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Notes to Accounts of Wipro Ltd.

Mar 31, 2015

1. Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Services (BPS), globally and IT Products.

Wipro is a public limited company incorporated and domiciled in India. The address of its registered office is Wipro Limited, Doddakannelli, Sarjapur Road, Bangalore - 560 035, Karnataka, India. Wipro has its primary listing with Bombay Stock Exchange and National Stock Exchange in India. The Company''s American Depository Shares representing equity shares are also listed on the New York Stock Exchange.

2. Corporate Social Responsibility

a) Gross amount required to be spent by the Company during the year isRs. 1,283.

b) Amount spent during the year on:

3. Capital commitments

The estimated amount of contracts remaining to be executed on Capital account and not provided for, net of advances is Rs. 863 (2014: Rs. 614).

4. Contingent Liabilities, to the extent not provided for

Contingent liabilities in respect of:

As at March 31,

2015 2014

Disputed demands for excise duty, customs duty, sales tax and other matters 2,560 2,338

Performance and financial guarantees given by the banks

on behalf of the Company 18,084 19,946

Guarantees given by the Company on behalf of subsidiaries| 8,7151 5,036

The Company''s Indian operations have been established as units in Special Economic Zone and Software Technology Park Unit under plans formulated by the Government of India. As per the plan, the Company''s India operations have export obligations to the extent of net positive foreign exchange (i.e. foreign exchange inflow- foreign exchange outflow should be positive) over a five year period. The consequence of not meeting this commitment in the future would be a retroactive levy of import duties on certain hardware previously imported duty free. As at March 31, 2015, the Company has met all commitments required underthe plan.

Tax Demands:

Company received a tax demand for year ended March 31, 2001 arising primarily on account of denial of deduction under section 10A of the Income Tax Act, 1961 (Act) in respect of profit earned by the Company''s undertaking in Software Technology Parkat Bangalore. The same issue was repeated in the successive assessments for the years ended March 31,2002 to March 31,201 Oand the aggregate demand is Rs. 46,515 (including interest ofRs. 13,673). The appeals filed against the said demand before the Appellate authorities have been allowed in favor of the Company by the second appellate authority for the years up to March 31, 2007. Further appeals have been filed by the Income taxauthorities before the Hon''ble High Court.The Hon''ble

High Court has heard and disposed off the appeals up to years ended March 31, 2004. Order of the Hon''ble High Courtis not yet received.

On similar issues for years prior to years ended March 31, 2001, the Hon''ble High Court in Karnataka has upheld the claim of the Company under section lOAoftheAct. For the year ended March 31, 2008, March 2009, the appeals are pending before Income Tax Appellate Tribunal (Tribunal). For year ended March 31, 2010, the Dispute Resolution Panel (DRP) allowed the claim of the Company under section 10A of the Act. The Income tax authorities have filed an appeal before the Tribunal. For year ended March 31,2011, the Company received the draft assessment order in March 2015, on similar grounds as that of earlier years, with a demand of Rs. 7,852 (including interest ofRs. 2,547) for the financial year ended March 31,2011.

Considering the facts and nature of disallowance and the order of the appellate authority/Hon''ble Karnataka High Court upholding the claims of the Company for earlier years, the Company believes that the final outcome of the above disputes should be in favor of the Company and there should not be any adverse impact on the financial statements.

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The resolution of these legal proceedings is not likely to have a material and adverse effect on the results of operations or the financial position of the Company.

5. Adoption of AS 30

The Company has applied the principles of AS 30, Financial Instruments: Recognition and measurement, as per announcement by ICAI to the extent such principles of AS 30 does not conflict with existing accounting standards prescribed under Section 133 of the Companies Act, 2013 (''Act'') read with Rule 7 of the Companies (Accounts) Rules, 2014, the provisions of Companies Act, 2013 (to the extent notified and applicable) and other authoritative pronouncements.

The Company has designated USD 145 Million (2014: USD 220 Million), Euro Nil (2014: Euro 25 Million) of forward contracts as hedges of its net investment in non- integral foreign operation and has also designated a dollar- denominated foreign currency borrowing amounting to USD 150 Million (2014: USD 150 Million) as a hedging instrument to hedge net investment in non-integral foreign operations. As equity investments in non-Integral foreign subsidiaries / operations are stated at historical cost, in these standalone financial statements, the changes in fair value of derivative contracts and impact of restatement of foreign currency borrowing amounting to (loss) / gain of Rs. 390 million for the year ended March 31,2015 has been recorded in the statement of profit and loss as part of other income [2014:Rs. (2,607)].

6. Derivatives

As at March 31,2015 the Company has recognised gain of Rs. 4,270 million (2014: Rs. 569) relating to derivative financial instruments (comprising foreign currency forward contract, option contracts and interest rate swap) that are designated as effective cash flow hedges in the shareholders''fund.

The following table presents the aggregate contracted principal amounts of the Company''s derivative contracts outstanding as at:

As of the balance sheet date, the Company has net foreign currency exposures that are not hedged by a derivative instrument or otherwise amounting to Rs. 18,398 (2014: Rs. 9,403).

7. Finance lease receivables

The Company provides lease financing for the traded and manufactured products primarily through finance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly or quarterly installments over periods ranging from 1 to 7 years.

The components of finance lease receivables are as follows:

8. Assets taken on lease

Finance leases:

The following is a schedule of present value of future minimum lease payments under finance leases, together with the value of the minimum lease payments as at March 31,2015

Operating leases:

The Company has taken on lease office, residential facilities and IT equipment''s under cancelable and non-cancelable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs. 2,682 and Rs. 3,040 during the years ended March 31,2015 and 2014, respectively.

9. Employee benefit plans

Gratuity: In accordance with applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity Plan) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employee''s lastdrawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life,Tata AIG and Birla Sun Life (''Insurer''). Under this plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

The Company has invested the plan assets in the insurer managed funds. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. Expected contribution to the fund for the year ending March 31,2016 is Rs. 789.

The Company assesses these assumptions with its projected long-term plans of growth and prevalent industry standards. The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

Superannuation: Apart from being covered under the gratuity plan, the employees of the Company also participate in a defined contribution plan maintained by the Company. This plan is administered by the Life Insurance Corporation of India and ICICI Prudential Insurance Company Limited.The Company makes annual contributions based on a specified percentage of each covered employee''s salary.

For the year ended March 31,2015, the Company has contributed (net) Rs. 367 to superannuation fund [2014: contribution recognized Rs. 332], in the statement of profit and loss.

Provident Fund (PF): In addition to the above, all employees receive benefits from a provident fund. The employee and employer each make monthly contributions to the plan. A portion of the contribution is made to the provident fund trust established by the Company, while the remainder of the contribution is made to the Government administered pension fund.

The interest rate payable by the trust to the beneficiaries is regulated by the statutory authorities. The Company has an obligation to make good the shortfall, if any, between the returns from its investments and the administered rate.

39. Employee stock option

i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans (collectively"stock option plans") are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of three to five years from the date of grant. Upon vesting, the employees can acquire one equity share for every option. The maximum contractual term for these stock option plans is generally 10 years.

ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basisoverthetotal vesting period of five years. The intrinsic value on the date of grant approximates the fair value. For the year ended March 31,2015, the Company has recorded stock compensation expense of Rs.1,296 (2014: Rs. 535).

iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specified period subject to fulfillment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Company''s shares at a price determined on the date of grant of options.The particulars of options granted undervariousplansare tabulated below. (The number of shares in the table below is adjusted for any stock splits and bonus shares issues).

