Home  »  Company  »  Hinduja Global Solut  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Hinduja Global Solutions Ltd.

Mar 31, 2016

A. Rights, preferences and restrictions attached to equity shares:

The Company has one class of Equity Shares having a par value of < 10 each. Each Shareholder is eligible for one vote per share held.

The dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend.

In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion to their shareholding.

* For the financial year ended March 31, 2016, the amount of per share dividend distributed to Equity Shareholders was Rs, 5 per share each on August 12, 2015 and November 6, 2015 and was Rs, 3.75 per share on February 9, 2016.

** During the year ended March 31, 2016 and March 31, 2015, the amount of per share dividend proposed as distribution to Equity Shareholders was Rs, 1.25 and Rs, 5, respectively, recognized in respective years.

Notes:

1 The Company has deposited an amount of Rs, 633.08 Lacs (Previous year: Rs, 633.08 Lacs) with the service tax authorities, which is included in "Balance with Government Authorities - Note 13". The Central Excise and Service Tax Appellate Tribunal South Zonal Bench, Bangalore in its fnal hearing on January 19, 2016 has allowed the appeal on merits in favour of the Company.

2 Hinduja Ventures Limited has received income tax demand pertaining to IT/ ITES business aggregating Rs,7,173.48 Lacs (Previous Year: Rs, 7,173.48 Lacs) in respect of period prior to October 1, 2006 which is reimbursable by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid Rs, 5,550 Lacs (Previous Year: Rs, 5,550 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ITES business, which is included in the ''Loans and Advances to related parties'' under Note 13 – ''Long-term loans and advances''. Hinduja Ventures Limited has filed an appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has strong case to succeed.

3 Future cash outfow in respect of above, if any, is determinable only on receipt of judgments''/ decisions pending with relevant authorities.

B) Guarantees given in favour of:

Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

California Physicians'' Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

b) Capital and other commitments:

(i) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account – Rs, 1,118.88 Lacs (Previous Year-Rs,'' 523.02 Lacs).

(ii) The Company has issued an Undertaking to provide need based financial support and is committed, if needed, to continue such support to meet the ongoing obligations of its following step-down subsidiaries.

i. HGS Mena FZ LLC

ii. C-Cubed N.V.

iii. Hinduja Global Solutions Europe Limited

iv HGS St. Lucia

v. HGS Colibrium Inc.

There has been no payments during the year against these undertakings.

2. disclosures in terms of Accounting Standard 15 (Revised 2005) ''employee Benefits''.

The Company has classified various benefits provided to employees as under: -

I Defined contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defined Contribution Plans

i. Employers'' Contribution to Employee''s State Insurance

ii. Employers'' Contribution to Employee''s Pension Scheme 1995

c) Percentage of each category of Plan Assets to total fair Value of Plan Assets as at March 31, 2016

The Plan Assets for Defined Benefit Plan in India are administered by Life Insurance Corporation of India (''LIC'') as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance Regulatory and Development Authority Regulations. In case of Defined benefit plan at a foreign branch, the Plan Assets are administered by the Investment department of Deutsche Bank AG. The Plan Assets consists of investment in Government Bonds 57.30% (Previous Year: 68.43%), Cash and Cash Equivalents 17.51% (Previous Year: 15.61%), Corporate Bonds 23.98% (Previous Year: 15.58%) and Others 1.21% (Previous Year: 0.38%) for amounts aggregating Rs, 960.99 Lacs (Previous YearRs," 1,345.07 Lacs).

III The liability for compensated absences as at March 31, 2016 aggregates Rs, 1,687.77 Lacs (Previous Year -Rs,1,214.47 Lacs).

3. Segment Information

In accordance with paragraph 4 of Accounting Standard 17 "Segment Reporting", the Company has presented segmental information only on the basis of the Consolidated financial statements (Refer Note 27 of the Consolidated financial statements).

4. Related Party Disclosures

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (Includes step-down subsidiaries)

1. HGS International, Mauritius

2. HGS International Services Private Limited, India

3. Hinduja Global Solutions Inc., U.S.A.

4. HGS Canada Inc., Canada

5. C-Cubed B.V., Netherlands

6. C-Cubed N.V., Curacao

7. Customer Contact Centre Inc., Philippines

8. Hinduja Global Solutions Europe Limited, U.K.

9. Hinduja Global Solutions UK Limited, U.K.

10. HGS France, S.A.R.L

11. HGS (USA), LLC

12. HGS Healthcare (Previously RMT L.L.C., U.S.A.)

13. Affna Company, Canada

14. HGS St. Lucia Ltd, Saint Lucia

15. Team HGS Limited, Jamaica

16. HGS Properties LLC, U.S.A.

17. HGS Canada Holdings LLC, U.S.A.

18. HGS Italy, S.A.R.L

19. HGS EBOS LLC , U.S.A.

20. HGS Mena FZ LLC, U.A.E

21. HGS Colibrium Inc (w.e.f March 26, 2015)

22. HGS Extensya Holdings Ltd (w.e.f November 25, 2015)

23. Extensya Investment Holdings Ltd (w.e.f November 25, 2015)

24. HGS Extensya Cayman Ltd (w.e.f November 25, 2015)

III Key Management Personnel

Mr. Partha DeSarkar, Chief Executive Officer and Manager

IV Enterprises where common control exists

1. Hinduja Group Limited

2. Hinduja Ventures Limited

3. IndusInd Media and Communication Limited

4. Hinduja Hosiptal Limited

Notes:

