs. 150.85 Rs. 150.85 No
Grant III : Rs. 523.50 Rs. 523.50 No
(Note: Prices are pre-bonus issue)
(c) options vested; As at March 31, 2008
Grant I : 597,400
Grant II : 16,000
Grant III : NIL
Total : 613,400
(d) options exercised; As at March 31, 2008Grant I : 473,650
Grant II : 16,000
Grant III : NIL
Total : 489,650
(e) the total number o shares arising as a result o exercise o option; 489,650
() options lapsed; As at March 31, 2008
Grant I : 123,150
Grant II : 54,600
Grant III : 41,250
Total : 219,000
(g) variation o terms o options; None
(h) money realized by exercise o options; Grant I : Rs. 53,689,750
Grant II : Rs. 2,413,600
Total : Rs. 5,61,03,350
(i) total number o options in orce; Grant I : 106,300*
Grant II : 358,125*
Total : 464,425*
*Post bonus adjustment
(j) employee wise details o options granted to;-
(i) senior managerial personnel; A summary^ o options granted to senior managerial personnel* are as
under:
No. o employees covered: 10 (Ten)
No. o options granted to such personnel: 303,100 (Three Lakh Three
Thousand One Hundred only)
*includes employees who are one level below the Board o Directors or CEO
working in executive capacity.
^ Only summary given due to sensitive nature o inormation, details o whichcan be obtained rom the Registered ofce by the members o the Company,
upon request.
(ii) any other employee who receives a grant in any one year o option
amounting to 5% or more o option granted during that year.
Nil
(iii) identifed employees who were granted option, during any one
year, equal to or exceeding 1% o the issued capital (excluding
outstanding warrants and conversions) o the company at the time
o grant
Nil
(k) diluted Earnings Per Share (EPS) pursuant to issue o shares on exercise
o option calculated in accordance with Accounting Standard(AS) 20
‘Earnings Per Share’
Rs.24.35 (previous year: 18.89)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 20/10018
A n n u A l R e p o R t 2 0 0 7 - 0 8
(l) Where the company has calculated the employee compensation cost
using the intrinsic value o the stock options, the dierence between
the employee compensation cost so computed and the employee
compensation cost that shall have been recognized i it had used the
air value o the options, shall be disclosed. The impact o this dierence
on profts and on EPS o the company shall also be disclosed
Please reer to Notes Nos.22 and 26 contained in the Notes to Accounts
(Schedule No.18) orming part o the Balance Sheet as at March 31, 2008 and
Proft and Loss Account or the year ended on that date.
(m) Weighted-average exercise prices and weighted-average air values o
options shall be disclosed separately or options whose exercise price
either equals or exceeds or is less than the market price o the stock
Grant I* Grant II* Grant III*
Weighted-average Exercise price Rs. 115.00 Rs. 150.85 Rs. 523.50
Weighted-average Fair Value Rs. 59.20 Rs. 41.18 Rs. 168.11
* Pre bonus issue
(n) A description o the method and signifcant assumptions used during the year to estimate the air values o options, including the ollowing weighted-
average inormation:
(i) risk-ree interest rate, Grant I Grant II Grant III
7% 7% 7.93%
(ii) expected lie, 2.5 years
(iii) expected volatility Grant I Grant II Grant III
10% 10% 51.13%
(iv) expected dividends, and The shares to be issued under stock options shall rank pari-passu, including
the right to receive dividend.
Expected dividend payouts to be paid during the lie o the option reduce the
value o a call option by creating drop in market price o the stock. Adjustments
or known dividend payouts over the lie o the option are made to the ormula
under Black Scholes method. However, in the present case, as the lie o the
option is greater than one year, there is considerable difculty in estimating
the amount and time o uture dividend payouts with certainty. Hence, uture
dividend payouts have not been incorporated in the valuation analysis
(v) the price o the underlying share in market at the time o option
grant
For Grant I the market price was Rs. 149.50
For Grant II the market price was Rs. 150.85
For Grant III the market price was Rs.523.50
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 21/100
Inorganic Initiatives take us to the next level of achievement
Corporates demand that IT infrastructure not only support today’s
requirements, but evolve with market conditions. With our well-
defined inorganic program in place we have accelerated the process
of achieving critical mass and appropriately
strengthened domain expertise and market access. At NIIT
Technologies we will continue to initiate equity relationships toachieve our growth targets
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 22/10020
A n n u A l R e p o R t 2 0 0 7 - 0 8
OVERVIEW
Despite challenging headwinds in terms o actor costincreases and Rupee appreciation, as well as toughmacroeconomic conditions, the Indian IT-BPO industry
sustained its global competitiveness. While the Outsourcingmarket continued to expand, by the end o the year it wasquite evident that radical changes were required in businessmodels ollowed.
The country’s advantages o readily available skilled, Englishspeaking proessionals, operational excellence, conduciveregulatory climate and cost advantage have aided Indiain emerging as the key Oshoring provider country, in theace o growing competition rom emerging oshoringdestinations such as the Philippines, Brazil and China.However, the “beyond-cost” expectations o benets suchas improved service levels, process eciency and speed-to-market are gaining in importance.
The total revenue aggregate or the IT-BPO sector (includingthe domestic and export segments) is expected to crossUS$ 64 billion. The industry directly generated employmentor nearly 2 million proessionals, accounting or 5.5 percento the country’s GDP.
The domestic market exhibited the astest growth, thusdisplaying growing maturity, as well as the strong demand.While the traditional turs such as North American andEurope continued to lead in terms o revenue contributions,Indian IT-BPO companies also orayed into emergingmarkets such as the APAC, Arica, Latin America, amongothers.
Industry watchers estimate that the Indian IT-BPO industryis on track to achieve the revenue targets set beore it bythe NASSCOM-McKinsey Study o 2002 and touch aroundUS$ 60 billion in terms o exports by 2010.
NIIT Technoloies LIMITED: (Consolidted)
STRaTEgy Of VaLuE fROM fOCuS
In the our years since NIIT Technologies was spun o rom NIIT Limited, we have demonstrated a sharp ocus onspecic vertical industry segments. BFSI, being the largestvertical, has accounted or 44 percent o the revenues, traveland transport or 25 percent and retail and manuacturing
or 12 percent. In all, 81 percent o the Company’s revenuesare derived rom these areas o ocus.
Our consistent & protable growth in the ace o harshmacroeconomic headwinds is driven by NIIT Technologies’single-minded ocus on building strengths in chosen
verticals.
Verticls Mix
BFSI
42%BFSI
44%
Others21%
Others19%
Retail &Manfg.
12%
Retail &Manfg.
12%
Transportation
25%
Transportation
25%
FY’07 FY’08
Within BFSI, the Company continues to be sharply ocusedon the Insurance sector, which now contributes around28 percent towards overall revenues. Our acquisition o UK-based specialist insurance solutions provider, ROOMSolutions Limited in 2006 has acilitated this perormance.ROOM Solutions has now been successully integrated intothe organisation.
BuSINESS INNOVaTION
The world is changing. And the old ways o doing businessmust change or organizations to remain relevant. Innovationis the key to transormation. Last year we announcedour oray into the new business segment o Inrastructure
Management and Managed Services. This has becomeour astest growing service line yielding annual growths o over 40 percent year on year. We have also integrated thisoering with our Application Development & Maintenance(ADM) & Business Process Outsourcing (BPO) servicesto provide a compelling & unique value proposition to ourcustomers. Over the last year, the Company has also madeinvestments into reworking our rameworks & products(both owned & acquired) into Platorm-based Services. Lastyear we also announced our oray into the Sotware as aService (SaaS) space. Taken together, these oerings willorm the basis or the transormation o our business modelrom a linear to a non-linear one. We expect our non-linear
oerings to drive our growth.INORgaNIC INITIaTIVES
During the year, your Company acquired 100 percent o German-based SoTec GmbH in an all cash deal. SoTecGmbH is a specialist in providing IT solutions and servicesin the airline revenue accounting and operations space. Theacquisition will urther strengthen our presence in the Travel,
Transportation and Logistics vertical.
PEOPLE RESOuRCES
As o March 31, 2008, the sta strength o NIIT Technologiesstood at 5,118, o which 711 were in the BPO segment. Atthe year end the Company has an oshore development
Management
Discussion and
Analysis
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 23/10021
A n n u A l R e p o R t 2 0 0 7 - 0 8
capacity o over 300,000 square eet. The constructionwork or the campus in Greater Noida is currently underwayin ull swing, and is expected to be completed by the endo 2008.
fINaNCIaL HIgHLIgHTS
The consolidated nancials take into account the nancialso NIIT Technologies Limited and its subsidiaries, includingsubsequent level companies ater eliminating inter-companytransactions.
NIIT Technologies and its subsidiaries posted a consolidatedincome o Rs. 9561 million or the nancial year endingMarch 31, 2008. The year saw revenues touch Rs. 9415million, up rom Rs. 8859 million in the previous year,resulting in an annual growth o 6 percent.
Revenue Profle
2,1362,178
2,214
2,373
158121
124
112
1,900
2,000
2,100
2,200
2,300
2,400
2,500
2,600
AMJ '07 JAS '07 OND '07 JFM '08
2294 2299
2338
2485
8,305
8,901
554
514
7,600
7,800
8,000
8,200
8,400
8,600
8,800
9,000
9,200
9,400
9,600
FY’07 FY’08
(Rs. Million) aMJ ’07 JaS ’07 OND ’07 JfM ’08 fy ’08
Sotware 2136 2178 2214 2373 8901
Business ProcessOutsourcing
158 121 124 112 514
NIIT Technoloies 2294 2299 2338 2485 9415
georph Mix
Europe accounted or around 50 percent o revenues, sameas last year. The revenue share o the Americas stood at 32percent, while Asia and Australia contributed the balance18 percent towards revenue totals.
georph Mix
FY’07
India
8%
Americas
32%
Americas
32%
Europe
50%
Europe
50%
APAC
10%
APAC
10%
India
8%
FY’08
Client profle
The company’s revenues were more broad-based thisyear compared to the previous year. The Top ve clientscontributed 36 percent o the revenues. The Top 10 clientscontributed 47 percent o the revenues, while 60 percent o
the revenues were generated rom the Top 20 customers. The Company continued to bag resh orders at a regularpace, and notched up a total intake o US$ 228 million orthe year. 91 percent o NIIT Technologies’ revenues werea result o repeat business. The Company’s million dollarclients jumped rom 38 to 42 during 2007-08.
39%
50%
65%
36%
47%
60%
0%
10%
20%
30%
40%
50%
60%
70%
FY '07 FY '08
Top 5 Top 10 Top 20
Audited Consolidated Proftability
Rs. Million
fy 2008 fy 2007 fy 2006
Revene 9415 8859 6075
Expenses 7652 7056 4920
Operating Proft 1763 1803 1156
Operating Prot margin 19% 20% 19%
PBT 1509 1516 790
PaT 1353 1292 663
An expense analysis o the Company shows that whilepersonnel constituted the highest element o cost at57 percent o revenues, development and bought-outmaterials constituted 7 percent and administrative andmarketing, 17 percent. Depreciation and amortisationaccounted or 4 percent, leaving a PBT margin o 16 percent or the year.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 24/10022
A n n u A l R e p o R t 2 0 0 7 - 0 8
Hede accontin
In accordance with its Risk management policies andprocedures, the company uses derivative instrumentssuch as oreign currency orward contracts and currencyoptions to hedge its risks associated with oreign currency
fuctuations relating to certain rm commitments and highlyprobable orecasted transactions. The derivatives thatqualiy or hedge accounting and designated as cash fowhedges are initially measured at air value & are remeasuredat a subsequent reporting date and the changes in the airvalue o the derivatives i.e gain or loss (net o tax impact)is recognized directly in shareholders’ unds under hedgingreserve to the extent considered highly eective. Gain orloss on derivative instruments that either does not qualiy orhedge accounting or not designated as cash fow hedgesor designated cash fow hedges to the extent consideredineective are recognized in the prot and loss account.
Hedge accounting is discontinued when the hedging
instrument expires, sold, terminated, or exercised, or nolonger qualies or hedge accounting. The cumulativegain or loss on the hedging instrument recognized inshareholder’s unds under hedging reserve is retained thereuntil the orecasted transaction occurs subsequent to whichthe same is adjusted against the related transaction. I ahedged transaction is no longer expected to occur, the netcumulative gain or loss recognized in shareholder’s und istranserred to prot and loss account in the same period.
adited Consolidted Blnce Sheet
Rs. Million
Prticlrs s on Mrch 31, 2008 Mrch 31, 2007
Sorces o fnds
Share Capital 587 391
ESOP Outstanding 2 4
Reserves and Surplus 3824 3308
Net Worth 4413 3703
Minorit Interest 49 149
Lon nds 647 793
Totl 5109 4645
appliction o fnds
Fixed Assets
Gross Block 4358 3770
Depreciation 2499 2277
Net Block 1859 1493
Capital Work in Progress 518 37
Investment 1311 1444
Deerred Tax Asset 68 80
Net Current Assets 1353 1591
Totl 5109 4645
Shre Cpitl
The paid-up equity share capital o the Company stands atRs. 587 million, constituting 58,698,395 equity shares o Rs 10/- each.
Emploee Stock Option Pln
The Company established NIIT Technologies Stock OptionPlan 2005 (ESOP 2005) in the year 2005-06 and the samewas approved at the Annual General Meeting o the companyon 29th July 2004. The plan was set up so as to oer and
grant or the benet o employees o the company and itssubsidiaries, who are eligible under Securities ExchangeBoard o India (SEBI) Guidelines (excluding promoters),options o the company in aggregate up to 3,850,000options under ESOP 2005, in one or more tranches, and onsuch terms and conditions as may be xed or determinedby the Board in accordance with the provisions o law orguidelines issued by the relevant authorities in this regard.
As per the plan each option is exercisable or one equityshare o ace value o Rs 10 each ully paid up on paymentto the company or such shares at a price to be determinedin accordance with ESOP 2005. SEBI has issued theEmployees’ Stock Option Scheme and Employee StockPurchase Scheme Guideline, 1999 which is applicable tothe above ESOP 2005.
The Company granted option in three tranches, the detailso which are as ollows:
Description Trnche 1 Trnche II Trnche III
Date o Grant August02, 2005
August11, 2005
June20,2007
Date o Vesting August02, 2006
August11, 2006
June20, 2008
Live grants at beginning /duringthe year (Nos)
106,800 - 280,000
Foreited/lapsed till vesting period
( Nos)
- - 41,250
Options Vested ( Nos) - - Nil
Options oreited post vesting(Nos)-Pre Bonus
3,700 - Nil
Options Exercised ( Nos)-PreBonus
18,400 - Nil
Vested Options Post Bonus 127,050 - -
Options oreited post vesting(Nos)-Post Bonus
750 - -
Options Exercised ( Nos)-PostBonus
20,000 - -
Exercisable/outstanding at the
end o the Year (Nos)- PostBonus
106,300 - 358,125
Exercise Price- Pre Bonus- Post Bonus
Rs 115.00Rs. 76.67
Rs 150.85-
Rs. 523.50Rs. 349.00
Remaining Contractual Lie 488 days - 1462 Days
Fair Value o the Options basedon Black and Scholes model ( asper Independent valuer’s report)
Rs 59.20 Rs 41.18 Rs. 168.11
Intrinsic Value o option Rs 34.50 - -
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 25/10023
A n n u A l R e p o R t 2 0 0 7 - 0 8
Lon fnds
The 6.50 percent Non-Convertible Debentures (Separately Tradable and Redeemable Principal Parts), redeemable overa ve-year period, refect the borrowed amount o Rs. 500million, privately placed in May 2003. Part redemption o
Rs. 100 million or the said debentures was done in May2007. The balance NCD o Rs. 150 mn as o March 31,2008, is due or repayment within one year. Loan unds alsoincludes Rs. 457 mn term loan outstanding as at March 31,2008 taken rom ICICI Bank, Bahrain.
Minorit Interest
The minority shareholding includes the interest o thirdparties in one o the Company’s subsidiaries, NIIT GISLimited (as minority shareholders), provision or which hasbeen made based on the prots o the subsidiary.
fixed assets
During the year, capital investments o Rs. 495 million
were made or project-related capital assets and capacityincreases. The goodwill created on account o the acquisitiono balance 25% stake in ROOM Solutions was Rs. 170million, while the goodwill created on account o acquisitiono SoTec GmbH was Rs. 156 million. In addition, Rs. 518million o Capital WIP was created, primarily or the newSEZ campus development at Greater Noida.
Investments
Investments o Rs. 1311 million refect the sums invested inDebt and Money Market Mutual Funds schemes.
Net Crrent assets
The elements o net current assets are as ollows:• Trade Receivables: Debtor days stand at 84, on a
total sundry debtors position o Rs. 2,178 million
• Csh nd Bnk: Cash and Bank balance as on March31, 2008 is Rs. 660 million. Considering the mutualund investments, the total cash and cash equivalentsare higher at Rs. 1972 million
• Other Crrent assets: This primarily includes unbilledrevenues and Interest Receivable
• Lons nd advnces: This includes advances, pre-paid expenses, security deposits made by the companyin the normal course o business and advance taxesdeposited
• Current Liabilities and Provisions: This representssundry creditors, including capital creditors, advancesrom customers, unearned revenues, security deposits,provisions or leave encashment, gratuity, dividend andother liabilities
Relted Prt Trnsctions
Related Party transactions are dened as transactions o thecompany with the Promoters, Directors or the Management,their subsidiaries or other related parties who may have apotential confict with the interests o the company at large.
All transactions covered under related party transactionswere regularly ratied and/or approved by the Board,
the guiding principles being arm’s length, airness and
transparency. The details o related party transactions aregiven in the Notes to Accounts section.
NIIT TECHNOLOgIES LTD: STaNDaLONE
Revene rom Opertions
The revenues rom operations or the year stood atRs. 4,447 million, up 50 percent year-on-year.
Other Income
The other income earned by the Company includes CapitalGains and Dividend Income on the mutual und investments,Recoveries made rom subsidiaries or common servicesand asset usage charges recovered rom the GroupCompany. The company reported Rs. 509 million o OtherIncome in FY08.
Revene Reconition Polic
The signicant Accounting policies and practices ollowedby NIIT Technologies Limited are disclosed in Note 1 o
Schedule “18” (Notes to Accounts) or the year.
forein Crrenc Ernin/Expenditre
Rs. Million
fy2008 fy2007
Earning in Foreign currency 4,059 2,683
Revenue Expenditure in Foreign Currency 1,024 81
Net Revenue Earning in Foreign Currency 3,035 2,602
Capital Expenditure in Foreign Currency 59 30
Net Foreign Currency Earnings 2,976 2,572
Expenditre
Personnel
The personnel cost was Rs.2,135 million, 48 percent o therevenue line, as compared with last year’s numbers at 39percent o revenues.
Development, Prodction nd Exection
This cost constituted 9 percent o revenues. It includes thecost o products purchased or resale.
Other Expenditre
Other expenditure including administration, marketingspend, travel and communication costs were at same levelsas last year at 16 percent o revenues.
Deprecition The Company’s depreciation charge was Rs. 230 million, 5percent o revenues.
Dividend
The Board o Directors o the Company has recommendeda dividend o Rs. 6.5 per Equity Share o Rs. 10 each, sameas last year, but on an enhanced equity base (post-bonus).
BaLaNCE SHEET
fixed assets
During the year, the Company added Rs. 403 million to itsgross block o assets or project related capital expenditure
and capacity increases.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 26/10024
A n n u A l R e p o R t 2 0 0 7 - 0 8
Investments
Rs. Million
fy 2008 fy 2007
Investment in subsidiaries & JV 1,323 1,132
Mutual unds 606 835
Totl 1,929 1,967
Crrent assets, Lons nd advnces
Trade Receivables
Sundry debtors amount to Rs.1,111 million (net o provisionor doubtul debts amounting to Rs. 36 million) as o March31, 2008. O the total receivables, Rs. 1085 mil lion worth o debts are outstanding or less than six months while Rs. 26million are outstanding or over six months.
Csh nd Bnk
Rs. Million
fy 2008 fy 2007
Fixed Deposits 10 10
Cash in hand & balances with Banks 135 53
Totl 145 63
The above excludes Rs. 606 Million invested in the moneymarket mutual und schemes, which have been consideredin investments (Rs. 835 Million last year).
Other Crrent assets
This includes Unbilled Revenue o Rs. 14 million, InterestReceivable o Rs. 1 million and Dividend Receivable o Rs.
382 million.
Lons nd advnces
The loans and advances stand at Rs. 474 million at theend o the year. The outstanding amount represents loan tosubsidiaries, Pre-paid Expenses and other constituents inthe normal course o business. These also include advancesto suppliers, advance tax (net o provision), rent advancesand security deposits given or premises.
Cpitl Strctre
The share capital o the company stands at Rs. 587million.
Reserves
The reserves and surplus o the company are as ollows:
Rs. Million
fy 2008
Capital redemption reserve 17
Share premium 2
Debenture redemption reserve 37
General Reserves 928
Hedging Reserve (145)
Prot and Loss Account 2,449
Totl 3,288
Lon fnds
Break up o the secured debt o Rs. 167 million as o year-end is:
• Rs. 150 million o privately placed 6.50 percent non-convertible debentures (STRPP) raised by the Company
in May 2003. These debentures are ully repayable inFY2009.
• The balance Rs.17 million pertains to vehicle-nancingarrangements undertaken by the Company or itsemployees.
Reconitions
• NIIT Technologies ranked among India’s Top 20 ITSotware and service Exporters by the NASSCOM2007 survey.
• NIIT Technologies ranked 36th in the 2008 Blck Book
o Otsorcin. The Top50 listing is published by WallStreet Journal & BusinessWeek. As per the 2008 Black
Book o Outsourcing, “Focusing on succeeding in specifc verticals in ITO and BPO, NIIT appears on the
Black Book ranks or the frst time with top scores rom
Banking, Financial Services & Insurance, Travel, Retail
& Manuacturing sectors.” NIIT Technologies was alsorecognized among the “Strongest Comebacks acrossve years o Black Book Satisaction Surveying”, andpositively ranked or C Level Commitment, CorporateDirection, Leadership Impact and Human CapitalPerormance.
• NIIT Technologies & KBC Bank Belgium were jointlyawarded the Bnkin & finnce ICT Innovtion
awrd or Belgium/Luxembourg.
• NIIT Technologies was awarded the Excellence inEducation Award by LOMA.
• Room Solutions was given ACORD InnovativeImplementation Award.
• NIIT Technologies was listed amongst Forbes Asia's“200 Best Under a Billion” companies.
• Mr. Rajendra S. Pawar, Chairman, NIIT Technologieswas conerred the geosptil Entreprener o the
yer awrd by Geospatial Today publication
Opportnities, Threts, Risk nd Concerns, Risk
Mitition
The NASSCOM reports suggest that the worldwidetechnology related spends are orecast to reach US$ 2.1trillion by 2010, growing at a CAGR o more than 7 percentover 2006-2010. Growth in global sourcing is expected tooutpace growth in total spends, with up to US$ 110-120billion o the total amount spent on sotware and services in2010, likely to be sourced rom worldwide centers throughthe global delivery model.
However, current macroeconomic environment posessignicant short & medium-term challenges to growth.
The sub-prime crisis, infationary environment uelledby high oil & commodity prices & volatile exchange ratescenarios are all part o the business environment. In such
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 27/10025
A n n u A l R e p o R t 2 0 0 7 - 0 8
an environment, the key to growth is likely to be innovativeservice oerings, and a deep understanding o customerneeds. The external growth actors include the growingimpact o technology-led innovation, leading the increasingdemand or global sourcing and the gradually evolvingsocio-political attitudes.
The Value proposition o the Indian IT-BPO industry islargely supported by its abundant talent that is expectedto support diverse operations, cost advantage, emphasison quality, inormation security and rapid growth in keybusiness inrastructure.
The IT-ITES Industry thrives under a dynamically changingand highly competitive business environment. YourCompany too aces several business risks, o which someprominent ones are discussed hereunder along side the riskmitigation approach ollowed by the Company:
Concentration risks: Your Company has taken signicant
steps to ensure that it does not become too dependenton ew clients or any particular geography. Europe andthe United States contributed 50 percent and 32 percentrevenues respectively, during the year 2007-08, with thebalance contribution coming rom the Asian region.
However, considerable eorts are being made to generatebusiness rom new geographies and clients. Your Companyis also increasing its ocus on all regions and has signed aJoint Venture with Ajilon Holding Europe B.V. (an AdeccoGroup company) to tap into the global business potential.
M&A execution risks: Your Company has chosen organicand inorganic route to grow exponentially in the uture
years. During the course, the Company may be exposedto risks such as, increase in cost on account o stang/ advisory ees, due diligence lapses and practical challengesin integration.
Your Company ollows a strategic approach in pursuanceo its M & A activities and many o the risks are mitigated byrestricting the choice o target companies by applying certainrigorous selection criteria as also by proper resourcing o the integration eorts. The Company also uses team o experts in carrying out the due diligence thereby reducingthe risk o lapses.
Investment portolio related risks: In order to deal with
surplus cash, your Company, as a policy, does not preer toinvest in high risk assets such as equities and low liquidityassets like real estate. The primary area o risk or theCompany’s market exposures are related to the interest raterisk on its investment securities. To mitigate interest raterisk, all surplus unds are invested in appropriate avenuesupon a review by the investment committee. All investmentdecisions are driven by certain guiding principles like, saetyo investments, liquidity and returns
Emploee-relted risks
Attrition: Human Resource unctions and initiatives o yourCompany are driven by a strong set o values and policies.
Your Company has maintained a competitive, healthy and
harmonious work environment at all levels. Your Companyhas taken new initiatives to strengthen its recruitmentprocesses, values and vision programmes, leadership andperormance management programmes to retain the besttalent.
Constraints in availability o skilled resources: Your Companyoers competitive salary constantly benchmarked to themarket, world class inrastructure, excellent work culture,high class training and career development and long termgrowth prospect, to remain an employer o choice. YourCompany is also ranked among the Top 20 Best Employersin a Dataquest–IDC Best Employer Survey. Your Company’sdevelopment centers are in cities which have goodavailability o skilled manpower.
Competition-related risk: Indian IT services market remains avery competitive space. The Company is acing competitionrom large Indian IT vendors and global vendors who areincreasing their India presence by setting up oshoredelivery centers.
Your Company ollows global standards o development,including an ISO 9001:2000 certication, assessment atLevel 5 o both SEI-CMMi and People-CMM rameworksand BS 7799 inormation security management certication.Operations o your Company’s subsidiary in Thailand areassessed at the international BS15000 IT managementstandards. NIIT SmartServe is BS 7799 and COPCcompliant.
Your Company/Subsidiaries are managed by locallyrecruited proessionals and talents across all geographies.
They have established strong interaction with various analystrms worldwide through participation in IT conerences andindustry specic events attended by CIO’s and executiveso major corporations. Sales & marketing and deliveryinrastructure o your Company is world class. This helpsyour Company to maintain its competitive edge over otherplayers.
Exchange rate risk: The unctional currencies or theCompany and its subsidiaries’ operations are the respectivecurrencies o the countries in which they operate. Substantialportion o your Company’s revenues is derived rom oreignexchange; any fuctuation in this could have an impacton the Company’s perormance. Your Company actively
books oreign exchange orward covers/derivative optionsto hedge against oreign currency fuctuations related to itsbills receivables and anticipated realisations rom projectedrevenues.
Geo-political risks: The ability o Indian IT/BPO servicescompanies to secure oshore projects rom clientorganisations abroad is oten subject to threat perceptionsas regards the Indian subcontinent. Current civil situationsin neighboring countries o India may have negativeimplications or the operations o the Company. To mitigatethese risks and to ensure continued delivery o services toclients irrespective o any geo-political disturbances, theCompany has been taking appropriate measures in respect
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 28/10026
A n n u A l R e p o R t 2 0 0 7 - 0 8
o disaster recovery and business continuity in dierentlocations.
INTERNaL CONTROL SySTEMS aND THEIR
aDEQuaCy
Your Company has an adequate system or internalcontrol covering all nancial and operating unctionscommensurating with company’s size and business. Theseensure that its assets and interests are careully protected.
The Systems and processes are continually reviewed or itseectiveness and augmented by documented policies andprocedures. A strong internal audit programme under theleadership o its dedicated Internal Audit team that ensuresadequate processes, systems and internal controls areimplemented strictly. Your Company has implemented oneo the leading ERP solutions in its global operations in orderto integrate various acets o business operations whichhas enabled the Company to control, monitor and reviewits worldwide operations online and has strengthened the
ability o internal controls to unction eectively. The AuditCommittee, which is a sub committee o your Board o
Directors, reviews adherence to internal control systems,internal audit reports and implementation o suggestions.
This Committee reviews all quarterly and yearly nancialresults o the Company and conveys to the Board itsrecommendation or consideration o such results and theirapproval.
aDDITIONaL DISCLOSuRES
The Company in the context o this report means NIIT Technologies Limited and/or its subsidiaries.
Certain statements made in this report relating to theCompany’s objectives, projections, outlook, estimates,etc. may constitute ‘orward looking statements’ withinthe meaning o applicable laws and regulations. Actualresults may dier rom such estimates or projections etc.,whether expressed or implied. Several actors including butnot limited to climatic conditions and economic conditionsaecting demand and supply, government regulations and
taxation, natural calamities, etc., over which the Companydoes not have any direct control, could make signicantdierence to the Company’s operations.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 29/100
Connecting with the people for Capacity Creation
People are at the core of our business. At NIIT Technologies all
initiatives and ventures are driven by this belief. Our focus on
training and innovative HR practices have earned us recognition.
By looking after our people and incentivising performance we
build on existing capacity and benefit from optimal performance
at every level. Our plans now include setting up a world-class
campus in Greater Noida, near Delhi
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 30/10028
A n n u A l R e p o R t 2 0 0 7 - 0 8
OVERVIEW
Corporate governance is the set o processes, customs,
policies, laws and institutions aecting the way a
corporation is directed, administered and controlled.
Corporate governance is all about the relationships amongthe many stakeholders, both internal and external, and
the goals or which the corporation is established. Good
corporate governance not only strenghtens the corporate
development but is ultimately a tool or socio-economic
development leading to a developed and aware economy.
The board o directors plays a key role in guiding and
implementing corporate governance and is responsible or
endorsing the organisation’s strategy, develop directional
policy, appoint, supervise and remunerate senior executives
and to ensure accountability o the organisation to its
owners and authorities. Key elements o good corporate
governance principles include trust and integrity, openness,
perormance orientation, responsibility and accountability,mutual respect, and commitment to values. Eective
corporate governance requires a clear understanding
o the respective roles o the board o directors and the
senior management and their relationships with other in the
corporate structure.
NIIT Technolgies’s philosophy on corporate governance
envisages striving towards the highest level o transparency,
accountability and equity in all acets o its operations and
its interactions with its stakeholders, including shareholders,
employees, clients and the Government. Our philosophy
on corporate governance is driven by our agenda or the
welare o all the stakeholders. We believe that sound
corporate governance is critical to enhance and retainstakeholders’ trust.