Wipro Employee Stock Option Plans and Restricted Stock Unit Option Plans

A summary of the general terms of grants under stock option plans and restricted stock unit option plans are as follows:

42. As at March 31, 2015 Rs. 22 Million is outstanding to Micro and Small Enterprises (Includes Rs. 1 Million of interest due and outstanding on the same) (2014: NiQ.This information has been determined to the extent such parties have been identified on the basis of information available with the Company.

45. Amalgamation of Companies

The Company has two wholly owned subsidiaries namely, Wipro Technology Services (''WTS'') and Wipro Energy IT Services Limited (''WEITSL'') who are engaged in the business of providing information technology services including software maintenance and support services. During the previous year, WTS and WEITSL have been amalgamated with the Company in terms of the scheme of amalgamation (''Scheme'') sanctioned by the Honorable High Court of Karnataka pursuant to its Order dated March 28,2014. The Scheme became effective on April 9,2014 with appointed date of April 1,2013 when the sanction of the Honorable High Court of Karnataka and filing of the certified copy of the same with the Registrar of Companies. The Scheme has been accounted for under the''pooling of interest method''as prescribed under AS 14 as per the terms of the Court Order. Since the subsidiaries amalgamated were wholly owned subsidiaries of the Company, there was no exchange of shares to effect the amalgamation. The difference between the amounts recorded as investments of the Company and the amount of share capital of the aforesaid amalgamating subsidiaries have been adjusted in the reserves.

47. Income Tax

The provision for taxation includes tax liability in India on the Company''s worldwide income. The tax has been computed on the worldwide income as reduced by the various deductions and exemptions provided by the Income Tax Act in India (Act), 1961 and the tax credit in India for the tax liabilities payable in foreign countries.

Most of the Company''s operations are through units in Special Economic Zone and Software Technology Parks(''STPs''). Income from STPs is not eligible for deduction from April 01,2011. Income from SEZ''s are eligible for 100% deduction for the first 5 years, 50% deduction for the next 5 years and 50% deduction for another 5 years subject to fulfilling certain conditions.

The Company has calculated its tax liability after considering the provisions of law relating to Minimum Alternate Tax (MAT). As per the Act, any excess of MAT paid over the normal tax payable can be carried forward and set off against the future tax liabilities. Accordingly an amount ofRs. 1,838 is included under''Long term loans and advances'' in the balance sheet as at March 31,2015 (March 31,2014: Rs. 1,838).

i) Tax expenses provision includes reversal of tax provision in respect of earlier periods no longer required amounting toRs. 952 for the year ended March 31, 2015 (2014: Rs. 1,121) and MAT credit of Nil for the year ended March 31,2015 (2014: Nil).

48. The Company publishes standalone financial statements along with the consolidated financial statements in the annual report. In accordance with Accounting Standard 17, Segment Reporting, the Company has disclosed the segment information in the consolidated financial statements.


Mar 31, 2014

1. Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Outsourcing (BPO) services, globally and IT Products.

During the previous year ended March 31, 2013, the Company had initiated and completed the demerger of other businesses such as consumer care and lighting, infrastructure engineering business and other non IT business of the Company (collectively, the "Diversified Business", refer note 31 for further details) into Wipro Enterprises Limited ("Resulting Company"), a company incorporated underthe lawsof India.Wiprois headquartered in Bangalore, India.

2. Contingent Liabilities, to the extent not provided for

Contingent liabilities in respect of:

As at March 31,

2014 2013

Disputed demands for excise duty, customs duty, income tax, sales tax and other matters 2,338 2,273

Performance and financial guarantees given by the banks on behalf of the company 19,946 20,618

Guarantees given by the Company on behalf of subsidiaries 5,0361 2,597 2014, the Company has met all commitments required under the plan.

Tax Demands:

The Company had received tax demands aggregating to ? 42,883 (including interest of? 12,907) arising primarily on account of denial of deduction under section 10A of the Income Tax Act, 1961 in respect of profit earned by the Company''s undertaking in Software Technology Park at Bangalore for the years ended March 31,2001 to March 31,2009.The appeals filed against the said demand before the Appellate authorities have been allowed in favor of the Company by the second appellate authority for the years up to March 31, 2007. Further appeals have been filed by the Income tax authorities before the Honorable High Court. For the year ended March 31,2008 and 2009, the appeal is pending before the Income Tax Appellate Tribunal.

In March 2014, the Company received the draft assessment order, on similar grounds as that of earlier years, with a demand of ? 9,058 (including interest of ? 2,938) for the financial year ended March 31, 2010. Subsequent to the year end, the company has filed its objections against the said demand before the Dispute Resolution Panel.

Considering the facts and nature of disallowance and the order of the appellate authority upholding the claims of the Company for earlier years, the Company expects that the final outcome of the above disputes to be in favor of the Company and impact on the company''s financial statements is not expected to be material.

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business.The resolution of these legal proceedings is not likely to have a material and adverse effect on the results of operations or the financial position of the Company.

3. Adoption of AS 30

The Company has applied the principles of AS 30, as per announcement by ICAI to the extent such principles of AS 30 does not conflict with existing accounting standards prescribed by Companies (Accounting Standards) Rules, 2006 (as amended) and other authoritative pronouncements.

The Company has designated USD 220 million (2013: USD 357 million) and Euro 25 million (2013: Euro 40 million) of forward contracts as hedges of its net investments in non-integral foreign operations and has also designated a dollar-denominated foreign currency borrowing amounting to USD 150 Million during the current period (2013: Nil) as a hedging instrument to hedge net investment in non-integral foreign operations. The company had also designated a yen-denominated foreign currency borrowing in combination with Cross-Currency Interest Rate Swaps (CCIRS) amounting to JPY 24.5 billion, as a hedging instrument to hedge net investment in a non-integral foreign operation which was repaid during quarter ended June 30, 2013. As equity investments in non-integral foreign subsidiaries/operations are stated at historical cost, in these standalone financial statements, the changes in fair value of derivative contracts and impact of restatement of foreign currency borrowing amounting to loss of (? 2,607) for the year ended March 31,2014 has been recorded in the statement of profit and loss as part of other income [2013: (? 1,107)].

4. Derivatives

As at March 31, 2014 the Company has recognized gain of? 569 [2013: ? 1,278] relating to derivative financial instruments (comprising foreign currency forward contract, option contracts and interest rate swap) thatare designated as effective cash flow hedges in the shareholders''fund.

The following table presents the aggregate contracted principal amounts of the Company''s derivative contracts outstanding as at:

5. Finance lease receivables

The Company provides lease financing for the traded and manufactured products primarily through finance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 10 years.

6. Employee benefit plans

Gratuity: In accordance with applicable Indian laws, the Company provides forgratuity.a defined benefit retirement plan (Gratuity Plan) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employee''s last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life, Tata AIG and Birla Sun Life (''Insurer''). Underthis plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

7. Employee stock option

(i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans (collectively"stock option plans") are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of five years from the date of grant. Upon vesting, the employees can acquire one equity share for every option.The maximum contractual term for these stock option plans is generally 10 years.

(ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basisoverthetotal vesting period of five years. The intrinsic value on the date of grant approximates the fair value. For the year ended March 31,2014, the Company has recorded stock compensation expense of ? 535 (2013:? 804).

(iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specified period subject to fulfillment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Company''s shares at a price determined on the date of grant of options.The particulars of options granted under various plans are tabulated below (The number of shares in the table below is adjusted for any stock splits and bonus shares issues).