1. There are no transactions with parties referred in I above.

2. Figures in bracket pertain to the previous year.

28 Operating Leases

The operating lease arrangement relating to office premises extend up to a period of twenty years from the respective dates of inception, which includes both cancellable and non-cancellable leases. Most of the leases are renewable for further period on mutually agreeable terms and also include escalation clauses.

Figures in bracket pertain to the previous year.

Provisions for litigations/ disputes represents claims against the Company not acknowledged as debts that are expected to materialize in respect of matters in litigation.

Figures in bracket pertain to the previous year.

The hedged highly probable forecast transactions denominated in foreign currency are expected to occur at various dates during the next 12 months. The (gain)/loss recognized in hedging reserve in equity during the year amounts to Rs, (879.55) Lacs [Previous Year: Rs, (55.56) Lacs].

The losses/(gain) on ineffective portion recognized in the Statement of Profit and Loss that arises from cash fow hedges amounts to Rs, (47.85) Lacs (Previous Year: Rs, 2.92 Lacs).

Gains and losses recognized in the hedging reserve in equity (Note 4) on forward foreign exchange contracts as of March 31, 2016 would be recognized in the income statement in the period or periods during which the hedged forecast transaction affects the related transaction in the Statement of Profit and Loss.

Had the Company adopted fairvalue method in respect of options granted, the employee compensation cost would have been higher/ (lower) by Rs,28.62 Lacs (Previous Year-Rs," (83.11) Lacs), Profit After Tax and the basic and diluted earning per share would have been lower/(higher) byRs, 28.62 Lacs (Previous Year-Rs," (83.11) Lacs) and Re. 0.14 (Previous Year- Re. (0.40)), respectively.

5. Pursuant to Schedule II of the Companies Act, 2013 (w.e.f. April 1, 2014), depreciation charge for the year ended March 31, 2015 is higher byRs," 939.71 lacs, and written down value aggregating Rs, 1,612.64 lacs (net of deferred tax of Rs, 572.62 lacs) for fixed assets with no residual life as at April 1, 2014 having being charged off to retained earnings.

6. Current tax includes provision for tax of Rs, 458.60 Lacs (Previous Year: Rs, 362.68 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

7. As per Section 135 of the Companies Act, 2013, a CSR committee has been formed by the company. The areas for CSR activities are eradication of tuberculosis, promoting education, art and culture, healthcare, and rehabilitation and rural development projects. These contributions by the Company were spent on activities, which are specified in Schedule VII of the Companies Act, 2013.

The difference, being the excess of net assets acquired over the consideration paid/payable is disclosed as Capital Reserve (Refer Note 4).

8. In view of the acquisition noted in Note 41 above, the figures of the current year are not strictly comparable year with figures of the previous year.

9. Previous Year''s figures have been regrouped/ rearranged, wherever considered necessary, to conform to current year''s classification.


Mar 31, 2015

1 General Information

Hinduja Global Solutions Limited ("HGS"), is engaged in Business Process Management. HGS with its subsidiaries offer voice and non-voice based services such as contact centre solutions and back office transaction processing across North America, Europe, Asia and Middle East. HGS is a public limited company, listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) in India.

2. a) Contingent Liabilities

A) Claims against the Company not acknowledged as debts:

(Rs. in Lacs) Sr. No. Particulars As at 31.03.2015 As at 31.03.2014

(i) Service Tax demand raised by authorities against which 633.08 633.08 appeal has been fled by the Company (Refer Note 1 below)

(ii) Income Tax demand raised by authorities against which 9,607.60 5,448.23 appeal has been fled by the Company

(iii) ESIC demand raised by authorities 329.38 -

(iv) Others (to the extent ascertainable) 33.48 2,473.85

(v) Other matters (Refer Note 2 below) 7,173.48 12,209.79

Notes:

1 The Company has deposited an amount of Rs. 633.08 Lacs (Previous year: Rs. 633.08 Lacs) with the service tax authorities, which is included in "Balance with Government Authorities – Note 13".

2 Hinduja Ventures Limited has received income tax demand pertaining to IT/ ITES business aggregating Rs. 7,173.48 Lacs (Previous Year: Rs. 12,209.79 Lacs) in respect of period prior to October 1, 2006 which is reimbursable by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid Rs. 5,550 Lacs (Previous Year: Rs. 5,550 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ ITES business, which is included in the 'Loans and Advances to related parties' under Note 13 – 'Long-term loans and advances'. Hinduja Ventures Limited has fled an appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has strong case to succeed.

3 Future cash outflow in respect of above, if any, is determinable only on receipt of judgments/decisions pending with relevant authorities.

