1、NAVIGATE YOUR NEXTTMAnnual Report 2017-18Infosys Annual Report 2017-18Think back just one hundred years from 2017.It would have taken you anywhere between five and ten days to get from London to New York;and well over a month to travel from London to Australia.Today,London is only around eight hours
2、 away from New York and about a day from Australia by air.If youd lived then,its likely your home wouldnt have had a landline telephone,because only 25%of working-class families in the US did.Today,landlines sit all but forgotten in our living rooms.Nearly 80%of the population,in the US alone,has a
3、smartphone in their pockets,while you can call for free over a WiFi network anywhere in the world.These are just two examples of the hundreds of ways in which someone,somewhere thought to try something no one else had ever dreamed of,chose to walk a path untrodden,that then caught the imagination of
4、 several others who joined in,till the idea gathered the strength to move us all forward.The digital disruption that engulfs us today has significantly increased our collective ability to create the next new normal.At Infosys,we see this as an exciting opportunity to make a difference.To partner wit
5、h our clients to look for the new things their customers may not yet know that they want,and help them be the first to respond boldly to the calling.Tocreate their next.We AI-power their core to help them prioritize the execution of change thatll take them closer to emerging opportunities.Thereon,we
6、 help them prepare to respond with Agile Digital at scale.We continuously enrich them with skills and learning from emerging technology domains and industries outside their own,so they can get the worlds best ideas to work harder to delight their customers.Our digital framework drives outcomes for t
7、hem across five areas Experience,Insight,Innovate,Accelerate and Assure.We craft the way their customers experience digital solutions,help their businesses gain insight from data,innovate with them in the world of vertical platforms and digital-first engineering,accelerate their core digitalization,
8、and assure means for them to establish digital trust.This annual report celebrates the multiple facets of this journey.Ajourney of so many nexts.Ajourney that will get so much more meaningful when you navigate your next with Infosys.NAVIGATE YOUR NEXT.WITH INFOSYS.4|Navigate your next Infosys Annual
9、 Report 2017-18Likes,shares and friends will shape your customers next experience Infosys Annual Report 2017-18What do customers really want?Our clients are beginning to ponder over this question more deeply,more frequently than ever before,and with good reason.They clearly see how significantly cus
10、tomer experience can differentiate their business.Especially with all thats made possible by the accelerated progression of digital technology and its rapid uptake by consumers.They understand that delivering great digital experiences means taking all those steps necessary to reimagine the business
11、systems,processes,people to organize the enterprise from its very core to deliver customer delight.Over the past 12 months,weve seen an increasing number of our own clients fast-tracking their digital transformation,to see the benefits of being more customer-centric:more satisfied buyers,increased l
12、oyalty,vocal advocacy,and lower cost of service,with us partnering them through the journey.What we did recently for a technology conglomerate makes for an interesting illustration.We helped them modernize,standardize,and automate 20 of their key business processes,and thereby digitize more than a m
13、illion caseloads,to eliminate over 8 million hours of wait time for their customers.Before we stepped in,something as vital as their Expedite Order process was a sequence of 122 steps that agents had to navigate,across a series of applications,functions and procedures,before they could determine if
14、a customers order could or could not be expedited.We brought in a combination of analytics,artificial intelligence(AI)and automation to intelligently route requests to the agent best equipped to resolve the issue,now also amplified by fully-automated processes delivered through an integrated custome
15、r engagement platform.The results have been dramatic.Some customer queries that typically took 20 hours to process are now done in less than 5minutes.Another example is how we are future-proofing a very large global telecom company.We are modernizing the core to drive operational agility,data-rich s
16、ystems,new ways of working,and flexible omnichannel customer experience across a five-year transformation roadmap.This involves the telecoms full stack,from the foundation BSS/OSS layers in partnership with Netcracker,through to the CSS customer interaction layers,created by using Adobe,UXP and Pega
17、Systems as both an omnichannel enabler and decisioning layer.All this will ensure end-to-end digital transformation driven by real-time,contextual customer data to deliver differentiated next best actions and next best offers.As our clients look to us for the edge that would differentiate their digi
18、tal solutions to create an impact in an increasingly uncertain,asymmetric and complex world,we are leveraging the breadth and depth of our digital expertise to deliver for them.We are also empowering our clients to transform their workplace experience by leveraging technology to connect their people
19、 to knowledge,to processes,to each other to move forward and do better.This year,Infosys acquired Brilliant Basics,a London-based product design and customer experience innovator known for their world-class Design Thinking-led approach and experience in executing global programs.Over the past year,t
20、he team has reimagined customer experience across channels,including the web,apps,ATM,kiosks,IVR,and branches,for several global banks.Many of these capabilities are now being integrated with our Finacle suite of banking solutions to bring the benefits of new digital experiences to more of our clien
21、ts.We have also announced in April 2018 a definitive agreement to acquire WONGDOODY,a US-based full-service creative and consumer insights agency.The addition of near-shore capabilities adds to our growing worldwide network of digital studios,which includes our expanding facilities in Bengaluru and
22、Pune,in India.These are focused on fulfilling the needs of global clients for end-to-end digital transformation solutions required to meet the demand for next-generation customer experience.This is but one step forward in the long path we have charted to close the gap for design and human-centric sk
23、ills in building highly usable technology solutions.It fits squarely into our outside-in approach of focusing on service design and experience at one end,and renewal of legacy technologies,processes,systems,and ways of working at the other,helping our clients meet rising customer expectations,delive
24、r personalized experiences at scale,and do it all at the speed of market.“When it comes to customer experience,we continue to transform,learn and shape the next stages as we move along our transformation journey.The scale of change is hugely significant;we are changing not only our digital layer,but
25、 our entire back office to ensure future-proof,operationally agile,and data-rich systems.”Sam Lloyd,Chief Information Officer,TelenetScott SorokinSVP and Head,Global Services Digital ExperienceTHE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTINNOVATEACCELERATEASSURE6|Navigate your next Infosys Annual Repor
26、t 2017-18Data is the lifeblood of the enterprise that aspires to be digital.It is that strategic asset that helps the business learn about evolving opportunities,hidden threats,changing customer expectations and the competitive landscape,in context and in time to respond meaningfully.This,in turn,he
27、lps to automate the supply chain,drive continuous innovation,and create micro-moments-based customer experience.Artificial intelligence(AI)powers the core of this data-driven enterprise and creates signals that then act on the business to bring transformational value.When this is enabled in a do-it-
28、yourself culture,everyone,at any given time,is able to move quickly in the right direction to defend,differentiate and even reimagine the business.We help our clients adopt this approach to ubiquitously creating value from data.We move them away from the conventional use case or point-solution-led a
29、pproach,towards the path to building industrialized capabilities to monetize data.We begin by creating an integrated blueprint of opportunities unique to their businesses for data-led value creation.Thereon we chart the roadmap to incrementally build the capabilities they need to deliver on the blue
30、print.This involves:Modernizing the core to prepare for the digital transformation Building systems that interpret data cognitively to discover new signals and connect the unconnected Leveraging AI to nurture a learnable and adaptable enterprise that evolves at digital speedModernizing entails relea
31、sing data and insights hidden in the legacy landscape and creating a flexible mesh of foundational services.This foundation can then be broken down into components that can be dynamically organized in several ways and automated to deliver against an evolving context.This also often necessitates dive
32、sting or modernizing the legacy systems that lie at the core of the enterprise.For example,recently,we worked with a retail mortgage bank,to advance their ability to generate credit scores for potential customers and process applications in real time.We re-engineered their credit acquisition decisio
33、n engine and also transformed their legacy mainframe environment to improve its agility.Today,the bank generates applicant credit scores in less than 50 milliseconds.Having released data from the core,the next task is to digitize the data supply chain and turn it into an asset that can be interprete
34、d cognitively and leveraged for making data-led decisions across the enterprise.We do this for several of our clients in the retailing business.We work to make sense of their structured and unstructured data around consumer actions,response to promotions,SmartLabel scans,product affinities,customer
35、propensities,along with price and promotion sensitivities.We then use machine learning models to improve the recommendation logic for their real-time product promotions.We put to use several AI models to solve business problems in an expert-assist,near-fully-automated mode.This allows for continuous
36、 learning and continuous improvement to be factored into both validated and new models.A case in point is how this is delivering value for our clients in the financial services business.We deploy AI techniques to detect anomalies in data values and transaction volumes that point to suspicious events
37、 and then alert decision-makers to potentially fraudulent activities.We even study these patterns to predict incidents and enable just-in-time prevention of irregularities.With this approach,enterprises can build a fabric for data to become the new internet,connecting all the dots that matter,the dr
38、iver of all enterprise decisions,and the advantage that everybody has equal access to.With that,it will not be data that differentiates the winning enterprises from the also-rans.It will be people amplified by this data,to be able to make connections unseen before,to find problems unarticulated befo
39、re,and to build solutions that solve the unsolvable,through collaborative relationships that benefit customers in ways unexplored.“Within ABN AMRO,we believe that we can generate true value from data by delivering innovative analytics capabilities and enabling access to high-quality data.We have dem
40、onstrated the first tangible results that created such enthusiasm that we decided to overhaul our entire data management ecosystem.We are implementing modern and metadata-driven data distribution technologies and are adopting AI capabilities from public cloud providers.”Marcel KramerIT Lead,Data Qua
41、lity&Analytics,ABN AMRO Bank Satish H.C.EVP and Head,Global Services Data&AnalyticsTHE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTINNOVATEACCELERATEASSUREAI-led insights will show your customers what to buy next Infosys Annual Report 2017-188|Navigate your next Infosys Annual Report 2017-18Your old machi
42、nery will be your next new IoT device Infosys Annual Report 2017-18The highly competitive markets that our clients serve demand a severe crunching of cost and time for them to remain relevant.We help them meet this challenge when they engineer their products,by digitizing the entire product lifecycl
43、e from design and manufacture to maintenance and service.In tandem with designing new products or production lines,our clients often have a portfolio of long-lived products and assets that must deliver to new expectations.We believe,for the enterprise thats rich in engineering legacy and looking to