Wipro Employee Stock Option Plans and Restricted Stock Unit Option Plans

8. There are no Micro and Small Enterprises, to whom the company owes dues, which are outstanding for more than 45 days as at March 31, 2014 (2013: Nil). This information has been determined to the extent such parties have been identified on the basis of information available with the Company.

9. Amalgamation of Companies

The Company has two wholly owned subsidiaries namely, Wipro Technology Services Limited (''WTS'') and Wipro Energy IT Services Private Limited (''WEITSL'') who are engaged in the business of providing information technology services including software maintenance and support services. During the current year, WTS and WEITSL have been amalgamated with the Company in terms of the scheme of amalgamation (''Scheme'') sanctioned by the Honorable High Court of Karnataka pursuant to its Order dated March 28,2014. The Scheme became effective on April 9,2014 with appointed date of April 1,2013 when the sanction of the Honorable High Court of Karnataka and filing of the certified copy of the same with the Registrar of Companies. The Scheme has been accounted for under the''pooling of interest method''as prescribed under AS 14 as per the terms of the Court Order. Since the subsidiaries amalgamated were wholly owned subsidiaries of the Company, there was no exchange of shares to effect the amalgamation. The difference between the amounts recorded as investments of the Company and the amount of share capital of the aforesaid amalgamating subsidiaries have been adjusted in the reserves.


Mar 31, 2013

1. Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Outsourcing (BPO) services, globally and IT Products. During the financial year 2013, the Company had initiated and completed the demerger of other business such as consumer care and lighting, infrastructure engineering business and other non IT business of the Company (collectively, the "Diversified Business", refer Note 31 for further details) into Wipro Enterprises Limited ("Resulting Company"), a company incorported under the laws of India. Wipro is headquartered in Bangalore, India.

2. Share application money pending allotment

(a) Number of shares proposed to be issued for share application money pending allotment outstanding as at March 31, 2013 and 2012 is 158,400 and 150,824 respectively representing the shares to be issued under employee stock option plan formulated by the Company.

(b) Securities premium on account of shares pending allotment amounts to Rs. 41 and Rs. 39 as at March 31, 2013 and 2012, respectively included in the Restricted stock units reserve.

(c) The Company has sufficient authorized equity share capital to cover the share capital amount arising from allotment of shares pending allotment as at March 31, 2013 and 2012.

(d) There is no interest accrued and due on amount due for refund as at March 31, 2013 and 2012.

(e) No shares are pending for allotment beyond the period for allotment as at March 31, 2013 and 2012.

3. Demerger and Discontinued operations

During the year, the Company has initiated and completed the demerger of Diversified Business. The "Scheme of Arrangement" (''the Scheme") involved transfer of the Diversified Business to a "Resulting Company" [Wipro Enterprises Limited (formerly known as Azim Premji Custodial Services Private Limited)] whose equity shares are not listed in any stock exchange in India or abroad. The Resulting Company, at the option of the shareholder, issues either its equity or redeemable preference shares in consideration of the demerger to each shareholder of the Company on a proportionate basis. The Scheme also provides an option for the public shareholders to exchange equity shares of the Resulting Company for the listed shares in the Company held by the promoter group. The Scheme became effective on March 31, 2013 with an appointed date of April 01, 2012 when the sanction of the Honorable High Court of Karnataka and filing of the certified copy of the same with the Registrar of Companies. The Scheme of Demerger has been accounted for in terms of the Court Orders and alterations or modifications as approved by the Board of Directors of the Company and the Resulting Company as provided for in the Scheme.

Consequent to demerger of the Diversified Business of the Company in terms of the Scheme, the financial statements of the Company for the year ended March 31, 2013, do not include the operations of the Diversified Business, and are therefore strictly not comparable with the figures of the previous year ended March 31, 2012. Further, as at March 31, 2013 the Resulting Company held in trust, shares in certain step subsidiaries which remained with the Company. The transfer of the shares in the said step subsidiaries to the Company will be given effect through due process under relevant laws and regulations. However, the power to govern the operating and financial policies, the appointment of majority of the board of directors and appointment of key management personnel is with the Company in accordance with the agreement with the Resulting Company. Accordingly, the investments in these subsidiaries have been included as long-term investments.

The Resulting Company shall be required to reimburse and indemnify Wipro (''the Company'') against all liabilities and obligations incurred by the Company in legal, taxation and other proceedings in so far as such liabilities and obligations relates to period prior to the Appointed date i.e. April 01, 2012 in respect of the Demerged Undertaking as defined in the Scheme of Arrangement approved by the Honorable High Court of Karnataka. All the assets and liabilities relating to the Diversified Business of the Company, on the appointed date, have been transferred to the Resulting Company. The excess of assets over liabilities relating to the Diversified Business of Rs. 42,299 transferred

4. Capital commitments

The estimated amount of contracts remaining to be executed on Capital account and not provided for, net of advances is Rs. 1,090 (2012: Rs. 1,248).

d) The Company''s Indian operations have been established as units in Special Economic Zone and Software Technology Park Unit under plans formulated by the Government of India. As per the plan, the Company''s India operations have export obligations to the extent of net positive foreign exchange (i.e. foreign exchange inflow - foreign exchange outflow should be positive) over a five year period. The consequence of not meeting this commitment in the future would be a retroactive levy of import duties on certain hardware previously imported duty free. As at March 31, 2013, the Company has met all commitments required under the plan.

Tax Demands:

The Company had received tax demands aggregating to Rs. 39,356 (including interest of Rs. 12,170 ) arising primarily on account of denial of deduction under section 10A of the Income Tax Act, 1961 in respect of profit earned by the Company''s undertaking in Software Technology Park at Bangalore for the years ended March 31, 2001 to March 31, 2008. The appeals filed against the said demand before the Appellate authorities have been allowed in favor of the Company by the second appellate authority for the years up to March 31, 2007. Further appeals have been filed by the Income tax authorities before the Hon''ble High Court. For the year ended March 31, 2008, based on DRP directions confirming the position of the assessing officer, the final assessment order was passed by the assessing officer. The Company has filed an appeal against the said order before the Appellate Tribunal.

In March 2013, the Company received the draft assessment order, on similar grounds as that of earlier years, with a demand of Rs. 8164 (including interest of Rs. 848) for the financial year ended March 31, 2009. The Company will file its objections against the said demand before the Dispute Resolution Panel, within the time limit prescribed under the statute.

Considering the facts and nature of disallowance and the order of the appellate authority upholding the claims of the Company for earlier years, the Company believes that the final outcome of the above disputes should be in favor of the Company and there should not be any material impact on the financial statements.

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The resolution of these legal proceedings is not likely to have a material and adverse effect on the results of operations or the financial position of the Company

5. Adoption of AS 30

The Company has applied the principles of AS 30, as per announcement by ICAI, to the extent such principles of AS 30 does not conflict with existing accounting standards prescribed by Companies (Accounting Standards) Rules, 2006.

The Company has designated USD 357 million (2012: USD 262 million) and Euro 40 million (2012: Euro 40 million) of forward contracts as hedges of its net investments in non-integral foreign operations. The Company has also designated a yen-denominated foreign currency borrowing amounting to JPY 16.5 billion (2012: JPY 16.5 billion), along with a floating for floating Cross-Currency Interest Rate Swap (CCIRS), as a hedging instrument to hedge its net investment in a non-integral foreign operation. Further, the Company has also designated yen-denominated foreign currency borrowing amounting to JPY 8 billion (2012: JPY 8 billion) along with floating for fixed CCIRS as cash flow hedge of the yen-denominated borrowing and also as a hedge of net investment in a non-integral foreign operation. As equity investments in non-integral foreign subsidiaries/operations are stated at historical cost, in these standalone financial statements, the changes in fair value of forward contracts, the yen- denominated foreign currency borrowing and the related CCIRS amounting to loss of Rs. 1,107 for the year ended March 31, 2013 have been recorded in the statement of profit and loss as part of other income (2012: Rs. 2,787).