B) Guarantees given in favour of:

Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

California Physicians' Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

b) Capital and other commitments:

(i) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account - Rs. 523.02 Lacs (Previous Year - Rs. 367.77 Lacs).

(ii) The Company has issued an Undertaking to provide need based financial support and is committed, if needed, to continue such support to meet the ongoing obligations of its following step-down subsidiaries.

i. Hinduja Global Solutions Inc.

ii. C-Cubed N.V.

iii. Hinduja Global Solutions Europe Limited

iv HGS St. Lucia

There has been no payments during the year against these undertakings.

3. Disclosures in terms of Accounting Standard 15 (Revised 2005) 'Employee Benefits'.

The Company has classified various benefits provided to employees as under: -

I Defined Contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defined Contribution Plans

i. Employers' Contribution to Employee's State Insurance

ii. Employers' Contribution to Employee's Pension Scheme 1995

4. Segment Information

In accordance with paragraph 4 of Accounting Standard 17 "Segment Reporting", the Company has presented segmental information only on the basis of the Consolidated financial statements (Refer Note 26 of the Consolidated financial statements).

5. Related Party Disclosures

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (Includes step-down subsidiaries)

1. HGS International, Mauritius

2. HGS International Services Private Limited, India

3. HGS Business Services Private Limited, India (Upto June 30, 2013) [Amalgamated with HGS International Services Private Limited having appointed date as July 1, 2013]

4. Hinduja Global Solutions Inc., U.S.A.

5. HGS Canada Inc., Canada

6. C-Cubed B.V., Netherlands

7. C-Cubed N.V., Curacao

8. Customer Contact Centre Inc., Philippines

9. Hinduja Global Solutions Europe Limited, U.K.

10. Hinduja Global Solutions UK Limited, U.K.

11. HGS France, S.A.R.L

12. HGS (USA), LLC

13. RMT L.L.C., U.S.A.

14. Affina Company, Canada

15. HGS St. Lucia Ltd, Saint Lucia

16. Team HGS Limited, Jamaica P

17. HGS Properties LLC, U.S.A.

18. HGS Canada Holdings LLC, U.S.A.

19. HGS Italy, S.A.R.L

20. HGS EBOS LLC, U.S.A.

21. HGS Mena FZ LLC, U.A.E

22. HGS Colibrium Inc (w.e.f March 26, 2015)

III Key Management Personnel

Mr. Partha DeSarkar, Chief Executive Officer and Manager

IV Enterprises where common control exists

1. Hinduja Group India Limited

2. Hinduja Group Limited

3. Hinduja Ventures Limited

4. IndusInd Media and Communication Limited

V Relatives of Key Management personnel

Mr. Pabitra DeSarkar

6. Operating Leases

The operating lease arrangement relating to office premises extend up to a period of twenty years from the respective dates of inception, which includes both cancellable and non-cancellable leases. Most of the leases are renewable for further period on mutually agreeable terms and also include escalation clauses.

7. Pursuant to Schedule II of the Companies Act, 2013 (w.e.f. April 1, 2014), depreciation charge for the year ended March 31, 2015 is higher by Rs. 939.71 lacs , and written down value aggregating Rs. 1,612.64 lacs (net of deferred tax of Rs. 572.62 lacs) for fixed assets with no residual life as at April 1, 2014 having being charged off to retained earnings.

8. Current tax includes provision for tax of Rs. 362.68 Lacs (Previous Year: Rs. 338.70 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

9. As per Section 135 of the Companies Act, 2013, a CSR committee has been formed by the company. The areas for CSR activities are eradication of tuberculosis, promoting education, art and culture, healthcare, and rehabilitation and rural development projects. These contributions by the Company were spent on activities, which are specified in Schedule VII of the Companies Act, 2013.

10. Previous Year's figures have been regrouped/ rearranged, wherever considered necessary, to conform to current year's classification.


Mar 31, 2014

1. a) Contingent Liabilities

A) Claims against the Company not acknowledged as debts:

(Rs. in Lacs)

Sr. No. Particulars As at 31.03.2014 As at 31.03.2013

(i) Service Tax demand raised by authorities against which 633.08 633.08 appeal has been fled by the Company (Refer Note 1 below)

(ii) Income Tax demand raised by authorities against which 5,448.23 5,196.73 appeal has been fled by the Company

(iii) Others (to the extent ascertainable) 2,432.49 1,127.10

(iv) Other matters (Refer Note 2 below) 12,209.79 18,275.72

Notes:

1. The Company has deposited an amount of Rs. 633.08 Lacs (Previous year: Rs.633.08 Lacs) with the service tax authorities, which is included in "Balance with Government Authorities – Note 13".

2. Hinduja Ventures Limited has received income tax demand pertaining to IT/ITES business aggregating Rs. 12,209.79 Lacs (Previous Year: Rs.18,275.72 Lacs) in respect of period prior to October 1, 2006 which is reimbursable by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid Rs.5,550 Lacs (Previous Year: Rs.3,750 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ITES business, which is included in the ''Loans and Advances to related parties'' under Note 13 – ''Long-term loans and advances''. Hinduja Ventures Limited has fled an appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has strong case to succeed.