The Board advocates the principles o corporate governance
and lays strong emphasis on its role to align and direct
the actions o the Company in achieving its corporate
objectives.
The Company is in compliance with the requirements o
corporate governance under clause 49 o listing agreement
and with the adoption o the code o conduct and a robust
clause 49 compliance monitoring system, the Company has
advanced urther in its pursuits o excellence in corporate
governance.
BOARD OF DIRECTORS
The Company is managed and controlled through a
proessional Board o Directors (“Board”) comprising o
an optimum combination o executive and non-executive
independent directors. The composition o the Board o the
Company is in conormity with the provisions o clause 49o the listing agreement with the stock exchange(s). The
present strength o the Board is six (6) members, out o
which three (3) members are non-executive independent
directors, constituting 50 percent o the total strength.
The Company’s Board consists o eminent persons with
considerable proessional expertise and experience. The
independent directors do not have any other material
pecuniary relationship (other than receiving remuneration
and stock options) or transactions with the Company, its
promoters, its management or its subsidiaries, which may
aect the independence or judgment o the directors.
Board meetings and director’s Attendance and other
Directorship/Membership & chairmanship
The Board meets at least once a quarter to review the
nancial results and discuss and approve other agenda
items (including inormation as mentioned in annexure 1A
to clause 49 o the Listing Agreement) and the gap between
two Board meetings does not exceed our calendar months.
In addition to the our scheduled meetings, meetings are
also convened to address the specic requirements o the
Company. Urgent matters, i required, are also approved
by the Board by passing resolutions through circulation.
Every director on the Board is ree to suggest any item or
inclusion in the agenda or the consideration o the Board.
During the year April 1, 2007 to March 31, 2008 the Boardmet ve times.
Attendance o each director at the Board meetings and the
last annual general meeting
Name of Director Board Meetings AGM
May
23, 2007
July
27, 2007
October
25, 2007
January
18, 2008
March
18, 2008
July
25, 2007
Mr Rajendra S Pawar Y Y Y Y Y Y
Mr Arvind Thakur Y Y Y Y Y Y
Mr Vijay K Thadani Y Y Y Y Y Y
Mr Subroto
Bhattacharya
Y Y Y Y Y Y
Mr Surendra Singh Y Y Y Y Y Y
Mr Amit Sharma Y Y N Y Y Y
Y : Attended
N : Leave o absence granted
The names and categories o the directors on the Board
along with the number o directorship and chairmanship/
membership o committees held by them, is given here-
under:
Report on
Corporate
Governance
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 31/10029
A n n u A l R e p o R t 2 0 0 7 - 0 8
Name PresentDesignation
Category No. ofDirectorships
held inall public
companies#
No. of Boardcommittees
membershipsheld in all
public compa-nies @
No. of Boardcommittees
Chairmanshipsheld in all
public compa-nies @
Mr Rajendra S Pawar Chairman &
Managing
Director
Promoter &
Executive
12 5 -
Mr Arvind Thakur CEO & Joint
Managing
Director
Executive 5 3 1
Mr Vijay K Thadani Director Promoter &
Non-executive
9 3 1
M r S ub ro to Bh at tacha ry a D irect or No n-ex ecut iv e,
Independent
8 4 4
Mr Surendra Singh Director Non-executive,
Independent
6 5 3
Mr Amit Sharma Director Non-executive,
Independent
2 1 1
# including NIIT Technologies Limited and excluding private, oreign and
section 25 Companies@ Board committee or this purpose includes audit committee and
shareholders’/ investors’ grievance committee
THE BOARD COMMITTEES
In accordance with the listing agreement o stock exchange(s)
on corporate governance, the ollowing committees were in
operation.
• Audit Committee
• Remuneration Committee
• Shareholders’/Investors’ Grievance Committee
Audit Committee
The Company has an Audit Committee comprising solely
o independent directors all being nancially literate, theChairman being an expert and having rich experience in
nancial sector. The Company Secretary acts as Secretary
to the Committee. The meeting is also attended by statutory
auditors, internal auditors, CFO, senior management
personnel o the Company. The recommendations o Audit
Committee are accepted and implemented by the Board.
Composition
The Audit Committee has been constituted with all the three
independent directors and is headed by an independent
director.
Chairman: Mr. Subroto Bhattacharya
Members: Mr. Surendra Singh and Mr. Amit Sharma
Functions and Terms of Reference
The terms o reerence o Audit Committee are as per Listing
Agreement with the Stock Exchanges read with Section
292 A o the Companies Act, 1956 and includes such other
unctions as may be assigned to it by the Board rom time
to time. The main unctions o the Audit Committee inter-
alia include:
• Supervision o the Company’s nancial reporting
process and the disclosure o its nancial inormation
to ensure that the nancial statements are correct,
sucient and credible;
• Management Discussion and Analysis o nancial
condition and results o operations;
• Recommending the appointment and removal o
statutory auditors, xation o audit ee and approval or
payment or any other services are also a part o the
Committee’s responsibilities;• Reviewing with the Management the annual nancial
statements beore submission to the Board or
approval, with particular reerence to:
o Matters required to be included in the Directors’
Responsibility Statement to be included in the
Board’s Report in terms o clause (2AA) o Section
217 o the Companies Act, 1956;
o Changes, i any, in accounting policies and practices
and reasons or the same;
o Major accounting entries based on exercise o
judgment by Management;
o Signicant adjustments made in the nancialstatements arising out o audit ndings;
o Compliance with listing and other legal requirements
relating to nancial statements;
o Disclosure o any related party transactions; and
o Qualications in the drat audit report.
• Reviewing with the Management, the quarterly nancial
statements beore submission to the Board or
approval.
• Reviewing with the Management, statutory and internal
auditors, the adequacy o internal control systems.
• Reviewing the adequacy o the internal audit unction,including the structure o the internal audit department,
stang and seniority o the ocial heading the
department, reporting structure coverage and requency
o internal audits.
• Discussions with internal auditors, on any signicant
ndings and ollow up thereon.
• Reviewing the ndings o any Internal Audit Report by
the internal auditors into matters concerning raud or
irregularity or a ailure o internal control systems o a
material nature and reporting the matter to the Board.
• Discussions with statutory auditors, beore the audit
commences, on the nature and scope o the audit as
well as having post-audit discussions to ascertain any
area o concern.
• Reviewing the Company’s nancial and risk management
policies.
• To look into the reasons or substantial deaults, i any,
in the payment to the shareholders (in case o non-
payment o declared dividends) and creditors.
Meetings and Attendance during the year
The particulars o meetings attended by the members o the
Audit Committee and the dates o meetings held during the
year 2007-08 are given below:
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 32/10030
A n n u A l R e p o R t 2 0 0 7 - 0 8
Name ofMembers
Audit Committee
May
4, 2007
May
23, 2007
July
27, 2007
Oct
25, 2007
Jan
18, 2008
March
18, 2008
Mr SubrotoBhattacharya
Y Y Y Y Y Y
Mr Surendra Singh Y Y Y Y Y Y
Mr Amit Sharma Y Y Y N Y Y
Y : Attended
N : Leave o absence granted
Remuneration Committee
The Remuneration Committee was set up to ormulate and
implement a credible and transparent policy or determining
and accounting or compensation ocused on attracting,
motivating and retaining key personnel (including evaluation
o remuneration and benets or the executive directors) and
to rame policies and systems or Employee Stock Option
Plans, as approved by the shareholders.
Composition
The Remuneration Committee comprises o threeIndependent Directors and is headed by an Independent
Director.
Chairman: Mr. Amit Sharma
Members: Mr. Subroto Bhattacharya and
Mr. Surendra Singh
Functions and Terms of reference
The broad terms o reerence o the Remuneration
Committee o the Company are as ollows:
To evaluate remuneration and benets or the Executive
Directors and to rame policies and systems or the associate
Stock Option Plans, as approved by the shareholders.
The Remuneration Committee has the powers to determine
and recommend to the Board the amount o remuneration,
including perormance/achievement bonus and perquisites,
payable to the Whole-time/ Managing Directors. The
recommendations o the Committee are based on the
evaluation o the Whole-time/ Managing Directors on certain
parameters, as laid down by the Board as part o the sel-
evaluation process. In terms o the guidelines, the Company
ensures that the remuneration by way o salary and other
allowances and monetary value o perquisites is within the
overall limit as specied under the Companies Act, 1956.
Meetings and Attendance during the year The particulars o the meeting attended by the member o
the Compensation/Remuneration Committee and the date
o the meetings held during the year are given below:
Name of Member Compensation/ Remuneration Committee
May
23, 2007
June
20, 2007
September
3, 2007
Mr Amit Sharma Y Y N
Mr Subroto Bhattacharya Y Y Y
Mr Surendra Singh Y Y Y
Y : Attended
N : Leave o absence granted
Details of Remuneration paid to Directors during the
year April 1, 2007 to March 31, 2008
A. Executive Directors
(Amount in Rs.)
Name of Director Mr. Rajendra S Pawar Mr. Arvind Thakur
Salary and Allowances 3,010,000 6,591,000
Part - A
Perquisites- 596,549
Part – B
Contribution to
Provident Fund,
Superannuation Fundor Annuity Fund
2,442,707 1,885,891
Performance- linked
Bonus
5,600,000 5,600,000
Total 11,052,707 14,673,440
i. Service Contracts: The current term o Mr Rajendra
S Pawar and Mr Arvind Thakur
will expire on May 31, 2010.
ii. Notice period: 6 months, unless otherwiseagreed by the Board
iii. Severance Fees: No severance ees, unless
otherwise agreed by the Board
iv. Perormance criteria: As determined by the
Compensation Committee and
the Board.
Further, Mr. Arvind Thakur was granted 75,000 stock
options under the Employee Stock Option Scheme during
the year 2007-08.
B. Non-executive Directors
The role o the Non-executive/Independent Directors o theCompany is not just restricted to corporate governance
or outlook o the Company but to involve and contribute
to the business and growth plans o the Company. The
remuneration paid to them is decided by the Board o
Directors o the Company, subject to the approval o the
shareholders. The existing remuneration policy is directed
towards rewarding perormance based on review o
achievements on a periodic basis. Non-executive directors
are paid remuneration by way o Commission and sitting ee
or the meetings o the Board and committees attended.
The details o the remuneration (including sitting ees) paid
to the non-executive directors is given below:
(Amount in Rs.)Name Mr Vijay K
Thadani
Mr Subroto
Bhattacharya
Mr Surendra
Singh
Mr Amit
Sharma
Commission 500,000 500,000 500,000 500,000
Sitting Fee 280,000 300,000 380,000 280,000
The non-executive directors o the Company were granted
certain stock options under the present Employee Stock
Option Scheme o the Company (ESOP-2005), during the
year 2005-06, the details o the options granted and allotted
to them on exercise o the options are given below, along
with the brie terms o the options:
Vesting Period : One (1) year rom the date o grant
Exercise Period : Three (3) years rom the date o vesting
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 33/10031
A n n u A l R e p o R t 2 0 0 7 - 0 8
Exercise Price : Rs.115/- (post Bonus Rs.76/-)
Discount : 23% o the market price
Name Mr Vijay K
Thadani
Mr Subroto
Bhattacharya
Mr Surendra
Singh
Mr Amit
Sharma
No. of options granted NIL 11,700 11,700 11,700
No. of optionsexercised during theyear 2006-07
NIL 11,700 11,700 NIL
No. of options
exercised during theyear 2007-08
NIL NIL NIL NIL
Date of allotment of
shares
NIL October
17, 2006
January
23, 2007
NIL
Entitlement due to
bonus issue
NIL NIL NIL 5,850
Outstanding Options
as on March 31, 2008
NIL NIL NIL 17,550
Details of equity shareholding of Non-Executive
Directors as on March 31, 2008
Name Number of shares held
Mr Vijay K Thadani 110,274
Mr Subroto Bhattacharya 17,550
Mr Surendra Singh 17,550
Mr Amit Sharma 3,655
The non-executive directors o the Company do not
have any pecuniary relationship (other than receipt o
Commission & sitting ee as stated above) or transactions
with the Company.
Shareholders’/ Investors’ Grievances Committee
The routine share transer, issue o duplicate sharecerticates, DEMAT/ REMAT o shares o the Company &
other related work have been delegated to the share transer
committee, which reports to the Shareholders’/ Investors’
Grievance Committee. The primary responsibility o the
Shareholders’/ Investors’ Grievance Committee is to look
into the redressal o Shareholders’/ Investors’ complaints.
Composition
The Shareholders’/Investors’ Grievances Committee
is headed by an Independent Director, and consists o
ollowing directors:
Chairman: Mr. Amit SharmaMembers: Mr. Vijay K Thadani and Mr. Arvind Thakur
Functions and Terms of reference
The unctioning and broad terms o reerence o the
Shareholders’/Investors’ Grievances Committee as adopted
by the Board is as under:
• To review the redressal o Shareholder and Investor
complaints
• To appoint a Compliance Ocer and determine the role
and responsibilities
• To take note o complaints received and resolution
thereo at periodic intervals
The main object o the Shareholders’/Investors’ Grievances
Committee is to strengthen investor relations.
Meetings & Attendance during the year
The particulars o the meeting attended by the member o
the Shareholders’/Investors’ Grievances Committee and the
date o the meetings held during the year are given below:
Name of Member Shareholders’/Investors’ Grievances Committee
May
23, 2007
July
27, 2007
Oct
25, 2007
Jan
18, 2008
Mr Amit Sharma Y Y N Y
Mr Vijay K Thadani Y Y Y Y
Mr Arvind Thakur Y Y Y Y
Y : Attended
N : Leave o absence granted
During the year April 1, 2007 to March 31, 2008 the Company
received 388 queries/complaints rom various Investors’/
Shareholders’ relating to Change o address/Non-receipto Dividend, Bonus Shares, Annual Report/Change o Bank
account details/Transer o Shares/Dematerialization o
shares, etc. The same were attended to the satisaction o
the Investors. At the end o the year March 31, 2008, no
complaint was pending or redressal and no shares were
pending or transer/dematerialization.
Details o queries/complaints in numbers received and
resolved during the year April 1, 2007 to March 31, 2008
Nature of query/complaint Received Resolved Unresolved
Change of address 37 37 -
Change of Bank 24 24 -
Correction in Dividend warrantand issue of DD
212 212 -
Non receipt of Dividend 39 39 -
Non receipt of Annual Report 3 3 -
Non receipt of Bonus shares 13 13 -
Non receipt of Fractional Bonus
share payment
4 4 -
Request for Annual Report 8 8
Request for Bonus shares 6 6 -
Request for duplicate share
certificates
3 3 -
Request for shareholding details 6 6
Share Certificates Lodged fortransfer
20 20 -
Others (not classified above) 13 13 -
Total 388 388 -
There was no complaints pending at the beginning o the
year. During the year April 1, 2007 to March 31, 2008
the Company attended most o the investors’ queries/
complaints within a period o 7 days rom the date o
receipt. The exceptions have been or cases constrained by
disputes or legal impediments.
Other Committees
The Board has constituted certain other sub-committees,
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 34/10032
A n n u A l R e p o R t 2 0 0 7 - 0 8
as mentioned below, to ocus on certain specic areas and
make inormed decisions within the authority delegated to
each o the said committees:
1. Operations Committee
2. ESOP Allotment Committee
3. Share Transer Committee
GENERAL MEETINGS
a. Particulars of the last three Annual General
Meetings
Year Location Date Day Time Special Business
2007 FICCI
Auditorium
Tansen
Marg,
New
Delhi-1
July 25 Wednesday 10.00
A.M.
a) Increase in
Authorised Share
capital o the
Company rom
Rs. 45.00 crore to
Rs. 75.00 crore;
b) Amendment in
the Articles o
Association o the
Company;c) Issue o Bonus
shares;
d) Appointment
o Mr. Rajendra
S Pawar under
section 269 o the
Companies Act,
1956;
e) Minimum
Remuneration
payable to Mr.
Rajendra S Pawar,
Chairman &
Managing Director.
) Appointment o
Mr. Arvind Thakur
under section 269
o the Companies
Act, 1956;
g) Minimum
Remuneration pay-
able to Mr. Arvind
Thakur as Chie
Executive Ocer
& Joint Managing
Director .
2006 FICCI
Auditorium
Tansen
Marg,
New
Delhi-1
Aug.
17
Thursday 10.00
A.M.
None
2005 FICCI
Auditorium
Tansen
Marg,
New
Delhi-1
July 22 Friday 10.00
A.M.
a) Increase in or-
eign Institutional
Investors (FIIs)
investment limit
to 49% o paid
up capital o theCompany
b) Revision o remu-
neration payable
to Mr. Rajendra S
Pawar, Chairman
and Executive
Director
c) Revision o remu-
neration payable to
Mr. Arvind Thakur,
Chie Executive
Ocer and Whole-
time Director
b. Postal Ballot
Special resolution passed through Postal Ballot during the
nancial year 2007-08:
No special resolution was passed by way o Postal
Ballot during the nancial year 2007-08
Special resolution proposed to be conducted through
Postal Ballot in next nancial year 2008-09:
There is no proposal to pass any special resolution
through postal ballot, until date.
DISCLOSURES
a. Related Party Transactions
There are no materially signicant related party
transactions o the Company which have a potential
confict with the interests o the Company at large. The
related party transactions (as per Accounting Standard
18) o the Company in the ordinary course o business
during the year April 1, 2007 to March 31, 2008 arereported under Note 16 o Schedule 18 o the Financial
Statements. The same, as per the provisions o Clause
49 o the Listing Agreement, were placed beore the
Audit Committee o the Company. For urther details,
please reer to Notes, orming part o the Balance Sheet
o the Company.
b. Accounting Treatment in preparation of nancial
statements
The Company has ollowed the applicable accounting
standards notied under section 211(3C) o the
Companies Act, 1956 in preparation o nancial
statements o the Company and there has been no
deviation rom the prescribed Accounting Standards.
c. Risk Management
The Company has laid down procedures to inorm
the Board Members about the Risk assessment
and minimization procedures. All the designated
ocials submit quarterly reports, through online risk
management system, which is reviewed periodically to
ensure eective risk identication and management.
d. Proceeds from the public issue/right issue/
preferential issues etc.
There was no resh public issue/right issue/preerential
issues etc. during the review period.
e. Code of Conduct
The Company has a well dened policy ramework,
which lays down procedures to be ollowed by the
employees or ethical proessional conduct. The code o
conduct has been laid down or all the Board Members
and Senior Management o the Company. The Board
members and Senior Management personnel have
armed compliance with the Company’s code o
conduct or the year 2007-08. This code is displayed
on the Company’s website.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 35/10033
A n n u A l R e p o R t 2 0 0 7 - 0 8
f. Management discussion and Analysis
There is a separate part on Management Discussion
and Analysis in the Annual Report.
g. Disclosure regarding appointment/ re-appointment
of Directors
Pursuant to the terms o appointment o the Directors
o the Company as approved by the members o the
Company in the 12th Annual General Meeting o the
Company held on July 29, 2004 all the directors except
the Directors in executive capacity, were liable to retire
by rotation and i eligible, oer themselves or re-
appointment. Accordingly, Mr. Surendra Singh and Mr.
Subroto Bhattacharya , are liable to retire by rotation at
the ensuing annual general meeting and being eligible
have oered themselves or re-appointment.
Brie prole o directors seeking re-appointment
and other relevant inormation in respect thereo are
provided in the notice to the Annual General Meeting.COMPLIANCE OF THE REQUIREMENT OF CLAUSE
49 OF THE LISTING AGREEMENT
a. Mandatory Requirements
The Company is ully compliant with the applicable
mandatory requirements o Clause 49 o the listing
agreement entered with stock exchange(s). Details
o these compliances are given below: (For detailed
compliance with each requirement (mandatory) o
Clause 49 please reer to ‘Annexure-A’-Clause 49-
Compliance Status relevant to the nancial year 2007-
08)
Particulars Clause of ListingAgreement
ComplianceStatus
For all quarters of
FY 2007-08
I. Board of Directors 49 I
(A) Composition o Board 49(IA) Complied
(B) Non-executive Directors’
compensation & disclosures
49(IB) Complied
(C) Other provisions as to Board and
Committees
49(IC) Complied
(D) Code o Conduct 49(ID) Complied
II. Audit Committee 49 (II)
(A) Qualifed & Independent Audit
Committee
49(IIA) Complied
(B) Meeting o Audit Committee 49(IIB) Complied
(C) Powers o Audit Committee 49(IIC) Complied
(D) Role o Audit Committee 49(IID) Complied
(E) Review o Inormation by AuditCommittee 49(IIE) Complied
III. Subsidiary Companies 49(III) Complied
IV. Disclosures 49(IV)
(A) Basis o related party transactions 49(IVA) Complied
(B) Disclosure o Accounting
Treatment
49(IVB) Complied
(C) Board Disclosures 49(IVC) Complied
(D) Proceeds rom Public issues,
rights issues, preerential issues,
etc.
49(IVD) Complied
(E) Remuneration o Directors 49(IVE) Complied
(F) Management 49(IVF) Complied
(G) Shareholders 49(IVG) Complied
V. CEO/CFO Certifcation 49(V) Complied
VI. Report on Corporate
Governance
49(VI) Complied
VII. Compliance 49(VII) Complied
b. Non-mandatory Requirements
The Company has ullled the ollowing non-mandatory
requirements.
i) Remuneration Committee: The Company has a
unctioning Remuneration Committee. Please see the
para on Remuneration Committee or details.
ii) Whistle Blower Policy – The Company does not have
a separate whistle blower policy. However, the code o
conduct o the Company refects the mechanism by
which the employees may report to the Management
their concerns about unethical behavior, actual or
suspected rauds or violation o the Company’s code
o conduct or ethics policy. The employees also have
direct access to the Audit Committee in exceptional
cases.
c. Code for prevention of Insider -Trading Practices
In compliance with the SEBI regulation on prevention
o insider trading, the Company has instituted acomprehensive code o conduct or its management
and sta. The code lays down guidelines, which advises
them on procedures to be ollowed and disclosures to
be made, while dealing with shares o NIIT Technologies
Limited and cautioning them o the consequences o
violations.
d. Statutory Compliance, Penalties and Strictures
The Company has complied with the requirements o
the Stock Exchange(s)/SEBI and Statutory Authority(ies)
on all matters related to the capital market during the
last three years. There are no penalties or strictures
imposed on the Company by Stock Exchange(s) or
SEBI or any Statutory Authority(ies) relating to theabove.
e. Compliance Ofcer
Mr Surender Varma, Company Secretary & Legal
Counsel is the Compliance Ocer. The Compliance
ocer can be contacted or any investor related
matter relating to the Company. His contact no. is
+91-11-46694777, Fax no. is +91-11-40570933 and
e-mail ID is [email protected].
MEANS OF COMMUNICATION
a. The quarterly/hal yearly/annual results are published in
the leading English and Hindi Newspapers (the details
o the publications are given hereunder) and displayedon the web site o the Company – www.niit-tech.
com where ocial news releases, nancial results,
consolidated nancial highlights, quarterly shareholding
pattern and presentations are also displayed.
b. The Company had Quarterly Earnings Calls on May
23, 2007, July 27, 2007, October 25, 2007, January
18, 2008 and Press Conerences in the months o May
2007, July 2007, October 2007 and January 2008 or
the investors o the Company immediately ater the
declaration o Quarterly/Annual results.
c. The Management Perspective, Business Review and
Financial Highlights are part o the Annual Report.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 36/10034
A n n u A l R e p o R t 2 0 0 7 - 0 8
d. All material inormation about the Company is promptly
sent through acsimile to the stock exchanges where
the shares o the Company are listed.
During the nancial year 2007-08 the Company published
its nancial results in the ollowing newspapers:
Financial Results Newspapers Date of publication
Unaudited fnancial results
or the quarter ended June
30, 2007
Financial Express
Jansata
July 28, 2007
Unaudited fnancial results
or the quarter ended
September 30, 2007
Business Standard
Rashtriya Sahara
October 26, 2007
Unaudited fnancial results
or the quarter ended
December 31, 2007
Business Standard
Veer Arjun
January 19, 2008
January 20, 2008
Audited fnancial results or
the quarter and year ended
March 31, 2008
Business Standard
Business Standard
(Hindi Edition)
June 12, 2008
SHAREHOLDERS’ INFORMATION
a. Annual General Meeting
Date: July 28, 2008
Time: 10.00 AM
Venue: FICCI Auditorium, 1 Tansen Marg,
New Delhi –110 001
Book Closure Date: July 22 to July 28, 2008
(both days inclusive)
b. Financial Calendar (tentative and subject to
change):
Financial reporting or the rst quarter ending
30th June, 2008
22nd July , 2008
Financial reporting or the second quarterending 30th September, 2008
16th October , 2008
Financial reporting or the third quarter ending
31st December, 2008
19th January , 2009
Financial reporting or the year ending 31st
March, 2009
11th May , 2009
Annual General Meeting or the year ending
31st March, 2009
17th July, 2009
c. Dividend
In view o our perormance, the Board o Directors have
recommended a dividend o Rs.6.50 per Equity Share o
Rs.10/- each, subject to approval o the shareholders’
at the ensuing Annual General Meeting. The dividend
shall be paid to the shareholders within 30 days romJuly 28, 2008, subject to declaration in the AGM and as
per the provisions o the Companies Act.
The dividend, i declared, would be paid to such
shareholders whose names appear in the Register o
Members as on July 28, 2008. In respect o shares
held in electronic mode, the dividend will be paid on the
basis o benecial ownership o the shares as per the
details to be urnished by National Securities Depository
Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) as at the end o the business hours on
July 21, 2008.
No unpaid/unclaimed dividend was eligible to be
transerred to the Investor Education and Protection
Fund o the Central Government, pursuant to Section
205A o the Companies Act, 1956.
d. Nomination Facility
The Companies (Amendment) Act, 1999, has provided
or a nomination acility to the Shareholders o theCompany. The Company is pleased to oer the acility
o nomination to Shareholders and Shareholders may
avail this acility by sending the duly completed Form 2B
as revised vide Notication No. GSR 836(E) dated 24th
October 2000, issued by the Department o Company
Aairs, to the Registered Oce o the Company/
Registrar o the Company in case shareholding is in
physical orms. In case o demat holdings the request is
to be submitted to the Depository Participant.
e. Listing of Shares
The Equity shares o the Company are currently listed at
the stock exchange at Bombay Stock Exchange Ltd.,
National Stock Exchange o India Ltd, Ahmedabad
Stock Exchange Ltd., Madras Stock Exchange Ltd.,
The Delhi Stock Exchange Association Ltd., The
Calcutta Stock Exchange Association Ltd. Listing ees
or the period April 1, 2007 to March 31, 2008 have
been paid to all Stock Exchanges.
Company’s equity shares are being mostly traded
at National Stock Exchange o India Limited and the
Bombay Stock Exchange Ltd., which have nationwide
trading terminals. Thereore, it is now proposed to
delist the shares o the Company rom the Ahmedabad,
Calcutta, Madras and Delhi Stock Exchange and a
resolution to that eect is being proposed to be placed
in the ensuing Annual General Meeting or the approval
o the shareholders.
f. Stock Code
Trading symbol on the : NIITTECH
National Stock Exchange
Trading symbol on the
Mumbai Stock Exchange
Physical : NIITTECH
Electronic : 532541
ISIN No. at NSDL/CDSL : INE 591G01017
g. Compliance certicate of the Auditors
The Company has annexed to this report, a certicateobtained rom the statutory auditors regarding
compliance o conditions o corporate governance as
stipulated in clause 49 o the listing agreement.
h. Stock Market Data
The Monthly High and Low Share Prices and Market
Capitalization o Equity Shares o the Company traded
at The Bombay Stock Exchange Ltd. and National
Stock Exchange o India Ltd. rom April 1, 2007 to
March 31, 2008 and the comparison o share prices o
the Company vis-à-vis the Sensex and Nity Indices are
given hereunder:
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 37/10035
A n n u A l R e p o R t 2 0 0 7 - 0 8
Share Price Movement during the year April 1, 2007 to
March 31, 2008
Bombay Stock Exchange National Stock Exchange
Month Sensex High(Rs.)
Low(Rs.)
M Cap*(Rs. in
millions)
NIFTY High(Rs.)
Low(Rs.)
M Cap*(Rs. in
millions)
Apr-07 13,872 477 412 17,556 4,088 474 412 17,595
May-07 14,544 638 439 23,581 4,296 637 441 23,581
Jun-07 14,651 614 449 20,179 4,318 611 450 20,179
Jul-07 15,551 574 460 18,463 4,529 575 460 18,581
Aug-07 15,319 489 280 12,088 4,464 490 280 12,127
Sep-07** 17,291 375 310 20,772 5,021 383 312 20,772
Oct-07 19,838 409 325 19,599 5,901 409 325 19,599
Nov-07 19,363 345 209 13,088 5,762 340 208 13,088
Dec-07 20,287 255 219 13,851 6,139 255 223 13,910
Jan-08 17,649 252 90 7,923 5,137 251 92 7,747
Feb-08 17,579 148 113 7,689 5,224 149 113 7,689
Mar-08 15,644 130 85 5,987 4,735 135 85 5,987
* Market capitalization at closing price o the month.
** Price is ex-bonus.
Share Holding Distribution as on March 31, 2008
Range No. of
Shareholders
% to Total
shareholders
No. of
Shares
% to Total
Shares
Up to 500 70,145 93.40 6,145,788 10.47
501 - 1000 2,655 3.53 1,931,791 3.29
1001 - 5000 1,801 2.40 3,805,726 6.48
5001 & above 504 0.67 46,815,090 79.76
TOTAL 75,105 100.00 58,698,395 100.00
No. of Shareholders
Up to 500 501-1000
1001-5000 5001 & above
93.4%
3.5%
2.4%
0.7%
No. of Shares
Up to 500 501-1000
1001-5000 5001 & above
6.48%
3.29%
10.47%
79.76%
Shareholding Pattern as on March 31, 2008
Category No. of shareHolding
% of Holding
Promoters Shareholding
- Indian Promoters 23,282,717 39.67
- Foreign Promoters
Total Promoters Shareholding 23,282,717 39.67
Public Shareholding
Institutional Investors
Mutual Funds and UTI 4,124,073 7.02
Banks, Financial Institutions
Insurance Companies (Central
/ State Govt. Institutions/Non
Government Institutions)
1,338,258 2.28
Foreign Institutional Investors 6,322,786 10.77
Others
Private Corporate Bodies 8,093,282 13.79
Trust 1,548,243 2.64
Indian Public 13,513,632 23.02
NRI/OCBs/Foreign Individuals 475,404 0.81
Total Public Shareholding 35,415,678 60.33
Grand Total 58,698,395 100.00
Share Holding Pattern
Promoters Pvt. Corp. Bodies Indian Public
NRI/OCBs Mutual Funds & UTI Banks, Financial Institutions
Foreign Institutional Investors
16%
23%
1%
20%
40%
11%
2%
7%
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 38/10036
A n n u A l R e p o R t 2 0 0 7 - 0 8
i. Dematerialisation of Shares
The Shares o the Company are compulsorily traded
in dematerialised orm by all categories o investors.