6. Derivatives

As at March 31, 2013 the Company has recognized gain / (loss) of Rs. 1,278 [2012: (Rs. 2,047)] relating to derivative financial instruments (comprising foreign currency forward contract, option contracts and interest rate swap) that are designated as effective cash flow hedges in the shareholders'' fund.

The following table presents the aggregate contracted principal amounts of the Company''s derivative contracts outstanding as at:

7. Finance lease receivables

The Company provides lease financing for the traded and manufactured products primarily through finance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 10 years.

8. Assets taken on lease

Finance leases:

The following is a schedule of present value of future minimum lease payments under finance leases, together with the value of the minimum lease payments as at March 31, 2013

9. Employee benefit plans

Gratuity: In accordance with applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity Plan) covering certain categories of employees.The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employee''s last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life, Tata AIG and Birla Sun Life (''Insurer''). Under this plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

10. Employee stock option

i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans (collectively "stock option plans") are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of five years from the date of grant. Upon vesting, the employees can acquire one equity share for every option. The maximum contractual term for these stock option plans is generally 10 years.

ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basis over the total vesting period of five years. The intrinsic value on the date of grant approximates the fair value. For the year ended March 31, 2013, the Company has recorded stock compensation expense of Rs. 804 (2012: Rs. 878).

iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specified period subject to fulfillment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Company''s shares at a price determined on the date of grant of options. The particulars of options granted under various plans are tabulated below. (The number of shares in the table below is adjusted for any stock splits and bonus shares issues).

11. Provisions

Provision for warranty represent cost associated with providing sales support services which are accrued at the time of recognition of revenues and are expected to be utilized over a period of 1 to 2 years from the balance sheet date. Other provisions primarily include provisions for tax related contingencies and litigations. The timing of cash outflows in respect of such provision cannot be reasonably determined. The activity in the provision balance is summarized below:

12. Earnings per share

The computation of equity shares used in calculating basic and diluted earnings per share is set out below:

Earnings per share and number of shares outstanding for the year ended March 31, 2012 and 2013, have been adjusted for the grant of 1 employee stock options for every 8.25 employee stock options held by each eligible employee in terms of the demerger scheme as on the Record Date.

13. The Management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at March 31, 2013 has been made in the annual financial statements based on information received and available with the Company. The Company has not received any claim for interest from any supplier under the said Act.

14. Acquisition

During the year, the Company acquired VIT Consultancy Private Limited in the IT Services segment. The Company believes that the acquisition will further strengthen Wipro''s presence in the banking domain. The goodwill of Rs. 129 comprises of value of expected synergies arising from these acquisitions. The purchase consideration of Rs. 207 was settled in cash.

15. Income Tax

The provision for taxation includes tax liability in India on the Company''s worldwide income. The tax has been computed on the worldwide income as reduced by the various deductions and exemptions provided by the Income tax Act in India (Act) and the tax credit in India for the tax liabilities payable in foreign countries.

Most of the Company''s operations are through units in Special Economic Zone and Software Technology Parks (''STPs''). Income from STPs is not eligible for deduction from April 01, 2011. Income from SEZ''s are eligible for 100% deduction for the first 5 years, 50% deduction for the next 5 years and 50% deduction for another 5 years subject to fulfilling certain conditions.

The Company has calculated its tax liability after considering the provisions of law relating to Minimum Alternative Tax (MAT). As per the Act, any excess of MAT paid over the normal tax payable can be carried forward and set off against the future tax liabilities. Accordingly an amount of Rs. 1,779 is included under ''Long term loans and advances'' in the balance sheet as at March 31, 2013 (March 31, 2012: Rs. 1,060).

i ) Tax expense provision includes reversal of tax provision in respect of earlier periods no longer required amounting to Rs. 868 for the year ended March 31, 2013 (2012: Rs. 745) and MAT credit of Rs. 719 for the year ended March 31, 2013 (2012: Rs. 1,060).

ii) The components of the deferred tax (net) are as follows:

16. The Company publishes standalone financial statements along with the consolidated financial statements in the annual report. In accordance with Accounting Standard 17, Segment Reporting, the Company has disclosed the segment information in the consolidated financial statements.

17. Corresponding figures for previous year presented have been regrouped, where necessary, to conform to the current year classification.

18. Additional information pursuant to Schedule VI


Mar 31, 2012

1. Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Outsourcing (BPO) services, globally. Further, Wipro has other businesses such as IT Products, Consumer Care and Lighting and Infrastructure engineering. Wipro is headquartered in Bangalore, India.

2. Share application money pending allotment

(a) Number of shares proposed to be issued for share application money pending allotment outstanding as of March 31, 2012 and 2011 is 150,824 and 211,605 respectively representing the shares to be issued under employee stock option plan formulated by the Company.

(b) Securities premium on account of shares pending allotment amounts to Rs 39 and Rs 55 as of March 31, 2012 and 2011, respectively. The shares pending allotment as of the year-end is expected to be allotted upon the completion of the vesting period based on the grant to which it pertains to.

(c) The Company has sufficient authorized equity share capital to cover the share capital on allotment of shares pending allotment as of March 31, 2012 and 2011.

(d) There are no interest accrued and due on amount due for refund as of March 31, 2012 and 2011.

(e) No shares are pending for allotment beyond the period for allotment as of March 31, 2012 and 2011.

(a) Obligation under finance lease is secured by underlying fixed assets. These obligations are repayable in monthly installments within the year ending March 31, 2014. These obligations carry an interest rate of 15.6%.

(b) The Company entered into an arrangement with a consortium of banks to obtain External Commercial Borrowings (ECB) during the year ended March 31, 2008. Pursuant to this arrangement, the Company has availed ECB of approximately 35 billion Yen repayable in full in April 2013. The ECB carries an average interest rate of 1.86% p.a. The ECB is an unsecured borrowing and the Company is subject to certain customary restrictions on additional borrowings and quantum of payments for acquisitions in a financial year.

(c) Interest free loan from State Government is repayable in five equal annual installments of Rs 7 starting from financial year 2013-14.

(d) Unsecured loans from others are repayable in monthly installments within the year ending March 31, 2015. The interest rate for these loans ranges from 6.03% to 7.21%.

As of March 31, 2012 and 2011, the Company has complied with the covenants under the loan arrangements.

(a) Includes gross block of Rs 1,270 (2011: Rs 1,270) and accumulated amortisation of Rs 63 (2011: Rs 104) being leasehold land.

(b) Include gross block of Rs 37 and accumulated depreciation of Rs 17 on account of merger.

(c) Includes Plant and machinery of Rs 25 (2011: Rs 25) and Furniture & fixtures of Rs 5 (2011: Rs 5) for research and development assets.

(d) Interest capitalised aggregated to Rs 43 and Rs 137 for the year ended March 31, 2012 and 2011 respectively.

(a) value of investments is less than one million rupees.

(b) Investments in this company carry certain restrictions on transfer of shares as provided for in the shareholders' agreements.

a) Cash and cash equivalents include restricted cash balance of Rs 22 and Rs 20, primarily on account of unclaimed dividends, as of March 31, 2012 and 2011, respectively.

b) The deposits with banks comprise time deposits, which can be withdrawn at any time without prior notice and without any penalty on the principal.

3. Capital commitments

The estimated amount of contracts remaining to be executed on Capital account and not provided for, net of advances is Rs 1,248 (2011: Rs 1,682).