3. Future cash outflow in respect of above, if any, is determinable only on receipt of judgments/decisions pending with relevant authorities.

B) Guarantees given in favour of:

Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

California Physicians'' Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

b) Capital and other commitments:

(i) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account – Rs.367.77Lacs (Previous Year – Rs. 41.53 Lacs).

(ii) The Company has issued an Undertaking to provide need based financial support and is committed, if needed, to continue such support to meet the ongoing obligations of its following step-down subsidiaries.

i. Hinduja Global Solutions Inc.

ii. C-Cubed N.V

iii. Hinduja Global Solutions Europe Limited

iv HGS St. Lucia

There has been no payments during the year against these undertakings.

2. Disclosures in terms of Accounting Standard 15 (Revised 2005) ''Employee Benefits''.

The Company has classified various benefits provided to employees as under: –

I Defined Contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defined Contribution Plans

i. Employers'' Contribution to Employee''s State Insurance

ii. Employers'' Contribution to Employee''s Pension Scheme 1995

C) Percentage of each Category of Plan Assets to total Fair Value of Plan Assets as at March 31, 2014

The Plan Assets for Defined Benefit Plan in India are administered by Life Insurance Corporation of India (''LIC'') as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance Regulatory and Development Authority Regulations. In case of defend benefit plan at a foreign branch, the Plan Assets are administered by the Investment department of Deutsche Bank AG. The Plan Assets consists of investment in Government Bonds 29.27% (Previous Year: 71.93%), Cash and Cash Equivalents 67.55% (Previous Year: 1.27%), Corporate Bonds 2.86% (Previous Year: 0.88%) and Others 0.32% (Previous Year: 25.92%) for an amounts aggregating Rs.1,360.58 Lacs (Previous Year Rs." 1,500.03 Lacs).

3. Segment Information

In accordance with paragraph 4 of Accounting Standard 17 "Segment Reporting", the Company has presented segmental information only on the basis of the Consolidated financial statements (Refer Note 26 of the Consolidated financial statements).

4. Related Party Disclosures (as identified by the Management)

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (Includes step-down subsidiaries)

1. HGS International, Mauritius

2. HGS International Services Private Limited, India

3. HGS Business Services Private Limited, India (Up to June 30, 2013. Also refer foot note to Note 12)

4. Hinduja Global Solutions Inc., U.S.A.

5. HGS Canada Inc., Canada

6. C-Cubed B.V., Netherlands

7. C-Cubed N.V., Curacao

8. Customer Contact Centre Inc., Philippines

9. Hinduja Global Solutions Europe Limited, U.K.

10. Hinduja Global Solutions UK Limited, U.K.

11. HGS France, S.A.R.L

12. HGS (USA), LLC

13. RMT L.L.C., U.S.A.

14. Affina Company, Canada

15. HGS St. Lucia Ltd, Saint Lucia

16. Team HGS Limited, Jamaica

17. HGS Properties LLC, U.S.A.

18. HGS Canada Holdings LLC, U.S.A.

19. HGS Italy, S.A.R.L

20. HGS EBOS LLC , U.S.A. (w.e.f. October 8, 2012)

21. HGS Mena FZ LLC, U.A.E (w.e.f February 4, 2014)

III Key Management Personnel

Mr. Partha DeSarkar, Chief Executive Officer and Manager

IV Enterprises where common control exists

1. Hinduja Group India Limited

2. Hinduja Group Limited (formerly Aasia Management and Consultancy Private Limited)

3. Hinduja Ventures Limited

4. IndusInd Media and Communication Limited

5. In Entertainment (India) Limited

6. Ashley Aviation Limited

V Relatives of Key Management personnel Rs. Mr. Pabitra DeSarkar

5. Operating Leases

The operating lease arrangement relating to office premises extend up to a period of twenty years from the respective dates of inception, which includes both cancellable and non-cancellable leases. Most of the leases are renewable for further period on mutually agreeable terms and also include escalation clauses.

B. The Company has entered into other various cancellable leasing arrangements for office and residential premises and towards which an amount of Rs.279.44 Lacs (Previous Year - Rs.179.25 Lacs) have been recognised in the Statement of Profit and Loss.

6. Exceptional Item for the year ended March 31, 2013 represents net claims receivable written-off consequent to settlement of dispute with a bank.

7. Current tax includes provision for tax of Rs.338.70 Lacs (Previous Year: Rs.304.20 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

8. Previous Year''s figures have been regrouped/ rearranged, wherever considered necessary, to conform to current year''s classification.


Mar 31, 2013

1. General Information

Hinduja Global Solutions Limited ("HGS"), is engaged in Business Process Management. HGS with its subsidiaries offer voice and non-voice based services such as contact centre solutions and back office transaction processing across North America, Europe and Asia. HGS is a public limited company, listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) in India.