44、find new growth,there lies a goldmine of opportunity to deftly build richer experiences by infusing new technology into their existing products.Leveraging our deep understanding of their broader business context,we help our clients uncover ways for technology to create avenues for their products to
45、deliver more value.The key here is to not wish away their rich legacy but revitalize it with newer technology.Like we did recently by re-engineering a hardware monolith a Cable Modem Termination System(CMTS)into smaller software components leveraging Software-defined networking/Network functions vir
46、tualization(SDN/NFV)technology.Our client,a cable operator,can now bring up or down the CMTS on demand and take it closer to customer homes.This will save them both capital expenditure and operational expenses.We understand how vital it is to recognize how the product or asset is engineered mechanic
47、ally and electronically,for us to then bring the right software to amplify it.This means knowing the products entire lifecycle design,manufacturing,assembly,customer operations,and after-sales service.For example,uncovering value from IoT data is a process of knowing exactly what constitutes desired
48、 product behavior,tracking the gap between real-world results and desired results,and communicating this to stakeholders who can investigate why it occurred and prevent its recurrence.In fact,recently,in partnership with an international engineering firm,we developed an AI-powered operational effici
49、ency framework to help manage large plants with complex IoT-led interconnected systems.Our clients are enthused about its potential to revolutionize plant operations by enhancing overall system performance,availability and reliability,in addition to managing the risks of disrupted production.While o
50、ur aspiration is to help our clients better leverage their existing assets,our IoT services are focused on impacting both their top line and bottom line.Today,enterprises leverage our IoT capabilities to remote-monitor products and assets,prevent breakdowns,and analyze data from sample assets to opt
51、imize performance across the entire production line.Having this view into how each product or asset operates is not just key to improving their efficiency but also to ensuring security along with legal and regulatory compliance.In addition,we have also brought in IoT to help our clients explore new
52、business models that offer products as services with usage-based pricing.The value we have been able to bring to our clients this last year,through our IoT offerings,is indicative of how more and more enterprises are trying to transform their product engineering and take advantage of technologies li
53、ke SDN,Augmented Reality/Virtual Reality,Robotics,Autonomous Technology and Additive Manufacturing.For example,we have developed a robotic arm-based test automation framework to automate the hardware and software testing of point-of-sale and mobile devices.We are also actively re-engineering critica
54、l metallic components for a leading turbo-machine maker,through Additive Manufacturing.We have a deep appreciation for the need to re-skill and upskill our own people so they can embrace and share the value of these emerging technologies.To accelerate their continuous and lifelong learning in these
55、domains,we are investing significantly in educational interventions including partnering with Udacity to train our people in the skills we need as a company to deepen focus on Autonomous Technology.Our opportunity clearly lies in bringing together knowledge of the new possibilities created by emergi
56、ng technologies,knowledge of how products are engineered,and knowledge of the industries they serve,to uncover avenues to amplify,with software,the value these products deliver.“IoT solutions are developed and deployed to achieve specific business outcomes;as such,it is critical to provide the compl
57、ete solution stack.Cisco is focused on engineering specific products and platforms which provide customers with complete solutions to realize business benefits.Systems integrators play an important role in customizing these IoT solutions and making sure that the expected benefits are fully realized,
58、thus forming an important link in the IoT value chain.”Jayaram Beladakere Director,Product Management,CiscoSudip SinghSVP and Head,Global Services Engineering,and Industry Head Services,Utilities,Resources and EnergyTHE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTINNOVATEACCELERATEASSURE10|Navigate your n
59、ext Infosys Annual Report 2017-18Modernize the core before you make your next move Infosys Annual Report 2017-18To thrive,even to survive,enterprises must be able to rapidly transform themselves or watch a born-digital competitor woo their customers away.For most established companies,the toughest s
60、truggle is with their monolithic legacy that cant pivot to support their aspirations.These often-siloed systems,built on older technology and surrounded mostly by archaic processes,have,over a period of time,become fairly complex and inextricably interlinked to support expansive operations.The fear
61、of disrupting these operations,making large new investments,and tackling the need for new skills to manage the transformation make it hard for enterprises to shrug off their legacy.But there is a way forward.The journey to organizational modernization and enterprise agility can be phased,at ones cho
62、sen pace,based on carefully chosen business priorities and executed through a combination of core renewals that create efficiency-led savings that can then be redirected to simultaneously building agile new systems of engagement.We help our clients do this by bringing together a combination of strat
63、egies for legacy landscape renewal including the following:a)Massive simplification of core systems from monolithic and interdependent to platform-led,lightly-tied components built on open source software.For example,for an Asian bank,we are working to transform their 36-year-old mainframe system,ru
64、nning on proprietary technology,to a more loosely-coupled,extensible architecture.We are already beginning to see encouraging early outcomes like a 30%reduction in their loan processing time and improved customer experience.b)Carving out fire lanes of microservices and APIs(Application Programming I
65、nterfaces)around the core that opens it up to customer-focused digital transformation.We did this with significant success for a direct seller of personal care products.We helped them build a robust API management strategy and microservices architecture to support their new responsive website and an
66、 agile social selling platform with over 230 applications serving a market spread across 100 countries.c)Bringing cloud-readiness to the legacy landscape so that it can be migrated to the cloud.We help our clients chart out and execute a cloud strategy to not only transition their non-differentiatin
67、g workloads to the cloud,but to also transform their businesses with the cloud.Contrary to popular perception,enterprises have huge untapped potential to exploit cloud-based technologies and in most cases,this entails choosing a hybrid approach involving hosted or private cloud and public cloud opti
68、ons.The journey of enterprise workloads moving to the cloud is just about starting and this would be an ideal time for most enterprises to embark on their own path to the future.There are enough proven technologies and solutions to help most of these enterprises meet their needs today,and this mitig
69、ates the perceived risks of cloud transformation.Leveraging Infosys Enterprise Cloud Ecosystem capabilities,we advise our clients on their cloud transformation strategy across infrastructure,data,applications and more,and then build and co-evolve their enterprise cloud.We dont just deliver managed s
70、ervices,but also help our clients tap into new revenue streams.Thats exactly what happened with an airline manufacturer we serve.They wanted to ease the struggle their customers faced when trying to find the right documentation to maintain their aircraft.We build a secure public cloud platform to ho
71、st their product manuals for anytime-anywhere access.While this saved them over a million dollars in customer servicing costs,they also shared this facility with other aircraft manufacturers offering documentation-hosting as a subscription-based service that generated significant new revenues for th
72、em in the very first year.We also understand and leverage the role that DevOps and Agile play,integrated with open source advantage,to support our clients need for on-demand and automated IT on their path to modernization.This,and every other modernization tactic we deploy,is part of a custom-strate
73、gy we carefully chart for every individual client to build in the changeability they need to make the necessary agile shifts through changing times continuously digitizing the core at one end and amplifying consumer experience at the other to stay ever-relevant.“As enterprises like us embark on the
74、digital journey,cloud plays a very important role.It is not just about moving workloads to cloud but about business value through agility,driving customer insights and most importantly,enhancing experience.”Neal JohnsonDirector of Business Technology,House of FraserNarsimha Rao M.EVP and Head,Global
75、 Services Cloud,Infrastructure and Security Solutions&IndependentValidation SolutionsTHE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTINNOVATEACCELERATEASSURE12|Navigate your next Infosys Annual Report 2017-18Almost every CIO and CISO we speak to tells us how consumed they are by the demands of predicting
76、and preventing security incidents in an expanding threat landscape.The challenge of cyber security has long since moved beyond monitoring infrastructure,networks,firewalls and IT assets to include the protection of the entire value chain systems,applications,user software,developer software and data
77、.For global enterprises seeking to build a more digital future for themselves,the transformation journey invariably extends from core modernization to customer delight.Because their core is most likely a monolithic legacy system,the road to digitization,for them,entails Application Programming Inter
78、face(API)fire-laning so their legacy landscapes can communicate with new platform-based components and open source software solutions.These APIs,while providing a window from the core into new applications,also inadvertently intensify cyber security risks.Then of course,the path to modernization als
79、o leads to the cloud.As this digitization scales,an elaborate cyber security setup becomes mission-critical,even inevitable.Thats why we offer defense-in-depth to our clients.On the other hand,hackers continue to innovate.To that,the typical enterprise responds by bolting on more point solutions.Oft
80、en,the result is a patchwork of solutions that not only dont work well together,but are inadequate to protect against evolving threats that are now spread across an attack surface with thousands of potential entry points,including those created by smartphones and Internet of Things(IoT)devices.Littl
81、e wonder,CISOs find themselves managing reactive security rather than driving holistic resilience.The need of the hour is flexible and adaptive security solutions,delivered in an integrated package.When these are consumed as-a-service,enterprises will have the flexibility to prioritize not just rapi
82、d remediation,but also plan for anticipatory protection.It removes the huge operational and cost overheads required to manage a fragmented landscape with point solutions pieced together.The CIO and CISO can,instead,focus on accelerating the enterprises digital agenda.Thats precisely what the Infosys
83、 Cyber Security Platform enables.Built with AI-driven automation at its core,it helps the custodians of enterprise security to transition from a fragmented and reactive approach to a managed security services model guided by a customized roadmap.For example,for one of our clients a beverage manufact
84、urer the platform brings together an optimized tool suite and the strong predictive capabilities needed to protect them against advanced threats all the while providing 24x7 security monitoring services,along with identity and access management services,for their 40,000+users and over 500 applicatio
85、ns.Complementing the value that our cyber security platform brings is our network of Security Operations Centers(SOCs),already operational in Bengaluru,Hyderabad and Pune in India,along with centers at our clients premises.These SOCs bring together best-in-class skills and a constantly updated solut
86、ions suite,along with managed services for security operations delivered round-the-clock through a network of inter-connected,global facilities.Our clients also have access to advanced threat-hunting capabilities and the latest in technology innovations for cyber security incubated in the Infosys Se