4. Contingent Liabilities

Contingent liabilities in respect of:

As of March 31, 2012 2011

a) Disputed demands for excise duty, customs duty, income tax, sales tax and other matters 2,374 1,472

b) Performance and financial guarantees given by banks on behalf of the Company 18,986 9,706

c) Guarantees given by the Company on behalf of subsidiaries 5,597 3,919

The Company's Indian operations have been established as units in Special Economic Zone and Software Technology Park Unit under plans formulated by the Government of India. As per the plan, the Company's Indian operations have export obligations to the extent of net positive foreign exchange (i.e. foreign exchange inflow - foreign exchange outflow should be positive) over a five year period. The consequence of not meeting this commitment in the future would be a retroactive levy of import duties on certain hardware previously imported duty free. As of March 31, 2012, the Company has met all commitments required under the plan.

Tax Demands:

The Company had received tax demands aggregating to Rs 40,040 (including interest of Rs 10,616) arising primarily on account of denial of deduction under Section 10A of the Income Tax Act, 1961 in respect of profit earned by the Company's undertaking in Software Technology Park at Bangalore for the years ended March 31, 2001 to March 2008. The appeals filed against the said demand before the Appellate authorities have been allowed in favor of the Company by the second appellate authority for the years upto March 2004 and further appeals have been filed by the Income tax authorities before the Hon'ble High Court. The first appellate authority has granted relief for the year ended March 31, 2005 and further appeal has been filed by the Income tax authorities before the Income-tax Appellate Tribunal. The Company is in appeal before the Income-tax Appellate Tribunal for the years ended March 31, 2006 and March 31, 2007 after receiving the assessment orders following the directions of the Dispute Resolution Panel. For the year ended March 31, 2008, the objections against the draft assessment order are pending before the Dispute Resolution Panel.

Considering the facts and nature of disallowance and the order of the appellate authority upholding the claims of the Company for earlier years, the Company believes that the final outcome of the above disputes should be in favor of the Company and there should not be any material impact on the financial statements.

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The resolution of these legal proceedings is not likely to have a material and adverse effect on the results of operations or the financial position of the Company.

5. Adoption of AS 30

The Company has applied the principles of AS 30, as per announcement by ICAI except to the extent such principles of AS 30 does not conflict with existing accounting standards prescribed by Companies (Accounting Standards) Rules, 2006.

The Company has designated USD 262 million (2011: USD 262 million) and Euro 40 million (2011: Euro 40 million) of forward contracts as hedges of its net investments in non integral foreign operations. The Company has also designated a yen-denominated foreign currency borrowing amounting to JPY 16.5 billion (2011: JPY 16.5 billion), along with a floating for floating Cross-Currency Interest Rate Swap (CCIRS), as a hedging instrument to hedge its net investment in a non-integral foreign operation. Further, the Company has also designated yen-denominated foreign currency borrowing amounting to JPY 8 billion (2011: JPY 8 billion) along with floating for fixed CCIRS as cash flow hedge of the yen-denominated borrowing and also as a hedge of net investment in a non-integral foreign operation. As equity investments in non-integral foreign subsidiaries/operations are stated at historical cost, in these standalone financial statements, the changes in fair value of forward contracts, the yen-denominated foreign currency borrowing and the related CCIRS amounting to gain/ (loss) of Rs (2,787) for the year ended March 31, 2012 has been recorded in the statement of profit and loss as part of other income (2011: Rs 326).

6. Derivatives

As of March 31, 2012 the Company has recognized losses of Rs 2,047 (2011: Rs 1,675) relating to derivative financial instruments (comprising foreign currency forward contract and option contracts) that are designated as effective cash flow hedges in the shareholders' fund.

The following table presents the aggregate contracted principal amounts of the Company's derivative contracts outstanding as of:

As of the balance sheet date, the Company has net foreign currency exposures that are not hedged by a derivative instrument or otherwise amounting to Rs 21,492 (2011 : Rs 27,733).

7. Sale of financial assets

From time to time, in the normal course of business, the Company transfers accounts receivables, net investment in finance lease receivables and employee advances (financials assets) to banks. Under the terms of the arrangements, the Company surrenders control over the financial assets and is without recourse. Accordingly, such transfers are recorded as sale of financial assets. Gains and losses on sale of financial assets without recourse are recorded at the time of sale based on the carrying value of the financial assets and fair value of servicing liability. In certain cases, transfer of financial assets may be with recourse. Under arrangements with recourse, the Company is obligated to repurchase the uncollected financial assets, subject to limits specified in the agreement with the banks. Accordingly, in such cases the amount received are recorded as borrowings in the balance sheet and cash flows from financing activities. Additionally, the Company retains servicing responsibility for the transferred financial assets.

During the year ended March 31, 2012, the Company transferred financial assets of Nil (2011: Rs 1,369), under such arrangements. Proceeds from transfer of receivables on non-recourse basis are included in the net cash provided by operating activities in the statements of cash flows. Proceeds from transfer of receivables on recourse basis are included in the net cash provided by financing activities. This transfer resulted in a net gain / (loss) of Nil for the year ended March 31, 2012 (2011: Rs (7)). As of March 31, 2012, the maximum amounts of recourse obligation in respect of the transferred financial assets are Nil (2011: Nil).

8. Finance lease receivables

The Company provides lease financing for the traded and manufactured products primarily through finance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 5 years.

Operating leases:

The Company leases office and residential facilities under cancelable and non-cancelable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs 2,154 and Rs 1,848 during the years ended March 31, 2012 and 2011, respectively.

9. Employee benefit plans

Gratuity: In accordance with applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity Plan) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employee's last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life, Tata AIG and Birla Sun Life ('Insurer'). Under this plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

The Company has invested the plan assets with the insurer managed funds. The expected rate of return on plan asset is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligation. Expected contribution to the fund during the year ending March 31, 2013 is Rs 336.

The Company assesses these assumptions with its projected long-term plans of growth and prevalent industry standards. The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

Superannuation: Apart from being covered under the gratuity plan, the employees of the Company also participate in a defined contribution plan maintained by the Company. This plan is administered by the Life Insurance Corporation of India and ICICI Prudential Insurance Company Limited. The Company makes annual contributions based on a specified percentage of each covered employee's salary.

For the year ended March 31, 2012, the Company has reversed (net) Rs (38), being excess the contribution (2011: contribution recognised Rs 168) to superannuation fund, in the statement of profit and loss.

Provident fund (PF): In addition to the above, all employees receive benefits from a provident fund. The employee and employer each make monthly contributions to the plan equal to 12% of the covered employee's salary. A portion of the contribution is made to the provident fund trust established by the Company, while the remainder of the contribution is made to the Government's provident fund.

The interest rate payable by the trust to the beneficiaries is regulated by the statutory authorities. The Company has an obligation to make good the shortfall, if any, between the returns from its investments and the administered rate.

Upto year ended March 31, 2011, in the absence of guidance from the Actuarial Society of India, actuarial valuation could not have been applied to reliably measure the provident fund liabilities. During the year ended March 31, 2012, the Actuarial Society of India issued the final guidance for measurement of provident fund liabilities. Accordingly, based on such actuarial valuation there is no shortfall in the fund as of March 31, 2012.

For the year ended March 31, 2012, the Company contributed Rs 2,125 (2011: Rs 1,824) towards provident fund.