2. a) Contingent Liabilities

A) Claims against the Company not acknowledged as debts:

(Rs. in Lacs)

Particulars As at 31.03.2013 As at 31.03.2012

(i) Service Tax demand raised by authorities against which appeal 633.08 633.08 has been filed by the Company (Refer Note 1 below)

(ii) Income Tax demand raised by authorities against which appeal 5,196.73 1,336.31 has been filed by the Company

(iii) Others (to the extent ascertainable) 1,124.15 694.64

(iv) Other matters (Refer Note 2 below) 18,275.72 16,662.50

Notes:

1. The Company has deposited an amount of R 633.08 Lacs (Previous year: R 633.08 Lacs) with the service tax authorities, which is included in "Balance with Government Authorities - Note 13".

2. Hinduja Ventures Limited has received income tax demand pertaining to IT/ ITES business aggregating R18,275.72 Lacs (Previous Year: R16,662.50 Lacs) in respect of period prior to October 1, 2006 which is reimbursable by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid R 3,750 Lacs (Previous Year: R 3,750 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ ITES business, which is included in the ''Loans and Advances to related parties'' under Note 13 - ''Long-term loans and advances''. Hinduja Ventures Limited has filed an appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has strong case to succeed.

3. Future cash outflow in respect of above, if any, is determinable only on receipt of judgements/ decisions pending with relevant authorities.

B) Guarantees given in favour of:

- Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

- California Physicians'' Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

b) Capital and other commitments:

(i) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account - R 41.53 Lacs (Previous Year - R 98.27 Lacs).

(ii) The Company has issued an Undertaking to provide need based financial support and is committed, if needed, to continue such support to meet the ongoing obligations of its following step-down subsidiaries.

i. Hinduja Global Solutions Inc.

ii. C-Cubed N.V.

iii. Hinduja Global Solutions Europe Limited

3. Disclosures in terms of Accounting Standard 15 (Revised 2005) ''Employee Benefits''.

The Company has classified various benefits provided to employees as under: -

I Defined Contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defined Contribution Plans

i. Employers'' Contribution to Employee''s State Insurance

ii. Employers'' Contribution to Employee''s Pension Scheme 1995

4. Segment Information

In accordance with paragraph 4 of Accounting Standard 17 "Segment Reporting", the Company has presented segmental information only on the basis of the Consolidated financial statements (Refer Note 26 of the Consolidated financial statements).

5. Related Party Disclosures (as identified by the Management)

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (Includes step-down subsidiaries)

1. HGS International, Mauritius

2. HGS International Services Private Limited, India (formerly known as Hinduja Outsourcing Solutions India Private Limited)

3. HGS Business Services Private Limited, India (formerly known as HCCA Business Services Private Limited)

4. Hinduja Global Solutions Inc., U.S.A.

5. HGS Canada Inc., Canada (formerly known as Online Support Inc.)

6. C-Cubed B.V., Netherlands

7. C-Cubed N.V., Curacao

8. Customer Contact Centre Inc., Philippines

9. Hinduja Global Solutions Europe Limited, U.K.

10. Hinduja Global Solutions UK Limited, U.K. (formerly known as Careline Services Limited)

11. HGS France, S.A.R.L (formerly known as Hinduja TMT France, S.A.R.L)

12. HGS (USA), LLC

13. RMT L.L.C., U.S.A.

14. Affina Company, Canada

15. HGS St. Lucia Ltd, Saint Lucia

16. Team HGS Limited, Jamaica

17. HGS Properties LLC, U.S.A.

18. HGS Canada Holdings LLC, U.S.A.

19. HGS Italy, S.A.R.L

20. HGS EBOS LLC , U.S.A. (w.e.f. October 8, 2012 )

III Key Management Personnel

Mr. Partha DeSarkar, Chief Executive Officer and Manager

IV Enterprises where common control exists

1. Hinduja Group India Limited

2. Aasia Management and Consultancy Private Limited

3. Hinduja Ventures Limited

4. IndusInd Media and Communication Limited

5. Hinduja Healthcare Private Limited

V Relatives of Key Management personnel Mr. Pabitra DeSarkar

6. Exceptional Item represents net claims receivable writtten-off consequent to settlement of dispute with a bank.

7. Current tax includes provision for tax of R 304.20 Lacs (Previous Year: R 256.36 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

8. Previous Year''s figures have been regrouped/ rearranged, wherever considered necessary, to conform to current year''s classification.


Mar 31, 2012

1. General Information

Hinduja Global Solutions Limited ("HGS"), is engaged in the business of Information Technology/ Information Technology Enabled Services. HGS with its subsidiaries offer voice and non-voice based services such as contact centre solutions and back office transaction processing across North America, Europe and Asia. HGS is a public limited company, listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) in India.

a. Rights, preferences and restrictions attached to equity shares:

The Company has one class of Equity Shares having a par value of R 10 each. Each Shareholder is eligible for one vote per share held.

The dividend proposed by the Board of Directors is subject to the approval of the Shareholders in the ensuing Annual General Meeting, except in case of Interim Dividend.