87、curity R&D Labs.This is our investment in continuously improving our core services portfolio,expanding our offerings into new areas of potential threat,and leveraging our innovation ecosystem to co-create solutions that deepen the value we deliver.The value that technology brings to cyber security,w
88、hile immense in itself,is best leveraged as a means to amplify human potential.Un-automatable tasks like imagining new avenues for breaches,finding new problems,and creating innovative solution combinations can only be performed by people.Thats why we are fully committed to nurturing and improving o
89、ur engineers skills and expertise in these domains through strong academic partnerships like the one we have forged with Purdue University.For us,each of these advances,in the past year,has been a step up in boosting the security posture of our clients so they can go about their business with greate
90、r confidence.“Cyber security is foundational for enterprises such as ours as we proceed through our digital transformation.Itis more than merely responding to events as they occur;it is crucial that we build solutions for predictive threat management and automated incident resolution.To achieve this
91、 requires fully-integrated security platforms that operate in ways that point solutions cannot”.James F.EckartChief Information Security Officer,The Coca Cola CompanyAnant R.AdyaSVP and Group Practice EngagementManager Cloud,Infrastructure and CyberSecurityTHE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTI
92、NNOVATEACCELERATEASSURESecure your business from the next cyber attack Infosys Annual Report 2017-18Infosys Annual Report 2017-18CONTENTS 16 How will the next unfold?18 Letter to the shareholder 20 Of navigators natural and nurtured 22 Resilient financial performance 24 Being local.Globally.25 From
93、the frontline 26 The Infosys Board of Directors 28 The Infosys leadership team 30 Board and committees Infosys Limited 31 Key trends 33 The year at a glance 35 Boards report Results of our operations and state of affairs Business description Human resources management Corporate governance Audit repo
94、rts and auditors Corporate social responsibility Acknowledgments 52 Annexures to the Boards report Annexure 1 Statement containing the salient features of the financial statements of subsidiaries/associate companies Annexure 2 Particulars of contracts/arrangements made with related parties Annexure
95、3 Particulars of employees Annexure 4 Independent Auditors certificate on corporate governance Annexure 5 Secretarial audit report for the financial year ended March 31,2018 Annexure 6 Extract of annual return Annexure 7 Annual report on CSR activities Annexure 8 Conservation of energy,research and
96、development,technology absorption,foreign exchange earnings andoutgo Annexure 9 Corporate policiesInfosys Annual Report 2017-18 83 Managements discussion and analysis Industry structure and developments Financial condition Results of our operations Opportunities and threats Outlook,risks and concern
97、s Internal control systems and their adequacy102 Corporate governance report Our corporate governance philosophy Board composition Board meetings Board committees Management review and responsibility Shareholders126 Shareholder information134 Risk management report138 CEO and CFO certification139 St
98、andalone financial statements Index Independent Auditors Report Annexure A to the Independent Auditors Report Annexure B to the Independent Auditors Report Balance Sheet Statement of Profit and Loss Statement of Changes in Equity Statement of Cash Flows Overview and notes to the financial statements
99、194 Consolidated financial statements Index Independent Auditors Report Annexure A to the Independent Auditors Report Consolidated Balance Sheet Consolidated Statement of Profit and Loss Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Overview and notes to the consol
100、idated financial statements251 Business responsibility report16|How will the next unfold?Infosys Annual Report 2017-18The digital revolution excludes no one and nothing from its embrace.We are engulfed in that time in the history of humanity when advances in technology and innovation are gathering m
101、omentum at an unprecedented pace.Now,we must be poised to tackle changes unlike any we have known before.Businesses are facing various simultaneous and disruptive challenges.Many industries like retail,media and entertainment have to contend with powerful digital disruptors.The automotive industry i
102、s facing the triple challenge of electric cars,self-driving capabilities and mobility aggregators.The utility industry must deal with an increasing proportion of energy coming from renewables,which are intermittent,and require storage and new types of grids.The FMCG industry must learn and adapt to
103、how brands will be bought in the future.The financial services companies are facing regulations on the one hand,and massive automation on the other.Smartphones in everyones hands and multiple sensors in every device Nandan M.NilekaniChairmanand every product are upending entire businesses.Machine le
104、arning and deep learning are commoditizing domain knowledge,and the winner take all nature of data-driven businesses is both swift and forbidding.Yet,I believe,this can be a force for positive change.With artificial intelligence,disease onset can be accurately predicted and prevented.Healthcare prov
105、iders are now able to enhance and extend care delivery beyond their facilities.Machinery and production assets can be remotely monitored to predict and prevent costly or mission-critical device failures.IoT-enabled inventory optimization and supply chain risk mitigation are a ubiquitous reality.Adva
106、nced driver assistance systems have already eased the burden of building safer vehicles.For financial institutions,the reach of smartphones is enabling them to visualize their business at population scale,and data and analytics are speeding up and improving the accuracy of their fraud detection ende
107、avors.Across sectors,HOW WILL THE NEXT UNFOLD?How will the next unfold?|17 Infosys Annual Report 2017-18“We are ready to boldly promise our clients Navigate your next with Infosys.What will unfold next is limited only by our imagination,our focus on customers,the execution of our strategy,and our sh
108、ared ambition to remake our world and the way we live and work in it.”theconsumers voice is being deeply acknowledged.Enterprises are vying with each other to meet the demand for superior experience,greater productivity,increased convenience and complete transparency with new digital business models
109、,yet building on their core strengths.In so many ways,and a great many times over,our collective ability to bring never-before benefits to business and society,catalyzed by technology and innovation,has increased.Today,we have a deep and renewed understanding of what is happening in the market,a kee
110、n sense of how we must respond,and the action we must take to make a tangible difference.We have gone through turbulence,but the resilience of the company has shone through and we are now in a very safe and stable place.The strategy refresh we undertook in the last six months has clearly outlined th
111、e way forward for us.We have a strong executive leadership team in place to inspire and steer the company towards our goals.With Salil Parekh leading the way as our new CEO and MD,weareall set to grow the strengths that have always differentiated us our values,our customer orientation,our brand,our
112、commitment to learning that drives continuous improvement,and our focus on partnering with all our stakeholders in a way that is unique to us.We are ready to boldly promise our clients Navigate your next with Infosys.After all,weve done this,lived this,for over three decades,and what will unfold nex
113、t is limited only by our imagination,our focus on customers,the execution of our strategy,and our shared ambition to remake our world and the way we live and workin it.18|Letter to the shareholderInfosys Annual Report 2017-18Salil ParekhChief Executive Officer and Managing DirectorLETTER TO THE SHAR
114、EHOLDERDear shareholder,Our primary objective is to help address and solve our clients business and technology challenges to enable them to better serve their customers,grow,and improve their profitability.With that in mind,we have set for ourselves the goal of increasing our relevance to our client
115、s.The more we succeed in that,the more likely we are to create increased value for our shareholders.Today,our clients large enterprises and government organizations are at different points in their digital journey.We are positioning our capabilities to help them navigate their next,across the differ
116、ent dimensions of thisjourney.Over the past few months,Ive spent time extensively with our clients and with our employees.Each one of the 48 clients I met during the previous quarter is a strong believer in our long-standing,market-leading,service delivery strength.In fact,they are keen that we buil
117、d upon our knowledge of their technology foundation and support them on their digital journey.I also learnt about the sense of tremendous pride our employees have in their work for ourclients.To increase our relevance to our clients,we have embarked on our strategy of Navigate your next.Toachieve th
118、is,we have defined the following four strategic imperatives:Scale Agile Digital Energize the core Re-skill our employees,and Localize in our key marketsScale Agile DigitalOur clients are moving rapidly on their digital journey.We have built,over the years,a formidable position in the digital space U
119、S$2.79 billion of our revenue in fiscal 2018 came from these digital services.Our digital framework drives business outcomes for our clients across five areas Experience,Insight,Innovate,Accelerate,and Assure.This reflects how we are thinking about our clients journey as they make progress through t
120、heir digital transformation.This also guides our own aspirations and efforts to build digital capability in service of our clients needs.Letter to the shareholder|19 Infosys Annual Report 2017-18“Today,our clients are at different points in their digital journey.We are positioning our capabilities t
121、o help them navigate their next,across the different dimensions of thisjourney.”Energize the coreOur core business is the cornerstone of our company and the critical element that has helped us build enormous client trust and loyalty.With advances in artificial intelligence and automation,we have the
122、 ability to make these core services even more efficient and effective for our clients.Our Nia platform is a critical element in this landscape.Re-skill our employeesIn working alongside our clients on their digital journey,we are actively working with our employees to enable their re-skilling.Our p
123、latform,Lex,makes learning accessible,relevant,fun,and drives outcomes that matter.Increasingly,we are taking this learning to our client organizations as well.Localize in our key marketsWe are embarking on building more local capabilities,especially in America,Europe,and Australia,to ensure we expa
124、nd our relevance to our clients.We announced our first campus for development and training in Indiana,US,and innovation hubs in other cities.With the articulation of our strategic direction,we have launched a transformation program for the company to drive the execution of the initiatives that will
125、help us achieve the outcomes envisaged.This is a three-year transformation program that will help position Infosys for increased client relevance.Our fiscal 2018 results are detailed in this annual report and demonstrate the underlying strength of our business.Our revenue was US$10.9 billion,which g
126、rew at 5.8%in constant currency from the previous year.Our operating margin was 24.3%and profit after tax was US$2.5 billion.Cash provided by operating activities was US$2.3billion.Thank you to each one of our 1,200 clients!Their trust and belief in us has enabled us to be the company we are.The ded
127、ication of our over 2,00,000 employees to drive outcomes for our clients is a testament to the results we have shown in fiscal 2018 and the continuing strength of our institution.Thank you to each one of them.Our exceptional leadership team has helped steer the company through the past several years
128、 and also helped design our strategic framework and the transformation program.My thanks to them for their energy and commitment in helping me operationalize our strategy.Today,as I look out of the window in my office at the lush green trees across our stunning campus in Bengaluru,I feel a sense of
129、excitement at the opportunities in the technology world as our clients are moving on their digital journey and the consequent opportunity for us to help them navigate their next.Ifeel a sense of pride at the incredible institution that has been built over the past 37 years that gives us a strong fou