The Company has arrangements with both the National
Securities Depository Limited (NSDL) and Central
Depository Services (India) Limited (CDSL), to establishelectronic connectivity o the shares or scrip less
trading. As on March 31, 2008, 99.18 percent shares
o the Company were held in dematerialised orm.
j. Liquidity of shares
The Shares o the Company are traded electronically
on the BSE/NSE and other Stock Exchanges where
they are listed. The Company’s shares are included in
indices o BSE- 200 and BSE-IT-TECk.
k. Share Transfer System
The Company has appointed a common Registrar or
physical share transer and dematerialisation o shares.
The shares lodged or physical transer/ transmission/ transposition are registered within a period o 15 days
i the documents are complete in all respects. For
this purpose, the Share Transer Committee (a sub-
committee o Shareholders’/Investors’ Grievance
Committee o the Board) meets as oten as required.
During the review period, the Committee met 24 times.
Adequate care is taken to ensure that no transers are
pending or more than a ortnight. Physical Shares
requested or dematerialisation were conrmed mostly
within a ortnight.
l. Registrar for Dematerialisation (Electronic Mode)
of shares & Physical Transfer of shares
The Company has appointed a Registrar ordematerialisation and transer o shares whose details
are given below:–
Alankit Assignments Limited
Unit: NIIT Technologies Limited
2E/21, Jhandewalan Extension,
New Delhi – 110 055.
Phone Nos.: 011-42541234, 23541234
Fax Nos.: 011-42541967
E-mail: [email protected]
m. Registered Ofce
NIIT Technologies Limited
NIIT House, C-125, Okhla Phase - I
New Delhi - 110 020
n. Address for correspondence
The shareholders may address their communication/
suggestions/ grievances /queries to:
Investor Services Department
NIIT Technologies Limited
NIIT House,
C-125, Okhla Phase - I
New Delhi - 110 020. Tel Nos. +91-11-41407000
Fax: +91-11-26817344
e-mail: [email protected]
o. Subsidiaries
The addresses o the subsidiaries are given elsewhere
in this Annual Report.
Acknowledgements
Your Directors wish to express their sincere thanks and
grateul appreciation or co-operation and support received
rom vendors, customers, banks, nancial institutions,
shareholders and the society at large. Your directors alsotake on record, their appreciation or the contribution and
hard work o employees across all levels. Without their
commitment, inspiration and hard work, your company’s
consistent growth would not have been possible. The
Directors also wish to place on record their sincere thanks
to government and regulatory agencies or their assistance
and support provided to the Company and look orward to
their continued support.
CERTIFICATE RELATING TO COMPLIANCE WITH
THE PROVISIONS OF CLAUSE 49 OF THE LISTING
AGREEMENT(S) IN RELATION TO THE CODE OF
CONDUCT FOR DIRECTORS/SENIOR MANAGEMENT
This is to certiy that as per clause 49 o the Listing
Agreement:
1. The code o conduct has been laid down or all the
Board Members and Senior Management and other
employees o the Company.
2. The code o conduct has been posted on the website
o the Company.
3. The Board members and Senior Management personnel
have armed compliance with the Company’s code o
conduct or the year 2007-08.
Arvind Thakur
Dated : June 11, 2008 Chie Executive Ocer
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 39/10037
A n n u A l R e p o R t 2 0 0 7 - 0 8
CERTIFICATE BY CHIEF EXECUTIVE OFFICER
AND CHIEF FINANCIAL OFFICER ON COMPLIANCE
WITH THE CONDITIONS OF CORPORATE
GOVERNANCE UNDER CLAUSE 49 OF THE LISTING
AGREEMENT(S)
To, The Board o Directors
NIIT Technologies Limited
C-125, Okhla Phase 1,
New Delhi – 110 020
We hereby certiy that or the Financial Year 2007-08
1. We have reviewed the nancial statements and the cash
fow statement and that to the best o our knowledge
and belie:-
a. These statements do not contain any materially
untrue statement or omit any material act or
contain statements that might be misleading;
b. These statements together present a true and air
view o the Company’s aairs and are in compliance
with existing accounting standards, applicable laws
and regulations.
2. There are, to the best o our knowledge and belie, no
transactions entered into by the Company during the
year 2007-08 which are raudulent, illegal or violate the
Company’s code o conduct.
3. We accept responsibility or establishing and maintaining
internal controls or nancial reporting and that we
have evaluated the eectiveness o the internal control
systems o the Company pertaining to nancial reporting
and we have disclosed to the Auditors and the AuditCommittee those deciencies, i any, o which we are
aware, in the design or operation o the internal control
systems and the steps we have taken or propose to
take to rectiy these deciencies.
4. We have indicated to the auditors and the Audit
Committee:-
a. signicant changes, i any, in internal control over
nancial reporting during this year.
b. signicant changes, i any, in accounting policies
during the year 2007-08 and that the same
have been disclosed in the notes to the nancial
statements; andc. instances o signicant raud o which we are
aware and the involvement therein, i any, o the
management or an employee having a signicant
role in the Company’s internal control system over
nancial reporting.
Arvind Thakur K T S Anand
Place : New Delhi Chie Chie
Dated : June 11, 2008 Executive Ocer Financial Ocer
AUDITORS’ CERTIFICATE ON COMPLIANCE WITH THE
CONDITIONS OF CORPORATE GOVERNANCE UNDER
CLAUSE 49 OF THE LISTING AGREEMENT(S)
To the Members o NIIT Technologies Limited,
We have examined the compliance o conditions o Corporate Governance by NIIT Technologies Limited, or
the year ended March 31, 2008, as stipulated in Clause 49
o the Listing Agreements o the said Company with stock
exchanges in India.
The compliance o conditions o Corporate Governance
is the responsibility o the Company’s Management.
Our examination was carried out in accordance with the
Guidance Note on ‘Certication o Corporate Governance
(as stipulated in Clause 49 o the Listing Agreement)’,
issued by the Institute o Chartered Accountants o India
and was limited to procedures and implementation thereo,
adopted by the Company or ensuring the compliance o the
conditions o Corporate Governance. It is neither an auditnor an expression o opinion on the nancial statements o
the Company.
In our opinion and to the best o our inormation and
explanations given to us, we conrm that the Company has
complied with the conditions o Corporate Governance as
stipulated in the above mentioned Listing Agreements in all
material aspects.
We state that such compliance is neither an assurance as
to the uture viability o the Company nor the eciency or
eectiveness with which the management has conducted
the aairs o the Company.
H. Singh
Partner
Membership No:F-86994
For and on behal o
Place:New Delhi Price Waterhouse
Dated: June 18, 2008 Chartered Accountants
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 40/10038
A n n u A l R e p o R t 2 0 0 7 - 0 8
Annexure A
Clause 49-Compliance Status relevant to the Financial
Year 2007-08
Board of Directors
Clause 49 (IA) Composition of Board
Standard
The Board o the Company should have optimum
combination o executive and non-executive directors.
However, not less than 50 per cent o the board o
directors should comprise non-executive directors.
I the Chairman o the Board is an executive director, at
least hal o the board should comprise o Independent
directors. Provided that where the non-executive
Chairman is a promoter o the Company or is related
to any promoter or person occupying management
positions at the Board level below the Board, at least
one hal o the Board o the Company shall consist o
independent directors.
Our practice
• The total strength o the Board o the Company is 6
Directors.
• Composition:
Executive director : 2 (33.33%)
Non executive directors : 4 (66.67%)
Independent directors : 3 (50%)
• The Chairman is Executive Director and is a promoter
o the Company.
• Out o 6 directors on the Board, 3 (50%) are
independent directors.
• Directors, prior to their appointment on the Board
as well as annually arm their independence by way
o a certicate to the Board. They are also required
to disclose any transaction, which may impact their
independent status.
Clause 49(IB) Non-executive directors’ compensation and
disclosures
Standard
All ees/compensation paid to Non-executive directorsshall be xed by the Board o directors and shall require
previous approval o shareholders in general meeting.
Our Practice
• The remuneration being paid to Non-executive
directors (i.e. commission) has been approved by
the Board o directors, which is within the overall limit
approved the shareholders o the Company. The Non-
executive directors are also paid sitting ees in relation
to the meetings o the Board or its committees
attended by them.
Clause 49(IC) Other provisions as to Board and Committees
Standard
There shall be at least our board meetings in a year
with maximum time gap o not more than our months
between any two meetings. Inormation given in Annexure-1A o clause 49 should be made available to
the Board. The Board shall also review compliance report
o all laws applicable to the company.
A director shall not be a member in more than 10
committees or act as a chairman o more than ve
committees across all companies in which he is a
director. The directors should annually inorm the
company about the committees positions held by them
in other companies.
Our practice
• During the year under review, the Board o the
Company met 5 Times and there was a maximum time
gap o less than 90 days between two consecutive
Board meetings.
• The inormation regularly placed beore the Board
inter-alia includes the inormation given under
Annexure-1A, wherever applicable.
• A compliance Report, with respect to applicable laws,
signed by the Compliance ocer is placed beore the
Board on quarterly basis.
• None o the directors o the Company is member o
more than 10 committees or Chairman o more thanve committees. An assurance in this regard is given
by the directors by way o certication to the Board.
• Company receives an annual certication by director
about the committee position he occupies in other
companies. The directors are also expected to notiy
changes when they take place.
Clause 49(ID) Code of conduct
Standard
The Board shall lay down a Code o Conduct or all Board
members and senior management o the Company and
the same shall be posted on the website o the Company.
All Board members and senior management personnel
shall arm compliance with the code on an annual
basis. The Annual Report o the company shall contain a
declaration to this eect signed by the CEO.
Our practice
• The Board has adopted a code o conduct or directors
and senior management personnel and this Code is
available on the ocial website o the Company www.
niit-tech.com
• All directors and senior management personnel arm
compliance with the code o conduct o the Company
on annual basis.
• A declaration in this regard duly signed by Chie
Executive Ocer is published elsewhere in this Annual
Report.
Audit Committee
Clause 49(II A) Qualied and Independent Audit Committee
Standard
The Company shall have an audit committee comprising
not less than three members. All members o the
committee shall be nancially literate and two third
members shall be Independent directors.
The Chairman o committee shall be an Independent
director and should be present in AGM o the Company.
At least one member o the committee shall have
accounting or related nancial management expertise.
The committee may invite such executive, as it considers
appropriate (particularly head o nance) to be present in
meeting. The Company Secretary should act as secretary
to the committee.
Our Practice
• Company has qualied and independent audit
committee, which comprises o 3 members. All
members o audit committee are Non-executive and
Independent.
• All members o Audit Committee are nancial literate
and a majority o them have accounting/nancialmanagement expertise.
• A brie background o members o Audit Committee:
– Mr. Subroto Bhattacharya: Mr. Bhattacharya,
a Chartered Accountant with over 30 years o
experience, specializes in nance and Management
consultancy. He has been part o the core team in
several reputed organizations.
– Mr. Surendra Singh: Mr. Singh, a retired IAS
Ocer, has held very senior position in the Central
and State Government. Starting his public service
in 1959, Mr. Singh has held positions like Cabinet
Secretary to the Government o India and Special
Secretary to the Prime Minister o India being
responsible or all the economic work in PM’s
Oce. He specializes in business and nance
management, internal controls and audit.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 41/10039
A n n u A l R e p o R t 2 0 0 7 - 0 8
– Mr. Amit Sharma: Mr. Sharma a MBA (Wharton
School) and MSE in Computer and Inormation
Science (University o Pennsylvania), is the Vice-
President, Asia-Pacic Strategy and Business
Development or Motorola Inc. He specializes in
strategic planning and business development.
• Mr. Subroto Bhattacharya, Chairman o Audit
Committee is an Independent director and waspresent in the AGM o the Company held on July 25,
2007.
• Management personnel are invited to the meeting/
discussion, whenever required by Audit Committee.
• The Company Secretary o the Company acts as a
secretary to the Audit Committee.
Clause 49 (II B) Meeting of Audit Committee
Standard
There should be at least our meetings o audit committee
in a year and not more then our months shall elapse
between two meetings. Two members or one third o
the members o the committee whichever is greater shall
constitute quorum or the meeting, but there should be
minimum o two independent members present.
Our practice
• During the year under review, the Audit Committee met
six times and there was a maximum gap o less than
90 days between two consecutive Audit Committee
meetings.
• Requirement as to quorum had been complied with at
every Audit Committee meeting.
Clause 49 (II C) Powers of Audit Committee
Standard
The Audit committee shall have powers, which should
include investigation o any matter within its terms o
reerence, to seek inormation rom employees, obtain
outside legal/proessional advice and to secure the
attendance o outsider, i necessary, in audit committee
meeting.
Our practice
The powers o audit committee are in accordance withClause 49 and have been duly approved by the Board
o the Company.
Clause 49 (II D) Role of Audit Committee
Standard
A comprehensive list o role o audit committee is provided
under Clause 49 which inter-alia includes oversight
and review o Company’s nancial reporting process,
recommendation o appointment/re-appointment o
statutory auditor and ees to be paid to them, review o
quarterly and annual nancial statements, perormance
o auditor, adequacy o internal control, unctioning o
whistle blower mechanism (in case the same is existing),
etc.
Our practice
The role o the Audit committee is in accordance with
Clause 49 and has been duly approved by the Board o
the Company.
Clause 49 (II E) Review of information by Audit Committee
Standard
The audit committee shall mandatorily review management
discussion and analysis o nancial condition and result
o operation, signicant related parties transactions,
management letters/ letters o internal control weakness
issued by the statutory auditors, internal audit reports
relating to internal control weakness and appointment,
removal and terms o remuneration o the Chie Internal
Auditor.
Our practice
The audit committee reviews all inormation as stipulated
under Clause 49.
Clause 49 (III) Subsidiaries Companies
Standard
This sub clause requires representation o Company’s
director on the Board o its material non-listed
Indian Subsidiary. It also prescribes or the review o
nancial statements o unlisted subsidiary by the audit
committee. The minutes o the board meeting and a statement o
all signicant transaction and arrangements entered into
by the unlisted subsidiary company is also required to
be placed at the Board meeting o the listed holding
company.
Our practice
• The Company has two Indian non-listed Subsidiary
Companies, NIIT GIS Limited and NIIT SmartServe
Limited. Mr Amit Sharma, an Independent Non-
Executive Director on the Board o the Company
is also a director on the Board o NIIT GIS Limited
as NIIT GIS Limited is Company’s material non-
listed Indian subsidiary. Further, even though NIIT
SmartServe Limited does not all under the material
non listed Indian subsidiary category, Mr Surendra
Singh, an Independent Non-Executive Director on
the Board o the Company has been appointed as adirector on the Board o NIIT SmartServe Limited.
• Financial Statements o Subsidiaries are reviewed by
the Audit Committee
• Minutes o Subsidiaries are placed beore the Board
o the Company on regular basis.
• A statement o all signicant transactions, i any, o the
subsidiaries are also placed beore the Board.
Disclosures
Clause 49 (IV A) Basis of related party transactions
Standard
Summary o transaction with related parties in ordinary
course o business, material individual transactions with
related parties which are not in the normal course o
business and material individual transactions with related
parties or others, which are not on an arm’s length basis
shall be placed beore the audit committee on periodicalbasis.
Our practice
The related party transactions are placed beore the Audit
Committee on periodic basis.
Clause 49 (IV B) Disclosure of Accounting Treatment
Standard
I in the preparation o nancial statements, a treatment
dierent rom that prescribed in an Accounting Standard
has been ollowed, the act shall be disclosed in the
nancial statements, together with proper management’s
justication.
Our practice
In preparation o nancial statements or the year under
review, treatment as prescribed in Accounting Standards
have been ollowed, which has also been disclosed in the
notes to accounts
Clause 49 (IV C) Board Disclosures-Risk Management
Standard
The Company shall lay down procedures to inorm Board
members about the risk assessment and minimization
procedures. These procedures shall be periodically
reviewed to ensure that executive management controls
risk through means o a properly dened ramework.
Our practice
The Company has ramed a risk management procedure,
which contains the procedure as to assessment o risks
and their minimization. All designated ocials submit
quarterly reports, through an online Risk Management
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 42/10040
A n n u A l R e p o R t 2 0 0 7 - 0 8
System, which is reviewed periodically to ensure eective
risk identication and management. The Board reviews
such risk management and minimization procedures on
periodic basis.
Clause 49 (IV D) Proceeds from public issue, rights issue,
preferential issue etc.
StandardWhen money is raised through an issue, it shall be
disclosed to the Audit Committee, the uses/ applications
o unds by major category (capital expenditure, sales and
marketing, working capital, etc.), on a quarterly basis.
Our practice
The Company has not made any public issue, right issue,
preerential issue etc. during the year under review.
Clause 49 (IV E) Remuneration of Directors
Standard
All pecuniary relationships or transactions o the non-
executive directors’ vis-à-vis the Company shall be
disclosed in the Annual Report. Annual Report should also
contain all details o remuneration o directors including
stock option, notice period, severance ees, etc.
Criteria or making payment to non-executive directorsand number o shares and other convertible instruments
held by them should be disclose in Annual Report.
Non-executive directors are required to disclose their
shareholding in the listed company in which they are
proposed to be appointed as directors, prior to their
appointment.
Our practice
• All pecuniary relationships or transactions o the Non-
executive directors vis-à-vis the Company, i any,
have been disclosed in this Corporate Governance
Report.
• Details o remuneration and other terms o directors
have been disclosed in the Corporate Governance
Report.
• The shareholding o Non-Executive Directors being re-
appointed at the ensuing Annual General Meeting is
disclosed in the Notice convening the Annual GeneralMeeting and the shareholding o all the Non-Executive
Directors is disclosed in the Corporate Governance
Report.
Clause 49 (IV F) Management
Standard
A Management discussion and analysis report should
orm part o Annual Report o the Company.
Senior management o the Company shall make
disclosure to the Board relating to all material nancial
and commercial transactions, where they have personal
interest that may have a potential confict with the interest
o the company at large.
Our practice
• A separate report on ‘Management’s Discussion and
analysis’ orms part o this Annual Report.• During the year under review, there was no incident
involving any confict o interests between the senior
management and the Company.
Clause 49
(IV G)
Shareholders
Standard
In case o the appointment o a new director or re-
appointment o a director the shareholders must be
provided with brie details o the appointee.
Quarterly results and presentations made by the company
to analysts shall be put on company’s web-site.
A Shareholders’ / Investors’ Grievance Committee
should be ormed under chairmanship o a non-executive
director.
To expedite the process, power o share transer may
be delegated and the delegated authority shall attend to
share transer ormalities at least once in a ortnight.
Our practice
• A brie prole o directors being appointed/re-
appointed has been provided in the notice convening
the Annual General Meeting.• Quarterly results are uploaded on website o the
Company within 24 hours o approval by the Board.
Presentation to analysts, i any, is uploaded on the
website o the Company.
• Company has ormed a committee named
‘Shareholders’/Investors’ Grievance Committee’
under the chairmanship o Mr. Amit Sharma, a Non-
executive & Independent director.
• The work o share transer has been delegated to
Registrar & Share Transer Agent o the Company
under the supervision o Share Transer Committee
which is a sub committee o Shareholders’/ Investors’
Grievance Committee o the Board.
Clause 49 (V) CEO/CFO Certication
Standard
The CEO i.e. the Managing director and the CFO i.e. the
Whole-time Finance Director or any other person heading
the nance unction discharging that unction shall inter-
alia certiy to the Board accuracy o nancial statement
and adequacy o internal controls or nancial reporting
purpose.
Our practice
• Chie Executive Ocer and Chie Financial Ocer
certiy compliance o requirements o this clause to
the Board.
• The certicate is also published in this Annual Report.
Clause 49 (VI) Report on Corporate Governance
Standard
There shall be a separate section on Corporate
Governance in the Annual Reports o Company.
The company shall submit a quarterly compliance report
to the stock exchange within 15 days rom the close o each quarter.
Our practice
• The Corporate Governance report published in Annual
Report ullls requirements o this clause.
• Quarterly Compliance Certicate duly signed by
Compliance Ocer as to the compliance o Clause
49 requirements is sent to the National Stock
Exchange, Bombay Stock Exchange, Delhi Stock
Exchange, Ahmedabad Stock Exchange, Calcutta
Stock Exchange and Madras Stock Exchange within
prescribed time limit.
Clause 49 (VII) Compliance
Standard
The Company shall obtain a certicate rom either the
auditors or practicing company secretaries regarding
compliance o conditions o Corporate Governance as
stipulated in this clause and annex the certicate with the
directors’ report.
The disclosures o the compliance with mandatory
requirements and adoption (and compliance) / non-
adoption o the non-mandatory requirements shall be
made in the section on Corporate Governance o the
Annual Report.
Our practice
• A certicate obtained rom the Auditors regarding
the compliance o the conditions o Corporate
Governance is published in this Annual Report.
• Compliance with all mandatory requirements and
certain non-mandatory requirements o clause 49 has
been highlighted elsewhere in the report on Corporate
Governance.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 43/10041
A n n u A l R e p o R t 2 0 0 7 - 0 8
AUDITORS’ REPORT
The members of niiT Techologes Lmted
1. WehaveauditedtheattachedBalanceSheetoNIITTechnologiesLimited,asat31March2008,andtherelatedProt
andLossAccountandCashFlowStatementortheyearendedonthatdateannexedthereto,whichwehavesigned
underreerencetothisreport.ThesenancialstatementsaretheresponsibilityotheCompany’smanagement.Our
responsibilityistoexpressanopiniononthesenancialstatementsbasedonouraudit.
2. WeconductedourauditinaccordancewiththeauditingstandardsgenerallyacceptedinIndia.ThoseStandardsrequire
thatweplanandperormtheaudittoobtainreasonableassuranceaboutwhetherthenancialstatementsarereeo
materialmisstatement.Anauditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosures
inthenancialstatements.Anauditalsoincludesassessingtheaccountingprinciplesusedandsignicantestimates
madebymanagement,aswellasevaluatingtheoverallnancialstatementpresentation.Webelievethatourauditpro-
videsareasonablebasisorouropinion.
3. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report)
(Amendment)Order,2004(together‘theorder’), issuedby theCentralGovernmentoIndiaintermsosub-section
(4A)oSection227o‘TheCompaniesAct,1956’oIndia(the‘Act’)andonthebasisosuchchecksothebooksand
recordsotheCompanyasweconsideredappropriateandaccordingtotheinormationandexplanationsgiventous,
weurtherreportthat:
(i)(a) Thecompanyismaintainingproperrecordsshowingullparticularsincludingquantitativedetailsandsituation
oxedassets.
(b) Thexedassetsarephysicallyveriedbythemanagementaccordingtoaphasedprogrammedesignedto
coveralltheitemsoveraperiodotwoyears,whichinouropinion,isreasonablehavingregardtothesizeo
theCompanyandthenatureoitsassets.Pursuanttotheprogramme,aportionothexedassetshasbeen
physicallyveriedbythemanagementduringtheyearandnomaterialdiscrepanciesbetweenthebookrecords
andthephysicalinventoryhavebeennoticed.
(c) Inouropinionandaccordingtotheinormationandexplanationsgiventous,asubstantialpartoxedassets
hasnotbeendisposedobytheCompanyduringtheyear.
(ii) (a) Accordingtotheinormationandexplanationgiventous,theCompanyprocuresinventoriesspecicallyorthe
purposeoexecutingcertaincontractsandnoinventoryisheldatanypointotimeduringtheyear.Accordingly
clauses(ii)(a)and(ii)(b)oParagraph4otheOrderarenotapplicabletotheCompany.
(b) Onthebasisoourexaminationotheinventroyrecords,inouropinion,theCompanyismaintainingproper
recordsoinventroy.
(iii) (a)Thecompanyhasgrantedunsecuredloans,totwowhollyownedsubsidiarycompaniescoveredintheregister
maintainedunderSection301othe Act.Themaximumamountinvolvedduringtheyearand theyear-end
balanceosuchloansaggregatestoRs.386LacsandRs.268Lacsrespectively.
Inouropinion,rateointerestandothertermsandconditionsosuchloansarenotprimaacieprejudicialtothe
interestotheCompany.
Inrespectotheaoresaidloans,thepartiesarerepayingtheprincipalamountsasstipulatedandarealso
regularinpaymentointerest,whereapplicable.
Inrespectotheaoresaidloans,thereisnooverdueamountmorethanRupeesOneLac.
(b) ThecompanyhasnottakenanyloanromanypartycoveredunderregistermaintainedunderSection301o
theAct.(iv) Inour opinion andaccordingto theinormationandexplanationsgiven tous, having regardtothe explanation
thatcertainitemspurchasedareospecialnatureorwhichsuitablealternativesourcesdonotexistorobtaining
comparativequotations,thereisanadequateinternalcontrolsystemcommensuratewiththesizeotheCompany
andthenatureoitsbusinessorthepurchaseoxedassetsandorthesaleogoodsandservices.Further,
onthebasisoourexaminationothebooksandrecordsotheCompany,andaccordingtotheinormationand
explanationsgiventous,wehaveneithercomeacrossnorhavebeeninormedoanycontinuingailuretocorrect
majorweaknessesintheaoresaidinternalcontrolsystem.
(v) (a)Inouropinionandaccordingtotheinormationandexplanationsgiventous,theparticularsocontractsor
arrangementsreerredtoinSection301otheActhavebeenenteredintheregisterrequiredtobemaintained
underthatsection.
(b) Inrespectotransactionswithsubsidiariesorrenderingoservicesandorpurchaseogoodsandservices
aggregating to Rs.39,559 lacsand Rs.296 Lacsrespectivelyand withothers aggregating to Rs.269 lacs
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 44/10042
A n n u A l R e p o R t 2 0 0 7 - 0 8
andRs.455Lacsrespectively,themanagementhasinormedusthatthesetransactionsdealtareoaspecial
natureandthereorecomparablepricesarenotavailable.Inouropinionandaccordingtotheinormationand
explanationsgiventous,therearenoothertransactionsmadeinpursuanceosuchcontractsorarrangements
exceedingthevalueoRupeesvelacsinrespectoanypartyduringtheyear.(vi)ThecompanyhasnotacceptedanydepositsromthepublicwithinthemeaningoSections58Aand58AAothe
Actandtherulesramedthereunder.
(vii)Inouropinion,theCompanyhasaninternalauditsystemcommensuratewithitssizeandnatureobusiness.
(viii)TheCentralGovernmentoIndiahasnotprescribedthemaintenanceocostrecordsunderclause(d)osub-
section(1)oSection209otheActoranyotheproductsotheCompany.
(ix) (a) AccordingtotheinormationandexplanationsgiventousandtherecordsotheCompanyexaminedbyus,
inouropinion,theCompanyisregularindepositingtheundisputedstatutoryduesincludingprovidentund,
investoreducationandprotectionund,employees’stateinsurance,income-tax,sales-tax,wealthtax,service
tax,customsduty,cessandothermaterialstatutoryduesasapplicablewiththeappropriateauthorities.
(b) AccordingtotheinormationandexplanationsgiventousandtherecordsotheCompanyexaminedbyus,
therearenoduesoincome-tax,sales-tax,wealthtax,servicetax,andcustomsdutyasat31March2008
whichhavenotbeendepositedonaccountoadispute. (x)ThecompanyhasnoaccumulatedlossesasatMarch31,2008andithasnotincurredanycashlossesinthe
nancialyearendedonthatdateorintheimmediatelyprecedingnancialyear.
(xi)AccordingtotherecordsotheCompanyexaminedbyusandtheinormationandexplanationgiventous,the
Companyhasnotdeaultedinrepaymentoduestoanynancialinstitutionorbankordebentureholdersasatthe
balancesheetdate.
(xii)The companyhasnot grantedanyloans andadvances on thebasisosecurity by wayopledge o shares,
debenturesandothersecurities.
(xiii) Theprovisionsoanyspecialstatuteapplicabletochitund/nidhi/mutualbenetund/societiesarenotapplicable
totheCompany.
(xiv) Inouropinion,theCompanyisnotadealerortraderinshares,securities,debenturesandotherinvestments.
(xv) Inouropinion and accordingto the inormationandexplanationsgivento us, the termsandconditions othe
guaranteesgivenbytheCompany,orcertainlimitsoRs.8,766Lacstakenbyawhollyownedsubsidiaryroma
bankisnotprejudicialtotheinterestotheCompany.
(xvi) Inouropinion,andaccordingtotheinormationandexplanationsgiventous,,onanoverallbasis,thetermloans
takenbytheCompanyoraugmentinglongtermresourcesotheCompanytowardsgeneralcorporateobjectives
havebeenappliedorthepurposesorwhichtheywereobtained.
(xvii) OnthebasisoanoverallexaminationothebalancesheetotheCompany,inouropinionandaccordingtothe
inormationandexplanationsgiventous,therearenoundsraisedonashort-termbasiswhichhavebeenusedor
long-terminvestment.
(xviii) Thecompanyhasnotmadeanypreerentialallotmentosharestopartiesandcompaniescoveredintheregister
maintainedunderSection301otheActduringtheyear.
(xix) Thecompanyhascreatedsecurityorchargeinrespectodebenturesissuedandoutstandingattheyearend.
(xx) Thecompanyhasnotraisedanymoneybypublicissuesduringtheyear. (xxi) DuringthecourseoourexaminationothebooksandrecordsotheCompany,carriedoutinaccordancewiththe
generallyacceptedauditingpracticesinIndia,andaccordingtotheinormationandexplanationsgiventous,we
haveneithercomeacrossanyinstanceoraudonorbytheCompany,noticedorreportedduringtheyear,norhave
webeeninormedosuchcasebythemanagement.
4. Furthertoourcommentsinparagraph3above,wereportthat:
(a) We have obtainedall the inormationand explanations, whichto the best oour knowledge and belie were
necessaryorthepurposesoouraudit;
(b) Inouropinion,properbooksoaccountasrequiredbylawhavebeenkeptbytheCompanysoarasappearsrom
ourexaminationothosebooks;
(c) TheBalanceSheet,ProtandLossAccountandCashFlowStatementdealtwithbythisreportareinagreement
withthebooksoaccount;
AUDITORS’ REPORT (Cotd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 45/10043
A n n u A l R e p o R t 2 0 0 7 - 0 8
(d) Inouropinion,the BalanceSheet,ProtandLossAccountandCashFlowStatementdealtwithby thisreport
complywiththeaccountingstandardsreerredtoinsub-section(3C)oSection211otheAct;
(e) Onthebasisowrittenrepresentationsreceivedromthedirectors,ason31March2008andtakenonrecordby
theBoardoDirectors,noneothedirectorsisdisqualiedason31March2008rombeingappointedasadirectorintermsoclause(g)osub-section(1)oSection274otheAct;
() Inouropinionandtothebestoourinormationandaccordingtotheexplanationsgiventous,thesaidnancial
statementstogetherwiththe notes thereonandattachedtheretogivein theprescribedmannerthe inormation
requiredbytheActandgiveatrueandairviewinconormitywiththeaccountingprinciplesgenerallyacceptedin
India:
(i) inthecaseotheBalanceSheet,othestateoaairsotheCompanyasat31March2008;
(ii) inthecaseotheProtandLossAccount,otheprotortheyearendedonthatdate;and
(iii) inthecaseotheCashFlowStatement,othecashfowsortheyearendedonthatdate.