In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion to their shareholding.

b. 20,538,003 Equity Shares issued for consideration other than cash pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company, sanctioned by Honourable High Court of Bombay effective March 7, 2007.

2. a) Contingent Liabilities

A) Claims against the Company not acknowledged as debts:

(R in Lacs)

Particulars As at 31.03.2012 As at 31.03.2011

(i) Service Tax demand raised by authorities against which appeal 633.08 633.08 has been filed by the Company (Refer Note 1 below)

(ii) Income Tax demand raised by authorities against which appeal 1,336.31 1,336.31 has been filed by the Company

(iii) Others (to the extent ascertainable) 694.64 80.24

(iv) Other matters (Refer Note 2 below) 16,662.50 15,390.48

Notes:

1. The Company has deposited an amount of R 633.08 Lacs (Previous year: R 633.08 Lacs) with the service tax authorities, which is included in "Balance with Government Authorities - Note 13".

2. Hinduja Ventures Limited has received income tax demand pertaining to IT/ ITES business aggregating R 16,662.50 Lacs (Previous Year: R15,390.48 Lacs) in respect of period prior to October 1, 2006 which is reimbursable by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid R 3,750 Lacs (Previous Year: R 3,150 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ ITES business, which is included in the 'Loans and Advances to related parties' under Note 13 - 'Long-term loans and advances'. Hinduja Ventures Limited has filed appeal/ is in process of filing an appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has fairly a strong case for a favourable decision.

3. Future cash outflow in respect of above, if any, is determinable only on receipt of judgements/ decisions pending with relevant authorities.

4. Subsequent to the demerger of IT/ ITES business from Hinduja Ventures Limited into the Company, certificates in respect of tax deducted at source by the customers under the Income Tax Act, 1961 of India aggregating R1,315.03 Lacs (Previous Year: R 1,315.03 Lacs) were received in the name of Hinduja TMT Limited (now known as 'Hinduja Ventures Limited'). In view of the Management, the Company is eligible for the benefits of such tax deducted at source since the services were provided by the Company. Further, certificates of tax deducted at source aggregating R1,081.70 Lacs (Previous year: R 1,606.53 Lacs) are in process of being collected from the customers.

B) Guarantees given in favour of:

- Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

- California Physicians' Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

b) Capital and other commitments:

(i) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account - R 98.27 Lacs (Previous Year - R 216.38 Lacs).

(ii) The Company has issued an Undertaking to provide need based financial support and is committed, if needed, to continue such support to meet the ongoing obligations of its following step-down subsidiaries:

i. Hinduja Global Solutions Inc.

ii. C-Cubed (Antilles) N.V.

iii. C-Cubed B.V.

iv. Hinduja Global Solutions Europe Limited

3. Disclosures in terms of Accounting Standard 15 (Revised 2005) 'Employee Benefits'.

The Company has classified various benefits provided to employees as under: -

I Defined Contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defined Contribution Plans

i. Employers' Contribution to Employee's State Insurance

ii. Employers' Contribution to Employee's Pension Scheme 1995

During the year, the Company has recognised the following amounts in the Statement of Profit and Loss -

C) Percentage of each Category of Plan Assets to total Fair Value of Plan Assets as at March 31, 2012

The Plan Assets for Defined Benefit Plan in India are administered by Life Insurance Corporation of India ('LIC') as per Investment Pattern stipulated for Pension and Group Schemes Fund by Insurance Regulatory and Development Authority Regulations. In case of defined benefit plan at a foreign branch, the Plan Assets are administered by the Investment department of Deutsche Bank AG. The Plan Assets consists of deposits with a bank aggregating R 837.12 Lacs (Previous Year R 228.50 Lacs).

4. Segment Information

Primary Segment

The Company has identified business segment as its primary segment. In accordance with Accounting Standard 17 "Segmental Reporting", the Company has determined its operations as a single reportable business segment, namely Information Technology/ Information Technology Enabled Services. Hence, it has no other primary reportable segments. Thus, the segment revenue, segment results, total carrying value of segment assets and liabilities, capital expenditure incurred to acquire the assets, the total amount of charge for depreciation are all as reflected in the financial statements as of and for the year ended March 31, 2012.

Secondary Segment

The Company has identified geographical segment as its secondary segment. The details of geographical segment are as follows:

5. Related Party Disclosures (as identified by the Management)

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (Includes step-down subsidiaries)