130、ndation for what we can create in the future.With my warmest regards,Bengaluru May 8,2018Salil ParekhChief Executive Officer and Managing Director20|Of navigators natural and nurtured Infosys Annual Report 2017-18OF NAVIGATORS NATURAL AND NURTUREDU.B.Pravin RaoChief Operating Officer and Whole-time
131、DirectorLetting go of the familiar,to navigate to the next,is not always easy.But so often its inevitable.As inescapable for naturals like the Arctic terns those ambitious navigators that chart their migratory flight from the North Pole to the South and back as it is for enterprises that must learn
132、to steer through the turbulence of digital disruption to find their future.Incumbent companies often large and successful businesses that thrived for decades before the emergence of this pervasive digitalization can sometimes feel like they must fight the winds that seem to be propelling everybody b
133、ut them forward.Yet,we believe that incumbents too can adapt,and leverage the resources they have a strong brand,significant capital,long-standing customer relationships and decades of institutional knowledge to find and take advantage of opportunities amidst the disruption.We should know.We are an
134、incumbent too.We also know that being digital means making far-reaching changes that go beyond simply investing in the latest digital technologies.It means reimagining operating models,considering how best to refactor and invigorate talent with digital skills,and looking afresh to engage in ways cus
135、tomers find valuable.Today,we are well on our way to executing our strategy to accomplish exactly that.In fact,our promise to our clients is to be their navigator as they chart their path to a more digital future.The strength of our conviction comes from the fact that each tenet of the strategy we r
136、ecommend for them,is already working for us.We are navigating,step by step,towards new digital opportunities while smartly leveraging our traditional strengths our core services.In the past three years,we have embraced artificial intelligence-based automation techniques and software automation platf
137、orms to boost the productivity of our core service delivery.Infosys Nia,our next-generation intelligent automation platform,and AssistEdge,our Robotic Process Automation platform,have been key to bringing machine learning and automation together with deep knowledge of our business to industrialize o
138、ur core landscape.Simultaneously,through Project Infynity,we are also transforming our delivery practices in a holistic modernization journey that will bring the agility we seek to our processes.These productivity and efficiency gains are enabling us to make Of navigators natural and nurtured|21 Inf
139、osys Annual Report 2017-18targeted investments to accelerate our Agile Digital business.We are boosting our digital delivery capabilities and priority services,including customer experience amplification,data analytics,product engineering,cloud migration,cyber security,automation and platform-based
140、business process management.We are applying these first to our own context.For example,today,Infosys hybrid cloud enables on-demand self-service provisioning,while doubling capacity,without increasing costs.We are beginning to manage our unstructured data with Penny-a-GB(PeG)our peta-scale,software-
141、defined storage.Mobile-first solutions drive all our critical business,learning and collaboration processes.Our Information System processes are simplified,reducing cumulative effort for critical processes by up to 80%.We have made significant progress in our workplace transformation journey as well
142、,even as proactive cyber defense nurtures the digital trust we need to continue to push through to thefuture.We are also incubating new offerings in areas such as blockchain,Augmented Reality/Virtual Reality and speech,vision,video and image intelligence,in collaboration with universities,research o
143、rganizations and our innovation ecosystem.Yet,we understand that each of these separate initiatives must come together seamlessly to turn it into a balanced,integrated program of change.Its only our people who can glue it all together.But only when they develop a deep appreciation for the digital cu
144、lture.We nurture this by driving talent re-skilling at scale for our employees in the new areas of digital services.In many ways,this comes naturally to us because teaching and learning has always been our lifeblood.Whether its our investments in our Global Education Center at Mysuru,India;in advanc
145、ed,anytime-anywhere learning systems such as our Lex platform;or our relationships with universities around the world to curate specific curricula,in areas such as creative design skills,machine learning,autonomous technologies and blockchain,our enthusiasm for lifelong learning remains unrivalled.W
146、e are also investing in localizing our workforce in the geographies we work in,because we believe that the benefits of digital transformation are often better realized contextually.We have announced the setting up of four delivery and innovation centers in the US.The first of these is already active
147、 in Indianapolis,while three others in Connecticut,Rhode Island and North Carolina are well on the way to becoming operational.We are also recruiting locally from universities in the US.We aim to scale this effort to include our key markets in Europe and Australia aswell.These strategic initiatives
148、energizing our core,scaling Agile Digital,re-skilling our people and expanding our localization are helping us find our next.So we can look forward to an opportunity-filled future.Much like the Arctic terns do.Their migratory patterns allow them to experience two summers in one year,every year and t
149、hats more than most other creatures in the world can hope for!“These strategic initiatives energizing our core,scaling Agile Digital,re-skilling our people and expanding our localization are helping us find our next.So we can look forward to an opportunity-filled future.”22|Resilient financial perfo
150、rmanceInfosys Annual Report 2017-18M.D.RanganathChief Financial OfficerDuring the financial year ended March31,2018,the company delivered a resilient financial performance on multiple fronts,primarily driven by productivity improvements and efficient capital management.Growth driven by digital reven
151、ue:The overall revenue growth was 7.2%in US dollar terms and 5.8%in constant currency terms.The overall revenue growth was on the back of healthy growth in digital revenues.The digital revenues exceeded 25%of the total revenues of the company.Resilient operating margin:Our operating margin was resil
152、ient at 24.3%driven by broad-based improvements in productivity,cost-optimization initiatives and improvement in key operational parameters.Revenue per employee increased by 6.3%during the year and crossed US$54,500.The revenue growth during the year was faster than headcount growth due to higher ut
153、ilization and productivity improvements.While revenue grew by 7.2%in US dollar terms,the headcount grew by just 1.9%.Ouroperating margin of 24.3%was above the midpoint of our guided range of 23%-25%.RevenuegrowthGroup headcountgrowth1.9%7.2%*$54,602Revenue per employee6.3%YoY growth*Based on consoli
154、dated IFRS US$RESILIENT FINANCIAL PERFORMANCEFCF(in US$million)*20171,68820181,947*Based on consolidated IFRS US$FCF is defned as net cash provided by operating activities less capital expenditure as per the consolidated Statement of Cash Flows prepared under IFRS.15.3%Robust cash flow:Our Free Cash
155、 Flow(FCF)was robust at US$1,947 million and grew by 15.3%,which was more than double the revenue growth of 7.2%.Resilient financial performance|23 Infosys Annual Report 2017-18“For the financial year ended March 31,2018,the company delivered a resilient financial performance on multiple fronts,incl
156、uding robust cash flow,strong EPS growth and healthy RoE.”Basic EPS(in US$)*201820171.100.94*Based on consolidated IFRS US$*Computed based on full numbers without rounding off17.8%*Return on equity*2018201724.1%21.4%*Based on consolidated IFRS US$and the interim dividend of US$529 million(including
157、dividend distribution tax),the total capital returned to shareholders works out to US$3,788 million.The aggregate dividend declared during the year was 43.50 per share(including interim dividend of 13.00,final dividend of 20.50 and special dividend of 10.00).The company announced a predictable and c
158、omprehensive Capital Allocation Policy in April 2018 after taking into consideration the strategic and operational cash requirements of the company in the medium term.The key aspects of the Capital Allocation Policy are discussed in detail in the Boards report section of this Annual Report.Strong EP
159、S growth and healthy RoE:EPS growth was strong at 17.8%.EPS for the year was US$1.10,including positive impact of 9 cents on account of an Advance Pricing Agreement(APA)with the US Internal Revenue Service(IRS).The APA improves the predictability of the companys tax obligations in respect of its US
160、operations.RoE improved during the year from 21.4%to 24.1%,driven primarily by better capital management.Successful execution of Capital Allocation Policy:The company successfully executed the Capital Allocation Policy that was announced in April 2017.As part of the policy,the company completed shar
161、e buyback of 13,000 crore(US$2,035 million).After including the final dividend for fiscal 2018 of US$823 million,special dividend of US$401 million Key milestones:The company is celebrating its 25th year of public listing in India and will be celebrating 20 years of global listing next year.The comp
162、any was inducted into the prestigious Dow Jones Sustainability Indices in this financial year.The company continues its endeavor towards building a competitive cost structure and at the same time investing to leverage growth opportunities so as to create sustainable value for its stakeholders.24|Bei
163、ng local.Globally.Ravi Kumar S.President and Deputy Chief Operating OfficerTo be impactful,ideas and programs whether modestly scoped improvements or ambitious business reinvention must be tied closely to the ebb and flow of the people they seek to serve.Thats why localization has such a significant
164、 role to play in accelerating and scaling the digital transformation of enterprises,and we want to bring the full force of this advantage to our clients.A first step in this direction,for us,is building strong in-market presence in those parts of the world where we have our deepest client clusters.L
165、astyear,we committed to hiring 10,000 American workers and establishing Technology and Innovation Hubs in the United States,over the next two years,to help nurture the next generation of innovators for our increasingly digital future.Today,the first of our technology and innovation hubs is already a
166、ctive in Indianapolis.Three other hubs are well on the way to becoming operational and more than 3,000 American workers have been welcomed into the Infosysfamily.An interesting fact that differentiates our expanding localization is the way we are transitioning our conventional hub-and-spoke talent m
167、odel,with the hubs primarily anchored in our India development centers,to a networks talent model building talent pools in our markets,closer to our clients to deliver and deploy digital solutions in co-creative cycles of agile development.We are bringing to our fold local talent not just freshly mi
168、nted engineers but customer experience designers and graduates from liberal arts backgrounds who can serve the various dimensions of our clients digital agenda.In fact,beyond leveraging this talent pool for them,we are sharing with our clients our entire talent value chain recruiting,training and ev
169、en refactoring their human resources which is so essential for them to scale digital and navigate their transformation.In the months to follow,its only natural that we replicate what we have so successfully accomplished in the US in our key markets in Europe and Australia as well.After all,being the
170、 navigator of our clients digital journey is not just about steering them through to their next milestone,but also a voyage through the contours,context and culture unique to each of them.BEING LOCAL.GLOBALLY.Infosys Annual Report 2017-18From the frontline|25 Mohit JoshiPresidentIts no longer busine
171、ss as usual for our clients.In a digitally disrupted world,its essential that businesses commit to nurturing new ways of working so that they can establish a foothold in a rapidly changing landscape.It is the technology and the mindset that together make for a winning combination.The unique opportun
172、ity before us,then,is to steer our clients through their transformation.To convincingly make the navigate your next promise to them,and to keep it.Thats why,this year,we accelerated investments in amplifying our brand and building perception around how we help our clients nurture new digital capabil