H. Sgh
Partner
MembershipNo.F–86994
Forandonbehalo
Prce Waterhouse
Chartered Accountants
Place : Gurgaon
Date : 11June,2008
AUDITORS’ REPORT (Cotd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 46/10044
A n n u A l R e p o R t 2 0 0 7 - 0 8
BAlAnCE ShEET as at Marc 31, 2008
Schedule / (note As At As At
Referece) 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
SOURCES OF FUnDS
SHAREHOLDERS’FUNDS
ShareCapital 1 586,983,950 391,005,300
ShareApplicationMoney-ESOP - 242,230
EmployeeStock
OptionOutstanding 2 2,444,900 3,684,600
ReservesandSurplus 3 3,287,937,012 2,574,932,763
3,877,365,862 2,969,864,893
LOAn FUnDS
SecuredLoans 4 166,617,230 266,574,138
4,043,983,092 3,236,439,031
APPLiCATiOn OF FUnDS
FiXED ASSETS 5
GrossBlock 2,129,990,458 1,756,340,523
Less:Depreciation/Amortisation 1,405,201,531 1,191,511,046
NetBlock 724,788,927 564,829,477
Capitalwork-in-progress 518,315,440 37,004,484
(includingCapitalAdvances)
INVESTMENTS 6 1,928,806,026 1,966,995,824
DEFERREDTAXASSETS(NET)18(21) 24,427,439 4,871,725
CURREnT ASSETS, LOAnS AnD ADVAnCES
SundryDebtors 7 1,111,475,363 1,021,691,057
CashandBankBalances 8 144,664,434 63,063,690
OtherCurrentAssets 9 396,447,557 13,476,817LoansandAdvances 10 474,000,134 312,572,994
2,126,587,488 1,410,804,558
Less:CURRENTLIABILITIESANDPROVISIONS
CurrentLiabilities 11 747,697,397 333,987,973
Provisions 12 531,244,831 414,079,064
1,278,942,228 748,067,037
NetCurrentAssets 847,645,260 662,737,521
4,043,983,092 3,236,439,031
nOTES TO ACCOUnTS 18
TheSchedulesreerredtoaboveormanintegralpartotheBalanceSheet. ThisistheBalanceSheetreerredtoinourreportoevendate.
H. Sgh Rajedra S Pawar Arvd ThakurPartner Chairman & Managing Director CEO & Jt. Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Aad Sureder VarmaPrce Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : GurgaonDate : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 47/10045
A n n u A l R e p o R t 2 0 0 7 - 0 8
PROfIT AnD lOSS ACCOUnT or the year eded March 31, 2008
Schedule / (note Year eded Year eded
Referece) 31st March 2008 31st March 2007
(Rs.) (Rs.)
inCOME
RevenueromOperations18{1(v)},(15),(20)} 4,447,143,757 2,971,648,815
OtherIncome 13 509,494,154 121,771,371
4,956,637,911 3,093,420,186
EXPEnDiTURE
Personnel 14 2,135,057,078 1,168,370,930
DevelopmentandBoughtout 15 388,802,998 103,400,453
Administration,FinanceandOthers 16 686,523,293 434,570,763
Marketing 17 24,241,706 30,614,087
DepreciationandAmortisation5 229,709,556 217,801,451
3,464,334,631 1,954,757,684
Prot before Tax 1,492,303,280 1,138,662,502
TaxExpense 18(21)
-Current 140,660,448 21,610,000
-MATCredit (90,130,000) -
-DeerredCharge/(Beneft) (3,268,304) (1,470,000)
-FringeBeneftTax 13,977,624 11,770,308
ProftaterTax 1,431,063,512 1,106,752,194
Balancebroughtorwardrompreviousyear 1,525,716,247 803,236,095
Balanceavailableorappropriation 2,956,779,759 1,909,988,289
APPROPRiATiOn
Dividend:-
DividendPaid(RelatedtoPreviousYear) 109,525 -CorporateDividendTaxonabove 18,614 -
ProposedonEquityShares 381,539,568 254,153,445
CorporateDividendTaxon
ProposedDividend 18(19) - 43,193,378
TranserredromDebentureRedemptionReserve (17,500,000) (23,750,000)
TranserredtoGeneralReserve 143,106,351 110,675,219
BalanceCarriedtoBalanceSheet 2,449,505,701 1,525,716,247
2,956,779,759 1,909,988,289
BasicEarningspershare 18(22) 24.39 18.99
DilutedEarningspershare 18(22) 24.35 18.89
nOTES TO ACCOUnTS 18
TheSchedulesreerredtoaboveormanintegralpartotheProftandLossAccount.
ThisistheProftandLossAccountreerredtoinourreportoevendate.
H. Sigh Rajedra S Pawar Arvid ThakurPartner Chairman & Managing Director CEO & Jt. Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Aad Sureder VarmaPrice Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : GurgaonDate : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 48/10046
A n n u A l R e p o R t 2 0 0 7 - 0 8
CASh flOW STATEMEnT or te year eded 31st Marc 2008
Year eded Year eded
31st March 2008 31st March 2007
(Rs.) (Rs.) (Rs.) (Rs.)
CASH FLOW FROM OPERATinG ACTiViTiESNetProtbeoreTax 1,492,303,280 1,138,662,502
Add/(Less):
Depreciation 229,709,556 217,801,451
UnrealizedExchange(Gain)/Loss 67,817,143 (7,139,921)
EmployeeStockOptionPlanExpenses - 4,092,891
ProvisionorDoubtulDebts (333,843) 1,882,183
ProvisionorDoubtulSecuritydeposit - 500,000
InterestIncome (8,739,205) (27,093,857)
DividendIncome (386,371,350) (16,674,318)
InterestExpenses 12,374,392 19,707,333
Lossondisposaloxedassets (14,568,040) 579,558
ProtonSaleoInvestment (41,913,585) (142,024,932) (10,972,681) 182,682,639
OperatingProtbeoreWorkingCapitalChanges 1,350,278,348 1,321,345,141
Add/(Less):(Increase)/DecreaseinWorkingCapital
TradeReceivables (89,556,395) (325,339,437)
OtherCurrentAssets (3,363,421) 32,217,638
LoansandAdvances (149,337,882) (4,519,434)
CurrentLiabilitiesandProvisions 227,346,446 (14,911,252) 87,182,195 (210,459,039)
DirectTaxpaid
(includingTaxDeductedatSource) (173,788,541) (29,492,657)
net cash from / (used )
Operatg Actvtes (A) 1,161,578,555 1,081,393,445
CASH FLOW FROM inVESTinG ACTiViTiES
PurchaseoFixedAssets (896,246,301) (255,064,316)ProceedsromSaleoFixedAssets 27,874,616 19,693,607
InvestmentinSubsidiary/JointVenture (191,123,165) (20,099,900)
ShorttermInvestmentswithMutualFunds
-ValueoUnitsPurchased (3,232,348,069) (2,974,986,538)
-ValueoUnitsSold 3,503,574,617 271,226,547 2,353,480,920 (621,505,618)
DividendIncome 4,831,782 16,674,318
LoanstoSubsidiaries
-Given (25,759,819) (207,600,000)
-Receivedback 24,322,500 (1,437,319) 158,600,000 (49,000,000)
LoanstoNIITianWelareTrustreceivedback 100,000,000 -
InterestreceivedonloantoSubsidiaries 4,322,533 32,149,116
Interestreceivedonxeddeposit
&LoantoNIITianWelareTrust 8,387,029 3,246,798
net cash from / (used )
ivestg Actvtes (B) (672,164,279) (873,905,995)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 49/10047
A n n u A l R e p o R t 2 0 0 7 - 0 8
CASh flOW STATEMEnT or te year eded 31st Marc 2008 (Cotd.)
Year eded Year eded
31st March 2008 31st March 2007
(Rs.) (Rs.) (Rs.) (Rs.)
CASH FLOW FROM FinAnCinG ACTiViTiES
ProceedsromIssueoShareCapital(incl.SharePremium) 3,407,066 52,709,581
TermLoans
-Received 7,843,357 8,080,293
-Repaid (7,800,265) 43,092 (29,351,010) (21,270,717)
Repaid6.5%Non-convertibleDebentures (100,000,000) (150,000,000)
InterestpaidonFixedLoan (14,771,201) (27,988,156)
Dividendpaid(includingDividendTax) (296,492,489) (263,560,062)
net cash from / (used )
Facg Actvtes (C) (407,813,532) (410,109,354)
CashandCashEquivalentsatthe
beginningotheyear(reerschedule8) 63,063,690 265,685,594
CashandCashEquivalentsatthe
endotheyear(reerschedule8) 144,664,434 63,063,690
nET inCREASE/(DECREASE)
in CASH AnD
CASH EQUiVALEnTS (A+B+C) 81,600,744 (202,621,904)
notes:
1 TheabovecashFlowhasbeenpreparedaspertheindirectmethodsetoutinAS-3notiedintheCompanies(AccountingStandard)
Rules,2006.
2 Theenclosedschedules1to18ormanintegralpartotheCashFlowStatement.
3 CashandcashequivelentsincludexeddepositsheldasmarginmoneyRs.10,496,712(PreviousyearRs.9,876,529).
4 Figuresinparanthesisindicatecashoutgo.
5 Previousyeargureshavebeenregrouped/reclassiedtoconormtocurrentyear’sclassication.
Thisisthecashfowstatementreerredtoinourreportoevendate.
H. Sgh Rajedra S Pawar Arvd ThakurPartner Chairman & Managing Director CEO & Jt. Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Aad Sureder VarmaPrce Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : GurgaonDate : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 50/10048
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES annexed to and forming part of te Baance Seet as at Marc 31, 2008
Schedule As At As At
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
1. SHARE CAPiTAL
Authorsed 75,000,000EquityShares(Previous Year45,000,000equityshares)oRs.10/-each 750,000,000 450,000,000
750,000,000 450,000,000
issued, subscrbed ad Pad-up
58,698,395EquityShares(previousyear 39,100,530shares)oRs.10/-each 586,983,950 391,005,300 (Reernotebelow) 586,983,950 391,005,300
Note:Outoabove,19,559,465equityshareswereissuedasullypaidbonussharesduringtheyear,bycapitalizationobalancesinsharepremiumandgeneralreserveaggregatingtoRs.195,594,650/-
2. EMPLOYEE STOCK OPTiOn OUTSTAnDinG
[Refer notes 1 ( v) ad 26 o Schedule 18]
AsperLastBalanceSheet 3,684,600 13,949,692 Less:Utilizedorissueoequityshares 1,094,800 9,809,692 Less:EmployeeStockOptionlapsedpostvesting 144,900 455,400
2,444,900 3,684,600
3. RESERVES AnD SURPLUS
Captal Redempto Reserve AsperLastBalanceSheet 16,570,603 16,570,603
Share Premum AsperLastBalanceSheet 76,566,027 13,595,052
Add:Additionduringtheyear 4,360,140 62,970,975 Less:UtilizedorissueoBonusShares 79,132,827 1,793,340 - 76,566,027
Debeture Redempto Reserve AsperLastBalanceSheet 55,000,000 78,750,000 Less:TranserredtoProft&LossAccount (17,500,000) 37,500,000 23,750,000 55,000,000
Geeral Reserve AsperLastBalanceSheet 901,079,886 857,917,921 Add:EmployeeStockOption lapsedpostvesting 144,900 455,400 Add:BalanceTranserred romProftandLossAccount 143,106,351 110,675,219 Less:AdjustmentoAccountingStandard 15EmployeeBenefts(Revised2005) - 67,968,654 Less:UtilizedorissueoBonusShares 116,461,822 927,869,315 - 901,079,886
Hedgg Reserve (Debt) (145,301,947) - (CreatedDuringtheyearNetodeerred taxassetsoRs.148.10Lacs) [ReerNote1(viii)and27onSchedule18] ProftandLossAccount 2,449,505,701 1,525,716,247
3,287,937,012 2,574,932,763
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 51/10049
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES annexed to and forming part of te Baance Seet as at Marc 31, 2008 (Contd.)Schedule As At As At
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
4. SECURED LOAnS
[Refer Notes 1 (x) and 6 on Schedule 18] LoansromBank -VehicleLoan 16,617,230 16,574,138 6.5%Non-ConvertibleDebentures 150,000,000 250,000,000
notes :
1) 6.5%Non-ConvertibleDebenturesare redeemableon26thMay2008.2) AmountduewithinoneyearRs.156,592,978/- (PreviousyearRs.105,954,866/-).
166,617,230 266,574,138
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 52/10050
A
n
n
u
A
l
R
e
p
o
R
t
2
0
0
7
-
0
8
S C h E D U l E S a n n e x e d t o a n d f o r m i n g p a r t o f t e B a a
n c e S e e t a s a t M a r c 3 1 , 2
0 0 8 ( C o n t d . )
5 .
F i X E D A S S E T S
[ R e f e r n o t e 1 ( ) , ( v ) , ( v ) , ( v ) , 3 b , 8 , 1 4 a d 1 9 ( b ) o S c h e d u l e 1 9 ]
F g u r e s R u p e e s
G R
O S
S
B L O C
K
D E P R E C i A T i O n
/ A M O R
T i S A T i O n
n E T
B L O C
K
D e s c r p t o o f A s s e t s
A s a t
0 1 . 0 4 . 2 0 0 7
A d d t o s
d u r g t h e Y e a r
S a l e s / A d j .
d u r g t h e Y e a r
A
s a t
3 1 . 0
3 . 2 0 0 8
A s a t
0 1 . 0 4 . 2 0 0 7
F o r t h e
Y e a r
S a l e s / A d j .
d u r g t h e Y e a r
A s a t
3 1 . 0 3 . 2 0 0 8
A s a t
3 1 . 0 3 . 2 0 0 8
A s a t
3 1 . 0 3 . 2 0 0 7
T a g b l e
L a n d - F r e e h o l d
1 6 7 , 1 6 5
-
-
1 6 7 , 1 6 5
-
-
-
-
1 6 7 , 1 6 5
1 6 7 , 1 6 5
L a n d - L e a s e H o l d
1 3 8 , 3 9 0 , 6 1 9
-
-
1 3 8 ,
3 9 0 , 6 1 9
1 , 3 8 2 , 4 5 8
1 , 5 4 1 , 2 3 9
-
2 , 9 2 3 , 6 9 7
1 3
5 , 4 6 6 , 9 2 2
1 3 7 , 0 0 8 , 1 6 1
B u i l d i n g s
1 3 , 0 3 1 , 6 2 7
-
1 0 , 9 3 1 , 6 2 7
2 ,
1 0 0 , 0 0 0
2 , 0 9 8 , 1 3 8
1 4 1 , 5 7 6
1 , 9 1 5 , 0 0 7
3 2 4 , 7 0 7
1 , 7 7 5 , 2 9 3
1 0 , 9 3 3 , 4 8 9
P l a n t & M a c h i n e r y
- C o m p u t e r s & P e r i p h e r a l s
3 7 0 , 9 4 3 , 8 0 8
7 2 , 9 8 1 , 2 8 3
1 1 , 8 4 0 , 6 5 8
4 3 2 ,
0 8 4 , 4 3 3
2 4 2 , 5 5 8 , 3 0 6
5 8 , 7 7 0 , 6 7 5
1 1 , 0 8 5 , 3 5 6
2 9 0 , 2 4 3 , 6 2 5
1 4
1 , 8 4 0 , 8 0 8
1 2 8 , 3 8 5 , 5 0 2
- O t h e r s
1 3 2 , 5 9 9 , 9 8 8
1 3 , 4 3 1 , 2 1 1
1 6 5 , 2 1 8
1 4 5 ,
8 6 5 , 9 8 1
5 5 , 2 6 0 , 9 4 4
7 , 5 0 1 , 0 6 4
1 6 4 , 1 3 9
6 2 , 5 9 7 , 8 6 9
8
3 , 2 6 8 , 1 1 2
7 7 , 3 3 9 , 0 4 4
F u r n i t u r e & F i x t u r e s
6 7 , 9 9 1 , 7 5 2
2 5 , 0 8 2 , 7 6 1
2 4 0 , 4 9 2
9 2 ,
8 3 4 , 0 2 1
4 1 , 0 3 8 , 6 2 0
7 , 2 4 5 , 0 5 4
2 4 0 , 3 9 2
4 8 , 0 4 3 , 2 8 2
4
4 , 7 9 0 , 7 3 9
2 6 , 9 5 3 , 1 3 2
L e a s e H o l d I m p r o v e m e n t s
1 0 9 , 4 8 9 , 7 3 1
1 0 8 , 5 3 1 , 2 6 0
1 , 3 3 9 , 8 6 0
2 1 6 ,
6 8 1 , 1 3 1
6 1 , 3 2 5 , 0 4 0
3 1 , 8 7 1 , 0 8 6
1 , 2 7 2 , 8 6 7
9 1 , 9 2 3 , 2 5 9
1 2
4 , 7 5 7 , 8 7 2
4 8 , 1 6 4 , 6 9 1
V e h i c l e s
3 2 , 3 2 6 , 6 3 3
5 , 3 5 2 , 0 1 9
4 , 8 0 7 , 7 9 2
3 2 ,
8 7 0 , 8 6 0
4 , 8 2 7 , 1 2 0
3 , 1 8 6 , 5 4 1
1 , 3 4 1 , 3 1 0
6 , 6 7 2 , 3 5 1
2
6 , 1 9 8 , 5 0 9
2 7 , 4 9 9 , 5 1 3
S u b T o t a l ( a )
8 6 4 , 9 4 1 , 3 2 3
2 2 5 , 3 7 8 , 5 3 4
2 9 , 3 2 5 , 6 4 7
1 , 0 6 0 ,
9 9 4 , 2 1 0
4 0 8 , 4 9 0 , 6 2 6
1 1 0 , 2 5 7 , 2 3 5
1 6 , 0 1 9 , 0 7 1
5 0 2 , 7 2 8 , 7 9 0
5 5
8 , 2 6 5 , 4 2 0
4 5 6 , 4 5 0 , 6 9 7
i t a g b l e - A q u r e d
S o f t w a r e
8 9 1 , 3 7 6 , 0 4 8
1 7 7 , 5 9 7 , 0 4 8
-
1 , 0 6 8 ,
9 7 3 , 0 9 6
7 8 3 , 0 0 6 , 1 4 2
1 1 9 , 4 5 1 , 2 2 2
-
9 0 2 , 4 5 7 , 3 6 4
1 6
6 , 5 1 5 , 7 3 2
1 0 8 , 3 6 9 , 9 0 6
P a t e n t s
2 3 , 1 5 2
-
-
2 3 , 1 5 2
1 4 , 2 7 8
1 , 0 9 9
-
1 5 , 3 7 7
7 , 7 7 5
8 , 8 7 4
S u b T o t a l ( b )
8 9 1 , 3 9 9 , 2 0 0
1 7 7 , 5 9 7 , 0 4 8
-
1 , 0 6 8 ,
9 9 6 , 2 4 8
7 8 3 , 0 2 0 , 4 2 0
1 1 9 , 4 5 2 , 3 2 1
-
9 0 2 , 4 7 2 , 7 4 1
1 6
6 , 5 2 3 , 5 0 7
1 0 8 , 3 7 8 , 7 8 0
T o t a l ( a + b )
1 , 7 5 6 , 3 4 0 , 5 2 3
4 0 2 , 9 7 5 , 5 8 2
2 9 , 3 2 5 , 6 4 7
2 , 1 2 9 ,
9 9 0 , 4 5 8
1 , 1 9 1 , 5 1 1 , 0 4 6
2 2 9 , 7 0 9 , 5 5 6
1 6 , 0 1 9 , 0 7 1
1 , 4 0 5 , 2 0 1 , 5 3 1
7 2
4 , 7 8 8 , 9 2 7
5 6 4 , 8 2 9 , 4 7 7
P r e v o u s Y e a r
1 , 6 0 7 , 7 0 3 , 3 7 7
2 4 1 , 2 3 5 , 6 4 0
9 2 , 5 9 8 , 4 9 4
1 , 7 5 6 ,
3 4 0 , 5 2 3
1 , 0 4 6 , 0 3 4 , 9 2 4
2 1 7 , 8 0 1 , 4 5 1
7 2 , 3 2 5 , 3 2 9
1 , 1 9 1 , 5 1 1 , 0 4 6
C a p i t a l W o r k - i n P r o g r e s s
( I n c l u d i n g C a p i t a l A d v a n c e s )
5 1
8 , 3 1 5 , 4 4 0
3 7 , 0 0 4 , 4 8 4
1 , 2 4
3 , 1 0 4 , 3 6 7
6 0 1 , 8 3 3 , 9 6 1
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 53/10051
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES annexed to and forming part of te Baance Seet as at Marc 31, 2008 (Contd.)
Schedule As At As At
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
6. inVESTMEnTS
[Refer notes 1 (v), 18 o Schedule 18]
A. LOnG TERM, TRADE [UnQUOTED] InSubsidiaryCompanies: 2,837,887EquityShareshavingno parvalueinNIITTechnologiesInc.USA 155,790,698 155,790,698
2,989,375EquityShareso 1Singapore$eachullypaid-upin NIITTechnologiesPacifcPteLtd.,Singapore 77,518,750 77,518,750
3,276,427EquityShareso 1UKPoundeachullypaid-upin NIITTechnologiesLtd.,UK 204,426,821 204,426,821
890,000equityShareso Rs.10/-eachullypaid-upin NIITGISLtd 8,900,000 8,900,000
537,934EquityShareso Euro1eachullypaid-upin NIITTechnologiesAG,Germany 184,762,155 184,762,155
50,000,000EquityShareso Rs.10/-eachullypaid-upin NIITSmartServeLimited (Previousyear25,000,000EquityShareso Rs.10/-each) 500,000,000 500,000,000
150,000EquitySharesoEuro1eachullypaid-upin 164,253,564 -
SotecGmbHGermany 10EquitySharesoUSD5,000eachullypaid-upin NIITTechnologiesLimited,Canada 1,969,500 -
OtherCompanies: 2,500,000equitysharesoRs.10eachin 25,000,000 99,900 AdeccoNIITTechnologiesPrivateLimited (Previousyear9,990EquitySharesoRs.10/-each)
B. SHORT TERM, nOn TRADE [UnQUOTED]
[Refer note 23 o Schedule 18]
InMutualFunds 606,184,538 835,497,500
1,928,806,026 1,966,995,824
note:
1. Duringtheyear,theCompanymadeinvestmentsin: (i)NIITTechnologiesLimited,CanadaoRs.1,969,500. (ii)AdeccoNIITTechnologiesPrivateLimited(aJointVenture)oRs.24,900,100.
2. Duringtheyear,theCompanyalsoacquired150,000equitysharesoEuro1eachinSoTecGmbHGermany, romitsexistingshareholdersorRs.164,253,564.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 54/10052
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES aexed to ad ormig part o te Baace Seet as at Marc 31, 2008 (Cotd.)Schedule As At As At
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
7. SUnDRY DEBTORS
(Usecured) Outstandingoroversixmonths
-ConsideredGood 26,388,259 2,363,250
-ConsideredDoubtul 35,545,976 35,879,819
OtherDebts-ConsideredGood1,085,087,104 1,019,327,807
1,147,021,339 1,057,570,876
Less:ProvisionorDoubtulDebts 35,545,976 1,111,475,363 35,879,819 1,021,691,057
1,111,475,363 1,021,691,057
8. CASH AnD BAnK BALAnCES
CashandChequesinHand 16,326,646 3,912,023
BalanceswithScheduledBanksin:
-CurrentAccounts 91,720,174 46,747,157 -DividendAccount 3,510,454 2,527,981
-FixedDepositAccounts 10,496,712 9,876,529
[IncludesRs.10,496,712/-(PreviousYear
Rs.9,876,529/-)pledgedasmarginmoney]
BalanceswithOtherBanksinCurrentAccount* 22,610,448 -
144,664,434 63,063,690
*BalancewithWachoviaBank,AtlantaUSA.MaximumBalanceduringtheyearRs.116,514,406.
9. OTHER CURREnT ASSETS
(Unsecured,consideredgood)
UnbilledRevenue 14,024,569 8,623,040
InterestReceivable 883,420 4,853,777 DividendReceivable 381,539,568 -
(ReerNote9onSchedule18)
396,447,557 13,476,817
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 55/10053
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES aexed to ad ormig part o te Baace Seet as at Marc 31, 2008 (Cotd.)
Schedule As At As At
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
10 LOAnS AnD ADVAnCES
(Unsecured, considered good except where otherwise stated ) [Refer Notes 1 (iii), (xi), 21 (a) (ii) on Schedule 18]
LoanstoSubsidiaries 26,759,850 26,068,455
LoantoNIITianWelareTrust - 100,000,000
PrepaidExpenses 56,816,075 49,043,615
Advancesrecoverableincashorinkind
ororvaluetobereceived 129,311,891 56,010,256
SecurityDeposits
-Consideredgood 142,695,523 72,314,342
-Considereddoubtul 1,459,716 1,459,716
144,155,239 73,774,058
Less:Provisionor
DoubtulSecurityDeposits 1,459,716 142,695,523 1,459,716 72,314,342
AdvanceIncomeTax 197,367,127 38,373,344
Less:ProvisionorIncomeTax 169,510,448 27,856,679 28,850,000 9,523,344
AdvanceFringeBenettax 34,412,614 19,617,856
Less:ProvisionorFringeBenettax 33,982,498 430,116 20,004,874 (387,018)
MATCredit 90,130,000 -
474,000,134 312,572,994
11 CURREnT LiABiLiTiES
[Refer note 5 ad 27 o Schedule 18]
SundryCreditors 447,044,744 271,727,665
AdvancesromCustomers 1,162,711 268,928
Interestaccruedbutnotdue 8,307,534 10,704,343 UnclaimedDividend* 3,510,454 2,527,981
OtherLiabilities 60,022,144 48,759,056
DerivativeInstrumentsFairValueLiability 227,649,810 -
*Therearenoamountsdueorpaymenttothe
InvestorProtectionFundunderSection205Co
TheCompaniesAct,1956asattheyear-end.
747,697,397 333,987,973
12 PROViSiOnS
[Refer Notes 1(vi) , 1(xi) , (xii), 9, & 17 on Schedule 18]
Provisionorcompensatedabsences 144,402,302 100,355,996
ProvisionorGratuity 5,302,961 16,376,245
ProposedDividendonEquityShares 381,539,568 254,153,445 CorporateDividendTax
(Refer Note 9 on schedule 18) - 43,193,378
531,244,831 414,079,064
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 56/10054
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES annexed to and forming part of te Profit and loss Account for te year ended Marc 31,
2008
Schedule Year eded Year eded
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
13. OTHER inCOME
[Refer notes 1(v), (v), 7,23 ad 27o schedule 18]
ProtonsaleoShortTermInvestments 41,913,585 10,972,681
Gainonexchangefuctuations(Net)* 32,914,444 34,207,367
RecoveryromSubsidiariesorcommon
corporateexpenses 26,901,095 27,611,525
Miscellaneous 21,393,680 32,305,480
DividendIncome 386,371,350 16,674,318
509,494,154 121,771,371
*NetoairvaluelossonderivativeinstrumentsoRs.67,537,863.
14. PERSOnnEL
[Refer notes 1(v) ,6, 8, 17, 24 ad 26 o schedule 18]
SalariesandBenets* 1,990,809,261 1,060,494,226
ContributiontoRetirementbenetunds 74,900,482 55,396,969
WelareandOtherExpenses 69,347,335 52,479,735
2,135,057,078 1,168,370,930
*IncludesexpenditureoRs.Nil(previousyearRs.4,092,891)inrespectoEmployeeStockOptionPlan.
15. DEVELOPMEnT AnD BOUGHT OUT
[Refer notes 15 (a), (b) o schedule 18]
Boughtoutitems 38,675,294 41,065,773
ProessionalCharges 316,532,298 38,933,126
EquipmentHiring 4,430,995 9,561,391
Consumables 19,797,803 3,769,874 Others 9,366,608 10,070,289
388,802,998 103,400,453
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 57/10055
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlES annexed to and forming part of te Profit and loss Account for te year ended Marc 31, 2008 (Contd.)
Schedule Year eded Year eded
no. 31st March, 2008 31st March, 2007
(Rs.) (Rs.)
16. ADMiniSTRATiOn, FinAnCE AnD OTHERS
[Refer note 8 o Schedule 18]
Rent 196,587,673 100,721,456
RatesandTaxes 11,999,139 10,804,205
ElectricityandWater 59,427,230 51,067,622
Communication 45,001,178 29,863,121
LegalandProessional 57,372,940 42,521,509
TravellingandConveyance 223,629,923 133,380,374
Bank,DiscountingandOtherFinancialCharges 2,515,265 2,208,092
InterestPaidonFixedLoans 12,374,392 19,707,333
Less:InterestReceivedon:
-Deposits 4,039,771 3,759,336
-Loans 4,699,434 23,328,260
-Others - 6,261
3,635,187 (7,386,524)
InsurancePremium 8,708,203 4,423,064
RepairsandMaintenance
-PlantandMachinery 24,753,630 23,720,392
-Buildings 20,607 1,043,754
-Others 20,442,559 14,413,195
SundryExpenses 32,429,759 27,790,503
686,523,293 434,570,763
17. MARKETinG
AdvertisementandPublicity 13,728,413 16,953,110
Others 10,513,293 13,660,977
24,241,706 30,614,087
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 58/10056
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008
1. STATEMEnT On SiGniFiCAnT ACCOUnTinG POLiCiES
Thesenancialstatementsarepreparedonanaccrualbasisandunderhistoricalcostconventionandinaccordance
withallapplicableaccountingstandardsspeciedinCompanies(AccountingStandardRules)2006.Thesignicant
accountingpoliciesadoptedbytheCompanyaredetailedbelow.
i) Fixed Assets
FixedAssetsarestatedatacquisitioncost.
ii) Deprecato ad Amortzato
Depreciationandamortizationisprovidedonapro-ratabasisonthestraight-linemethodovertheestimateduseul
livesotheassetsdeterminedasollows:-
LeaseholdLand 90years
LeaseholdImprovements 3yearsorleaseperiodwhicheverislower
Computers,relatedaccessoriesandsotware 2-5years
Allotherassets RatesprescribedunderscheduleXIVtotheCompan
1956
Further,computersystems andsotwareare technically evaluatedeachyear ortheir useul economic lie andtheunamortizeddepreciableamountotheassetischargedtoprotandlossaccountasdepreciationovertheir
revisedremaininguseullie.
iii) imparmet of Assets
Allassetsotherthaninventories,investmentsanddeerredtaxasset,arereviewedorimpairment,whereverevents
orchangesincircumstances indicatethatthe carryingamount maynotbe recoverable.Assetswhosecarrying
valueexceedstheirrecoverableamountarewrittendowntotherecoverableamount.
iv) ivestmets
Long-terminvestmentsarevaluedattheiracquisitioncost.Anydeclineinthevalueothesaidinvestment,other
thanatemporarydecline,isrecognizedandchargedtoprotandlossaccount.Short-terminvestmentsarecarried
atcostortheirmarketvalueswhicheverislower.
v) Reveue Recogto
Software Servces Thecompany derivesa substantial part o its revenueromtimeandmaterialcontractswheretherevenue is
recognizedonamanmonthbasis.AlsotheCompanyderivesrevenuesromxedpricecontractswhererevenue
isrecognizedbasedonproportionatecompletionmethodandoreseeablelossesonthecompletionocontracti
any,isprovidedor.