1. HGS International, Mauritius (formerly known as Pacific Horizon Limited, Mauritius)

2. Hinduja Outsourcing Solutions India Private Limited, India

3. HCCA Business Services Private Limited, India (w.e.f. August 12, 2011)

4. Hinduja Global Solutions Inc., U.S.A.

5. Online Support Inc., Canada (w.e.f. August 2, 2011)

6. C-Cubed B.V., Netherlands

7. C-Cubed (Antilles) N.V., Curacao

8. Customer Contact Centre Inc., Manila

9. Hinduja Global Solutions Europe Limited, U.K. (formerly known as HTMT Europe Limited, U.K.)

10. Careline Services Limited, U.K.

11. Hinduja TMT France, S.A.R.L

12. HGS (USA), LLC (formerly known as Affina L.L.C ., U.S.A)

13. RMT L.L.C., U.S.A

14. Affina Company, Canada

15. HGS St. Lucia Ltd, Jamaica

16. Team HGS Limited, Jamaica

17. HGS Properties LLC, U.S.A. (w.e.f. November 28, 2011)

18. HGS Canada Holdings LLC, U.S.A.

19. HGS Italy, S.A.R.L

III Key Management Personnel Mr. Partha DeSarkar

IV Enterprises where common control exists

1. Hinduja Group India Limited

2. Aasia Management and Consultancy Private Limited

3. Hinduja Ventures Limited

4. IndusInd Media and Communication Limited

5. Hinduja Healthcare Private Limited

6. Hinduja Realty Ventures Limited

V Relatives of Key Management personnel Mr. Pabitra DeSarkar

Mrs. Samya Ahmed

6. Current tax includes provision for tax of R 256.36 Lacs (Previous Year: R 274.80 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

7. The financial statements for the year ended March 31, 2011 had been prepared as per the then applicable, pre- revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements.


Mar 31, 2011

1. Commitments and Contingent Liabilities

a) Estimated Amount of Contracts (net of capital advances) remaining to be executed on Capital Account - Rs. 216.38 Lacs (Previous Year - Rs. 193.05 Lacs).

b) Contingent liabilities in respect of:

(Rs. in Lacs)

Particulars As at As at 31.03.2011 31.03.2010

(i) Service Tax demand raised by authorities against which appeal 633.08 359.02 has been filed by the Company (Refer Note 1 below)

(ii) Other claims against the Company not acknowledged as debts 80.24 4.79 (to the extent ascertainable)

(iii) Income Tax demand raised by authorities against which appeal has been filed by the Company 1,336.31 --

(iv) Other matters (Refer Note 2 below) 15,390.48 14,042.81

Notes:

1. The Company has deposited an amount of Rs. 633.08 Lacs (Previous year - Rs. Nil) with the service tax authorities, which is included in "Balance with Excise and Custom Authorities - Schedule J".

2. Hinduja Ventures Limited has received income tax demand pertaining to IT/ ITES business aggregating Rs. 15,390.48 Lacs (Previous Year - Rs. 14,042.81 Lacs) in respect of period prior to October 1, 2006 which will be reimbursed by the Company pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT/ITES business into the Company sanctioned by High Court of Judicature of Bombay and made effective on March 7, 2007. In this regard, the Company has paid Rs. 3,150 Lacs (Previous Year - Rs. 1,350 Lacs) to Hinduja Ventures Limited to discharge part payment of disputed Income tax dues pertaining to IT/ ITES business, which is included in the Advances Recoverable in Cash or in Kind or for value to be received. Hinduja Ventures Limited has fi led appeal against the said demand. In view of Management and based on the legal advice obtained, the Company has fairly a strong case for a favourable decision.

3. Future cash outfl ow in respect of above, if any, is determinable only on receipt of judgements/ decisions pending with relevant authorities.

4. Subsequent to the demerger of IT/ ITES business from Hinduja Ventures Limited into the Company, certifi cates in respect of tax deducted at source by the customers under the Income Tax Act, 1961 of India aggregating Rs. 1,315.03 Lacs (Previous Year - Rs. 1,315.03 Lacs) were received in the name of Hinduja Ventures Limited. In view of the Management, the Company is eligible for the benefits of such tax deducted at source since the services were provided by the Company. Further, certifi cates of tax deducted at source aggregating Rs. 1,606.53 Lacs (Previous year - Rs. 1,423.31 Lacs) are in process of being collected from the customers.

c) Guarantees/ Bonds outstanding as at March 31, 2011 are as follows:

Guarantees given by banks on behalf of the Company - Rs. 241.77 Lacs (Previous Year - Rs. 216.75 Lacs)

Indemnity Bond given by Company to Deputy Commissioner and Assistant Commissioner of Customs and Assistant Commissioner of Central Excise towards obtaining 100% EOU status for its locational Offices - Rs. 4,330.55 Lacs (Previous Year - Rs. 4,617.36 Lacs)

Corporate Guarantees given in favour of:

Ryder System, Inc., to guarantee the payment and performance of Hinduja Global Solutions Inc., a subsidiary company, under the Outsourcing Master Services Agreement entered between the two.

Zurich Services Corporation, Schaumburg to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

California Physicians Service dba Blue Shield of California to secure the performance of Hinduja Global Solutions Inc., a subsidiary company, under the Master Service Agreement, pursuant to which Hinduja Global Solutions Inc. has contracted to perform certain services.

Irrevocable Letter of Credit aggregating USD 2,000,000 (Previous Year - USD 2,000,000) [equivalent Rs. 888.00 Lacs (Previous Year - Rs. 899.50 Lacs)] issued towards performance of an overseas contract against charge on current and fixed assets of the Company, both present and future.