173、ities.We also focused on making Infosys an attractive employer brand in our key markets where we are fast-tracking hiring from in-market talent pools to serve our clients digital agenda.Today,we are also widely refactoring our own talent in areas like AI-led analytics,digital experience,and cyber se
174、curity.This includes creating on-demand avenues for our salesforce to participate in the learning,so they are well-prepared to reset our clients path to change at scale.They are now fully equipped to share the value of the industry-specific digital solution stacks,that weve built,with our clients.Ou
175、r design studios and innovation labs furnish them with the show and tell aids they need to demonstrate proof-of-value.We continue to mine for and grow business in our large accounts,by creating the right flying formation of experts including specialists from our vibrant partner ecosystem.Conducting
176、Design Thinking workshops,finding new ways to deal with sticky old problems,and setting up client-specific training academies are integral to this process.Large deals too are a well-oiled growth engine as we invest energies in building a robust pipeline on one end,while improving the win rate on the
177、 other.Not unlike every year,we have added significantly to the very impressive roster of clients we already have.This year,the number stands at 283 additional names.Were also focused on expanding our footprint and are making investments in new geographies and in underpenetrated subverticals.To us,t
178、his progress weve made,resonates with our aspiration to partner with our clients not merely to help them respond to the challenges of a changing reality,but to pave their way to a sustainable digital future.FROM THE FRONTLINE Infosys Annual Report 2017-18Infosys Annual Report 2017-1826|The Infosys B
179、oard of Directors Clockwise from top left:Nandan M.NilekaniChairmanSalil ParekhChief Executive Officer and Managing DirectorU.B.Pravin RaoChief Operating Officer and Whole-time Director Ravi VenkatesanIndependent DirectorKiran Mazumdar-Shaw Lead Independent Director(1)THE INFOSYS BOARD OF DIRECTORS#
180、(1)Effective April 13,2018#As on April 13,2018Infosys Annual Report 2017-18The Infosys Board of Directors|27 Clockwise from top right:D.SundaramIndependent DirectorD.N.PrahladIndependent DirectorDr.Punita Kumar-SinhaIndependent DirectorRoopa KudvaIndependent Director#As on April 13,2018Infosys Annua
181、l Report 2017-1828|The Infosys Leadership Team THE INFOSYS LEADERSHIP TEAMPRESIDENTSM.D.RanganathChief Financial OfficerU.B.Pravin RaoChief Operating Officer and Whole-time DirectorSalil ParekhChief Executive Officer and Managing Director Mohit JoshiPresident Ravi Kumar S.President and Deputy Chief
182、Operating OfficerInfosys Annual Report 2017-18The Infosys Leadership Team|29 Deepak PadakiGroup Head Corporate Strategy,and Chief Risk OfficerBinod R.HampapurGlobal Head Talent&Technology OperationsInderpreet SawhneyGroup General Counsel and Chief Compliance OfficerKoushik R.N.Group Head Procurement
183、&Global ImmigrationKrishnamurthy ShankarGroup Head Human Resources and Infosys Leadership InstituteKarmesh VaswaniIndustry Head CPG,Logistics&RetailNarsimha Rao M.Head,Global Services Cloud,Infrastructure and Security Solutions&Independent Validation SolutionsAnantharaman RadhakrishnanChief Executiv
184、e Officer&Managing Director BPMRamadas Kamath U.Head-Administration,Facilities,Infrastructure and Security&SustainabilityJayesh SanghrajkaDeputy Chief Financial OfficerEXECUTIVE VICE PRESIDENTSRichard LoboHead,HR Infosys Limited Sangita SinghIndustry Head Healthcare&Life SciencesSatish H.C.Head,Glob
185、al Services Data&AnalyticsSrikantan MoorthyHead,Global Services Application Development&Maintenance30|Board and committees Infosys Limited Infosys Annual Report 2017-18BOARD AND COMMITTEES INFOSYS LIMITEDThe Board of DirectorsNandan M.NilekaniChairmanSalil ParekhChief Executive Officer and Managing
186、DirectorU.B.Pravin RaoChief Operating Officer and Whole-time DirectorKiran Mazumdar-ShawLead Independent DirectorD.N.PrahladIndependent DirectorDr.Punita Kumar-SinhaIndependent DirectorRavi VenkatesanIndependent DirectorRoopa KudvaIndependent DirectorD.SundaramIndependent DirectorExecutive officersS
187、alil ParekhChief Executive Officer and Managing DirectorU.B.Pravin RaoChief Operating Officer and Whole-time DirectorM.D.Ranganath Chief Financial OfficerRavi Kumar S.President and Deputy Chief Operating OfficerMohit JoshiPresident Infosys LimitedKrishnamurthy ShankarGroup Head,Human Resources and I
188、nfosysLeadership InstituteInderpreet SawhneyGroup General Counsel and Chief Compliance OfficerBoard committeesAudit committeeD.SundaramChairperson and Financial ExpertDr.Punita Kumar-SinhaRavi Venkatesan Roopa KudvaCorporate social responsibility committeeKiran Mazumdar-ShawChairpersonU.B.Pravin Rao
189、Dr.Punita Kumar-SinhaRoopa KudvaFinance and investment committee(1)Dr.Punita Kumar-SinhaChairpersonKiran Mazumdar-Shaw D.N.PrahladRoopa KudvaNomination and remuneration committeeKiran Mazumdar-ShawChairpersonD.N.PrahladRavi VenkatesanD.SundaramRisk and strategy committeeD.N.PrahladChairpersonKiran M
190、azumdar-Shaw Ravi VenkatesanD.SundaramStakeholders relationship committeeRavi VenkatesanChairpersonDr.Punita Kumar-SinhaRoopa KudvaAs on April 13,2018(1)Dissolved effective April 13,2018Key trends|31 Infosys Annual Report 2017-18Key trends2018201720162015201470,52268,48462,44153,31950,13320182017201
191、62015201416,02914,35313,49112,32910,6482018201720162015201410,93910,2089,5018,7118,249201820172016201520142,4862,1402,0522,0131,751Revenues(1)(in crore)Net profit(1)(4)(in crore)Revenues(1)(in US$million)Net profit(1)(4)(in US$million)2018201720162015201412,56111,3039,5208,5059,442Free cash flow(1)(
192、5)(in crore)(1)Based on IFRS consolidated financial statements(2)Based on dividend declared and including corporate dividend tax.Adjusted for bonus issue,wherever applicable(3)At the end of respective fiscal years(4)During the quarter ended December 31,2017,on account of the conclusion of an Advance
193、 Pricing Agreement(APA)with the US Internal Revenue Service(IRS),the Company has,in accordance with the APA,reversed income tax expense provision of US$225 million(1,432 crore)which pertains to previous periods which are no longer required.Consequently,profit for the year ended March 31,2018 has inc
194、reased,resulting in an increase in basic earnings per equity share by 5.88(US$0.09)for the year ended March 31,2018.(5)Free cash flow is defined as net cash provided by operating activities less capital expenditure as per the consolidated Statement of Cash Flows prepared under IFRS.(6)Liquid assets
195、include deposits with banks and highly-rated financial institutions,investments in liquid mutual funds,fixed maturity plan securities,tax-free bonds,government bonds,non-convertible debentures of highly-rated companies,certificates of deposit and commercial paper.(7)During the year,11,30,43,478 equi
196、ty shares were bought back by the Company for a total amount of 13,000 crore.Dividend per share(2)(in)2018201720162015201443.5025.7524.2522.2515.75Interim dividend of 13.00 and fnal dividend of 20.50Special dividend of 10.002018201720162015201431,76538,77334,46832,58530,251Liquid assets(1)(3)(6)(7)(
197、in crore)201820172016201520142,47,1982,34,8052,79,8372,54,7711,88,510Market capitalization(3)(in crore)32|Key trendsInfosys Annual Report 2017-18201820172016201520142,04,1072,00,3641,94,0441,76,1871,60,405Number of employees(2)201820172016201520141,2041,1621,092950890201820172016201520142019141513Nu
198、mber of clients(2)Number of US$100 million+clients(2)2018201720162015201484.6%81.7%80.6%80.9%77.4%2018201720162015201454,60251,37550,74552,34051,923Utilization(excluding trainees)Revenue per employee(1)(in US$)2018201720162015201424.1%21.4%22.7%24.1%22.9%Return on Equity(RoE)(1)(4)(1)Based on IFRS c
199、onsolidated financial statements(2)At the end of respective fiscal years(3)Adjusted for bonus issue,wherever applicable(4)During the quarter ended December 31,2017,on account of the conclusion of an APA with the IRS,the Company has,in accordance with the APA,reversed income tax expense provision of
200、US$225 million(1,432 crore)which pertains to previous periods which are no longer required.Consequently,profit for the year ended March 31,2018 has increased,resulting in an increase in basic earnings per equity share by 5.88(US$0.09)for the year ended March 31,2018.2018201720162015201471.0762.8059.
201、0353.9446.59Basic earnings per share(1)(3)(4)(in)2018201720162015201424.3%24.7%25.0%25.9%24.0%Operating margin(1)The year at a glance|33 Infosys Annual Report 2017-18The year at a glanceBased on Ind AS consolidated financial statementsin crore,except per equity share data20182017Growth(%)Financial p
202、erformanceRevenues70,52268,4843.0Gross profit25,39225,2310.6Operating profit 17,14816,9011.5Profit after tax(1)(2)16,02914,35311.7Earnings per share(par value of 5 each):Basic(1)71.0762.8013.2Diluted71.0062.7713.1Financial position Cash and cash equivalents(4)19,81822,625(12.4)Current investments(4)
203、6,4079,970(35.7)Assets held for sale(2)2,060Net current assets(3)34,17639,692(13.9)Property,plant and equipment (including capital work-in-progress)(2)11,72211,1165.5 Goodwill(2)2,2113,652(39.5)Intangible assets(2)247776(68.2)Other non-current assets15,69314,10611.3 Total assets79,89083,355(4.2)Liab
204、ilities directly associated with assets held for sale(2)324Non-current liabilities861360139.2 Total equity(4)64,92468,982(5.9)Total equity and liabilities(4)79,89083,355(4.2)(1)During the quarter ended December 31,2017,on account of the conclusion of an Advance Pricing Agreement(APA)with the US Inte
205、rnal Revenue Service(IRS),the Company has,in accordance with the APA,reversed income tax expense provision of US$225 million(1,432 crore),which pertains to previous periods that are no longer required.Consequently,profit for the year ended March 31,2018 has increased,resulting in an increase in basi
206、c earnings per equity share by 5.88 for the year ended March31,2018.(2)In the quarter ended March 2018,on conclusion of a strategic review of the portfolio businesses,the Company initiated identification and evaluation of potential buyers for its subsidiaries,Kallidus and Skava(together referred to
207、as Skava)and Panaya(collectively referred to as the disposal group).The Company anticipates completion of the sale by March 2019 and accordingly,assets amounting to 2,060 crore and liabilities amounting to 324 crore in respect of the disposal group have been reclassified under held for sale.On recla
208、ssification,the disposal group has been measured at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 118 crore in respect of Panaya has been recognized in the consolidated Statement of Profit and Loss for the year ended March 31,2018.The disposal g
209、roup does not constitute a separate major component of the Company and therefore,has not been classified as discontinued operations.On a standalone basis,investments amounting to 1,525 crore in respect of these subsidiaries have been reclassified under held for sale.On reclassification,these investm
210、ents have been measured at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 589 crore in respect of Panaya has been recognized in the standalone Statement of Profit and Loss for the year ended March 31,2018.(3)Excludes assets held for sale and liab
211、ilities directly associated with assets held for sale(4)During the year,11,30,43,478 equity shares were bought back by the Company for a total amount of 13,000 crore.34|The year at a glanceInfosys Annual Report 2017-18Based on IFRS US$consolidated financial statementsin US$million,except per equity
212、share data20182017Growth(%)Financial performanceRevenues10,93910,2087.2 Gross profit3,9383,7624.7 Operating profit2,6592,5205.5 Net profit(1)(2)2,4862,14016.2 Earnings per share(par value of 5(US$0.16)each):Basic(1)1.100.94(5)17.8 Diluted1.100.94(5)17.8 Financial position Cash and cash equivalents(4
213、)3,0413,489(12.8)Current investments(4)9821,538(36.2)Assets held for sale(2)316Net current assets(3)5,2436,121(14.3)Property,plant and equipment(2)1,8631,8073.1 Goodwill(2)339563(39.8)Intangible assets(2)38120(68.3)Other non-current assets2,3422,08212.5 Total assets12,25512,854(4.7)Liabilities direc
214、tly associated with assets held for sale(2)50Non-current liabilities13156133.9 Total equity(4)9,96010,637(6.4)Total equity and liabilities(4)12,25512,854(4.7)(1)During the quarter ended December 31,2017,on account of the conclusion of an APA with the IRS,the Company has,in accordance with the APA,re
215、versed income tax expense provision of US$225 million,which pertains to previous periods that are no longer required.Consequently,profit for the year ended March 31,2018 has increased,resulting in an increase in basic earnings per equity share by US$0.09 for the year ended March 31,2018.(2)In the qu