Dvded
Dividendincomeisrecognizedwhentherighttoreceivedividendisestablished.
vi) Employee Benets
a) Retirement Benet Plans:
- Provdet Fud
The Company makesdenedcontribution toRegional ProvidentFundCommissionerw.e.. 1October
2005inrespectoProvidentFund.TheCompanydoesnothaveanyurtherobligationinthisrespect.
Fortheperiodupto30thSeptember2005,theCompanymadecontributiontoaTrustestablishedorthe
purposesoProvidentFundbyNIITLimitedwhichisadenedbenetplantotheextentthattheCompany
hasanobligationtomakegoodtheshortall,iany,betweenthereturnromtheinvestmentotheTrust
andinterestratenotiedeveryyearbytheGovernment.TheCompany’sobligationtowardsanypossible
shortallisactuariallydeterminedandprovidedor.
- Superannuation
The Company makes dened contribution toa Trust establishedorthepurposeby NIITLimited.The
Companyhasnourtherobligationbeyondit’smonthlycontributions.
- Gratuity
Gratuityisapostemploymentdenedbenetplan.Theliabilityrecognizedinthebalancesheetinrespect
ogratuityisthepresentvalueothedenedbenetobligationatthebalancesheetdatelesstheairvalue
oplanassets.Thedenedbenetobligationiscalculatedannuallybyanindependentactuaryusingthe
projectedunitcreditmethod.ActuarialgainsandlossesarechargedorcreditedtotheProtandloss
accountintheyearinwhichsuchgainsorlossesarise.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 59/10057
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
- Overseas Employees
Inrespectoemployeesotheoverseasbranch,theCompanymakesdenedcontributiononamonthly
basistowardstheretirementbenetplanswhichischargedtotheprotandlossaccount.
b) Compesated abseces Liabilityinrespectocompensatedabsencesisprovidedbothorencashableleaveandthoseexpectedtobe
availedbasedonactuarialvaluation,whichconsidersundiscountedvalueothebenetsexpectedtobepaid/
availedduringthenextoneyearandappropriatediscountedvalueorthebenetsexpectedtobepaid/availed
ateroneyear.
c) Employee Stock Opto Scheme
Thestockoptionsgrantedunder“NIITTechnologiesEmployeesStockOptionPlan2005”isaccountedoras
pertheaccountingtreatmentprescribedbyEmployeeStockOptionSchemeandEmployeestockPurchase
Guidelines,1999,issuedbySecuritiesandExchangeBoardoIndia,wherebytheintrinsicvalueotheoption
beingexcessomarketvalueotheunderlyingshareimmediatelypriortodateograntoveritsexercisepriceis
recognizedasdeerredemployeecompensationwithacredittoemployeestockoptionoutstandingaccount.
Thedeerredemployeecompensationischargedtoprotandlossaccountonstraightlinebasisoverthe
vestingperiodotheoption.Thebalanceinemployeestockoptionoutstandingaccountnetoanyun-amortised
deerredemployeecompensationisshownseparatelyaspartoshareholders’unds. vii) Foreg Currecy Trasacto
Transactionsinoreigncurrencyarebookedatstandardratesdeterminedperiodically,whichapproximatetheactual
rates,andallmonetaryassetsandliabilitiesinoreigncurrencyarerestatedattheyear-end.Gain/Lossarisingout
ofuctuationsonrealization/paymentorrestatement,ischarged/creditedtotheprotandlossaccount.
Withregardtooreignexchangeorwardcontractstakentohedgeitsexposuretomovementsinoreignexchange
rates,thepremiumordiscountsarisingoutattheinceptionotheorwardcontractisamortizedasincomeor
expenseoverthelieothecontractandtheexchangedierenceonsuchacontractisrecognizedinthestatement
oprotandlossin thereportingperiodinwhichtheexchangeratechangesexcepttothe extenton whichthe
accountingpolicyonhedgeaccountingasdetailedin(viii)belowandurtherexplainedinnote27belowapplies.
TheoperationsotheCompany’sUSbranchareconsideredintegralinnatureandthebalances/andtransactionso
thebrancharetranslatedusingtheaoresaidprinciple.
viii)Hedge Accoutg InaccordancewithitsRiskmanagementpoliciesandprocedures,theCompanyusesderivativeinstrumentssuch
asoreign currencyorward contractsand currencyoptionsto hedge itsrisks associatedwithoreign currency
fuctuationsrelatingtocertainrmcommitmentsandhighlyprobableorecastedtransactions.Thederivativesthat
qualiy orhedgeaccounting anddesignated as cashfow hedges areinitially measuredat air value & arere-
measuredatasubsequentreportingdateandthechangesintheairvalueothederivativesi.e.gainorloss(net
otaximpact)isrecognizeddirectlyinshareholders’undsunderhedgingreservetotheextentconsideredhighly
eective.Gainorlossonderivativeinstrumentsthateitherdonotqualiyorhedgeaccountingorarenotdesignated
ascashfowhedgesordesignatedascashfowhedgestotheextentconsideredineectivearerecognizedinthe
protandlossaccount.
Hedgeaccountingisdiscontinuedwhenthehedginginstrumentexpires,sold,terminated,orexercised,ornolonger
qualiesorhedgeaccounting.Thecumulativegainorlossonthehedginginstrumentrecognizedinshareholder’s
undsunderhedgingreserveisretainedthereuntiltheorecastedtransactionoccurssubsequenttowhichthesame
isadjustedagainsttherelatedtransactioninprotandlossaccount.Iahedgedtransactionisnolongerexpectedtooccur,thenetcumulativegainorlossrecognizedinshareholder’sundistranserredtoprotandlossaccountin
thesameperiod.
ix) Borrowg Cost
Borrowingcosts areexpensedintheyearinwhichitisincurred except wherethe cost isincurredduringthe
construction o an asset that takes a substantial period to get ready or its intended use in which case it is
capitalized.
x) Taxation
Taxexpensecomprisingobothcurrenttax(includingFringeBenetTax)anddeerredtaxisincludedindetermining
thenetresultsortheyear.Deerredtaxrefectstheeectotemporarytimingdierencesbetweentheassetsand
liabilitiesrecognizedornancialreportingpurposesandtheamountsthatarerecognizedorcurrenttaxpurposes.
Asa matter oprudencedeerredtax assets arerecognizedand carriedorward onlyto theextent,there is a
reasonablecertaintythatsucientuturetaxableincomewillbeavailableagainstwhichsuchdeerredtaxassets
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 60/10058
A n n u A l R e p o R t 2 0 0 7 - 0 8
canberealized.Currenttax(includingFringeBenetTax)isdeterminedbasedontheprovisionsoIncome-taxAct,
1961.
MinimumAlternateTax(MAT)creditassetisrecognizedintheBalanceSheetwhereitislikelythatitwillbeadjusted
againstthedischargeothetaxliabilityinutureunderIncomeTaxAct. xi) Provsos ad cotgeces
TheCompanycreatesaprovisionwhenthereispresentobligationasaresultoapasteventthatprobablyrequires
anoutfoworesourcesandareliableestimatecanbemadeotheamountoobligation.Adisclosureoracontingent
liabilityismadewhenthereisapossibleobligationorapresentobligationthatprobablywillnotrequireanoutfow
oresourcesorwhereareliableestimateotheobligationcannotbemade.
xii) Leases
Leaserentalinrespectooperatingleasearrangementsarechargedtoexpenseonastraightlinebasisoverthe
termotherelatedleaseagreement.
2. COnTinGEnT LiABiLiTiES: -
a) Guarantees issued by banker outstanding at the end o accounting year Rs. 112,364,479/- (Previous Year
Rs.93,194,315/-).
b) Guaranteestobank againstlines ocredit sanctionedtowhollyownedoverseas subsidiaries Rs.876,643,900/-
(PreviousYearRs.1,068,132,300/-).
c) Guarantees on behal o wholly owned overseas subsidiaries Rs. 508,119,500/- (Previous Year
Rs.514,810,500/-).
d) Guarantees given on behal o NIITian Welare Trust or loans availed by the Trust Nil (Previous Year
Rs.75,000,000/-).
e) Claims against the Company not acknowledged as debts Rs. 270,115,497/- (Previous Year Rs. 6,230,000/-)
includingvendorclaimsRs.263,885,497(PreviousYearNil).
3. Estimated amount o contracts remaining to be executed on capital account (net o advances) not provided or
Rs.599,263,721/-(PreviousYearRs.167,250,207/-).
4. Duringtheyear,theCompanyestablisheda branchin theUSAandacquiredcertainassetsaggregatingtoRs.225
lacs(includingxedassetsanddeerredtaxassetsoRs.168lacsand15Lacsrespectively)andliabilitiesaggregating
to212Lacsromitswhollyownedsubsidiary(NIITTechnologiesInc.USA)andstartedprovidingonsiteservicestothe
whollyownedsubsidiary.
5. Mcro ad Small scale busess ettes :
There are no micro and small scale enterprises, to which the Company owes dues, as at 31 March 2008. This
inormationasrequiredtobedisclosedundertheMicro,SmallandMediumenterprisesDevelopmentAct,2006has
beendeterminedtotheextentsuchpartieshavebeenidentiedonthebasisoinormationavailablewithcompany.
6. a) WorkingcapitallimitsoRs.10,000Lacs(PreviousYearRs.10,000Lacs)aresecuredbyarstchargeonthebook
debtsotheCompanyandbyasecondchargeonmovableassetsotheCompany.TheCompanyhasnotutilized
theundbasedlimitasattheyear-end(previousyearRs.Nil).
b) 6.50%NonConvertibleDebenturesaresecuredbywayoamortgageonreeholdlandotheCompanyandarst
paripassuchargebywayohypothecationomovableassets/properties,subjecttochargescreatedongeneral
assetsotheCompanyinavourotheCompany’sbanker(s)orsecuringborrowingsotheCompanyorworking
capitalrequirements.
c) Vehicleloansrombanksaresecuredbywayohypothecationothevehiclesnanced.
7. InterestreceivedaregrossotaxdeductedatsourceoRs.1,522,302/-(PreviousYearRs.5,328,163/-).
8. Expensesduringtheyeararenet orecoveries towardscommonservices romdomestic subsidiariesamounting to
Rs.2,469,813/-(PreviousYearRs.1,978,398/-).
9. TheCompany’sdomesticsubsidiaryNIITGISLimitedhasdeclareddividendowhichRs.381,539,568/-(PreviousYear
Rs.Nil)isreceivablebytheCompanyinrespectowhichdividenddistributiontaxwouldbepaidbythesubsidiary.In
termsoprovisionsosub-section1Aosection115OotheIncomeTaxAct,nodividenddistributiontaxispayableby
theCompany,sincethedividendreceivablebytheCompanyromitssubsidiaryisequivalenttothedividendproposed
bytheCompanyorthecurrentyear.
10.TheprotonsaleoshortterminvestmentsincludeRs.45Lacs(previousyearRs.Nil)protonsaleounitsomutual
undsheldasinvestmentoraperiodomorethan12months.
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 61/10059
A n n u A l R e p o R t 2 0 0 7 - 0 8
11. EARninGS in FOREiGn CURREnCY
2007-08
(Rs.)
2006-07
(Rs.)
SotwareServices 4,034,006,906 2,656,516,226Interest(NetoTaxes) 1,447,139 7,639,670
Otherincome 23,550,240 18,752,647
12. CiF VALUE OF iMPORTS
2007-08
(Rs.)
2006-07
(Rs.)
Capitalgoods 58,964,681 29,924,522
13. EXPENDITURE IN FOREIGN CURRENCY (Net of Taxes)
2007-08
(Rs.)
2006-07
(Rs.)
DevelopmentandBoughtout 41,402,247 23,569,473 Travel 112,295,156 47,103,490
Proessionalees 1,756,546 2,845,607
BranchoceExpenses 857,136,651 -
Others 11,269,741 7,107,521
14. PAYMENT TO AUDITORS ( Excluding Service Tax )
2007-08
(Rs.)
2006-07
(Rs.)
StatutoryAuditees 3,800,000 3,800,000
CerticationandOtherServices 2,515,000 2,520,000
Taxauditees 419,000 Reimbursementoexpenses 463,794 475,688
15. DETAiLS RELATinG TO OPEninG STOCK, PURCHASES, REVEnUE AnD CLOSinG STOCK
a) TheCompanyisengaged,inter-alia,intheproductionanddevelopmentocomputersotware.Theproductionand
saleosuchsotwarecannotbeexpressedingenericunit.Hence,itisnotpossibletogivequantitativedetailsas
requiredunderparagraph3and4CoPartIIoScheduleVIotheCompaniesAct,1956.
b) Thedetailsrelatingtotradeditemsareasunder:
2007-08
Value (Rs.)
2006-07
Value (Rs.)
OpeningStock - -
Purchases 38,675,294 41,065,773
Sales 43,590,424 48,567,618
Closingstock - -
TheCompanydealsinanumberosotwareandhardwareitemswhosecostandsellingpricevaryordierent
items.Therevenueromthedierentkindosotwareandtheirrelatedcostsindividuallyconstitutelessthan10%
otheturnoverandcostsotheCompanyrespectively.Accordingly,noquantitativeinormationrelatingtosotware
andhardwaretradedisbeinggiven.
c) RevenueincludesincomeromsotwaredevelopmentandrelatedservicesoRs4,403,553,334/-(PreviousYear
Rs.2,923,081,197/-).
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 62/10060
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
16. RELATED PARTY TRAnSACTiOnS AS PER ACCOUnTinG STAnDARD 18:
A. Related party relationship where control exists:
Subsdares :
1. NIITGISLtd,India
2. NIITSmartServeLtd,India
3. NIITTechnologiesLtd,UnitedKingdom
4. NIITTechnologiesBV,Netherlands
5. NIITTechnologiesNV,Belgium
6. NIITTechnologiesPteLimited,Singapore
7. NIITTechnologiesLtd,Thailand
8. NIITTechnologiesPtyLtd,Australia
9. NIITTechnologiesKK,Japan
10.NIITTechnologiesAG,Germany
11. NIITTechnologiesGmbH,Ostterreich
12.NIITTechnologiesAG,Schweiz
13.NIITTechnologiesInc,USA
14.NIITSmartServeLimited,UnitedKingdom
15.ROOMSolutionsLimited,UnitedKingdom16.SoTecGmbH,Germany(w.e.29thFebruary2008)
17.NIITTechnologiesLimited,Canada(w.e.7thNov.2007)
B. Other related partes wth whom the Compay has trasacted:
a) Partes of whom the Compay s a assocate ad ts subsdares:
- NIITLimited,India(Throughitssubsidiary,ScantechEvaluationServicesLtd,India)
- NIITMiddleEastLLCBahrain
- NIITUSAINC
b) Key Maageral Persoel
1) RajendraSPawar
2) VijayKThadani
3) ArvindThakur
c) Partes whch the Key Maageral Persoel of the Compay are terested:- NayaBazarNoveltiesPvt.Ltd.,India
d) Jot Veture:
- AdeccoNIITTechnologiesPrivateLimited,India
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 63/10061
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
C. Detals of trasactos wth related partes (descrbed above) carred out o a arms legth bass:-
nature of
Trasactios
Subsidiaries Party of
whom the
Compay isa associate
Key
Maagerial
Persoel
Parties i
which Key
MaagerialPersoel of
the Compay
are iterested
Joit Veture Total
PurchaseofFixed
Assets(Note2)
26,912,276
(-)
1,269,798
(15,632,018)
-
(-)
-
(-)
-
(-)
28,182,074
(15,632,018)
PurchaseofGoods
(Note3)
1,090,500
(3,877,501)
-
(-)
-
(-)
-
(46,840)
-
(-)
1,090,500
(3,924,341)
SaleofFixedAssets
(Note4)
-
(-)
301,999
(3,605,115)
-
(-)
-
(-)
-
(-)
301,999
(3,605,115)
RenderingofServices
(Note5)
3,927,677,695
(2,551,617,635)
18,884,314
(84,180)
-
(-)
-
(-)
4,061,393
(-)
3,950,623,402
(2,551,701,815)
ReceivingofServices(Note6)
1,580,815(2,088,026)
44,207,244(28,025,053)
-(-)
-(1,551,336)
-(-)
45,788,059(31,664,415)
RecoveryofExpenses
bytheCompany
(Includingthose
fromOverseas
Subsidiaries)(Note7)
109,260,313
(91,833,655)
23,455,077
(39,528,478)
-
(-)
-
(-)
2,396,248
(433,555)
135,111,638
(131,795,688)
RecoveryofExpenses
fromtheCompany
(Note8)
163,196,779
(2,779,712)
15,287,354
(12,161,152)
-
(-)
-
(-)
26,172
(-)
178,510,305
(14,940,864)
Fiace:
Investmentsmade
(Note9)
166,223,065
(250,000,000)
-
(-)
-
(-)
-
(-)
24,900,100
(99,900)
191,123,165
(250,099,900)LoansGiven
(Note10)
25,759,819
(207,600,000)
-
(-)
-
(-)
-
(-)
-
(-)
25,759,819
(207,600,000)
LoansGiven
Receivedback
(Note11)
24,322,500
(158,600,000)
-
(-)
-
(-)
-
(-)
-
(-)
24,322,500
(158,600,000)
LoansTaken
repaidback
(Note12)
-
(20,000,000)
-
(-)
-
(-)
-
(-)
-
(-)
-
(20,000,000)
Interestreceived
(Note13)
1,447,139
(17,328,261)
-
(-)
-
(-)
-
(-)
-
(-)
1,447,139
(17,328,261)
InterestPaid(Note14) -
(682,740)
-
(-)
-
(-)
-
(-)
-
(-)
-
(682,740)Remuneration
(Note15)
-
(-)
-
(-)
26,523,001
(24,718,129)
-
(-)
-
(-)
26,523,001
(24,718,129)
OtherIncome
(Note16)
28,226,531
(28,708,383)
-
(-)
-
(-)
-
(-)
3,949,509
(-)
32,176,040
(28,708,383)
OtherExpenses
(Note17)
-
(-)
10,513,426
(-)
-
(-)
514,555
(-)
-
(-)
11,027,981
(-)
Dividendpaidto
ScantechEvaluation
ServicesLtd
-
(-)
62,805,080
(57,973,920)
-
(-)
-
(-)
-
(-)
62,805,080
(57,973,920)
DividendReceivable
fromNIITGISLtd.
381,539,568
(-)
-
(-)
-
(-)
-
(-) (-)
381,539,568
(-)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 64/10062
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
notes:
1. Figuresinparenthesisrepresentpreviousyear’sgure.
2.TransactionsinpurchaseoFixedAssetsortheyearwith;
NIITSmartServeLimitedRs.100.57Lacs(PreviousyearNil) NIITTechnologiesIncRs.168.55Lacs(PreviousyearNil)
NIITLimitedRs.1.50Lacs(PreviousyearRs.23.46Lacs)
NIITMiddleEastRs.11.19Lacs(PreviousyearNil)
NIITMultimediaLimitedNil(PreviousyearRs.132.86Lacs)
3. Includestransactionsinpurchaseogoodsortheyearmainlywith;
NIITGISLtdRs.10.90Lacs(PreviousyearRs.38.78Lacs)
4. IncludestransactionsinSaleoFixedAssetsortheyearwith;
NIITLimitedRs.3.02Lacs(PreviousyearRs.36.05Lacs)
5. IncludestransactionsinRenderingoServicesortheyearmainlywith;
NIITTechnologiesLtd,UKRs.9,570.17Lacs(PreviousyearRs.9,482.47Lacs)
NIITTechnologiesIncUSARs.21,133.21Lacs(PreviousyearRs.9,834.58Lacs)andincludesrevenueromrevision
inratesbasedonanindependenttranserpricingstudy. NIITLimitedRs.188.84Lacs(PreviousyearRs.0.75Lacs)
6 IncludestransactionsinReceivingoServicesortheyearmainlywith;
NIIT(Thailand)LtdRs.15.80Lacs(PreviousyearNil)
NIITLimitedRs.51.71Lacs(PreviousyearRs.119.81Lacs)
NIITMiddleEastRs.390.36Lacs(PreviousyearRs.160.44Lacs)
7 IncludestransactionsinrecoveryoexpensesbytheCompanyortheyearmainlywith;
NIITTechnologiesLtd,UKRs.279.68Lacs(PreviousyearRs.300.94Lacs)
NIITTechnologiesIncUSARs.477.26Lacs(PreviousyearRs.269.21Lacs)
NIITLimitedRs.189.45Lacs(PreviousyearRs.395.28Lacs)
NIITMiddleEastRs.41.85Lacs(PreviousyearNil)
8 IncludestransactionsinrecoveryoexpensesromtheCompanyortheyearmainlywith;
NIITTechnologiesIncUSARs.1,462.21Lacs(PreviousyearRs.1.95Lacs) NIITSmartServeLimitedRs.58.49Lacs(PreviousyearRs.25.84Lacs)
NIITUSAIncRs.80.65Lacs(PreviousyearNil)
NIITLimitedRs.72.21Lacs(PreviousyearRs.121.38Lacs)
9 IncludestransactionsinInvestmentsmadeortheyearmainlywith;
NIITSmartServeLimitedNil(PreviousyearRs.2,500Lacs)
SoTecGmbHRs.1642.54Lacs(PreviousyearNil)
10 TransactionsinLoansGivenortheyearwith;
NIITSmartServeLimitedNil(PreviousyearRs.490.00Lacs)
NIITTechnologiesLtd,UKNil(PreviousyearRs.1,586.00Lacs)
SoTecGmbHRs.257.60Lacs(PreviousyearNil)
11 Transactionsinloansgivenreceivedbackortheyearwith;
NIITTechnologiesLtd,UKNil(Previousyear1,586.00Lacs)
NIITTechnologiesAG,GermanyRs.243.23Lacs(PreviousyearNil)
12 Transactionsinloanstakenrepaidbackortheyearwith;
NIITGISLimitedNil(PreviousyearRs.200Lacs)
13 Transactionsininterestreceivedorintheyearwith;
NIITSmartServeLimitedNil(PreviousyearRs.96.89Lacs)
NIITTechnologiesAG,GermanyRs.12.81Lacs(PreviousyearRs.18.31Lacs)
NIITTechnologiesLtd,UKNil(PreviousyearRs.58.09Lacs)
SoTecGmbHRs.1.66Lacs(PreviousyearNil)
14 Transactionsininterestpaidortheyearwith;
NIITGISLimitedNil(PreviousyearRs.6.83Lacs)
15Remunerationo:
MrRSPawar–Rs.110.52Lacs(PreviousyearRs.100.45Lacs)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 65/10063
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
MrArvindThakur–Rs.146.73Lacs(PreviousyearRs.139.93Lacs)
MrVijayKThadani–Rs.7.96Lacs(PreviousyearRs.6.80Lacs)
16 Includestransactionsinotherincomeortheyearmainlywith;
NIITSmartServeLtdRs.40.75Lacs(PreviousyearRs.54.30Lacs) NIITGISLimitedRs.35.26Lacs(PreviousyearRs.46.28Lacs)
NIITTechnologiesIncUSARs.71.20Lacs(PreviousRs.69.59Lacs)
NIITTechnologiesLtd,UKRs.50.32Lacs(PreviousyearRs.46.84Lacs)
17Includestransactionsinotherexpensesortheyearmainlywith;
NIITLtdRs.105.13Lacs(PreviousyearNil)
D. Detals of balaces wth related partes:
Recevables
As at 31.03.2008
(Rs.)
Payables
As at 31.03.2008
(Rs.)
Recevables
As at 31.03.2007
(Rs.)
Payables
As at 31.03.2007
(Rs.)
Subsidiaries 1,385,595,817 31,928,794 804,876,793 2,473,755
Associates 3,675,410 3,783,524 - 977,209
KeyManagerial
Personnel
- 11,780,000 - 16,445,200
JointVenture - - 433,555 -
17. Employee Benets
a) Expenditurein respectodenedcontributionpostretirementbenetplansviz.ProvidentFund,Superannuation
FundandOverseasplanamountedtoRs.52,038,302/-(previousyearRs.38,421,586/-).
b) Disclosurein respecto denedbenetplansin accordance withAccountingStandard15 (Revised)“Employee
Benets”
- Provdet Fud:
InrespectoCompany’sobligationtowardsguaranteedreturnsonProvidentFundContributionsmadetothe
TrustestablishedbyNIITLimited,theCompany’sobligationhasbeenactuariallydetermined.Asperactuary’s
reporttheinterestearningsandcumulativesurplusoTrustaremorethanthe statutoryrequirementandaccordinglythereisnoadditionalliabilityoemployeronaccountointerestshortall.
- Gratuty:
Disclosuresasperactuarialreportoindependentactuary:
Amout of oblgato as at the year ed s determed as uder:
Amout (Rs.)
Descrpto 2007-08 2006-07
Preset value of oblgato as at the begg of the year 48,543,734 33,961,373
Interestcost 3,883,499 2,547,103
Currentservicecost 9,234,405 7,147,373
Benetspaid (3,408,663) (4,835,697)
Actuarial(gain)/lossonobligations 2,964,261 9,723,5Preset value of oblgato as at the ed of the year 61,217,236 48,543,734
Chage Pla Assets:
Descrpto 2007-08 2006-07
Pla assets at begg at far value 32,167,489 28,985,327
Expectedreturnonplanassets 2,975,493 2,608,679
Contributions 23,943,437 5,575,185
Benetspaid (3,408,663) (4,835,697)
Actuarialgain/(loss)onplanassets 236,518 (166,
Pla assets at year ed at far value 55,914,274 32,167,489
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 66/10064
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
Amout of the oblgato recogzed the Balace Sheet:
Descrpto 2007-08 2006-07
Presentvalueothedenedbenetobligationattheendotheyear 61,217,235 48,543,734
Fairvalueoplanassetsattheendotheyear 55,914,274 32,167,489
Lablty recogzed the Balace sheet 5,302,961 16,376,245
Amount of gratuity expense recognised in the Prot and loss account:
Descrpto 2007-08 2006-07
Currentservicecost 9,234,405 7,147,373
Interestcost 3,883,499 2,547,103
Expectedreturnonplanassets (2,975,493) (2,608,679)
Actuarial(gain)/lossrecognizedduringtheyear 2,727,743 9,889,587
Total 12,870,154 16,975,384
ivestmet detals of pla assets:
ThePlanassetsaremaintainedwithLieInsuranceCorporationGratuityScheme.Thedetailsoinvestment
maintainedbyLieInsuranceCorporationarenotavailablewiththeCompanyandhavenotbeendisclosed.
Principalactuarialassumptionsatthebalancesheetdate:
2007-08 2006-07
DiscountingRate 8.00% 7.50%
ExpectedRateoreturnonplanassets 9.25% 9.00%
Theestimatesouturesalaryincreasesconsideredinactuarialvaluationtakeaccountoinfation,seniority,
promotionandotherrelevantactorssuchassupplyanddemandintheemploymentmarket.
18. Thecompanyhas 50% ownershipinterestin AdeccoNIITTechnologies privateLimited,a companyincorporatedin
India.
Thecompany’sinterestintheJVisreportedaslongterminvestmentandstatedatcost.However,theCompany’sshare
oassets,liabilities,incomeandexpensesetc.relatedtoit’sinterestinthejointventure,basedonnancialstatements
othejointventureisasollows:-
As at 31 March 2008 Amout
Rs. LacsI. Assets-FixedAssets(Net) 24-CurrentAssets,LoanandAdvances 206-ProtandLossAccount 105II. Labltes- CurrentLiabilitiesandprovisions 85III. icome -RevenueromOperation 180
-OtherIncome 18IV.Expenses-OperatingExps 294-Depreciation 5-Taxes 2 V. Prot/(Loss) after Tax (103)
19. PursuanttotheimplementationoAccountingStandard11“TheEectsochangesinForeignExchangeRates”,as
prescribed byCompanies (Accounting Standard) Rules 2006, inrelation tooreign currencyliabilitiesattributableto
acquisitionoxedassets,theCompanyhasrecognizedanexchangegainoRs.105.60Lacsortheperiodended
March31,2008withcorrespondingimpactontheprotbeoretaxesortheyearoRs.80.82Lacs
20. Thedominantsourceoriskandreturnsotheenterpriseisconsideredtobethebusinessinwhichitoperatesviz
–sotwaresolutions.BeingasinglebusinesssegmentCompany,noprimarysegmentinormationisbeingprovided.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 67/10065
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
ThesecondarysegmentinormationasperAccountingStandard17“SegmentReporting”inrelationtothegeographies
isasollows:
(Rs. Lacs)
Partculars Reveue from Customers bylocato of customers Carryg amout of segmet assetsby locato of the assets Additions to xed assets
31.03.2008 31.03.2007 31.03.2008 31.03.2007 31.03.2008 31.03.2007
India 4,271 3,439 53,229 39,845 4,030 2,412
America 21,175 9,835 - - - -
Europe 17,414 14,299 - - - -
AsiaPacic
(includingAustralia)
1,611 2,143 - - - -
Total 44,471 29,716 53,229 39,845 4,030 2,412
21. Income Tax
a) Current Income Tax -
(i) ThecompanypaystaxesonincomeundertheIndianincometaxregulationsandundertheUStaxregulations
inrespectoitsIndia&USoperations.(ii) AsregardIndianincometax,theCompanyavailsdeductionundertheprovisionsoSection10BotheIncome
TaxAct,availabletoexportorientedunitregisteredwithSotwareTechnologyParksoIndia.Thecurrenttax
chargeortheyearincludeschargeinrespectoIndianIncomeTaxoRs1,180Lacsateradjustingreliein
relationtoincometaxespayablein UnitedStatestothe extento Rs.56Lacs.The currenttaxunderIndian
Income tax relates toMinimumAlternateTax (MAT) as perthe provisions o Section 115JB,part owhich
amountingtoRs.901Lacs,isexpectedtoberecoveredinutureyearsandthesamehasbeenrecognizedas
MATcreditentitlementintheseaccounts.