As of March 31, 2012, provision for leave encashment of Rs 3,289 has been presented under Provisions - Employee retirement benefits. The liability as of March 31, 2011 of Rs 2,028 that was previously included under Sundry Creditors in the financial statements for year ended March 31, 2011 prepared under the pre-revised Schedule VI of the Companies Act, 1956, has now been accordingly reclassified under provisions. Provision for leave encashment is a deferred deduction under the tax laws which can be claimed only on actual payment. Accordingly, the consequent impact on current and deferred tax has been given effect.

10. Employee stock option

i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans (collectively "stock option plans") are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of five years from the date of grant. Upon vesting, the employees can acquire one equity share for every option. The maximum contractual term for these stock option plans is generally 10 years.

ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basis over the total vesting period of five years The instrinic value on the date of grant approximates the fair value. For the year ended March 31, 2012, the Company has recorded stock compensation expense of Rs 878 (2011: Rs 1,310).

iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specified period subject to fulfillment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Company's shares at a price determined on the date of grant of options. The particulars of options granted under various plans are tabulated below. (The number of shares in the table below are adjusted for any stock splits and bonus shares issues).

The weighted-average grant-date fair value of options granted during the year ended March 31, 2012 was Rs 449.80 (2011: Rs 417.65) for each option. The weighted average share price of options exercised during the year ended March 31, 2012 was Rs 399.22 (2011: Rs 424.28) for each option.

The fair value of 30,000 options granted during the year ended March 31, 2012 (other than at nominal exercise price) has been estimated on the date of grant using the Black-Scholes-Merton option pricing model. The fair value of share options has been determined using the following assumptions:

** Includes amortization expense relating to options granted to employees of the Company's subsidiaries, amounting to Rs 76 (2011: Rs 123). This expense has been debited to respective subsidiaries.

Earnings per share and number of shares outstanding for the year ended March 31, 2011 have been adjusted for the two equity shares for every three equity shares stock dividend approved by the shareholders on June 4, 2010.

11. The Management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of the amounts payable to such enterprises as of March 31, 2012 has been made in the annual financial statements based on information received and available with the Company. The Company has not received any claim for interest from any supplier under the said Act.

12. Acquisitions

On June 10, 2011, the Company acquired the global oil and gas information technology practice of the Commercial Business Services Business Unit of Science Applications International Corporation Inc., Delaware, USA ('SAIC') through an Asset and Stock Purchase agreement ('ASPA'). SAIC's global oil and gas practice provides consulting, system integration and outsourcing services to global oil majors with significant domain capabilities in the areas of digital oil field, petro-technical data management and petroleum application services, addressing the upstream segment. The Company believes that the acquisition will further strengthen Wipro's presence in the Energy, Natural Resources and Utilities domain. In accordance with the ASPA, all fixed assets, current assets and liabilities, right and obligations of the oil and gas business of US and Canada have been vested with the Company. The acquired assets and liabilities recorded in the books of SAIC relating to the US and Canada oil and gas business are recorded by the Company at their respective book values. The goodwill of Rs 3,219 comprises value of expected synergies arising from the acquisition. The purchase consideration of Rs 3,781was settled in cash.

13. Income Tax

The provision for taxation includes tax liability in India on the Company's worldwide income. The tax has been computed on the worldwide income as reduced by the various deductions and exemptions provided by the Income tax Act in India (Act) and the tax credit in India for the tax liabilities payable in foreign countries.

Most of the Company's operations are through units in Special Economic Zone and Software Technology Parks ('STPs'). Income from STPs is not eligible for deduction from April 01, 2011. Income from SEZ's are eligible for 100% deduction for the first 5 years, 50% deduction for the next 5 years and 50% deduction for another 5 years subject to fulfilling certain conditions.

The Company has calculated its tax liability after considering the provisions of law relating to Minimum Alternative Tax (MAT). As per the Act, any excess of MAT paid over the normal tax payable can be carried forward and set off against the future tax liabilities. Accordingly an amount of Rs 1,060 is included under 'Short term loans and advances' in the balance sheet as of March 31, 2012 (March 31, 2011: Rs 126).

14. The Company publishes standalone financial statements along with the consolidated financial statements in the annual report. In accordance with Accounting Standard 17, Segment Reporting, the Company has disclosed the segment information in the consolidated financial statements.

15. Hitherto the applicability of revised Schedule VI from the current year, the Company has reclassified previous year figures to conform to this year's classification. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of the financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of Balance Sheet.


Mar 31, 2011

Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Outsourcing (BPO) services, globally. Further, Wipro has other businesses such as IT Products, Consumer Care and Lighting and Infrastructure engineering. Wipro is headquartered in Bangalore, India.

2. Capital commitments

The estimated amount of contracts remaining to be executed on Capital account and not provided for, net of advances is Rs. 1,682 million(2010 : Rs. 2,648 million).

3. Contingent Liabilities

Contingent liabilities in respect of

(Rs. in Million)

Particulars As at March 31, 2011 2010

a) Disputed demands for excise 1,472 1,384 duty, customs duty, income tax, sales tax and other matters

b) Performance and financial 9,706 13,760 guarantees given by banks on behalf of the Company

c) Guarantees given by the Company 3,919 3,748 on behalf of subsidiaries

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The resolution of these legal proceedings is not likely to have a material and adverse efect on the financial statements of the Company.

The Companys Indian operations have been established as a Software Technology Park Unit under a plan formulated by the Government of India. As per the plan, the Companys India operations have export obligations to the extent of 1.5 times the employee costs for the year on an annual basis and 5 times the amount of foreign exchange released for capital goods imported, over a fve year period. The consequence of not meeting this commitment in the future would be a retroactive levy of import duties on certain computer hardware previously imported duty free. As at March 31, 2011, the Company has met all commitments required under the plan.

Tax Demands:

The Company had received tax demands from the Indian income tax authorities for the financial years ended March 31, 2001, 2002, 2003 and 2004 aggregating to Rs. 11,127 million (including interest of Rs. 1,503 million). The tax demands were primarily on account of the Indian income tax authoritys denial of deductions claimed by the Company under Section 10A of the Income Tax Act 1961, in respect of Profits earned by the Companys undertakings in Software Technology Park at Bangalore. The appeals fled by the Company for the above years to the frst appellate authority were allowed in favor of the Company, thus deleting a substantial portion of the demands raised by the Income tax authorities. On further appeal fled by the income tax authorities, the second appellate authority upheld the claims of the Company for the years ended March 31, 2001, 2002, 2003 and 2004.

In December 2008, the Company received, on similar grounds, an additional tax demand of Rs. 5,388 million (including interest of Rs. 1,615 million) for the financial year ended March 31, 2005. The appeal fled before the frst appellate authority against the said order has been allowed in favour of the Company thus deleting substantial demand raised by the Income tax authorities.

In December 2009, the Company received the draft assessment order, on similar grounds, with a demand of Rs. 6,757 million (including interest of Rs. 2,050 million) for the financial year ended March 31, 2006. The Company had fled its objections against the said demand before the Dispute Resolution Panel, which later issued directions confrming the position of the assessing ofcer. Subsequently, the assessing officer passed the final assessment order in October 2010 raising a tax demand of Rs. 7,218 million (including interest of Rs. 2,510 million). The Company has fled an appeal against the said order before the tribunal within the time limit permitted under the statute.

In December 2010, the Company received the draft assessment order, on similar grounds, with a demand of Rs. 7,747 million (including interest of Rs. 2,307 million) for the financial year ended March 31, 2007. The Company has fled an objection against the said demand before the Dispute Resolution Panel, within the time limit permitted under the statute.

Considering the facts and nature of disallowance and the order of the appellate authority upholding the claims of the Company for earlier years, the Company believes that the fnal outcome of the above disputes should be in favour of the Company and there should not be any material impact on the standalone financial statements.