216、arter ended March 2018,on conclusion of a strategic review of the portfolio businesses,the Company initiated identification and evaluation of potential buyers for its subsidiaries,Kallidus and Skava(together referred to as Skava)and Panaya(collectively referred to as the disposal group).The Company
217、anticipates completion of the sale by March 2019 and accordingly,assets amounting to US$316 million and liabilities amounting to US$50 million in respect of the disposal group have been reclassified under held for sale.On reclassification,the disposal group has been measured at the lower of carrying
218、 amount and fair value less cost to sell and consequently,an impairment loss of US$18 million in respect of Panaya has been recognized in the consolidated Statement of Comprehensive Income for the year ended March 31,2018.The disposal group does not constitute a separate major component of the Compa
219、ny and therefore,has not been classified as discontinued operations.On a standalone basis,investments amounting to 1,525 crore in respect of these subsidiaries have been reclassified under held for sale.On reclassification,these investments have been measured at the lower of carrying amount and fair
220、 value less cost to sell and consequently,an impairment loss of 589 crore in respect of Panaya has been recognized in the standalone Statement of Profit and Loss for the year ended March 31,2018.(3)Excludes assets held for sale and liabilities directly associated with assets held for sale(4)During t
221、he year,11,30,43,478 equity shares were bought back by the Company for a total amount of US$2,035 million.(5)Computed based on full numbers without rounding offThe year at a glanceBoards report|35 Infosys Annual Report 2017-18Boards reportDear members,The Board of Directors hereby submits the report
222、 of the business and operations of your Company(the Company or Infosys),along with the audited financial statements,for the financial year ended March 31,2018.The consolidated performance of the Company and its subsidiaries has been referred to wherever required.1.Results of our operations and state
223、 of affairsin crore,except per equity share dataParticularsStandalone ConsolidatedFor the year ended March 31,For the year ended March 31,2018201720182017Revenue from operations61,941 59,289 70,522 68,484 Cost of sales39,138 37,057 45,130 43,253 Gross profit22,803 22,232 25,392 25,231 Operating expe
224、nses Selling and marketing expenses2,763 2,728 3,560 3,591 General and administration expenses3,562 3,628 4,684 4,739 Total operating expenses6,325 6,356 8,244 8,330 Operating profit16,478 15,876 17,148 16,901 Impairment loss on assets held for sale(2)589 Other income,net(2)(3)(4)4,019 3,062 3,193 3
225、,080 Profit before non-controlling interests/share in net loss of associate19,908 18,938 20,341 19,981 Share in net loss of associate,including impairment of associate(4)(71)(30)Profit before tax19,908 18,938 20,270 19,951 Tax expense(1)3,753 5,120 4,241 5,598 Profit after tax(1)16,155 13,818 16,029
226、 14,353 Non-controlling interests Profit for the year(1)(2)16,155 13,818 16,029 14,353 Other comprehensive income Items that will not be reclassified subsequently to profit or loss59(47)62(50)Items that will be reclassified subsequently to profit or loss(38)29 281(228)Total other comprehensive incom
227、e,net of tax21(18)343(278)Total comprehensive income for the year16,176 13,800 16,372 14,075 Earnings per share(EPS)(5)Basic(1)71.28 60.1671.07 62.80 Diluted71.25 60.15 71.00 62.77 Notes:The above figures are extracted from the audited standalone and consolidated financial statements as per Indian A
228、ccounting Standards(Ind AS).1 crore=10 million(1)During the quarter ended December 31,2017,on account of the conclusion of an Advance Pricing Agreement(APA)with the US Internal Revenue Service(IRS),the Company has,in accordance with the APA,reversed income tax expense provision of US$225 million(1,4
229、32 crore)which pertains to previous periods which are no longer required.Consequently,profit for the year ended March 31,2018 has increased,resulting in an increase in basic earnings per equity share by 5.88 on a consolidated basis and 5.85 on a standalone basis for the year ended March 31,2018.(2)I
230、n the quarter ended March 2018,on conclusion of a strategic review of the portfolio businesses,the Company initiated identification and evaluation of potential buyers for its subsidiaries,Kallidus and Skava(together referred to as Skava)and Panaya(collectively referred to as the disposal group).The
231、Company anticipates completion of the sale by March 2019 and accordingly,assets amounting to 2,060 crore and liabilities amounting to 324 crore in respect of the disposal group have been reclassified under held for sale.On reclassification,the disposal group has been measured at the lower of carryin
232、g amount and fair value less cost to sell and consequently,an impairment loss of 118 crore in respect of Panaya has been recognized in the consolidated Statement of Profit and Loss under other income for the year ended March 31,2018.The disposal group does not constitute a separate major component o
233、f the Company and therefore,has not been classified as discontinued operations.In the standalone financial statements of the Company,investments amounting to 1,525 crore in respect of these subsidiaries have been reclassified under held for sale.On reclassification,these investments have been measur
234、ed at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 589 crore in respect of Panaya has been recognized in the standalone Statement of Profit and Loss for the year ended March 31,2018.(3)Other income includes 257 crore and 262 crore for the year
235、ended March 31,2018 in the standalone and consolidated financial statements of the Company respectively towards interest on income tax refund.Other income in the consolidated Statement of Profit and Loss for the year ended March 31,2018,also includes impairment loss of 118 crore in respect of Panaya
236、,as mentioned in the preceding note.(4)During the year ended March 31,2018,Infosys Nova Holdings LLC,a wholly-owned subsidiary,has written down the entire carrying value of its investment in its associate,DWA Nova LLC.Consequently,the Company has written down the entire carrying value of the investm
237、ent in its subsidiary,Infosys Nova Holdings LLC,amounting to 94 crore in the standalone Statement of Profit or Loss of the Company under other income.Consequent to the above,in the consolidated financials,the Company has written down the entire carrying value of the investment in its associate,DWA N
238、ova LLC,amounting to 71 crore.The write-down in the carrying value of investment in associate DWA Nova LLC during the year ended March 31,2017 was 18 crore.(5)Equity shares are at par value of 5 per share.36|Boards reportInfosys Annual Report 2017-18Financial positionin crore,except per equity share
239、 dataParticularsStandaloneConsolidatedAs at March 31,2018As at March 31,2017As at March 31,2018As at March 31,2017Cash and cash equivalents(3)16,77019,15319,81822,625Current investments(3)5,9069,6436,4079,970Assets held for sale(1)1,5252,060Net current assets(2)30,90335,89634,17639,692Property,plant
240、 and equipment(1)(including capital work-in-progress)10,4699,85211,72211,116Goodwill(1)292,2113,652Other intangible assets(1)101247776Other non-current assets21,18822,35115,69314,106Total assets75,87779,88579,89083,355Liabilities directly associated with assets held for sale(1)324Non-current liabili
241、ties71382861360Retained earnings opening balance49,957 44,698 52,882 47,063 Add:Profit for the year16,155 13,818 16,029 14,353 Transfer from Special Economic Zone Re-investment Reserve on utilization(4)582 953 617 953 Less:Dividends including dividend distribution tax(7,500)(6,980)(7,469)(6,952)Tran
242、sfer to general reserve(1,382)(1,579)(1,382)(1,582)Transfer to Special Economic Zone Re-investment Reserve(4)(2,141)(953)(2,200)(953)Retained earnings closing balance55,671 49,957 58,477 52,882 Other equity7,83118,0606,44616,100Total equity(3)63,50268,01764,92468,982Total equity and liabilities75,87
243、779,88579,89083,355Number of equity shares(3)218,41,14,257 229,69,44,664 217,33,12,301228,56,55,150(1)In the quarter ended March 2018,on conclusion of a strategic review of the portfolio businesses,the Company initiated identification and evaluation of potential buyers for its subsidiaries,Kallidus
244、and Skava(together referred to as Skava)and Panaya(collectively referred to as the disposal group).The Company anticipates completion of the sale by March 2019 and accordingly,assets amounting to 2,060 crore and liabilities amounting to 324 crore in respect of the disposal group have been reclassifi
245、ed under held for sale.On reclassification,the disposal group has been measured at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 118 crore in respect of Panaya has been recognized in the consolidated Statement of Profit and Loss for the year end
246、ed March 31,2018.The disposal group does not constitute a separate major component of the Company and therefore,has not been classified as discontinued operations.On a standalone basis,investments amounting to 1,525 crore in respect of these subsidiaries have been reclassified under held for sale.On
247、 reclassification,these investments have been measured at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 589 crore in respect of Panaya has been recognized in the standalone profit and loss for the year ended March 31,2018.(2)Excludes assets held
248、 for sale and liabilities directly associated with assets held for sale.(3)During the year,11,30,43,478 equity shares were bought back by the Company for a total amount of 13,000 crore.(4)The Special Economic Zone(SEZ)Re-investment Reserve has been created out of the profit of eligible SEZ units in
249、terms of the provisions of Section 10AA(1)(ii)of the Income-tax Act,1961.The reserve should be utilized by the Company for acquiring new plant and machinery for the purpose of its business in the terms of Section 10AA(2)of the Income-tax Act,1961.Revenues standaloneOur revenue from operations on a s
250、tandalone basis increased by 4.5%to 61,941 crore in fiscal 2018.Our software export revenues aggregated to 60,080 crore,up from 57,491 crore in the previous year.Out of the total revenue,62.9%came from North America,23.3%from Europe,10.8%from the Rest of the World,and 3.0%from India.Revenues consoli
251、datedOur revenue from operations on a consolidated basis increased by 3.0%to 70,522 crore in fiscal 2018.Our software export revenues aggregated to 68,291 crore,up from 66,304 crore in the previous year.Out of the total revenue,60.4%came from North America,23.7%from Europe,12.7%from the Rest of the
252、World,and 3.2%from India.Profits standaloneOur gross profit on a standalone basis amounted to 22,803 crore(36.8%of revenue),as against 22,232 crore(37.5%of revenue)in the previous year.Selling and marketing costs were 4.5%of our revenue for the year ended March 31,2018,as compared to 4.6%for the yea
253、r ended March 31,2017.General and administration expenses were 5.7%of our revenue for the year ended March 31,2018,as compared to 6.1%for the year ended March 31,2017.The operating profit amounted to 16,478 crore(26.6%of revenue),as against 15,876 crore(26.8%of revenue),in the previous year.The prof
254、it before tax was 19,908 crore(32.1%of revenue),as against 18,938 crore(31.9%of revenue)in the previous year.Net profit was 16,155 crore(26.1%of revenue),as against 13,818 crore(23.3%of revenue)in the previous year.Boards report|37 Infosys Annual Report 2017-18Profits consolidatedOur gross profit on
255、 a consolidated basis amounted to 25,392 crore(36.0%of revenue),as against 25,231 crore(36.8%of revenue)in the previous year.Selling and marketing costs were 5.1%of our revenue for the year ended March 31,2018,as compared to 5.2%for the year ended March 31,2017.General and administration expenses we
256、re 6.6%of our revenue for the year ended March,31 2018,as compared to 6.9%for the year ended March 31,2017.The operating profit amounted to 17,148 crore(24.3%of revenue),as against 16,901 crore(24.7%of revenue)in the previous year.The profit before tax was 20,270 crore(28.7%of revenue),as against 19
257、,951 crore(29.1%of revenue)in the previous year.Net profit was 16,029 crore(22.7%of revenue),as against 14,353 crore(21.0%of revenue)in the previous year.North AmericaEuropeRest of the WorldIndiaFS(1)ECS(2)RCL(3)All other segmentsHILIFE(4)MFG(5)Hi-TechRevenue distribution by geographical segments(in
258、%)Revenue distribution by business segments(in%)Net proft*(in crore)16,029201814,353201717,14816,901Operating proft(in crore)Basic EPS*(in)201871.07201762.80Gross proft(in crore)25,392201825,2312017Total revenue(in crore)201870,522201768,484Return on equity201824.1%201721.4%26.410.923.815.813.17.22.