(iii) ThecurrenttaxchargeincludestaxpayableundertheUSincometaxregulationoRs.226Lacs.
b) DEFERRED TAX
Breakupodeerredtaxassets/liabilitiesandreconciliationocurrentaccountingperioddeerredtaxcreditisas
ollows:
(Rs. Lacs)
Deferred Tax Assets/Liabilities As at
1.04.2007
Trasferred from
niiT Techologesic. USA (Refer
note 4 above)
Charged/
(Credted)durg the
year
As at
31.03.2008
Deferred Tax Liabilities
a)Taximpactodierencebetweencarryingamountoxedassetsin
thenancialstatementsandaspertheincometaxcalculation.
101 36 84 221
b)Taximpactoexpensesnotchargedinthenancialstatementsbut
claimedasdeductionunderincometax
84 - (1) 83
c)TaximpactoGainscreditedinthenancialstatementsbutnotoered
ortaxunderincometax
- - 6 6
Total (A) 185 36 89 310
Deferred Tax Assets a)Taximpactoexpenseschargedinthenancialstatementsbut
allowableasdeductionsinutureyearsunderincometax:
-ProvisionordoubtuldebtsandAdvances 127 - 6 121
-ProvisionorCompensatedAbsences,BonusandGratuity 63 51 (137) 251
-OtherExpenses 44 - 10 34
Total (B) 234 51 (121) 406
DeerredTaxAssets/(Liability)(B–A) 49 15 (32) 96
Add:DeerredTaxAssetrelatedtoairvaluelossonderivativeinstruments
notchargedinthenancialstatementsbuttakentotheBalanceSheet.
(ReerNote27)
- - - 148
Net Deferred Tax Assets / (Liability) 244
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 68/10066
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
Deerredtaxassetsand liabilitiesabovehavebeendetermined byapplyingtheincometax ratesorespective
countries.Deerredtax assetsand liabilitiesinrelationtotaxespayableunderdierenttaxjurisdictionshavenot
beenosetinnancialstatements.
22. EARninG PER SHARE:2007-08 2006-07
ProtattributabletoEquityshareholders(Rs.)-(A) 1,431,063,512 1,106,752,194
WeightedAveragenumberoEquitysharesOutstandingduringtheyear–(B) 58,680,226 58,284,007
Add:Eectopotentialdilutiveshares(stockoptions)-(ReerNote26below) 84,829 318,351
Weightedaveragesharesoutstandingconsideredordeterminingdilutive
earningpershare-(C)
58,765,055 58,602,358
NominalValueoEquityShares(Rs.) 10 10
BasicEarningspershare(Rs)(A/B) 24.39 18.99
DilutedEarningspershare(Rs)(A/C) 24.35 18.89
EARninG PER SHARE {had far value method bee employed for
accoutg for Employee Stock Opto ( Refer note 26 below)}
ProtattributabletoEquityshareholders(Rs.)-(D) 1,399,614,276 1,104,622,866
BasicEarningspershare(Rs)(D/B) 23.85 18.95
DilutedEarningspershare(Rs)(D/C) 23.82 18.85
Note:TheweightedaveragenumberoequitysharesoutstandingconsideredordeterminingBasicandDilutiveEarning
perShareorthepreviousyearhasbeenappropriatelyadjustedorBonusSharesissuedsoastomakethe
Earningpersharecomparable.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 69/10067
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
23. Durg the year the Compay acqured ad sold uts of mutual fuds o varous dates as follows:
Scheme no. of
uits
at the
begiigof the
year
Value of
the uits i
had at the
begiig ofthe year at
lower of cost
or market
value ( Rs.)
no. of uits
purchased
Purchase
Value (Rs.)
no. of uit
sold
Sale Value
(Rs.)
no. of uits
i had at the
year-ed
Value of uits
i had at the
year-ed at
lower of costor market
value
(Rs.)
Market Value
of uits i
had.
(Rs.)
Liquid Scheme of Mutual Fud
PrudentiallICICIMutual
Fund -
-
8,945,617
100,000,000
8,945,617
103,328,883 - - -
SBIMutualFund
-
-
2,374,713
40,614,000
2,374,713
40,898,491 - - -
J.M.FinancialMutual
Fund - -
10,231,600
110,000,000
6,550,325
70,316,603 3,681,275
40,000,000
41,704,062
KotakMahindraMutual
Fund - -
14,805,826
232,782,997
14,805,826
234,113,243 - - -
BirlaSunlifeMutual
Fund 10,625,327
126,552,502
19,885,676
249,035,303
30,511,003
379,939,139 - - -
FranklinTempletonMutual
Fund - -
299,721
360,000,000
299,721
361,262,287 - - -
PrincipalMutualFund
- -
6,841,503
90,000,000
6,841,503
90,427,325 - - -
StandardCharteredMutual
Fund 93,092
93,154,226
9,600,431
372,766,863
9,614,560
381,776,236 78,962
90,000,000
91,446,689
DSPMerrillLynchMutual
Fund - -
170,901
176,315,080
130,946
135,936,761 39,955
41,315,080
41,462,610
HSBCMutualFund
9,299,783
93,105,346
40,157,819
493,435,356
49,457,603
591,216,777 - - -
Fixed Maturity Plan/Interval plan
DSPMerrillLynchMutual
Fund 60,479
60,478,865
2,125,347
61,285,541
2,185,825
123,079,486 - - -
BirlaSunlifeMutualFund 3,007,461
30,074,615
33,637,495
336,374,946
24,847,584
253,917,216 11,797,372
117,973,720
119,914,387
PrudentialICICIMutual
Fund 7,068,948
70,689,500
12,210,913
124,430,279
7,138,153
71,621,226 12,141,708
123,738,229
131,058,810
SBIMutualFund 8,019,703
80,197,480
4,000,000
40,000,000
12,019,703
120,811,027 - - -
JMFinancialMutual 5,068,516
50,685,168 - -
5,068,516
50,685,168 - - -
RelianceMutualFund
Monthlyplan 5,028,626
50,286,263
8,364,758
90,000,000
5,028,626
54,810,015 8,364,758
90,000,000
91,467,791
RelianceMutualFund
Quarter ly p lan 5,000,000
50,000,000
5,040,600
50,406,000
5,000,000
50,000,000 5,040,600
50,406,000
54,553,406
KotakMahindraMutual
Fund 9,027,354
90,273,535
20,490,170
204,901,704
24,242,373
247,192,027 5,275,151
52,751,509
55,128,492
DeutscheMutualFund 4,000,000
40,000,000 - -
4,000,000
40,000,000 - - -
ABNAmroMutualFund - -
9,592,418
100,000,000
9,592,418
102,242,707 - - -
TOTAL
66,299,289 835,497,500
208,775,508
3,232,348,069
228,655,015
3,503,574,617 46,419,781
606,184,538
626,736,247
Previous Year Figures
10,364,282 203,019,200 276,725,367 2,974,986,538 220,790,360 2,353,480,920 66,299,289 835,497,500 -
Prot rom sale o the above units o Rs. 41,913,585/- (Previous Year Rs. 10,972,681/-) and Dividend income
Rs.4,831,782/-(PreviousYearRs.16,674,318/-)romabovemutualundsareincludedinOtherIncomeinSchedule
13.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 70/10068
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
24. MAnAGERiAL REMUnERATiOn:
CalculationoManagerialRemunerationunderSection198otheCompaniesAct,1956:
2007-08 2006-07
Prot before taxation as per P&L Account 1,492,303,280 1,138,662,502
Add:NetIncrease/(Decrease)inProvisionorDoubtulDebt 333,843 (34,045,758)
Add:DepreciationasperBooksoAccounts 229,709,556 217
Less:DepreciationasperSec.350otheCompaniesAct,1956 200,270,095 193,483,867
Net Prot under Section 349 of the Companies Act, 1956 1,522,076,584 1,128,934,328
Add:DirectorsRemuneration 27,726,147
Net Prot under Section 198 of the Companies Act, 1956 1,549,802,731 1,154,972,457
Max.remunerationallowableunderSec.198otheCompaniesAct,1956
restrictedto11%oNetProt
170,478,300 127,046,970
Max.CommissionallowabletoNon-ExecutivedirectorsunderSec.309o
theCompaniesAct,1956restrictedto1%oNetProt
15,498,027 11,549,725
Drectors’ remuerato:
AsapprovedbytheShareholdersandwithinthelimitsprescribedunderScheduleXIIItotheCompaniesAct,1956
Executive Directors’ Remuneration: 2007-08 ( Rs ) 2006-07 ( Rs )
SalaryandAllowances 9,601,000 5,988,000
PerormanceLinkedBonus 11,200,000 15,865,200
Contributiontoprovidentandotherunds 4,328,598 1,387,886
ValueoPerquisites 596,549 797,043
Sub Total (A) 25,726,147 24,038,129
Non executive Directors’ Remuneration:
CommissiontoNonExecutiveDirectors(B) 2,000,000 2,000,000Total Drector’s Remuerato ( A + B ) 27,726,147 26,038,129
NonExecutiveDirectors’SittingFees 1,240,000 900,000
OtherExpenses 53,983 -
25. LEASES
AlloperatingleasesenteredintobyCompanyarecancelableongivinganoticeo1to3months.Aggregateexpenditure
inrespectooperatingleaseamountstoRs.208,098,109/-(PreviousyearRs.116,111,817/-).
26. EMPLOYEE STOCK OPTiOn PLAn:
(i) TheCompanyestablishedNIITTechnologiesStockOptionPlan2005(ESOP2005)intheyear2005-06andthe
samewasapprovedattheAnnualGeneralMeetingotheCompanyon29thJuly2004.Theplanwassetupsoas
tooerandgrantorthebenetoemployeesotheCompanyanditssubsidiaries,whoareeligibleunderSecurities
Exchange Board oIndia (SEBI) Guidelines(excluding promoters), options o theCompanyin aggregate up to3,850,000optionsunderESOP2005,inoneormoretranches,andonsuchtermsandconditionsasmaybexed
ordeterminedbytheBoardinaccordancewiththeprovisionsolaworguidelinesissuedbytherelevantauthorities
inthisregard.AspertheplaneachoptionisexercisableoroneequityshareoacevalueoRs10eachullypaid
uponpaymenttotheCompanyorsuchsharesatapricetobedeterminedinaccordancewithESOP2005.SEBI
hasissuedtheEmployee’sStockOptionschemeandEmployeeStockPurchaseSchemeGuideline,1999whichis
applicabletotheaboveESOP2005.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 71/10069
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
TheCompanygrantedoptioninthreetranches.Thedetailsowhichareasollows:
Descrpto Trache 1 Trache ii Trache iii
[note (b)]
2007-08 2006-07 2007-08 2006-07 2007-08
DateoGrant August02,2005 August11,2005June
20,2007
DateoVesting August02,2006 August11,2006June
20,2008
Livegrantsatbeginning/duringtheyear
(Nos)
106,800 609,850 - 70,600 280,000
Foreited/lapsedtillvestingperiod(Nos) - 54,600 - 54,600 41,250
OptionsVested(Nos) - 555,250 - 16,000 Nil
Optionsoreitedpostvesting(Nos)-Pre
Bonus
3,700 13,200 - - Nil
OptionsExercised(Nos)-PreBonus 18,400 435,250 - 16,000 Nil VestedOptionsPostBonus 127,050 - - - -
Optionsoreitedpostvesting(Nos)-Post
Bonus
750 - - - -
OptionsExercised(Nos)-PostBonus 20,000 - - - -
Exercisable/outstandingattheendo
theYear(Nos)-PostBonus[Note(a)]
106,300 106,800 - - 358,125
ExercisePrice
-PreBonus
-PostBonus
Rs115.00
Rs.76.67
Rs115.00
-
Rs150.85
-
Rs150.85
-
Rs.523.50
Rs.349.00
RemainingContractualLie 488days 853days - - 1462Days
FairValueotheOptionsbasedonBlack
andScholesmodel(asperIndependent
valuer’sreport)[Note(c)]
Rs59.20 Rs59.20 Rs41.18 Rs41.18 Rs.168.11
IntrinsicValueooption[Note(c)] Rs34.50 Rs34.50 - - -
notes:
a) Duringtheyear,theCompanyhasissuedbonussharesintheratioo1:2i.e.oneadditionalequityshareorevery
twoequitysharesontherecorddate.
b) Duringtheyear,theCompensation/RemunerationCommitteeatitsmeetingheldonJune20,2007hasapproved
issueo280,000options(Grant-III)outotheoptionsunderESOP2005,toSeniorManagerialPersonnelothe
Company/Subsidiaries.
c) Theairvalueandtheintrinsicvaluesarebasedonprebonusissuevaluations.
TheassumptionsusedbytheindependentvaluerordeterminationoairvalueaspertheBlack&Scholesmodelisas
ollows:
a) Marketpriceconsideredisthelatestavailableclosingprice,priortothedateothegrant.
b) Exercisepriceisthepricepayablebytheemployeesorexercisingtheoption.
c) Asthelieotheoptionisgreaterthanoneyearthereisconsiderabledicultyinestimatingtheamountandtime
outuredividendpayoutswithcertainty,henceuturedividendpayouthavenotbeenincorporatedinthevaluation
analysis.
d) Volatility- Variancein thestockpriceis consideredas 10%(ForGrantI &II)and 51.13%(GrantIII)is basedon
historicalvolatilityinthesharepricemovementotheCompanyandourothercomparablecompanies.
e) Averagelieotheoptionsisconsideredtobe2.5Years(ForGrantI,II&III).
) Risk less interest rate hasbeen assumed at 7% (For GrantI &II)and 7.93 %(GrantIII) basedon long term
governmentbondsotenyearresidualmaturity.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 72/10070
A n n u A l R e p o R t 2 0 0 7 - 0 8
(ii) Otherinormationregardingemployeesharebasedpaymentisasbelow:
Descrpto Trache 1 Trache ii Trache iii
[note (b)
above]2007-08 2006-07 2007-08 2006-07 2007-08
Expenseaccountedorduringtheperiod
basedonintrinsicvalueotheoptions
- 4,092,891 - - -
Additional expense had the Company
recorded theESOP Expense based on
airValueotheoptions[Netoamount
attributable to the Employees o the
subsidiaries (Rs. Nil) Previous Year
Tranche 1- Rs 797,232 Tranche 2- Rs
(388,107)Transerabletosubsidiaries]
- 2,930,273 - (800,945) 31,449,236
ForimpactonBasicandDilutiveEarningPerShare,hadairvalueotheoptionbeenusedordeterminingEmployee
StockOptionPlanexpense,reernote22above.
27.a) During theyear,the Companyreviewed itsrisk management policy andhedgingstrategiesin respecto highly
probableorecasttransactionsand rm commitments w.e..18thJanuary,2008.TheCompanyhasdesignated
certainoreigncurrencyderivativeinstrumentswhichmeetthehedgingcriteria,ascashfowhedges.
ThederivativeinstrumentsheldbytheCompanyason31stMarch,2008takentohedgeitsexposuresincluded:
- ForwardexchangecontractsoUSD237millionhavingaairvaluelossoRs.1,280Lacs.Inrelationtothe
above,airvaluelossoRs.1,453Lacs(NetodeerredtaxesoRs.148Lacs)postdesignationascashfow
hedgesandconsideredeectivehasbeenincludedinthehedgingreserveundershareholders’Fundsandthe
balancegainhasbeenrecognizedintheprotandlossaccount.
- Euro-USDollarandGBP-USDollarderivativeoptionstosellmaximumoEuro18.50millionandGBP20.60
millionrespectively,airvaluelossontheseoptionsoRs.997Lacshasbeenrecognizedintheprotandloss
account.TheCompanyhasconsideredthesederivativeoptionsappropriateromaneconomicperspective.
b) Thecompanywasamortizingpremiumordiscountarisingonallorwardexchangecontractsoverthelieothe
contractandwas simultaneouslyrecognizing theexchange dierenceson suchcontractsin theprotandloss
accountaspertheaccountingpolicystatedinNote1(vii)above.However,witheectromJanuary18,2008,the
CompanyreviseditsaccountingpolicyonderivativeinstrumentsexplainedinNote1(viii)aboveandurtherdetailed
in(a)above.Theaoresaidrevisionresultedinrecognitionoairvalueloss(netodeerredtax)inhedgingreserve
undershareholders’equitytotheextentoRs.1453LacsandrecognitionoadditionalliabilitytotheextentoRs.
1,596Lacs.
28. Previousyeargureshavebeenregrouped/recastwherevernecessarytoconormtocurrentyear’sclassication.
SChEDUlE ‘18’: notes to Accouts or te year eded 31st Marc 2008 (Cotd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 73/10071
A n n u A l R e p o R t 2 0 0 7 - 0 8
BAlAnCE ShEET ABSTRACT AnD COMPAnY’S GEnERAl BUSInESS PROfIlE
REGiSTRATiOn DETAiLS
RegistrationNo. 0 4 8 7 5 3 StateCode 5 5
BalanceSheetDate 3 1 - 0 3 - 2 0 0 8CAPiTAL RAiSED DURinG THE YEAR (AMOUnT in Rs. THOUSAnDS)
PlublicIssue N I L
BonusIssue 1 9 5 5 9 5 RightIssue N I L
ESOPIssue 3 8 4 PrivatePlacement N I L
POSiTiOn OF MOBiLiSATiOn AnD DEPLOYMEnT OF FUnDS (AMOUnT in Rs. THOUSAnDS)
TotalLiabilities 4 0 4 3 9 8 3 TotalAssets 4 0 4 3 9 8 3
SOURCES OF FUnDS
PaidupCapital 5 8 6 9 8 4 Reserve&Surplus 3 2 8 7 9 3 7
SecuredLoans 1 6 6 6 1 7 UnsecuredLoan N I L
EmployeeStockOption
Outstanding2 4 4 5
APPLiCATiOn OF FUnDS
NetFixedAssets 1 2 4 3 1 0 4 Investments 1 9 2 8 8 0 6
NetCurrentAssets 8 4 7 6 4 5 DeerredTaxAsset 2 4 4 2 8
AccumulatedLosses N I L
PERFORMAnCE OF COMPAnY (AMOUnT in Rs. THOUSAnDS)
Turnover 4 9 5 6 6 3 8 TotalExpenditure 3 4 6 4 3 3 5
Prot/(Loss)beoreTax 1 4 9 2 3 0 3 Prot/(Loss)aterTax 1 4 3 1 0 6 4
Earningpershare(inRs.) 2 4 . 3 9 Dividend(%)-Equity 6 5 %
GEnERiC nAMES OF THREE PRinCiPAL PRODUCTS/SERViCES OF THE COMPnY (AS PER MOnETARY
TERMS)
1. ItemCode N / A
ProductDescription S O F T W A R E S O L U T I O N S
2. ItemCode N / A
ProductDescription
3. ItemCode N / A
ProductDescription
Rajedra S Pawar Arvd ThakurChairman & Managing Director CEO & Jt. Managing Director
Ashok Arora K T S Aad Sureder VarmaGroup Chie Financial Ofcer Chie Financial Ofcer Company Secretary
& Legal Counsel Place : GurgaonDate : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 74/100
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 75/10073
A n n u A l R e p o R t 2 0 0 7 - 0 8
AUDITORS’ REPORT – Consolidated Financial Statement of NIIT Tecnologies Limited,
its subsidiaries and joint venture (NIIT Tecnologies Group).
Report of the auditors to the Board of Directors of NIIT Technologies Limited
1. WehaveauditedtheattachedconsolidatedBalanceSheetoNIITTechnologiesLimited,itssubsidiariesandjointventure(NIITTechnologiesGroup),asat 31stMarch,2008andtheconsolidatedProtand LossAccountandconsolidated
CashFlowStatementortheyearendedonthatdate,whichwehavesignedunderreerencetothisreport.These
consolidatednancialstatementsaretheresponsibilityotheNIITTechnologiesGroup’smanagementandhavebeen
prepared by the NIIT Technologies Group’s management on the basis o separate nancial statements and other
nancialinormationregardingcomponents.Ourresponsibilityistoexpressanopinionontheseconsolidatednancial
statementsbasedonouraudit.
2. We conducted our audit in accordancewith the auditing standards generally acceptedin India. Those standards
requirethatweplanandperormtheaudittoobtainreasonableassuranceaboutwhetherthenancialstatementsare
prepared,inallmaterialrespects,inaccordancewithanidentiednancialreportingrameworkandarereeomaterial
misstatement.Anauditincludesexamining,onatestbasis,evidencesupportingtheamountsanddisclosuresinthe
nancialstatements.Anauditalsoincludesassessingtheaccountingprinciplesusedandsignicantestimatesmadeby
NIITTechnologiesGroup’smanagement,aswellasevaluatingtheoverallnancialstatementpresentation.Webelieve
thatourauditprovidesareasonablebasisorouropinion.
3. We did not auditthenancialstatementso certainsubsidiaries,whose nancialstatementsrefecttotal assets o
Rs.28,278LacsandtotalliabilitiesoRs.12,488Lacsasat31stMarch,2008andtotalrevenueoRs.55,701Lacs
andtotalexpensesoRs.37,284LacsandtotalcashfowsoRs.4,433.22Lacs(net)ortheyearendedonthat
dateconsideredintheconsolidatednancialstatements.Further,wedidnotauditthenancialstatementsoSoTec
GmbH,Germanyason29February2008(dateoacquisition)refectingnetassetsoRs.80.30Lacsconsideredor
thepurposeodetermininggoodwillandrecordingnetassetsonthedateoacquisition(reernote7onSchedule20to
theConsolidatedFinancialStatement).Thesenancialstatementsandothernancialinormationhavebeenauditedby
otherauditorswhosereportshavebeenurnishedtous,andouropinion,insoarasitrelatestotheamountsincluded
inrespectothesesubsidiaries,isbasedsolelyonthereportsootherauditors.
4. WereportthattheconsolidatednancialstatementshavebeenpreparedbyNIITTechnologiesGroup’smanagementin
accordancewiththerequirementsoAccountingStandard(AS)21,ConsolidatedFinancialStatementsandAccounting
Standard(AS) 27,Financial Reportingo Interestsin Joint Ventures,speciedin Companies(AccountingStandard)Rules,2006.
5. Basedonourauditandonconsiderationothereportsotheotherauditorsonseparatenancialstatements(reerPara
3above)andonothernancialinormationothecomponents,inouropinionandtothebestoourinormationand
explanationsgiventous,theattachedconsolidatednancialstatementsgiveatrueandairviewinconormitywiththe
accountingprinciplesgenerallyacceptedinIndia:
(i) incaseotheConsolidatedBalanceSheet,otheconsolidatedstateoaairsotheNIITTechnologiesGroupasat
31stMarch,2008;
(ii) incaseotheConsolidatedProtandLossAccount,otheconsolidatedresultsooperationsoNIITTechnologies
Grouportheyearendedonthatdate;and
(iii) inthecaseotheConsolidatedCashFlowStatement,otheConsolidatedCashFlowsoNIITTechnologiesGroup
ortheyearendedonthatdate.
H. Singh
Partner
MembershipNo.F–86994
Forandonbehalo
Price Waterhouse
Chartered Accountants
Place : Gurgaon
Date : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 76/10074
A n n u A l R e p o R t 2 0 0 7 - 0 8
CONSOLIDATED BALANCE ShEET as at 31st Marc 2008
Schedule/(Note As at As at
Reference) 31st March 2008 31st March 2007
(Rs.) (Rs.)SOURCES OF FUNDS
SHAREHOLDERS’ FUNDS
ShareCapital 1 586,983,950 391,005,300
ShareApplicationMoney-
EmployeesStockOption - 242,230
EmployeesStock
OptionOutstanding 2 2,444,900 3,684,600
ReservesandSurplus 3A 3,699,043,693 3,139,419,768
CumulativeTranslationReserve 3B 124,662,795 4,413,135,338 168,114,063 3,702,465,961
MINORITYINTEREST 4 49,495,722 149,316,775
LOAN FUNDS
SecuredLoans 5A 624,000,497 694,739,654
UnsecuredLoans 5B 22,842,934 98,458,417 5,109,474,491 4,644,980,807
APPLICATION OF FUNDS
FIXED ASSETS 6
GrossBlock 4,358,575,581 3,770,243,913
Less:DepreciationandAmortisation 2,499,417,245 2,277,025,733
NetBlock 1,859,158,336 1,493,218,180
Capitalwork-in-progress 518,315,440 37,004,485
(includingCapitalAdvances)
INVESTMENTS 7 1,311,445,950 1,444,273,807
DEFERREDTAXASSETS-[NET]20(9)(b) 67,396,291 80,139,968
CURRENT ASSETS, LOANS AND ADVANCES
Inventories 5,639,735 2,917,294
SundryDebtors 8 2,178,325,218 1,860,557,969
CashandBankBalances 9 660,290,315 943,543,084
OtherCurrentAssets 10 93,425,919 146,542,254
Loans&Advances 11 710,034,363 427,702,245
3,647,715,550 3,381,262,846
Less : CURRENT LIABILITIES AND PROVISIONS
CurrentLiabilities 12 1,565,889,795 1,269,511,168
Provisions 13 728,667,281 521,407,311
2,294,557,076 1,790,918,479
NetCurrentAssets 1,353,158,474 1,590,344,367
5,109,474,491 4,644,980,807
NOTES TO ACCOUNTS 20
TheSchedulesreerredtoaboveormanintegralpartotheConsolidatedBalanceSheet
ThisistheConsolidatedBalanceSheetreerredtoinourreportoevendate
H. Singh Rajendra S Pawar Arvind ThakurPartner Chairman & Managing Director CEO & Joint Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Anand Surender VarmaPrice Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : Gurgaon
Date : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 77/10075
A n n u A l R e p o R t 2 0 0 7 - 0 8
CONSOLIDATED PROFIT AND LOSS ACCOUNT for te year ended 31st Marc 2008
Year ended Year ended
Schedule/(Note 31st March 2008 31st March 2007
Reference) (Rs.) (Rs.)
INCOME
RevenueromOperations 14 9,415,125,534 8,858,620,412
OtherIncome 15 146,050,288 148,591,785
9,561,175,822 9,007,212,197
EXPENDITURE
Personnel 16 5,405,089,698 4,746,089,541
Developmentandboughtout 17 679,639,146 854,243,706
Administration,FinanceandOthers 18 1,450,447,328 1,342,817,120
Marketing 19 128,030,801 113,842,410
DepreciationandAmortisation 6 388,785,411 434,658,912
8,051,992,384 7,491,651,689
ProtbeoreTax 1,509,183,438 1,515,560,508
TaxExpense 20(9)-Current 208,173,697 177,741,517
-MATCredit (109,528,633) -
-DeerredCharge/(Credit) 22,487,664 (6,920,833)
-FringeBenetTax 16,406,330 14,494,732
-ShareinJointVenture 20(6)(b) 161,227 -
ProtaterTaxbeoreMinorityinterest 1,371,483,153 1,330,245,092
NetProtattributabletoMinority 18,877,582 37,803,609
NetprotattributabletoEquity
shareholdersaterminorityinterest 1,352,605,571 1,292,441,483
Balancebroughtorwardrompreviousyear 2,055,361,623 1,177,758,961
Less:-Adjustmentonadoptiono
AccountingStandard15-Employee
Benets(Revised2005) - 2,055,361,623 30,566,779 1,147,192,182
Balanceavailableorappropriation 3,407,967,194 2,439,633,665
APPROPRIATION
DividendPaid(relatingtoPreviousYear) 109,525 -
CorporateDividendTaxonabove 18,614 -
ProposedDividendonEquityShares 381,539,568 254,153,445
CorporateDividendTax 20(17) 64,842,650 43,193,378
TranserredromDebentureRedemptionReserve (17,500,000) (23,750,000)
TranserredtoGeneralReserve 185,975,965 110,675,219
BalancecarriedtoBalanceSheet 2,792,980,872 2,055,361,623
3,407,967,194 2,439,633,665
BasicEarningperShare 20(10) 23.05 22.17DilutedEarningperShare 20(10) 23.02 22.05
NOTES TO ACCOUNTS 20
TheSchedulesreerredtoaboveormanintegralpartotheConsolidatedProtandLossAccount
ThisistheConsolidatedProtandLossAccountreerredtoinourreportoevendate
H. Singh Rajendra S Pawar Arvind ThakurPartner Chairman & Managing Director CEO & Joint Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Anand Surender VarmaPrice Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : Gurgaon
Date : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 78/10076
A n n u A l R e p o R t 2 0 0 7 - 0 8
CONSOLIDATED CASh FLOW STATEMENT for te year ended 31st Marc 2008
Year ended Year ended
31st March 2008 31st March 2007
(Rs.) (Rs.)
A. Cashowfromoperatingactivities:
NetProtBeoreTax 1,509,183,438 1,515,560,508 Adjustmentsor:
-DepreciationandAmortisation 388,785,411 434,658,912
-InterestExpense 50,890,072 37,869,126
-InterestIncome (40,098,519) (36,866,676)
(Prot)/LossonFixedAssetssold/scrapped(14,515,692) 3,965,398
-UnrealizedExchange(gain)/loss 67,537,863 (21,002,683)
-MiscellaneousExpenditurewritteno - 40,322
-ProvisionorBad&DoubtulDebts 6,044,673 30,704,648
-DividendIncomeromcurrentInvestment (5,539,547) (16,674,318)
-ProtonsaleoInvestments (80,616,146) (38,251,466)
EmployeeStockOptionPlanExpenses - 5,206,433
372,488,115 399,649,696 Operatingprotbeoreworkingcapitalchanges 1,881,671,553 1,915,210,204
Add/(Less):(Increase)/Decreaseinworkingcapital:
-(Increase)/DecreaseinSundryDebtors (289,316,521) (510,586,431)
-(Increase)/DecreaseinOtherReceivables(130,469,787) 304,758,616
-(Increase)/DecreaseinInventories (2,722,438) 3,194,327
-Increase/(Decrease)in
TradeandOtherPayables 29,547,370 (392,961,376) 73,491,262 (129,142,226)
-IncomeTaxPaid (314,252,440) (170,321,457)
(IncludingTaxdeductedatSource)
Net cash from operating activities 1,174,457,737 1,615,746,521
B. CashowfromInvestingactivities: Purchaseoxedassets (957,570,978) (406,977,116)
ProceedsromSaleoxedassets 29,309,726 25,822,651
PaidorAcquisitionoRoomSolutionsLtd,UK (307,474,168) (657,115,263)
PaidorAcquisitionoSoTecGmbH (164,253,565) -
Shortterminvestmentswithmutualunds
-Purchasesduringtheyear (3,844,108,436) (3,498,970,377)
-Salesduringtheyear 4,057,552,440 213,444,004 2,742,364,859 (756,605,518)
LoantoNIITianWalareTrustReceivedBack 100,000,000 -
InterestReceived 42,243,936 35,965,711
DividendReceived 5,539,547 16,674,318
Net cash used in investing activities (1,038,761,498) (1,742,235,217)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 79/10077
A n n u A l R e p o R t 2 0 0 7 - 0 8
CONSOLIDATED CASh FLOW STATEMENT for te year ended 31st Marc 2008 (Contd.)
Year ended Year ended
31st March 2008 31st March 2007
(Rs.) (Rs.)
