Infosys Technologies India International Accounting

1
Infosys Technologies (India)International
Accounting

• Ani Vardanyan
• Meri Hakobyan
• Lilit Gharayan
• Hripsime Hovivyan

2
Infosys technologies background

• First Indian company to be listed in the US
• Specialized in software development
• Provides consulting and IT services to clients
  globally
• Over 72,000 employees worldwide (72,241 )
• Focuses on new ways of business combining IT
  innovation and adoption while also leveraging an
  organization's current IT assets.

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Infosys technologies background

• Seven software professionals founded Infosys in
  1981 with the goal of creating wealth legally and
  ethically in India
• Between 1981 and 1991 Infosys aimed to create
  large-scale software factories in India using
  contemporary technology, methodology and software
  tools
• In 1993, Infosys went public on the Indian stock
  exchange with a market capitalization of 10
  million
• In 1999 Infosys was listed on NASDAQ with a
  market capitalization of 10 billion

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Vision and Mission

• Vision - "To be a globally respected corporation
  that provides best-of-breed business solutions,
  leveraging technology, delivered by best-in-class
  people." Mission - "To achieve our objectives in
  an environment of fairness, honesty, and courtesy
  towards our clients, employees, vendors and
  society at large."

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Why to disclose additional information(Benefits)

• Additional info provides an important input to
  the financial analysis process
• Helps to evaluate the quality of earnings and
  financial position (current and prospective)
• Provides the opportunity to communicate more
  policy and future oriented info about the company
• Informs and influences investors decisions in
  the globalized securities market

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Costs associated with information disclosure

• Data collection and processing
• Auditing
• Possibility of claims from employees and trade
  unions
• Threat of takeover or merger
• Publication
• Technical processing problems
• Possibility of intervention by government
  agencies
• Possibility of claims from political and consumer
  groups
• Possibility of intervention by taxation
  authorities

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Competitive Advantages or Disadvantages of
Voluntary Disclosures

• Firms provide voluntary disclosures to the
  financial market in order to guide the valuation
  of shares by mitigating adverse selection
• However, voluntary disclosures could cause
  detriment to the disclosing firms prospects as
  the competitors in the product market observe the
  disclosures
• Competitive disadvantage resulting from the
  existence of proprietary costs may discourage the
  firms in high competition industries from
  providing voluntary disclosures
• From the other hand, firms provide voluntary
  disclosures to deter potential rivals from
  entering the market

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Competitive Advantages or Disadvantages of
Voluntary Disclosures

• Firms with high levels of intellectual capital
  (IC) are more inclined to disclose their IC as
  they cannot legitimize their status through the
  traditional symbols of corporate success, the
  tangible hard assets
• Voluntary IC disclosures may enable investors and
  other relevant stakeholders to better assess the
  firms future wealth creation capabilities, allow
  a more precise valuation of the firm and decrease
  their perception of risk
• Management in firms with high levels of IC is
  motivated to signal to the market in their
  reports, positive information about those
  intangibles
• IC disclosures in their annual accounts in order
  to satisfy the information demands of current and
  potential investors, hence maintaining or
  attracting valuable resources

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Infosys Technologies

• Reports For the Fiscal 2007 revenues of 3.1
  billion growth of 44
• Expects Fiscal 2008 revenues to grow 28 -
  30 to reach 4 billion