259、860.43.223.712.720182017Capital expenditure on tangible assets standaloneThis year,on a standalone basis,we incurred capital expenditure of 1,823 crore.This comprises 1,422 crore in infrastructure,396 crore for investment in computer equipment and 5 crore in vehicles.In the previous year,we incurred
260、 capital expenditure of 1,817 crore.This comprised 1,157 crore in infrastructure,654 crore for investment in computer equipment and 6 crore in vehicles.Capital expenditure on tangible assets consolidatedOn a consolidated basis,we incurred capital expenditure of 1,955 crore.During the current year,1,
261、479 crore Note:Based on Ind AS consolidated financial statements.*Includes reversal of income tax provision of US$225 million(1,432 crore)pertaining to previous periods on account of conclusion of APA.Consequently,profit for the year ended March 31,2018 has increased,resulting in an increase in basi
262、c earnings per equity share by 5.88 on a consolidated basis.(1)Financial Services(2)Energy&utilities,Communications and Services(3)Retail,Consumer Packaged Goods and Logistics(4)Life Sciences,Healthcare and Insurance(5)Manufacturing38|Boards reportInfosys Annual Report 2017-18in infrastructure,471 c
263、rore in computer equipment and 5crore in vehicles have been invested.In the previous year,we incurred capital expenditure of 2,799 crore.This comprised 1,991 crore in infrastructure,800 crore for investment in computer equipment and 8 crore in vehicles.LiquidityOur principal sources of liquidity are
264、 cash and cash equivalents and the cash flow that we generate from our operations.We continue to be debt-free and maintain sufficient cash to meet our strategic and operational requirements.We understand that liquidity in the Balance Sheet has to balance between earning adequate returns and the need
265、 to cover financial and business requirements.Liquidity enables us to be agile and ready for meeting unforeseen strategic and business needs.We believe that our working capital is sufficient to meet our current requirements.As of March 31,2018,we had 30,903 crore in working capital(working capital d
266、efined as current assets,excluding assets held for sale minus current liabilities,excluding liabilities directly associated with assets held for sale)on a standalone basis,and 34,176 crore on a consolidated basis.Working capital includes liquid assets of 27,752 crore on a standalone basis and 31,765
267、 crore on a consolidated basis as at March 31,2018,as against 34,561 crore on a standalone basis,and 38,773 crore on a consolidated basis as on March 31,2017.Liquid assets on both standalone and consolidated basis include deposits with banks and highly-rated financial institutions,investments in liq
268、uid mutual funds,fixed maturity plan securities,tax-free bonds,government bonds,non-convertible debentures of highly-rated companies,certificates of deposit(CDs)and commercial paper.CDs represent marketable securities of banks and eligible financial institutions for a specified time period with high
269、 credit rating given by domestic credit rating agencies.Investments made in non-convertible debentures issued by government-aided institutions and financial institutions with high credit rating.The details of these investments are disclosed under the non-current and current investments section in th
270、e standalone and consolidated financial statements in this Annual Report.Capital Allocation Policy The Board,at its meeting on April 13,2018,reviewed and approved the Capital Allocation Policy of the Company after taking into consideration the strategic and operational cash requirements of the Compa
271、ny in the medium term.The key aspects of the Capital Allocation Policy are as follows:i.The Board has decided to retain the current policy of returning up to 70%of the free cash flow of the corresponding financial year in such manner as may be decided by the Board from time to time,subject to applic
272、able laws and requisite approvals,if any.Free cash flow is defined as net cash provided by operating activities less capital expenditure as per the consolidated Statement of Cash Flows prepared under International Financial Reporting Standards(IFRS).Dividend payout includes Dividend Distribution Tax
273、(DDT).ii.In addition to the above,out of the cash on the Balance Sheet,the Board has identified an amount of up to 13,000 crore(US$2 billion(1)to be paid to shareholders in the following manner:a.A special dividend of 10.00 per share(US$0.15 per ADR(1)resulting in a payout of approximately 2,600 cro
274、re(approximately US$400 million(1)in June 2018b.An amount of up to approximately 10,400 crore(approximately US$1,600 million(1)to be paid out to shareholders for fiscal 2019,in such manner as may be decided by the Board,subject to applicable laws and requisite approvals,if any.(1)USD/INR exchange ra
275、te at 65.00.Basic EPSBasic earnings per share increased by 18.5%to 71.28 at standalone level and by 13.2%to 71.07 at consolidated level.On account of the conclusion of APA with the IRS,the Company has reversed income tax expense amounting to US$225 million(1,432 crore)pertaining to previous periods
276、resulting in an increase in profits for fiscal 2018.Consequently,earnings per share increased by 5.85 per share on a standalone basis and 5.88 per share on a consolidated basis for the year ended March 31,2018.DividendDividend per share declared is in line with the Capital Allocation Policy approved
277、 by the Board on April 13,2017.The Company declared dividend as under:Dividend per share(in)Fiscal 2017(2)Fiscal 2018(3)Interim dividend11.0013.00Final dividend14.75(1)20.50Special dividend(1)10.00Total dividend25.7543.50Payout ratio(interim and final dividend)49.6%69.8%(1)Recommended by the Board o
278、f Directors at its meeting held on April 13,2018.The payment is subject to the approval of the shareholders at the ensuing Annual General Meeting of the Company to be held on June 23,2018.(2)Our dividend policy was to pay up to 50%of consolidated post-tax profits.(3)Our dividend policy is to pay up
279、to 70%of free cash flow.Free cash flow is defined as net cash provided by operating activities less capital expenditure as per the consolidated Statement of Cash Flows prepared under IFRS.The Register of Members and Share Transfer Books will remain closed on June 16,2018 for the purpose of payment o
280、f the final dividend for the financial year ended March 31,2018,payment of the special dividend,and the AGM.The AGM is scheduled to be held on June 23,2018.Boards report|39 Infosys Annual Report 2017-18Share buybackIn line with the Capital Allocation Policy,the Board,at its meeting on August 19,2017
281、,approved a proposal for the Company to buy back its fully-paid-up equity shares of face value 5 each from the eligible equity shareholders of the Company for an amount not exceeding 13,000 crore.The shareholders approved the proposal of buyback of equity shares through the postal ballot that conclu
282、ded on October 7,2017.The buyback offer comprised a purchase of 11,30,43,478 equity shares aggregating 4.92%of the paid-up equity share capital of the Company at a price of 1,150 per equity share.The buyback was offered to all eligible equity shareholders(including those who became equity shareholde
283、rs as on the record date by cancelling American Depositary Shares(ADSs)and withdrawing underlying equity shares)of the Company as on the record date(i.e.November1,2017)on a proportionate basis through the Tender offer route.The Company concluded the buyback procedures on December 27,2017 and 11,30,4
284、3,478 equity shares were extinguished.The Company has utilized securities premium and general reserve for the buyback of its shares.In accordance with Section 69 of the Companies Act,2013,the Company has created a Capital Redemption Reserve of 56 crore equal to the nominal value of the shares bought
285、 back as an appropriation from the general reserve.Advance Pricing Agreement(APA)with the US Internal Revenue Service(IRS)During the quarter ended December 31,2017,the Company concluded an APA with the IRS.Under the APA,the Company and the IRS have agreed on the methodology to allocate revenues and
286、compute the taxable income of the Companys US branch operations.This agreement covers fiscal 2011 to fiscal 2021.The Company expects the APA to enhance the predictability of the Companys tax obligation in respect of its US operations.In accordance with the APA,the Company has reversed income tax exp
287、ense provision of US$225 million(1,432 crore)which pertains to previous periods that are no longer required.Consequently,profit for the year ended March 31,2018 has increased resulting in an increase in basic earnings per share by 5.85 on a standalone basis and 5.88 on a consolidated basis for the y
288、ear ended March 31,2018.Particulars of loans,guarantees or investmentsLoans,guarantees and investments covered under Section 186 of the Companies Act,2013 form part of the Notes to the financial statements provided in this Annual Report.Transfer to reservesWe propose to transfer 1,615 crore to the g
289、eneral reserve on account of declaration of dividend on both standalone and consolidated levels.Fixed depositsWe have not accepted any fixed deposits including from the public and,as such,no amount of principal or interest was outstanding as of the Balance Sheet date.Particulars of contracts or arra
290、ngements made with related parties Particulars of contracts or arrangements with related parties referred to in Section 188(1)of the Companies Act,2013,in the prescribed Form AOC-2,is appended as Annexure 2 to the Boards report.Managements discussion and analysisIn terms of the provisions of Regulat
291、ion 34 of the Listing Regulations,the Managements discussion and analysis is set out in this Annual Report.Risk management reportIn terms of the provisions of Section 134 of the Companies Act,2013,a Risk management report is set out in this Annual Report.Board policiesThe details of the policies app
292、roved and adopted by the Board are provided in Annexure 9 to the Boards report.Material changes and commitments affecting financial position between the end of the financial year and date of the report Lead Independent Director:The Board,at its meeting held on April 13,2018,appointed Kiran Mazumdar-
293、Shaw,Independent Director,as the Lead Independent Director of the Board.Acquisition:The Board,at its meeting held on April 13,2018,approved the Company to enter into a definitive agreement to acquire WongDoody Holding Company Inc,a US-based creative and consumer insights agency,for a total considera
294、tion of up to US$75 million(approximately 489 crore),including contingent consideration and retention payouts,subject to regulatory approvals and fulfillment of closing conditions.Capital Allocation Policy:The Board,at its meeting held on April 13,2018,reviewed and approved the Capital Allocation Po
295、licy of the Company after taking into consideration the strategic and operational cash requirements of the Company in the medium term.Key aspects of the Capital Allocation Policy have been discussed earlier in the Boards report.2.Business descriptionStrategyOur strategic objective is to build a sust
296、ainable organization that remains relevant to the agenda of our clients,while creating growth opportunities for our employees and generating profitable returns for our investors.Our clients and prospective clients are faced with transformative business opportunities due to advances in software and c