The Company is subject to legal proceedings and claims which have arisen in the ordinary course of its business. The resolution of these legal proceedings is not likely to have a material and adverse efect on the results of operations or the financial position of the Company.

4. Note on Reserves:

i) Restricted stock units reserve includes Deferred Employee Compensation, which represents future charge to the Profit and loss account and employee stock options outstanding to be treated as securities premium at the time of allotment of shares.

5. Adoption of AS 30

The Company has adopted Accounting Standard 30, issued by ICAI except to the extent the adoption of AS 30 does not confict with existing accounting standards prescribed by Companies (Accounting Standards) Rules, 2006 and other authoritative pronouncements.

The Company has designated USD 262 million (2010: USD 262 million) and Euro 40 million (2010: Euro 40 million) of forward contracts as hedges of its net investments in non integral foreign operations. The Company has also designated a yen-denominated foreign currency borrowing amounting to JPY 16.5 billion (2010: JPY 18 billion), along with a foating for foating Cross-Currency Interest Rate Swap (CCIRS), as a hedging instrument to hedge its net investment in a non-integral foreign operation. Further, the Company has also designated yen-denominated foreign currency borrowing amounting to JPY 8 billion (2010: JPY 8 billion) along with foating for fixed CCIRS as cash flow hedge of the yen- denominated borrowing and also as a hedge of net investment in a non-integral foreign operation. As equity investments in non integral foreign subsidiaries/operations are stated at historical cost, in these standalone financial statements, the changes in fair value of forward contracts, the yen- denominated foreign currency borrowing and the related CCIRS amounting to gain/ (loss) of Rs. 326 million for the year ended March 31, 2011 has been recorded in the Profit and loss account as part of other income (2010: Rs. 4,378 million).

6. Derivatives

As of March 31, 2011 the Company has recognised losses of Rs. 1,675 million (2010: Rs. 5,099 million) relating to derivative financial instruments (comprising of foreign currency forward contract and option contracts) that are designated as efective cash flow hedges in the shareholders fund.

7. Merger and Acquisitions

Pursuant to the scheme of amalgamation approved by the Honourable High Courts of Karnataka and Bombay, Wipro Yardley Consumer Care Private Limited has been merged with the Company with retrospective efect from April 1, 2010, the Appointed Date. The amalgamation has been accounted as amalgamation in the nature of merger in accordance with the terms of the Order. The excess of purchase consideration over the net assets of the undertaking amounting to Rs. 0.08 million has been adjusted against capital reserve of the Company. The merger order was received subsequent to March 31, 2011 but prior to the issuance of the financial statements, therefore the financial results of the above undertaking for the period April 1, 2010 to March 31, 2011 have been included in the year ended March 31, 2011 of the Company.

8. Sale of financial assets

From time to time, in the normal course of business, the Company transfers accounts receivables, net investment in fnance lease receivables and employee advances (financials assets) to banks. Under the terms of the arrangements, the Company surrenders control over the financial assets and are without recourse. Accordingly, such transfers are recorded as sale of financial assets. Gains and losses on sale of financial assets without recourse are recorded at the time of sale based on the carrying value of the financial assets and fair value of servicing liability. In certain cases, transfer of financial assets may be with recourse. Under arrangements with recourse, the Company is obligated to repurchase the uncollected financial assets, subject to limits specifed in the agreement with the banks. Accordingly, in such cases the amount received are recorded as borrowings in the balance sheet and cash flows from fnancing activities. Additionally, the Company retains servicing responsibility for the transferred financial assets.

During the year ended March 31, 2011, the Company transferred financial assets of Rs. 1,369 million (2010: Rs. 1, 666 million), under such arrangements. Proceeds from transfer of receivables on non recourse basis are included in the net cash provided by operating activities in the statements of cash flows. Proceeds from transfer of receivables on recourse basis are included in the net cash provided by fnancing activities. This transfer resulted in a net gain / (loss) of Rs. (7) million for the year ended March 31, 2011 (2010: Rs. (21) million). As at March 31, 2011, the maximum amounts of recourse obligation in respect of the transferred financial assets are Nil (March 31, 2010: Nil).

9. Finance lease receivables

The Company provides lease fnancing for the traded and manufactured products primarily through fnance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 5 years.

Operating leases:

The Company leases ofce and residential facilities under cancelable and non-cancelable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs. 1,848 million and Rs. 1,783 million during the years ended March 31, 2011 and 2010, respectively.

10. Employee benefit plans

Gratuity: In accordance with applicable Indian laws, the Company provides for gratuity, a defned benefit retirement plan (Gratuity Plan) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employees last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life, Tata AIG and Birla Sun Life (Insurer). Under this plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

Superannuation: Apart from being covered under the gratuity plan, the employees of the Company also participate in a defined contribution plan maintained by the Company. This plan is administered by the Life Insurance Corporation of India and ICICI Prudential Insurance Company Limited. The Company makes annual contributions based on a specifed percentage of each covered employees salary.

For the year ended March 31, 2011, the Company contributed Rs. 168 million (2010: Rs. 246 million) to superannuation fund.

Provident fund (PF): In addition to the above, all employees receive benefits from a provident fund. The employee and employer each make monthly contributions to the plan equal to 12% of the covered employees salary. A portion of the contribution is made to the provident fund trust established by the Company, while the remainder of the contribution is made to the Governments provident fund.

The interest rate payable by the trust to the benefciaries is regulated by the statutory authorities. The Company has an obligation to make good the shortfall, if any, between the returns from its investments and the administered rate.

The Guidance on implementing AS 15, Employee benefits issued by the Accounting Standards Board (ASB) provides that exempt provident funds which require employers to meet the interest shortfall are in efect defned benefit plans. The Company believes that it is not practicable to reliably determine the interest shortfall obligation. Accordingly, the computation of liability and disclosure in accordance with the provisions of AS 15 cannot be implemented.

For the year ended March 31, 2011, the Company contributed Rs. 1,824 million (2010: Rs. 1,422 million) to PF.

11. Employee stock option

i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of fve years from the date of grant. Upon vesting, the employees can acquire one equity share for every option. The maximum contractual term for these stock option plans is generally 10 years.

ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basis over the total vesting period of fve years. For the year ended March 31, 2011, the Company has recorded stock compensation expense of Rs. 1,310 million, (2010: Rs. 1,224 million).

iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specifed period subject to fulfllment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Companys shares at a price determined on the date of grant of options. The particulars of options granted under various plans are tabulated below. (The numbers of shares in the table below are adjusted for any stock splits and bonus shares issues).

12. Borrowings

The Company entered into an arrangement with a consortium of banks to obtain External Commercial Borrowings (ECB) during the year ended March 31, 2008. Pursuant to this arrangement, the Company has availed ECB of approximately 35 billion Yen repayable in full in March 2013. The ECB is an unsecured borrowing and the Company is subject to certain customary restrictions on additional borrowings and quantum of payments for acquisitions in a financial year.

13. Income Tax

The provision for taxation includes tax liability in India on the companys worldwide income. The tax has been computed on the worldwide income as reduced by the various deductions and exemptions provided by the Income tax Act in India (Act) and the tax credit in India for the tax liabilities payable in foreign countries.

Most of the Companys operations are through units in Software Technology Parks (STPs). Income from STPs is eligible for 100% deduction upto March 31, 2011. The Company also has operations in Special Economic Zones (SEZs). Income from SEZs are eligible for 100% deduction for the frst 5 years, 50% deduction for the next 5 years and 50% deduction for another 5 years subject to fulflling certain conditions.