C. Cashowfromnancingactivities: 6.5%NonConvertibleDebenturesrepaid (100,000,000) (150,000,000)
TermLoans
-Receivedduringtheyear 167,334,187 520,388,822
-Repaidduringtheyear (112,900,378) 54,433,809 (95,817,359) 424,571,463
ShortTermLoanromBankPaid (2,805,074) -
ProceedsromissueoSharecapital 3,407,066 52,709,581
(IncludingSharePremium)
InterestPaid (53,239,376) (46,405,063)
Dividendpaid(Includingcorporatedividendtax) (296,492,489) (263,560,062)
Netcash(used)/frominnancingactivities (394,696,064) 17,315,919
Net (Decrease) inCash & Cash Equivalents (A+B+C) (258,999,825) (109,172,777)
AdjustmentonaccountoExchangeRate (24,298,061) 20,386,335
Cashandcashequivalentsasatthe
beginningotheyear Reer-Schedule-9 943,543,084 923,750,208
CashacquiredonAcquisitions 45,117 108,579,318
Total cash and cash equivalents
at the close of the year Refer-Schedule-9 660,290,315 943,543,084
NOTES :
1 TheaboveCashfowstatementhasbeenpreparedundertheindirectmethodsetoutinAS-3notiedunderCompaniesAct.
2 Figuresinparanthesisindicatecashoutgo.
3 CashandcashequivalentsincludexeddepositsheldasmarginmoneyRs.25,228,873(PreviousYearRs.30,365,253).
4 Theenclosedschedules(1to20)ormanintegralpartotheCashFlowStatement.5 Previousyeargureshavebeenregrouped/reclassiedtoconormtocurrentyear’sclassication.
ThisistheConsolidatedCashFlowStatementreerredtoinourreportoevendate.
H. Singh Rajendra S Pawar Arvind ThakurPartner Chairman & Managing Director CEO & Joint Managing Director MembershipNo.F-86994 Forandonbehalo Ashok Arora K T S Anand Surender VarmaPrice Waterhouse Group Chie Financial Ofcer Chie Financial Ofcer Company Secretary Chartered Accountants & Legal Counsel
Place : GurgaonDate : June11,2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 80/10078
A n n u A l R e p o R t 2 0 0 7 - 0 8
Schedule As at As At
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)1 SHARE CAPITAL Authorised 75,000,000EquityShares(PreviousYear 45,000,000equityshares)oRs.10/-each 750,000,000 450,000,000
750,000,000 450,000,000
Issued, Subscribed and Paid up 58,698,395EquityShares(PreviousYear 39,100,530EquityShares)oRs.10each 586,983,950 391,005,300 (Reernotebelow)
Note:Outoabove19,559,465equityshareswere issuedasullypaidbonussharesduringtheyear,by capitalisationobalancesinsharepremiumandgeneral reserveaggregatingtoRs.195,594,650.
586,983,950 391,005,300
2 EMPLOYEES STOCK OPTION OUTSTANDING [Refer Note 1(viii)(c) and 14 on Schedule 20]
AsperLastBalanceSheet 3,684,600 13,949,692 Less:Utilizedorissueoequityshares 1,094,800 9,809,692 Less:EmployeeStockOptionlapsedpostvesting 144,900 455,400
2,444,900 3,684,600
3A RESERVES AND SURPLUS CapitalRedemptionReserve AsperlastBalanceSheet 16,570,603 16,570,603
Share Premium
AsperLastBalanceSheet 76,566,027 13,595,052 Add:Additionduringtheyear 4,360,141 62,970,975 Less:UtilizedorissueoBonusShares (79,132,828) 1,793,340 - 76,566,027
Debenture Redemption Reserve AsperlastBalanceSheet 55,000,000 78,750,000 Less:Transerredto ProtandLossaccount (17,500,000) 37,500,000 (23,750,000) 55,000,000
General Reserve (Note 1) AsperlastBalanceSheet 935,921,515 903,194,658 Less:Adjustmentonadoptiono AccountingStandard15-EmployeeBenets- - (78,403,762) (Revised2005) Add:EmployeeStockOption lapsedpostvesting 144,900 455,400 Add:BalanceTranserredrom
ProtandLossAccount 185,975,965 110,675,219 Less:UtilizedorissueoBonusShares (116,461,822) 1,005,580,558 - 935,921,515
Hedging Reserve (Debit) (155,381,680) - (Createdduringtheyear,NetodeerredtaxRs.148lacs)
[Refer note 1(x) and 5 on Schedule 20]
Prot&LossAccount(Netoshareolossin jointventureRs.10,529,889) 2,792,980,872 2,055,361,623
Note 1 : TheGeneralReserveisasperIndian CompaniesAct,inrespectoIndiancompanies. Generalreserve,iany,ooverseassubsidiaries areincludedaspartotheprotandlossaccount.
3,699,043,693 3,139,419,768
SChEDULES annexed to and forming part of te Consolidated Balance Seet as at 31st Marc 2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 81/10079
A n n u A l R e p o R t 2 0 0 7 - 0 8
Schedule As at As At
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)3B CUMULATIVE TRANSLATION RESERVE
[Refer Note 1(ix) on Schedule 20]
AsperlastBalanceSheet 168,114,063 119,568,436
Increase/(decrease)duringtheyear (43,451,268) 48,545,627
124,662,795 168,114,063
4 MINORITY INTEREST
[Refer Note 1(i) and 7(a) on Schedule 20]
AsperlastBalanceSheet 149,316,775 63,312,863
Less:AdjustmentattributabletoMinorityonadoptiono
AccountingStandard15-EmployeeBenets - (310,784)
(Revised2005)
Add:49%MinorityInterestinRoomSolutionsLtd, UKonthedateoacquisition - 102,194,991
Less:24%InterestinRoomSolutionsLtd,
UKacquiredromMinority - (57,431,678)
Less:25%InterestinRoomSolutionsLtd,
UKacquiredromMinority (61,608,766) -
Add/(Less):TranslationAdjustment (1,919,033) 3,747,774
Add:Minorityshareintheresultsortheyear 18,877,582 37,803,609
Less:MinorityShareindividenddeclaredbysubsidiary (47,156,576) -
Less:MinorityShareoCorporateDividendTax
ondividenddeclaredbysubsidiary (8,014,260) -
49,495,722 149,316,775
5A SECURED LOANS[Refer Note 4 on Schedule 20]
LoanromBanks
-Termloan 456,557,099 426,276,000
-VehicleLoan 17,443,398 474,000,497 18,463,654 444,739,654
6.5%Non-ConvertibleDebentures(Note1) 150,000,000 250,000,000
Note:1
6.5%Non-convertibleDebenturesare
redeemableon26thMay2008
624,000,497 694,739,654
5B UNSECURED LOANS
[Refer Note 4 on Schedule 20] Short-TermLoansandAdvances
-Frombank 8,220,630 -
-Fromothers 14,622,304 98,458,417
22,842,934 98,458,417
SChEDULES annexed to and forming part of te Consolidated Balance Seet as at 31st Marc 2008 (Contd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 82/100
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 83/10081
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULES annexed to and forming part of te Consolidated Balance Seet as at 31st Marc 2008 (Contd.)
Schedule As at As At
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)7 INVESTMENTS
[Refer Note 1(v) on Schedule 20]
Trade, Long Term
199,145CommonsharesinRelativityTechnologiesInc.,USA 40 44
953,265CommonSharesinComputerLogicInc.,USA 40 43
500,000PreerenceSharesand189,655CommonShares 40 44
inCokineticSystemsInc.,USA
Non - Trade Short Term
Inmutualunds,debtsandmoneymarketsecurities 1,311,445,830 1,444,273,676
(FairvaluebasedonrepurchasepriceasonMarch31,2008
Rs.1,343,787,934(PreviousYearRs1,465,286,890)
1,311,445,950 1,444,273,8078 SUNDRY DEBTORS (Unsecured)
Debtsoutstandingoraperiodexceedingsixmonths:
-Consideredgood 69,006,459 25,848,973
-Considereddoubtul 74,346,929 69,280,878
Otherdebts:
-Consideredgood 2,097,750,612 1,834,708,996
2,241,104,000 1,929,838,847
Less:Provisionordoubtuldebts (74,346,929) (69,280,878)
ShareinJointVenture(ReerNote6(b)onSchedule20) 11,568,147 -
2,178,325,218 1,860,557,969
9 CASH AND BANK BALANCES
CashandChequesinHand 48,838,523 40,138,139 BalanceswithBanksin:
-CurrentAccounts 416,403,520 559,210,706
-DividendAccount 3,510,454 2,527,981
-FixedDepositAccounts 161,878,033 177,534,845
[IncludesRs.25,228,873(PreviousYear
Rs.30,365,253)pledgedasmarginmoney]
-CallMoneyaccounts 22,696,296 164,044,303
-ExchangeEarnersForeignCurrencyAccount 29,627 87,110
ShareinJointVenture(ReerNote6(b)onSchedule20) 6,933,862 -
660,290,315 943,543,084
10 OTHER CURRENT ASSETS
(Unsecured, Considered good)
Interestreceivable 3,251,617 5,397,034
UnbilledRevenue 90,174,302 141,145,220
93,425,919 146,542,254
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 84/10082
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULES annexed to and forming part of te Consolidated Balance Seet as at 31st Marc 2008 (Contd.)
Schedule As at As At
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)11 LOANS & ADVANCES
(Unsecured, considered good except
where otherwise stated)
[Refer Note 1(xiii) and 9 on Schedule 20]
LoantoNIITianWelareTrust - 100,000,000
Advancesrecoverableincashorinkind
ororvaluetobereceived 180,763,732 85,739,066
SecurityDeposits 193,496,552 131,531,729
Less-ProvisionorDoubtuldeposits (1,459,716) 192,036,836 (1,459,716) 130,072,013
PrepaidExpenses 156,697,401 128,675,252
MATCreditEntitlement 109,528,633 -
AdvanceIncomeTax 343,014,797 166,353,274 Less:ProvisionorIncomeTax (274,686,900) 68,327,897 (182,741,246) (16,387,972)
AdvanceFringeBenetTax 40,315,754 22,897,641
Less:ProvisionorFringeBenetTax (39,700,085) 615,669 (23,293,755) (396,114)
ShareinJointVenture(ReerNote6(b)onSchedule20) 2,064,195 -
710,034,363 427,702,245
12 CURRENT LIABILITIES
SundryCreditors 802,697,069 733,868,937
AdvancesromCustomers 54,983,429 59,449,943
LiabilitiesunderFinanceLease 1,541,210 2,426,908
[Refer Note 13(b) on Schedule 20]
UnclaimedDividend* 3,510,454 2,527,980 UnearnedRevenue 149,985,062 220,871,667
Interestaccruedbutnotdue 8,099,924 10,449,228
OtherLiabilities 299,784,790 239,916,505
DerivativeInstrumentsFairValueLiability 237,729,542 -
[Refer Note 1(x) and 5 on Schedule 20]
ShareinJointVenture(ReerNote6(b)onSchedule20) 7,558,315 -
*Therearenoamountsdueorpaymentto
theinvestorprotectionundundersection205C
otheCompaniesAct,1956
1,565,889,795 1,269,511,168
13 PROVISIONS
[Refer Note 1(viii), 15 and 17 on Schedule 20] ProposedDividend 428,696,144 254,153,445
TaxonProposedDividend 72,856,910 43,193,378
Gratuity 4,783,856 16,743,039
Compensatedabsences 221,379,793 207,317,449
ShareinJointVenture(ReerNote6(b)onSchedule20) 950,578 -
728,667,281 521,407,311
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 85/10083
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULES annexed to and forming part of te Consolidated Profit and Loss Account for te year ended 31st Marc 2008
Schedule Year ended Year ended
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)14 REVENUE FROM OPERATIONS
[Refer Note 1 (vii) and 12 on Schedule 20]
Revenueromoperations 9,404,220,509 8,858,620,412
ShareinJointVenture(ReerNote6(b)onSchedule20) 10,905,025 -
9,415,125,534 8,858,620,412
15 OTHER INCOME
[Refer Note 1(vii) on Schedule 20]
IncomeromDividend 5,539,547 16,674,318
ProtonsaleoshorttermInvestment 80,616,146 38,251,466
Gainonexchangefuctuations(Net)* 8,389,821 33,742,978
Others 50,011,711 59,923,023
ShareinJointVenture(ReerNote6(b)onSchedule20) 1,493,063 - *Netounrealisedairvalueloss(net)onderivative
instrumentsoRs.67,537,863.
146,050,288 148,591,785
16 PERSONNEL
[Refer Note 1(viii), 14 and 15 on Schedule 20]
SalariesandBenets* 4,900,964,823 4,311,165,572
Contributiontoretirementbenetunds 338,120,715 301,399,944
Welareandotherexpenses 153,310,557 133,524,025
ShareinJointVenture(ReerNote6(b)onSchedule20) 12,693,603 -
*IncludesexpenditureoRs.Nil(PreviousYear
Rs.5,206,433)inrespectoEmployeeStockOptionPlan
5,405,089,698 4,746,089,541
17 DEVELOPMENT AND BOUGHT OUT
BoughtoutItems 204,027,647 220,426,153
ProessionalCharges 330,478,986 499,192,789
EquipmentHiring 6,360,047 11,214,656
SotwareDuplicationCharges 83,892,039 91,178,457
Others 52,478,282 32,231,651
ShareinJointVenture(ReerNote6(b)onSchedule20) 2,402,145 -
679,639,146 854,243,706
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 86/10084
A n n u A l R e p o R t 2 0 0 7 - 0 8
Schedule Year ended Year ended
No. 31st March 2008 31st March 2007
(Rs.) (Rs.)18 ADMINISTRATION, FINANCE AND OTHERS
[Refer Note 8 on Schedule 20]
Rent 335,515,290 263,714,013
RatesandTaxes 15,048,677 37,667,041
ElectricityandWater 93,777,677 81,965,563
Communication 136,962,216 140,153,040
LegalandProessional 194,546,895 206,055,742
TravellingandConveyance 429,356,660 344,505,487
Interestpaid:
-FixedLoans 50,890,072 37,869,126
Less:InterestReceivedon:
-Deposits 37,176,177 30,855,295
-Loans 2,921,672 6,005,120 -Others 670 6,261
40,098,519 10,791,553 36,866,676 1,002,450
Bank,DiscountingandOtherFinancialCharges 8,229,424 17,631,207
Baddebtandprovisionordoubtuldebt 6,044,673 30,704,648
LeaseRentals 5,139,150 4,829,432
InsurancePremium 35,668,462 42,663,093
RepairsandMaintenance
-PlantandMachinery 82,682,267 72,129,512
-Buildings 2,919,484 8,329,023
-Others 29,944,502 24,627,102
115,546,253 105,085,637
SundryExpenses 57,239,962 66,799,445 Miscellaneousexpenditurewritteno - 40,322
ShareinJointVenture(ReerNote6(b)onSchedule20) 6,580,436 -
1,450,447,328 1,342,817,120
19 MARKETING
AdvertisementandPublicity 63,901,112 63,566,027
Others 63,600,614 50,276,383
ShareinJointVenture(ReerNote6(b)onSchedule20) 529,075 -
128,030,801 113,842,410
SChEDULES annexed to and forming part of te Consolidated Profit and Loss Account for te year ended 31st Marc 2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 87/10085
A n n u A l R e p o R t 2 0 0 7 - 0 8
1. STATEMENT ON SIGNIFICANT ACCOUNTING POLICIES
Theseconsolidatednancialstatementsarepreparedonanaccrualbasisandunderhistoricalcostconventionandin
accordancewiththeaccountingstandardsspeciedinCompanies(AccountingStandardRules),2006.Disclosuresare
giventotheextentpracticableinaccordancewithaoresaidaccountingstandardsandprovisionsotheCompaniesAct,
1956.ThesignicantaccountingpoliciesadoptedbytheNIITTechnologiesGrouparedetailedbelow:
i) Basis of consolidation
Theconsolidatednancialstatementsarepreparedin accordancewith AccountingStandard“21”Consolidated
Financial statement and Accounting Standard “27” Financial Reporting o Interests in Joint Ventures specied
inCompanies (Accounting StandardRules), 2006.Theseconsolidatednancialstatementsincludeaccountso
NIITTechnologies Limited,its subsidiaryundertakingsand appropriateshareo Joint Venture undertaking (NIIT
TechnologiesGroup/Group).SubsidiaryundertakingsarethosecompaniesinwhichNIITTechnologiesLimited,
directlyorindirectly,hasanownershipomorethanonehalovotingpowerorotherwisehaspowertoexercise
controlovertheoperationsandtoobtaineconomicbenets.Thesubsidiariesareconsolidatedromthedateo
acquiringmajorityownershiponwhicheectivecontrolistranserredtotheGroupandarenolongerconsolidated
romthedateodisposal.Onacquisition,considerationpaidlessnetassetsacquiredisconsideredasGoodwill.
InterestinJointVentureundertakingoverwhichtheGroupexercisesjointcontrolisconsolidatedusingproportionate
consolidation.AllmaterialinterGrouptransactions,balancesandunrealizedsurplusesanddecitsontransactions
between group companies are eliminated. Consistency in adoption o accounting policies among all group
companiesisensuredtotheextentpracticable.Separatedisclosureismadeorminorityinterests.Alsoreernote
6below.
ii) Fixed Assets
FixedAssetsarestatedatacquisitioncost.
iii) Depreciation and Amortisation
DepreciationandAmortisationisprovidedonapro-ratabasisonthestraightlinemethodovertheestimateduseul
livesotheassetsdeterminedasollows:-
Buildings 58years
LeaseholdLand 90years
LeaseholdImprovements 3yearsorleaseperiodwhicheverislower
Computers,relatedaccessories(IncludedinPlant&machinery)andintangibleassetsincludingGoodwillarisingonConsolidationupto
31March2006
1-5years
GoodwillarisingonConsolidationonorater1April2006 ReviewedorImpairment
Furniture,xturesandvehicles 5-10years
Allotherassets 3-20years
Further,computer systems and sotware are technicallyevaluatedeachyearortheir useul economiclieand
theunamortizeddepreciableamountotheassetischargedtoprotandlossaccountasdepreciationovertheir
revisedremaininguseullie.
iv) Impairment of Assets
Allassetsotherthaninventories,investmentsanddeerredtaxassetsarereviewedorimpairment,whereverevents
orchangesincircumstancesindicatethat thecarryingamountmaynot berecoverable.Assetswhosecarrying
valuesexceedtheirrecoverableamountarewrittendowntotherecoverableamount.v) Investments
Long-terminvestmentsarevaluedattheiracquisitioncost.Anydeclineinthevalueothesaidinvestment,other
thanatemporarydecline,isrecognizedandchargedtoprotandlossaccount.Short-terminvestmentsarecarried
atcostortheirmarketvalueswhicheverislower.
vi) Inventory valuation
Inventoriesarevaluedlowerocostsornetrealizablevalue.
vii) Revenue Recognition
Software Services
TheGroupderivesasubstantialpartoitsrevenueromtimeandmaterialcontractswheretherevenueisrecognized
onamanmonthbasis.TheGroupalsoderivesrevenuesromxedpricecontractswheretherevenueisrecognized
basedonproportionatecompletionmethod.Further,oreseeablelossesonthecompletionothecontracts,iany
arealsoprovidedor.
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 88/10086
A n n u A l R e p o R t 2 0 0 7 - 0 8
Product Sales
Revenue rom sale o products including sale o sotware user licenses are recognized, when delivery to the
customerhasoccurred.Incaseomultipleelementcontractsinvolvingproductsandservicesrevenueisrecognized
onproportionatecompletionbasisexceptwhereindividualcomponentsareseparableproductsorservicesthatcan
bedealtwithonastandalonebasisinwhichcaserevenueinrespectoeachcomponentisrecognizedseparately,
asperthetermsothecontract.
Annual Maintenance Contracts
Revenueromannualmaintenancecontractisrecognisedinproportiontotimeelapsed,onaStraightlinebasis.
Dividend
Dividendincomeisrecognizedwhentherighttoreceivedividendisestablished.
viii) EmployeeBenets
a) RetirementBenets:
- Provident Fund (India based employees):
TheGroupmakesdenedcontributiontoRegionalProvidentFundCommissionerw.e..1October2005in
respectoProvidentFund.TheGroupdoesnothaveanyurtherobligationinthisrespect.Fortheperiod
upto30thSeptember2005,theGroupmadecontributiontoaTrustestablishedorthepurposebyNIIT
LimitedwhichisadenedbenetplantotheextentthattheGrouphasanobligationtomakegoodtheshortall,iany,betweenthereturnromtheinvestmentothetrustandinterestratenotiedeveryyearby
theGovernment.TheGroup’sobligationoranypossibleshortallisactuariallydeterminedandprovided
or.
- Superannuation
TheGroupmakesdenedcontributiontoatrustestablishedorthepurposebyNIITLimitedoreligible
employees.TheGrouphasnourtherobligationbeyondit’smonthlycontributions.
- Gratuity
GratuityisapostemploymentdenedbenetplanoreligibleemployeesinIndia.Theliabilityrecognizedin
thebalancesheetinrespectogratuityisthepresentvalueothedenedbenetobligationatthebalance
sheetdatelesstheairvalueoplanassets.Thedenedbenetobligationiscalculatedannuallybyan
independentactuaryusingtheprojectedunitcreditmethod.Actuarialgainsandlossesarechargedor
creditedtotheprotandlossaccountintheyearinwhichsuchgainsorlossesarise.
- Overseas employees
In respect o companies incorporated outside India, where applicable, the companies make dened
contributionsonamonthlybasistowardsretirementbenetplanswhichischargedtotheprotandloss
account.
b) Compensated absences:
Liabilityinrespectocompensatedabsenceisprovidedbothorencashableleaveandthoseexpectedtobe
availedbasedonactuarialvaluationorwhichitconsidersundiscountedvalueothebenetsexpectedtobe
paid/availedduringthenextoneyearandappropriatediscountedvalueorthebenetsexpectedtobepaid/
availedateroneyear.
c) Employee Stock Option Scheme
Thestockoptionsgrantedunder“NIITTechnologiesEmployeesStockOptionPlan2005”isaccountedoras
pertheaccountingtreatmentprescribedbyEmployeeStockOptionSchemeandEmployeestockPurchase
Guidelines,1999,issuedbySecuritiesandExchangeBoardoIndia,wherebytheintrinsicvalueotheoptionbeingexcessomarketvalueotheunderlyingshareimmediatelypriortodateograntoveritsexercisepriceis
recognizedasdeerredemployeecompensationwithacredittoemployeestockoptionoutstandingaccount.
Thedeerredemployeecompensationischargedtoprotandlossaccountonstraightlinebasisoverthe
vestingperiodotheoption.Thebalanceinemployeestockoptionoutstandingaccountnetoanyun-amortized
deerredemployeecompensationisshownseparatelyaspartoshareholders’unds.
ix) Foreign Currency Transaction / Translation
Transactions in oreign currency (currency other than companies’ reporting currency) are booked at standard
ratesdeterminedperiodically,whichapproximatetheactualrates,andallmonetaryassetsandliabilitiesinoreign
currencyarerestatedattheyear-end.Gain/Lossarisingoutofuctuationsonrealization/paymentorrestatement
ischarged/creditedtotheprotandlossaccount.
Withregardtooreignexchangeorwardcontractstakentohedgeitsexposuretomovementsinoreignexchange
rates,thepremiumordiscountsarisingattheinceptionotheorwardcontractisamortizedasincomeorexpense
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 89/10087
A n n u A l R e p o R t 2 0 0 7 - 0 8
overthelieothecontractandtheexchangedierenceonsuchacontractisrecognizedinthestatementoprot
andlossinthereportingperiodinwhichtheexchangeratechangesexcepttotheextenttowhichtheaccounting
policyonhedgeaccountingasdetailedinnote(x)belowandurtherexplainedinnote5belowapplies.
Forthepurposesoconsolidation,theoperationsooverseassubsidiariesareconsiderednonintegralinnatureandaccordinglytheirassetsandliabilitiesaretranslatedattheyearendexchangerateandincomeandexpenditure
itemsaretranslatedat standardratesthatapproximatetheexchangerateprevailingon thedateotransaction.
Theresultanttranslationadjustmentisrefectedasaseparatecomponentoshareholders’undsas‘Cumulative
TranslationReserve’.Upondisposalordissolutionooverseassubsidiaries,thebalanceinCumulativeTranslation
Reserveinrelationtothesubsidiaryistranserredtotheprotandlossaccount.
x) Hedge Accounting
Inaccordancewithits risk management policiesand procedures, the Group uses derivative instrumentssuch
asoreign currencyorward contractsand currencyoptionsto hedge itsrisks associatedwithoreign currency
fuctuations relating to certain rm commitments and highly probable orecasted transactions. The derivatives
thatqualiyorhedgeaccountinganddesignatedascashfowhedgesareinitiallymeasuredatairvalueandare
re-measuredatasubsequentreportingdateandthechangesintheairvalueothederivativesi.egainorloss(net
otaximpact)isrecognizeddirectlyinshareholders’undsunderhedgingreservetotheextentconsideredhighly
eective.Gainorlossonderivativeinstrumentsthateitherdonotqualiyorhedgeaccountingornotdesignatedascashfowhedgesordesignatedascashfowhedgestotheextentconsideredineectivearerecognizedinthe
protandlossaccount.
Hedgeaccountingisdiscontinuedwhenthehedginginstrumentexpires,sold,terminated,orexercised,ornolonger
qualiesorhedgeaccounting.Thecumulativegainorlossonthehedginginstrumentrecognizedinshareholder’s
undsunderhedgingreserveisretainedthereuntiltheorecastedtransactionoccurssubsequenttowhichthe
sameisadjustedagainsttherelatedtransactionintheprotandlossaccount.Iahedgedtransactionisnolonger
expectedtooccur,thenetcumulativegainorlossrecognizedinshareholdersundistranserredtoprotandloss
accountinthesameperiod.
xi) Leases
Leaserentalinrespectooperatingleasearrangementsarechargedtoexpenseonastraightlinebasisoverthe
termotherelatedleaseagreement.
Finance leasetransactionsareconsideredas nancingarrangementsandtheleasedassetis capitalizedatan
amountequaltothepresentvalueotheutureminimumleasepaymentsandcorrespondingamountisrecognized
asa liability.The lease paymentsmadeareapportionedbetweennancechargesand reduction ooutstanding
liabilityinrelationtoleasedasset.
xii) Borrowing Cost
Borrowingcosts areexpensed intheyearin whichit isincurredexcept where the costis incurredduringthe
construction o an asset that takes a substantial period to get ready or its intended use in which case it is
capitalized.
xiii) Taxation
Taxexpensecomprisingobothcurrenttax(includingFringeBenetTax)anddeerredtaxisincludedindetermining
thenetresultsortheyear.Deerredtaxrefectstheeectotemporarytimingdierencesbetweentheassetsand
liabilitiesrecognizedornancialreportingpurposesandtheamountsthatarerecognizedorcurrenttaxpurposes.
Asa matter oprudencedeerred taxassets arerecognizedand carriedorward onlyto theextent,there is a
reasonablecertaintythatsucientuturetaxableincomewillbeavailableagainstwhichsuchdeerredtaxassetscanberealized.CurrentTax(includingFringeBenetTax)isdeterminedbasedontheprovisionsoIncomeTaxAct
andregulations,otherespectivecountries.
MinimumAlternativeTax(MAT)creditassetisrecognizedintheBalanceSheetwhereitislikelythatitwillbeadjusted
againstthedischargeothetaxliabilityinutureunderIndianIncomeTaxAct.
xiv)Provisions and contingencies
TheGroupcreatesaprovisionwhenthereispresentobligationasaresultoapasteventthatprobablyrequiresan
outfoworesourcesandareliableestimatecanbemadeotheamountoobligation.Adisclosureoracontingent
liabilityismadewhenthereisapossibleobligationorapresentobligationthatprobablywillnotrequireanoutfow
oresourcesorwhereareliableestimateotheobligationcannotbemade.
2 CONTINGENT LIABILITIES: -
a) GuaranteesissuedbybankersoutstandingattheendoaccountingyearRs.1,375.38Lacs,includesShareinJoint
VentureRs.4.20Lacs(PreviousYearRs.1,295.54Lacs,includesShareinJointVentureRs.Nil).
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 90/10088
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
b) Guarantees issued to banker outstanding at the end o accounting year Rs.8,766.44 Lacs (Previous Year
Rs.10,681.32Lacs).
c) Guarantees given onbehalo NIITian WelareTrustorloans availedby theTrustRs.Nil(Previous yearRs.750
Lacs).
d) Corporateguaranteesoutstandingatyearend,Rs.5,081.20Lacs(PreviousyearRs.5,148.10Lacs).
e) ClaimsagainsttheGroupnotacknowledgedasdebtsRs.2,701.15Lacs(PreviousYearRs.62.30Lacs)including
vendorclaimsRs.2,638.85Lacs(PreviousYearNil).
) Salestax‘C’ormsoutstandingRs.21.38Lacs(PreviousyearRs.Nil).
3 Estimated amount ocontractsremainingtobeexecuted oncapitalaccountnotprovidedor(netoadvances)Rs
5,995.92Lacs,includesshareinjointventureRs.2.83Lacs(PreviousYearRs2,071.26Lacs,includesshareinjoint
ventureRs.Nil).
4 a) WorkingCapitalLimitsotheParentCompanyaresecuredbyarstchargeonbookdebtsandbyasecondcharge
onmovableassetsotheParentCompany.TheParentCompanyhasnotutilizedtheundbasedlimitas atthe
year-end(PreviousyearRsNil).
b) 6.50%NonConvertibleDebenturesaresecuredbywayoamortgageonreeholdlandandarstparipassucharge
bywayohypothecationomovableassets/properties,subjecttochargescreatedongeneralassetsotheParent
Companyinavouroitsbanker(s)orsecuringtheirworkingcapitalrequirements.
c) VehicleLoansromBanksaresecuredbywayohypothecationothevehiclesnanced.
d) Termloanrombankissecuredbyarstpriorityoverxedassetsandafoatingchargeoverthepresentanduture
immovableassetsincludingreceivablesoNIITTechnologiesLimited,UK,asubsidiaryCompanyintheGroup.
Additionally,theParentCompanyhasgivenaguaranteeinrelationtothisloanwhichhasbeenconsideredinNote
2(b)above.
e) Thesecuredandunsecuredloansothegrouparerepayableasollows:-
Amount in Rs.
31.03.2008 31.03.2007
Withinthenext1year 379,117,945 311,641,902
Inthenext2to5years 267,725,486 481,556,170
5 a) Duringtheyear,theGrouprevieweditsriskmanagementpolicyandhedgingstrategiesinrespectohighlyprobable
orecasttransactionsandrmcommitmentsw.e..18 thJanuary,2008.TheGrouphasdesignatedcertainoreign
currencyderivativeinstrumentswhichmeetthehedgingcriteria,ascashfowhedges.