4. Segment Information

Primary Segment

The Company has identifi ed primary segment to be business segment. In accordance with Accounting Standard 17 "Segmental Reporting", the Company has determined its operations as a single reportable business segment, namely Information Technology/ Information Technology Enabled Services. Hence, it has no other primary reportable segments. Thus, the segment revenue, segment results, total carrying value of segment assets and liabilities, capital expenditure incurred to acquire the assets, the total amount of charge for depreciation are all as refl ected in the fi nancial statements as of and for the year ended March 31, 2011.

5. Related Party Disclosures (as identifi ed by the Management)

I Individual having control with his relatives and associates

Mr. Ashok P. Hinduja

II Subsidiaries of Hinduja Global Solutions Limited (includes indirect subsidiaries)

1. Pacifi c Horizon Limited, Mauritius

2. Hinduja Outsourcing Solutions India Private Limited (w.e.f. May 13, 2010)

3. Hinduja Global Solutions Inc., U.S.A. (formerly known as Source1 HTMT Inc., U.S.A.)

4. C-Cubed B.V., Netherlands

5. C-Cubed (Antilles) N.V., Netherlands

6. Customer Contact Centre Inc., Manila

7. HTMT Europe Limited, U.K.

8. Careline Services Limited, U.K. (w.e.f. June 21, 2010)

9. Hinduja TMT France, S.A.R.L

10. Affi na L.L.C ., U.S.A

11. RMT L.L.C, U.S.A

12. Affi na Company, Canada

III Key Management Personnel

Mr. Partha De Sarkar

IV Enterprises where common control exists

1. Impeccable Imaginations Private Limited (formerly known as Serendipity Films Private Limited)

2. Hinduja Group India Limited

3. Aasia Management and Consultancy Private Limited

4. Hinduja Ventures Limited

5. IndusInd Media and Communication Limited

6. Hinduja Healthcare Private Limited

7. Hinduja Realty Ventures Limited

V Relatives of Key Management personnel

Mrs. Samya Ahmed

12. There are no delays in payments to Micro and Small Enterprises as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006. Further, there are no outstanding dues payable to micro and small enterprises at the year-end.

This has been determined to the extent such parties have been identifi ed on the basis of information available with the Company.

13. Exceptional income of Rs. 576.05 Lacs in the previous year ended March 31, 2010 represents write back of provision for mark-to-market losses on outstanding forward exchange contracts held for hedging future customer receivables on account of appreciation of rupee against US dollar.

14. Disclosures in terms of Accounting Standard 15 (Revised 2005) Employee Benefits.

The Company has classifi ed various benefits provided to employees as under:

I Defi ned Contribution Plans

a) Provident Fund

b) Superannuation Fund

c) State Defi ned Contribution Plans

i. Employers Contribution to Employees State Insurance

ii. Employers Contribution to Employees Pension Scheme 1995.

15. The details of Employee Stock Option Plan [ESOP] of the Company are as follows:

The Shareholders of the Company at their Annual General Meeting held on 27th September 2008 granted approval to the HTMT Global Solutions Limited Employees Stock Option Plan 2008 (now Hinduja Global Solutions Employees Stock Option Plan 2008) ("ESOP 2008"). Subsequently, the Compensation Committee approved the terms and conditions relating to ESOP 2008 and options were granted on 31st July, 2009. The details of ESOP 2008 is as follows:

Maximum grant of options

The maximum number of options that could be issued under ESOP 2008 is 205,380 (being 1% of the outstanding equity shares of the Company as at April 1, 2009)

Vesting Period

Options to vest over a period of three years from the date of their grant as under:

- 1/6th of the options granted will vest on the first anniversary of the grant date.

- 1/3rd of the options granted will vest on the second anniversary of the grant date.

- 1/2 of the options granted will vest on the third anniversary of the grant date.

Exercise Period

Options vested with an employee will be exercisable prior to completion of the 48th month from the date of their grant by subscribing to the number of equity shares in the ratio of one equity share for every option. In the event of cessation of employment due to death, resignation or otherwise the options may lapse or be exercisable in the manner specifi cally provided for in the Scheme.

Exercise Price

Rs. 400.10 per share

The exercise price per share is determined on the basis of closing price at the

National Stock Exchange of India Limited immediately preceding the date of grant.

Method of Accounting and Intrinsic Value

The compensation costs of stock options granted to employees are accounted using the intrinsic value method. Intrinsic value is the amount by which the quoted market price of the underlying share exceeds the exercise price of the option. In view of exercise price being equal to closing market price on the day prior to the date of the grant, the intrinsic value of the option is Rs. Nil.

Fair Value and Model Used

Rs. 178.04 per option.

The fair value of stock option has been calculated using Black-Scholes Option Pricing Model.

16. Current tax includes provision for tax of Rs. 274.80 Lacs (Previous Year - Rs. 114.09 Lacs) pertaining to overseas branches which is determined as per the laws applicable in the relevant country.

17. Previous Years figures have been regrouped/ rearranged, wherever necessary, to conform to the current years classification.

 
Subscribe now to get personal finance updates in your inbox!