297、omputing technology.These organizations are dealing with the challenge of having to reinvent their core offerings,processes and systems rapidly and position themselves as digitally enabled.The journey to the digital future requires not just an understanding of new technologies and new ways of workin
298、g,but a deep appreciation of existing technology landscapes,business processes and practices.40|Boards reportInfosys Annual Report 2017-18Ourstrategy is to be a navigator for our clients as they ideate,plan and execute their journey to a digital future,to help them navigate your next.We have embrace
299、d a four-pronged strategy to strengthen our relevance to clients and drive accelerated value creation.Towards implementing the strategy,we will:Scale Agile Digital Re-skill our people Energize the core Expand localizationInvest in digital capabilities&priority servicesInfuse AI and automation,levera
300、ging NiaRe-skill talent at scalefor us and our clientsHire locally in markets,local delivery&trainingScale Agile DigitalEnergize the CoreRe-skill our PeopleExpand LocalizationScale Agile DigitalWe will continue to make targeted investments to rapidly accelerate our Agile Digital business.We define d
301、igital as a set of use cases that drive business outcomes for our clients across five areas:THE CLIENT DIGITALJOURNEYEXPERIENCEINSIGHTINNOVATEACCELERATEASSURE Experience:Well-designed systems for digital marketing,omnichannel interaction,personalization and content management that can enhance custom
302、er experience Insight:AI-based systems for advanced analytics,leveraging Big Data Innovate:Engineering new and digital-first products and offerings leveraging Internet of Things and advanced industry Software-as-a-Service platforms Accelerate:The digitization of core systems by migrating to cloud te
303、chnologies,abstracting APIs,modernizing legacy systems and infrastructure,integrating applications and leveraging Robotic Process Automation(RPA)Assure:Implementing advanced cyber-security systems and specialized validation of software systems.In addition to these,we will also invest in sales and co
304、nsulting capabilities to engage with clients both in their technology divisions and their business organizations.We will continue to leverage alliances that complement our core competencies.We will continue to partner with leading technology software and hardware providers in creating,deploying,inte
305、grating and operating business solutions for our clients.We will continue to invest in research and development(R&D)to stay abreast of new technologies and to incubate new offerings in areas such as blockchain,AR/VR and speech,vision,video and image intelligence.We will expand the scope of our colla
306、borations to encompass universities,research organizations and the startup innovation ecosystem.We will continue to deploy our capital in making selective business acquisitions that augment our Agile Digital expertise,to complement our presence in certain market segments.Energize the coreWe will con
307、tinue to embrace automation and artificial intelligence(AI)-based techniques and software automation platforms to boost productivity of our clients core processes and systems.We will continue to leverage these,along with lean processes,Agile development and our Global Delivery Model(GDM)to deliver s
308、olutions and services to our clients in the most cost-effective manner,while at the same time optimizing our cost structure to remain competitive.We will continue to invest in our flagship RPA platform AssistEdge,our AI platform,Infosys Nia,and in core business applications such as Finacle,McCamish
309、and others to bring differentiated and market-leading features and capabilities to our projects with clients.Re-skill our peopleAn exponential adoption of new technologies is leading to a wide digital talent gap.As technology shifts gain rapid acceleration,we will drive talent re-skilling at scale f
310、or our own employees and for our clients organizations in the new areas of digital services.Teaching and learning are central to Infosys culture.Our investments in our Global Education Center and in creating various learning opportunities for our employees help our employees stay abreast of new deve
311、lopments in software technologies,spur innovation and help them build a lifelong career with the Company.We will continue to invest in advanced,anytime-anywhere learning systems such as our Lex platform and in creating and harnessing up-to-date content from internal and external sources.Further,we a
312、re expanding our relationships with universities around the world to curate specific curricula for our employees in areas such as creative design skills,machine learning,autonomous technologies,blockchain etc.Expand localizationWe believe that client proximity lends several benefits while delivering
313、 Agile Digital transformations,and we will invest in localizing our workforce in various geographies.We have announced the setting up of four delivery and innovation centers in the US.The first of these is already active in Indianapolis,while three others in Connecticut,Rhode Island and North Caroli
314、na are well on the way to becoming Boards report|41 Infosys Annual Report 2017-18operational.We are recruiting locally from universities in the US.We aim to become an employer of choice from US universities and will set up dedicated leadership and support teams in the US,Europe and Australia.Our str
315、ategy to localize will also reduce our dependence on immigration policies.OrganizationOur go-to-market business units are organized as:Financial Services Life Sciences,Healthcare and Insurance Manufacturing Retail,Consumer Packaged Goods and Logistics Hi-tech Communications Services,Utilities,Resour
316、ces and Energy China Japan India Infosys Public ServicesOur service delivery is organized as horizontal service lines:Global Delivery Experience Insight Innovate Accelerate Assure Infosys Global Consulting Infosys Center for Emerging Technology Solutions Products and Platforms Finacle Edge suite Inf
317、osys Nia Infosys McCamish Panaya Skava Business Process Management Infosys BPMClient baseOur client-centric approach continues to bring us high levels of client satisfaction.We derived 98.5%of our consolidated revenues from repeat business this fiscal.We,along with our subsidiaries,added 283 new cli
318、ents,including a substantial number of large global corporations.Our total client base at the end of the year stood at 1,204.The client segmentation,based on the last 12 months revenue for the current and previous years,on a consolidated basis,is as follows:Clients20182017100 million dollar+201975 m
319、illion dollar+353150 million dollar+57561 million dollar+634598InfrastructureWe added 2.04 million sq.ft.of physical infrastructure space during the year.The total available space as on March 31,2018 stands at 46.57 million sq.ft.We have a total of 126 development centers in 27 countries,82 sales of
320、fices in 35 countries.We have a presence in 45 countries as on March 31,2018.Infosys Innovation FundOur investment and acquisition strategy is designed to strengthen our competitive positioning and bring technology innovation to our clients.We have a multi-pronged strategy in identifying,investing i
321、n,and evangelizing next-generation technologies.We believe we will achieve this through organic investments in R&D,as well as by making investments in external innovation ecosystems and in particular,technology startup companies.The Infosys Innovation Fund identifies early-stage startup companies de
322、veloping innovative,next-generation solutions and technologies in the areas of AI and machine learning,Big Data and analytics,convergence of physical and digital processes,technology infrastructure management,cloud systems and cyber security.The Fund partners with startups by providing early-stage c
323、apital and in helping bring their innovations to market,attaining scale,product validation and customer introductions.The Fund has invested US$53 million to date in the form of minority holdings in early-stage companies.As of March31,2018,the Fund has an additional US$12 million in uncalled/pending
324、capital commitments.The carrying value of such investments as on March 31,2018 was US$31 million on account of write-down of investment in DWA Nova amounting to US$11 million(71 crore)and on account of changes in fair value.Subsidiaries and associatesWe,along with our subsidiaries,provide consulting
325、,technology,outsourcing and next-generation services.At the beginning of the year,we had 17 direct subsidiaries,26 step-down subsidiaries and one associate.As on March 31,2018,we have 20 direct subsidiaries and 26 step-down subsidiaries.Name change of Infosys BPO Limited:During the year,Infosys BPO
326、Limited,an Indian subsidiary of the Company,received the approval of the Ministry of Corporate Affairs,Government of India,to change the name of the Company to Infosys BPM Limited.The new name is a reflection of the paradigm shift in the nature of services that the Company now offers through its hol
327、istic approach of end-to-end transformative BPM(Business Process Management).Assets held for sale:In the quarter ended March 2018,on conclusion of a strategic review of the portfolio businesses,the Company initiated identification and evaluation of potential buyers for its subsidiaries,Kallidus and
328、Skava(together referred to as Skava)and Panaya(collectively referred to as the disposal group).The Company anticipates completion of the sale by March 2019 and accordingly,assets amounting to 2,060 crore and liabilities amounting to 324 crore in respect of the disposal group have been reclassified u
329、nder held for sale.On reclassification,the disposal group has been measured at the lower of carrying amount and fair value less cost to sell and consequently,an impairment loss of 118 crore in respect of Panaya has been recognized in the consolidated Statement of Profit and Loss under other income f
330、or the year ended March 31,2018.An impairment loss of 589 crore in respect of Panaya has been recognized 42|Boards reportInfosys Annual Report 2017-18in the standalone Statement of Profit and Loss for the year ended March 31,2018.During the year,the Board of Directors reviewed the affairs of the sub
331、sidiaries.In accordance with Section 129(3)of the Companies Act,2013,we have prepared the consolidated financial statements of the Company,which form part of this Annual Report.Further,a statement containing the salient features of the financial statement of our subsidiaries in the prescribed format
332、 AOC-1 is appended as Annexure 1 to the Boards report.The statement also provides details of the performance and financial position of each of the subsidiaries.In accordance with Section 136 of the Companies Act,2013,the audited financial statements,including the consolidated financial statements an
333、d related information of the Company and audited accounts of each of its subsidiaries,are available on our website,.These documents will also be available for inspection till the date of the AGM during business hours at our registered office in Bengaluru,India.QualityThe Quality function at Infosys has been at the forefront of enabling delivery and support functions in differentiation,optimization
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