ThederivativeinstrumentsheldbytheGroupason31stMarch,2008takentohedgeitsexposuresincluded:
- ForwardexchangecontractsoUSD239millionandGBP3.5millionhavingaairvaluelossoRs.1,381Lacs.
Inrelationtotheabove,airvaluelossoRs.1,554Lacs(NetodeerredtaxesoRs.148Lacs)postdesignation
ascashfowhedgesandconsideredeectivehasbeenincludedinthehedgingreserveundershareholders’
Fundsandthebalancegainhasbeenrecognizedintheprotandlossaccount.
- Euro-USDollarandGBP-USDollarderivativeoptionstosellmaximumoEuro18.50millionandGBP20.60
millionrespectively,airvaluelossontheseoptionsoRs.997Lacshasbeenrecognizedintheprotandloss
account.TheCompanyhasconsideredthesederivativeoptionsappropriateromaneconomicperspective.
b) TheGroup wasamortizingpremium or discount arising on allorward exchange contractsover the lie o the
contractand wassimultaneouslyrecognizingthe exchangedierencesonsuch contractsin theprotandloss
accountaspertheaccountingpolicystatedinNote1(ix)above.However,witheectromJanuary18,2008,the
GroupreviseditsaccountingpolicyonderivativeinstrumentsexplainedinNote1(x)aboveandurtherdetailedin(a)
above.Theaoresaidrevisionresultedinrecognitionoairvalueloss(netodeerredtax)inhedgingreserveunder
shareholders’equitytotheextentoRs.1,554LacsandrecognitionoadditionalliabilitytotheextentoRs.1,697
Lacs.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 91/10089
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
6 Consolidation
a) DetailsoNIITTechnologiesLimited’ssubsidiariesallowhichhavebeenconsideredintheseconsolidatedaccounts
onalinebylinebasisareasollows:
Subsidiary Percentage of ownership
interest as at 31.03.2008
Percentage of
ownership interest as at31.03.2007
Country of
incorporation
NIITGISLimited 88.99 88.99 India
NIITSmartServeLimited 100 100 India
NIITTechnologiesInc. 100 100 UnitedStates
NIITTechnologiesLtd 100 100 UnitedKingdom
NIITTechnologiesCo.Ltd 100 100 Japan
NIITTechnologiesPteLtd 100 100 Singapore
NIITBeneluxBV 100 100 Netherlands
NIITBelgiumNV 99.96 99.96 Belgium
NIITThailandLimited 100 100 Thailand
NIITAsiaPacicPtyLimited 100 100 Australia
NIITTechnologiesAG 100 100 Germany
NIITTechnologiesAGSchweiz 100 100 SwitzerlandNIITTechnologiesGmbH 100 100 Austria
NIITSmartServeLimited 100 100 UnitedKingdom
RoomSolutionsLimited 100 75 UnitedKingdom
NIITTechnologiesLtd 100 - Canada
SoTecGmbH 100 - Germany
b) TheParentCompanyalsohas50%interestinajointventureviz,AdeccoNIITTechnologiesPrivateLimitedasat
31stMarch2008.TheJointventurehasbeenaccountedorusingproportionateconsolidationinaccordancewith
theAccountingStandard27“FinancialReportingoInterestsinJointVentures”.TheParentCompany’sshareinthe
assets,liabilities,incomeandexpensesothejointventureasadjustedoreliminationarisingromtransactionswith
variouscompaniesothegroupisincludedintherespectiveschedulesintheseconsolidatednancialstatements.
7 (a) Ason21stSeptember2007,theGroupacquiredtheremaining25%interestinRoomSolutionsLimited,UK.The
goodwillonacquisitionotheremaininginteresthasbeenarrivedatasollows:
Rs.
Considerationpaid 232,467,169
Less:25%onetassetsoRoomSolutionsLimited,UKason21stSeptember2007* 61,608,766
Goodwill arising 170,858,403
*basedonmanagementaccounts
(b) TheGroupalsoacquired100%interestinSoTecGmbH,on29thFebruary2008.Thegoodwillonacquisitionhas
beenarrivedatasollows:
Considerationpaid 164,253,565
Less:100%onetassetsoSoTecGmbHason29thFebruary2008# 8,030,328
Goodwill arising 156,223,237
#basedonauditedaccounts
- The above goodwill has been ascertained based on the book values o the net assets acquired which in
management’sviewarenotsignicantlydierentromtheirairvalues.
8 Payment to Auditors (Excluding Service Tax)
i) PaymenttoParentCompanyauditors
Particulars Year 2008
(Rs.)
Year 2007
(Rs.) Auditees 6,145,360
CerticationServices 2,715,000 2,520,000
Taxauditees 569,000
Reimbursementoexpenses 614,339 837,767
ii) PaymenttootherauditorsamounttoRs.14,786,756(PreviousYearRs.14,931,036).
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 92/10090
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
9 TAXATION
a) CURRENT TAX
TheGrouphasavaileddeductionsavailableundertheprovisionsosection10Band80ICotheIndianIncomeTax
Act,inrespectocertainExportOrientedUndertakings(EOU’s)registeredwithSotwareTechnologyParksoIndia(STPI)andoranundertakingsetupinabackwardarearespectively.ThecurrenttaxliabilityinIndianIncomeTax
isprimarilyarisingunderMinimumAlternateTaxprovisionsoSection115JBotheIndianIncomeTaxAct,parto
whichamountingtoRs.1,095Lacsisexpectedtoberecoveredinutureyearsandthesamehasbeenrecognized
asMATcreditentitlementintheseaccounts.
b) DEFFERED TAX (NET)
Breakupodeerredtaxassets/liabilitiesandreconciliationocurrentaccountingperioddeerredtaxchargeisas
ollows:
(Rs Lacs)
Deferred Tax Assets/Liabilities As at 1.04.2007 Charge/ (Credit)for the year
As at31.03.2008
Deferred Tax Liabilities
a) Taximpactodierencebetweencarryingamountoxedassets
inthenancialstatementsandaspertheincometaxcalculation.
100 58 158
b) Taximpacto expensesnotchargedinthenancialstatements
butclaimedasdeductionunderincometax
84 (1) 83
c) TaximpactoGainscreditedin thenancialstatementsbutnot
oeredortaxunderincometax
- 5 5
d) Others 5 3 8
Total (A) 189 65 254
Deferred Tax Assets:
a) Taximpactodierencebetweencarryingamountoxedassets
inthenancialstatementsandaspertheincometaxcalculation.
424 (290) 134
b) Taximpacto expenseschargedin thenancialstatementsbut
allowableasdeductionsinutureyearsunderincometax:
Provisionordoubtuldebts 128 2 130
ProvisionorCompensatedabsences,BonusandGratuity 319 146 465
Others 119 (77) 42
c) Carryorwardlosses/unabsorbeddepreciation. - 9 9
Total (B) 990 (210) 780
Deferred Tax Asset / (Liability) (B-A) 801 (275) 526
Add: Deerred Tax Asset related to Fair Value loss on derivative
instrumentsnotchargedinthenancialstatementsbuttakentothe
BalanceSheet.
- - 148
Net Deferred Tax Asset / (Liability) - - 674
Note:
i) ThemovementinDeerredtaxasset/liabilityaboveincludesthatonaccountocurrencytranslationobalanceso
overseassubsidiariesoRs.51Lacs.
ii) Deerredtaxassetsandliabilitiesabove havebeendetermined byapplyingtheIncomeTaxratesorespective
countries.AlsoasrequiredbyAccountingStandard22“AccountingorTaxesonIncome”deerredtaxassetsand
liabilitiesinrelationtodierentCompanieshavenotbeenosetandhavebeenrepresentedinthebalancesheetas
ollows:
(Rs Lacs)
Particulars As at 31.03.2008 As at 31.03.2007
DeerredTaxLiability(Net) - -
DeerredTaxAsset(Net) 674 801
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 93/10091
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
iii) Deerredtaxassetsarisingromcarryorwardlosses/unabsorbeddepreciationhasbeenrecognizedonlytothe
extentodeerredtaxliabilityintherespectivecompaniesexceptwheretheGroupis certainotheirrecoveryin
ull.
10 Earnings Per Share2007-08 2006-07
ProtattributabletoEquityshareholders(Rs.)-(A) 1,352,605,571 1,292,441,483
WeightedAveragenumberoEquitysharesOutstandingduringtheyear–(B) 58,680,226 58,284,007
Add:Eectopotentialdi lutiveshares(stockoptions)-(ReerNote14below) 84,829 318,35
Weightedaveragesharesoutstandingconsideredordeterminingdilutiveearningper
share-(C)
58,765,055 58,602,358
NominalValueoEquityShares(Rs.) 10 10
BasicEarningspershare(Rs)(A/B) 23.05 22.17
DilutedEarningspershare(Rs)(A/C) 23.02 22.05
EARNING PER SHARE {had fair value method been employed for accounting
for Employee Stock Option (Refer Note 14 below)}
2007-08 2006-07
ProtattributabletoEquityshareholders(Rs.)-(D) 1,321,156,335 1,289,903,032
BasicEarningspershare(Rs)(D/B) 22.51 22.13
DilutedEarningspershare(Rs)(D/C) 22.48 22.01
Note: The weightedaverage number oequity shares outstandingconsideredordetermining Basicand Dilutive
EarningperShareorthepreviousyearhasbeenappropriatelyadjustedorBonusSharesissuedsoastomake
theEarningpersharecomparable.
11 Related Party Disclosures as per Accounting Standard 18
A. ListorelatedpartieswithwhomtheGrouphastransacted:
a. PartiesowhomtheGroupisanassociateanditssubsidiaries
1) NIITLimited
2) NIITUSAInc.3) NIITMalaysiaSdnBhd
4) NIITChina(Shanghai)Ltd
5) ScantechEvaluationServicesLimited
6) NIITMiddleEastLLCBahrain
7) NIITMultimediaLtd.
8) NIITLimitedUK
b. KeyManagerialpersonnel
RajendraSPawar
VijayKThadani
ArvindThakur
c. Partiesinwhichthekeymanagerialpersonnelortherelativesothekeymanagerialpersonnelareinterested.
NayaBazarNoveltiesPvtLtd.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 94/10092
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
B. Detailsotransactionwithrelatedpartiescarriedoutonanarmslengthbasis:
Nature of Transactions Party of whomthe group is an
associate and it’s
subsidiaries(Rs.)
Key ManagerialPersonnel
(Rs.)
Parties in whichKey Managerial
Personnel of
the group areinterested
(Rs.)
Total(Rs.)
PurchaseoFixedAssets
-(Note2)
1,269,798
(15,632,018)
-
(-)
-
(-)
1,269,798
(15,632,018)
RecoveryromNIITLimitedGroup
-(Note3)
15,503,475
(37,562,899)
-
(-)
-
(-)
15,503,475
(37,562,899)
RecoverybyNIITLimitedGroup
–(Note4)
44,915,034
(42,371,355)
-
(-)
-
(-)
44,915,034
(42,371,355)
ReceivingoServices/Goods
(Note5)
49,152,171
(30,785,077)
-
(-)
-
(1,598,176)
49,152,171
(32,383,253)
RenderingoServices–
(Note6)
67,285,504
(31,145,270)
-
(-)
-
(1,049,745)
67,285,504
(32,195,015)
Remuneration(Note7) -
(-)
26,523,001
(24,718,129)
-
(-)
26,523,001
(24,718,129)
OtherIncome -
(4,814,057)
-
(-)
-
(-)
-
(4,814,057)
OtherExpenses(Note8) 10,513,426
(3,650,755)
-
(-)
514,555
(-)
11,027,981
(3,650,755)
DividendPaidtoScantech
EvaluationServicesLimited
62,805,080
(57,973,920)
-
(-)
-
(-)
62,805,080
(57,973,920)
SaleoFixedassets
(Note9)
301,999
(3,605,115)
-
(-)
-
(-)
301,999
(3,605,115)
Notes:
1 FiguresinParenthesisrepresentpreviousyear’sgures.
2 Includestransactionsortheyearwith;
- NIITLimitedRs.1.50Lacs(PreviousYearRs.23Lacs)
- NIITMultimediaLimitedRs.Nil.(PreviousYearRs.133Lacs)
- NIITMiddleEastECRs.11.20Lacs.(PreviousYearRs.Nil)3 Includestransactionsortheyearmainlywith;
- NIITLimitedRs.72.44Lacs(PreviousYearRs.375.63Lacs)
- NIIT(USA)IncRs.80.65Lacs(PreviousYearRs.Nil)
4 Includestransactionsortheyearmainlywith;
- NIITLimitedRs.226.72Lacs(PreviousYearRs.412.96Lacs)
- NIITMiddleEastRs.41.85Lacs(PreviousYearRs.Nil)
- NIIT(USA)IncRs.180.57Lacs(PreviousYearRs.Nil)
5 Includestransactionsortheyearmainlywith;
- NIITLimitedRs.71.10Lacs(PreviousYearRs.119.81Lacs)
- NIITMalaysiaSdnBhdRs.Nil(PreviousYearRs.1.01Lacs)
- NIITChina(Sanghai)LtdRs.30.05Lacs(PreviousYearRs.Nil)
- NIITMiddleEastRs.390.36Lacs(PreviousYearRs.160.43Lacs)
6 Includestransactionsortheyearmainlywith;
- NIITUSAInc,Rs.174.20Lacs(PreviousYearRs.10.49Lacs)
- NIITChina(Sanghai)LtdRs.Nil(PreviousYearRs.114.02Lacs)
- NIITLimitedRs.272.55Lacs(PreviousYearRs.0.75Lacs)
- NIITUKRs.226.09Lacs(PreviousYearRs.Nil)
7 RemunerationtoKeyManagerialPersonnelincludesthosepaidto;
- RajendraSPawar–Rs.110.52Lacs(PreviousYearRs.100.45Lacs)
- ArvindThakur–Rs.146.73Lacs(PreviousYearRs.139.93Lacs)
- VijayKThadani–Rs.7.96Lacs(PreviousYearRs.6.80Lacs)
8 Includestransactionsortheyearwith
- NIITLimitedRs.105.13Lacs(PreviousYearRs.36.50Lacs)
9 Includestransactionsortheyearwith
- NIITLimitedRs.3.02Lacs.(PreviousyearRs.36.05Lacs.)
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 95/10093
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
C. Outstandingbalanceswithrelatedparties:
Receivables as at
31.03.2008
(Rs.)
Payables as at
31.03.2008
(Rs.)
Receivables as at
31.03.2007
(Rs.)
Payables as at
31.03.2007
(Rs.)
Parties o whom the group is an
associateanditssubsidiaries.
14,279,817 3,180,118 10,802,124 11,213,501
KeyManagerialPersonnel - 11,780,000 - 16,445,200
12 TheDominantsourceoriskandreturnsothegroupisconsideredtobethebusinessinwhichitoperatesviz–sotware
solutions.Beingasinglebusinesssegmentgroup,noprimarysegmentinormationisbeingprovided.Thesecondary
segmentinormationasperAccountingStandard17‘SegmentReporting’inrelationtogeographiesisasollows:
(Rs. Lacs)
Particulars Revenue from external
Customers by location ofcustomers
Carrying amount of segment
assets by location of theassets
Additionstoxedassets
31.03.2008 31.03.2007 31.03.2008 31.03.2007 31.03.2008 31.03.2007
India 8,622 7,042 39,935 30,800 5,868 2,640
RestoAsiaPacic
(includingAustralia)
9,176 8,882 4,722 4,706 460 374
Europe 46,617 44,119 21,485 22,154 1,871 6,611
America 29,736 28,544 7,898 6,699 30 78
Total 94,151 88,587 74,040 64,359 8,229 9,703
13 Disclosure of Leases as per Accounting Standard (AS) – 19
a) Operating Leases
TotaloutureMinimumLeasePaymentsundernon-cancelableleasesincaseopremisesandequipments:
Particulars In respect of Premises
(Rs.)
In respect of equipment (Rs)
March 31, 2008 March 31, 2007 March 31, 2008 March 31, 2007
Amountpayablewithinthenext1year 127,461,623 81,500,011 10,863,288 15,227,542
Amountpayableinthenext2to5years 148,488,129 175,004,322 8,183,841 11,682,030
Aggregatepayments during theperiod underoperating leases amounttoRs. 347,014,487(Previous YearRs
279,758,101).
b) Finance Leases
Theminimumleasepaymentoutstandingandtheirpresentvalueatthebalancesheetdateinrespectoplantand
machinerythathavebeencapitalizedareasollows:
Particulars * Minimum lease
payments Amount(Rs.)
Finance charges
Amount(Rs.)
Present value of lease
payments Amount(Rs.)
Amountpayablewithinthenext1year 1,085,540
(1,652,167)
151,221
(205,818)
934,319
(1,446,349)
Amountpayableinthenext2to5years 663,281
(1,062,338)
56,390
(81,779)
606,891
(980,559)
Total 1,748,821
(2,714,505)
207,611
(287,597)
1,541,210
(2,426,908)
*Figuresinparenthesisrepresentpreviousyeargures.
14 EMPLOYEE STOCK OPTION PLAN:
(i) TheParentCompanyestablishedNIITTechnologiesStockOptionPlan2005(ESOP2005)intheyear2005-06and
thesamewasapprovedattheAnnualGeneralMeetingotheParentCompanyon29 thJuly2004.Theplanwas
setupsoastooerandgrantorthebenetoemployeesotheParentCompanyanditssubsidiaries,whoare
eligibleunderSecuritiesExchangeBoardoIndia(SEBI)Guidelines(excludingpromoters),optionsothe Parent
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 96/10094
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
Companyinaggregateupto3,850,000optionsunderESOP2005,inoneormoretranches,andonsuchterms
andconditionsasmaybexedordeterminedbytheBoardinaccordancewiththeprovisionsolaworguidelines
issuedbytherelevantauthoritiesinthisregard.Aspertheplaneachoptionisexercisableoroneequityshare
oacevalueoRs10eachullypaiduponpaymenttotheParentCompanyorsuchsharesatapricetobe
determinedinaccordancewithESOP2005.SEBIhasissuedtheEmployee’sStockOptionschemeandEmployee
StockPurchaseSchemeGuideline,1999whichisapplicabletotheaboveESOP2005.
TheParentCompanygrantedoptioninthreetranches.Thedetailsowhichareasollows:
Description Tranche 1 Tranche II Tranche III[Note (b)]
2007-08 2006-07 2007-08 2006-07 2007-08
DateoGrant August02,2005 August11,2005 June20,2007
DateoVesting August02,2006 August11,2006 June20,2008
Livegrantsatbeginning/duringthe
year(Nos)
106,800 609,850 - 70,600 280,000
Foreited/lapsedtillvestingperiod
(Nos)
- 54,600 - 54,600 41,250
OptionsVested(Nos) - 555,250 - 16,000 Nil
Optionsoreitedpostvesting(Nos)-
PreBonus
3,700 13,200 - - Nil
OptionsExercised(Nos)-PreBonus 18,400 435,250 - 16,000 Nil
VestedOptionsPostBonus 127,050 - - - -
Optionsoreitedpostvesting(Nos)-
PostBonus
750 - - - -
OptionsExercised(Nos)-PostBonus 20,000 - - - -
Exercisable/outstandingattheendo
theYear(Nos)-PostBonus[Note(a)]
106,300 106,800 - - 358,125
ExercisePrice-PreBonus
-PostBonus
Rs.115.00
Rs.76.67
Rs.115.00
-
Rs.150.85
-
Rs.150.85
-
Rs.523.50
Rs.349.00
RemainingContractualLie 488days 853days - - 1462Days
FairValueotheOptionsbasedon
BlackandScholesmodel(asper
Independentvaluer’sreport)[Note-(c)]
Rs59.20 Rs59.20 Rs41.18 Rs41.18 Rs.168.11
IntrinsicValueooption[Note-(c)] Rs34.50 Rs34.50 - - -
Notes:
a) Duringtheyear,theParentCompanyhasissuedbonussharesintheratioo1:2i.e.oneadditionalequityshare
oreverytwoequitysharesontherecorddate.
b) Duringtheyear,theCompensation/RemunerationCommitteeatitsmeetingheldonJune20,2007hasapproved
issueo280,000options(Grant-III)outotheoptionsunderESOP2005,toSeniorManagerialPersonnelotheParentCompany/Subsidiaries.
c) Theairvalueandtheintrinsicvaluesarebasedonprebonusissuevaluations.
TheassumptionsusedbytheindependentvaluerordeterminationoairvalueaspertheBlack&Scholesmodel
isasollows:
a) Marketpriceconsideredisthelatestavailableclosingprice,priortothedateothegrant.
b) Exercisepriceisthepricepayablebytheemployeesorexercisingtheoption.
c) Asthelieotheoptionisgreaterthanoneyearthereisconsiderabledicultyinestimatingtheamountand
timeouturedividendpayoutswithcertainty,henceuturedividendpayouthavenotbeenincorporatedinthe
valuationanalysis.
d) Volatility-Varianceinthestockpriceisconsideredas10%(ForGrantI&II)and51.13%(GrantIII)isbasedon
historicalvolatilityinthesharepricemovementotheCompanyandourothercomparablecompanies.
e) Averagelieotheoptionsisconsideredtobe2.5Years(ForGrantI,II&III).
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 97/10095
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
) Risklessinterestratehasbeenassumedat7% (ForGrantI &II)and7.93%(GrantIII)basedonlongterm
governmentbondsotenyearresidualmaturity.
(ii) OtherinormationasrequiredbytherelatedGuidanceNoteonemployeesharebasedpaymentsissuedbythe
InstituteoCharteredAccountantsoIndiaregardingemployeesharebasedpaymentisasbelow:Description Tranche 1 Tranche II Tranche III
[Note (b)above]
2007-08 2006-07 2007-08 2006-07 2007-08
Expense accounted or during the
period based on intrinsic value o the
options
- 4,092,891 - - -
Additional expense had the Group
recordedtheESOPExpensebasedon
airValueotheoptions[Netoamount
attributable to the Employees o the
subsidiaries (Rs. Nil) Previous Year
Tranche1-Rs797,232Tranche2-Rs
(388,107)Transerabletosubsidiaries]
- 2,930,273 - (800,945) 31,449,236
ForimpactonBasicandDilutiveEarningPerShare,hadairvalueotheoptionbeenusedordeterminingEmployee
StockOptionPlanexpense,reernote10above.
15 EmployeeBenets
a) Expenditureondenedcontributionpostretirementbenetplansviz.ProvidentFund,SuperannuationFundand
OverseasPlanamountedtoRs.324,205,911(PreviousyearRs.282,974,304).
b) Disclosureinrespect o denedbenetplansin accordancewithAccountingStandard 15 (Revised) “Employee
Benets”
- Provident Fund:
InrespectoGroup’sobligationtowardsguaranteedreturnsonProvidentFundContributionsmadetotheTrust
establishedbyNIITLimited,theGroup’sobligationhasbeenactuariallydetermined.Asperactuary’sreportthe
interestearningsandcumulativesurplusoTrustaremorethanthestatutoryrequirementandaccordinglythereisnoadditionalliabilityoemployeronaccountointerestshortall.
- Gratuity:
Disclosuresasperactuarialreportoindependentactuary:
Amount of obligation as at the year end and is determined as under:
Amount (Rs.)
Description 2007-08 2006-07
Presentvalueoobligationasatthebeginningotheyear 54,632,680 39,244,344
Interestcost 4,352,290 2,761,836
Currentservicecost 10,497,143 7,708,875
Benetspaid (4,066,990) (5,081,402)
Actuarial(gain)/lossonobligations 1,672,364 9,
Presentvalueoobligationasattheendotheyear 67,087,487 54,632,680
Change in Plan Assets:
Amount (Rs.)
Description 2007-08 2006-07
Planassetsatbeginningotheyearatairvalue 37,889,641 34,239,812
Expectedreturnonplanassets 3,495,759 2,838,445
Contributions 24,778,615 6,687,134
Benetspaid (4,066,990) (5,081,402)
Actuarialgain/(loss)onplanassets 206,606
Planassetsatyearendatairvalue 62,303,631 37,889,641
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 98/10096
A n n u A l R e p o R t 2 0 0 7 - 0 8
SChEDULE ‘20’: Notes to Consolidated Accounts for te year ended 31st Marc 2008 (Contd.)
Amount of the obligation recognized in the Balance Sheet:
Amount (Rs.)
Description 2007-08 2006-07
Presentvalueothedenedbenetobligationattheendotheyear 67,087,487 54,632,680Fairvalueoplanassetsattheendotheyear 62,303,631 37,889,641
LiabilityrecognizedintheBalancesheet 4,783,856 16,743,039
AmountofgratuityexpenserecognisedintheProtandlossaccount:
Amount (Rs.)
Description 2007-08 2006-07
Currentservicecost 10,497,143 7,708,875
Interestcost 4,352,290 2,761,836
Expectedreturnonplanassets (3,495,759) (2,838,445)
Actuarial(gain)/lossrecognizedduringtheyear 1,465,758 10,793
Total 12,819,432 18,425,641
Investment details of plan assets: ThePlanassetsaremaintainedwithLieInsuranceCorporationGratuityScheme.Thedetailsoinvestment
maintainedbyLieInsuranceCorporationarenotavailablewiththeGroupandhavenotbeendisclosed.
Principalactuarialassumptionsatthebalancesheetdate:
2007-08 2006-07
DiscountingRate 7.5%-8% 7.5%
ExpectedRateoreturnonplanassets 9%-9.25% 8.7%-9%
The estimates o uture salary increases considered in actuarial valuation take account o infation, seniority,
promotionandotherrelevantactorssuchassupplyanddemandintheemploymentmarket.
16 PursuanttotheimplementationoAccountingStandard11“TheEectsochangesinForeignExchangeRates”,as
prescribed byCompanies (Accounting Standard) Rules 2006, inrelation tooreign currencyliabilitiesattributableto
acquisitionoxedassets,theGrouphasrecognizedanexchangegainoRs.105.60LacsortheperiodendedMarch
31,2008withcorrespondingimpactontheprotbeoretaxesortheyearoRs.80.82Lacs.17 a) TheParentcompany’sdomesticsubsidiarydeclaredadividendoRs.428,696,144owhichRs.381,539,568is
receivablebytheParentcompany,andthebalanceRs.47,156,576relatestotheminority.Thecorporatedividend
taxtotheextentoRs.8,014,260relatedtotheminoritywhichhasbeenappropriatelyadjustedromtheminority
interestintheseaccounts.
b) The corporate dividendtaxdisclosedaspart o appropriationor Rs. 64,842,650relates totaxpayable bythe
subsidiaryattributabletodividendreceivablebytheParentcompany.Intermsosub-section1Aosection115Oo
theIndianIncomeTaxAct,nodividendtaxispayablebytheParentcompanysincethedividendreceivablebythe
Parentcompanyromitssubsidiaryisequaltothedividendproposedbyitorthecurrentyear.
18 Previousyeargureshavebeenregrouped/recastwherevernecessarytoconormtocurrentyear’sclassication.
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 99/100
P r i n t e d a t S o n a P r i n t e r s P v t . L t d .
F - 8 6 / 1 O k h l a P h .
1 , N
e w D
e l h i - 2 0 T e l : 9 1 1 1 4 1 6 1 6 5 6 6
8/8/2019 Niit Tech Annual Report 2007 08
http://slidepdf.com/reader/full/niit-tech-annual-report-2007-08 100/100
NORTH AMERICAPrincipal Office:NIIT Technologies Inc.1050 Crown Pointe Parkway5th FloorAtlanta, GA 30338, USAPhone: +1(770) 551 9494Toll Free +1(888) 454 NIITFax: +1(770) 551 9229
996, Old Eagle School Rd,Suite 1121Wayne, PA 19087Phone: 610 688 5700Fax : 610 688 2430
33 Woods Avenue SouthSuite #600Iselin, NJ 08830Phone: +732 744 3381Fax: +732 321 6562
CanadaNIIT Technologies Ltd.2345, Yonge StreetSuite 912Toronto, ON M4P 2E5Canada
EUROPE
AustriaNIIT Technologies GmbHKandlgasse 18/4/9A-1070 WienAustriaPhone: +43 (1) 729 62 62Fax: +43 (1) 729 62 62-90
BelgiumNIIT Technologies NVRond Point Schuman 61040 BrusselsBelgiumPhone:+32 - (0) 2-234 -7867Fax:+32 - (0) 2-234 -7911
GermanyNIIT Technologies GmbHDelitzscher Strasse 9D-40789 MonheimGermanyPhone: +49 (0) 21 73/16 75Fax: +49 (0) 21 73/16 75-1 50
United KingdomNIIT Technologies Limited6th Floor, Westfields, London RoadHigh Wycombe,Buckinghamshire HP11 1HP, UKPhone: +44 1494 539333Fax: +44 1494 539444
NIIT SmartServe Ltd.6th Floor, Westfields, London Road
High Wycombe,Buckinghamshire HP11 1HP, UKPhone: +44 1494 539333Fax: +44 1494 539444
ROOM Solutions Ltd.Gracechurch House55 Gracechurch StreetLondon, EC3V 0EEPhone: +44 (0)20 7667 8600Fax: +44 (0)20 7667 8601
ASIA
India
Bangalore
NIIT Technologies Ltd.,No.31/2, Roopena Agrahara,Begur Hobli,Hosur Main Road,Bangalore - 560068 IndiaPhone: +91 (80) 30289500Fax: +91 (80) 30289799
KolkataNIIT Technologies LtdEM 4/1 Sector V, Salt LakeKolkata 700 091 IndiaPhone: +91 (33) 30381000Fax: +(33) 23577713
Mumbai
NIIT Technologies Ltd4th Floor, Tower BMarwah Centre,Krishnalal Marwah MargOff Saki Vihar Road,Andheri(E), Mumbai - 400072 IndiaPhone: +91-22-40103100Fax: +91-22-40103444
New DelhiNIIT Technologies Ltd.A-43 MCIA
NIIT GIS Ltd.8, Balaji Estate,Sudarshan Munjal MargKalkaji, New Delhi 110019 IndiaPhone: +91(11) 26203840Fax :+91(11) 26203838
SingaporeNIIT Technologies Pte Ltd.
31 Kaki Bukit Road 3#05-13 TechlinkSingapore 417818Phone: +65-68488300Fax: +65-68488322
JapanNIIT Technologies Co. Ltd.Yokohama Landmark Tower 39F2-2-1-1 MinatomiraiNishi-ku, Yokohama 220-8139Phone: +81 (45) 225-6010Fax: +81 (45) 225-6211
ThailandNIIT Technologies Ltd.1206 Level 12, River Wing WestEmpire Tower195 South Sathorn RoadYannawa, Sathorn, Bangkok 10120Phone: +66 2 670 0735-41Fax: +66 2 670 0742
AUSTRALIASydneyNIIT Technologies Pty LtdLevel 1, 51 Walker StreetNorth Sydney, NSW 2060AustraliaPhone: +61 (0) 2 9963 0096
MelbourneLevel 40, 140 William StreetMelbourne VICAustralia 3000Phone: +61 3 9607 8264Fax: +61 3 9607 8282