Pursuant to the amendments in the Act, the Company has calculated its tax liability after considering the provisions of law relating to Minimum Alternative Tax (MAT). As per the Act, any excess of MAT paid over the normal tax payable can be carried forward and set of against the future tax liabilities. Accordingly an amount of Rs. 126 million (2010: Rs. 195 million) is included under Loans and Advances in the balance sheet as of March 31, 2011.

14. The Company publishes standalone financial statements along with the consolidated financial statements in the annual report. In accordance with Accounting Standard 17, Segment Reporting, the Company has disclosed the segment information in the consolidated financial statements.

15. Corresponding fgures for previous year presented have been regrouped, where necessary, to conform to the current year classification.

16. Additional Information Schedule VI


Mar 31, 2010

Company overview

Wipro Limited (Wipro or the Company), is a leading India based provider of IT Services, including Business Process Outsourcing (BPO) services, globally. Further, Wipro has other businesses such as IT Products, Consumer Care and Lighting and Infrastructure engineering. Wipro is headquartered in Bangalore, India.

1. Note on Reserves:

i) Restricted stock units reserve includes Deferred Employee Compensation, which represents future charge to the profit and loss account and employee stock options outstanding to be treated as securities premium at the time of allotment of shares.

2. Adoption of AS 30

The Company has adopted AS 30 and the limited revisions to other accounting standards which come into effect upon adoption of AS 30 from April 1, 2008.

AS 30 states that particular sections of other accounting standards; AS 4, Contingencies and Events Occurring after Balance sheet Date, to the extent it deals with contingencies, AS 11 (revised 2003), The Effects of Changes in Foreign Exchange Rates, to the extent it deals with the forward exchange contracts and AS 13, Accounting for Investments, except to the extent it relates to accounting for investment properties, would stand withdrawn only from the date AS 30 becomes mandatory (April 1, 2011 for the Company).

Accordingly, the Company continues to comply with the guidance under these accounting standards; AS 4 - relating to Contingencies, AS 11 - relating to Forward Contracts and AS 13 - relating to Investments until AS 30 becomes mandatory.

The Company has designated USD 262 Million (2009: USD 267 Million) and Euro 40 Million (2009: Euro 40 Million) of forward contracts as hedges of its net investments in non integral foreign operations. The Company has also designated a yen-denominated foreign currency borrowing amounting to JPY 18 Billion (2009: JPY 27 Billion), along with a floating for floating Cross-Currency Interest Rate Swap (CCIRS), as a hedging instrument to hedge its net investment in a non-integral foreign operation. Further, the Company has also designated yen-denominated foreign currency borrowing amounting to JPY 8 Billion (2009: JPY 8 billion) along with floating for fixed CCIRS as cash flow hedge of the yen- denominated borrowing and also as a hedge of net investment in a non-integral foreign operation. As equity investments in non integral foreign subsidiaries/operations are stated at historical cost, in the standalone financial statements, the changes in fair value of forward conttacts, the yen- denominated foreign currency borrowing and the related CCIRS amounting to gain/ (loss) of Rs 4,378 Million for the year ended March 31, 2010 has been recorded in the profit and loss account as part of othet income (2009: Rs (7,454) Million). 5. Derivatives

As of Match 31,2010 the Company has recognised losses of Rs 5,099 Million (2009: Rs 16,859 Million) relating to derivative financial instruments (comprising of foreign currency forward contract and option contracts) that are designated as effective cash flow hedges in the shareholders fund.

3. Merger and Acquisition

Pursuant to the scheme of amalgamation approved by the Honorable High Court of Karnataka, Indian undertakings of Wipro Networks Pte Limited, Singapore, and WMNETSERV Limited, Cyprus have been merged with the Company with retrospective effect from April 1, 2009, the Appointed Date. The amalgamation has been accounted as amalgamation in the nature of merger in accordance with the terms of the Order. The excess of purchase consideration over the net assets of the undertaking amounting to Rs. 199 Million has been adjusted against general reserve of the Company.

4. Sale of financial assets

From time to time, in the normal course of business, the Company transfers accounts receivables, net investment in finance lease receivables and employee advances (financials assets) to banks. Under the terms of the arrangements, the Company surrenders control over the financial assets and are without recourse. Accordingly, such transfers are recorded as sale of financial assets. Gains and losses on sale of financial assets without recourse are recorded at the time of sale based on the carrying value of the financial assets and fair value of servicing liability. In certain cases, transfer of financial assets may be with recourse. Under arrangements with recourse, the Company is obligated to repurchase the uncollected financial assets, subject to limits specified in the agreement with the banks. Accordingly, in such cases the amount received are recorded as borrowings in the balance sheet and cash flows from financing activities. Additionally, the Company retains servicing responsibility for the transferred financial assets.

During the year ended March 31, 2010, the Company transferred financial assets of Rs. 1,666 Million (2009: Rs. 539), under such arrangements. Proceeds from transfer of receivables on non recourse basis are included in the net cash provided by operating activities in the statements of cash flows. Proceeds from transfer of receivables on recourse basis are included in the net cash provided by financing activities. This transfer resulted in a net gain / (loss) of Rs. (21) Million for the year ended March 31, 2010 (2009: Rs. (35) Million,). As at March 31, 2010, the maximum amounts of recourse obligation in respect of the transferred financial assets are Rs. Nil (March 31, 2009: Nil).

5. Finance lease receivables

The Company provides lease financing for the traded and manufactured products primarily through finance leases. The finance lease portfolio contains only the normal collection risk with no important uncertainties with respect to future costs. These receivables are generally due in monthly, quarterly or semi-annual installments over periods ranging from 3 to 5 years.

6. Assets taken on lease

Operating leases:

The Company leases office and residential facilities under cancelable and non-cancelable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs 1,783 Million and Rs 1,479 Million during the years ended March 31, 2010 and 2009 respectively.

7. Employee Benefit Plans

Qratuity: In accordance with applicable Indian laws, the Company provides for gratuity, a defined benefit retirement plan (Gratuity Plan) covering certain categories of employees. The Gratuity Plan provides a lump sum payment to vested employees, at retirement or termination of employment, an amount based on the respective employees last drawn salary and the years of employment with the Company. The Company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC), HDFC Standard Life, Tata AIG and Birla Sun Life (Insurer). Under this plan, the settlement obligation remains with the Company, although the Insurer administers the plan and determines the contribution premium required to be paid by the Company.

The Company assesses these assumptions with its projected long-term plans of growth and prevalent industry standards. The estimates of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand factors in the employment market.

Superannuation: Apart from being covered under the gratuity plan, the employees of the Company also participate in a defined contribution plan maintained by the Company. This plan is administered by the LIC & ICICI. The Company makes annual contributions based on a specified percentage of each covered employees salary.

For the year ended March 31, 2010, the Company contributed Rs 246 Million (2009: Rs 211 Million) to superannuation fund.

Provident fund (PF): In addition to the above, all employees receive benefits from a provident fund. The employee and employer each make monthly contributions to the plan equal to 12% of the covered employees salary. A portion of the contribution is made to the provident fund trust established by the Company, while the remainder of the contribution is made to the Governments provident fund.

The interest rate payable by the trust to the beneficiaries is regulated by the statutory authorities. The company has an obligation to make good the shortfall, if any, between the returns from its investments and the administered rate.

The Guidance on implementing AS 15, Employee Benefits issued by the Accounting Standards Board (ASB) provides that exempt provident funds which require employers to meet the interest shortfall are in effect defined benefit plans. The Company believes that it is not practicable to determine the interest shortfall obligation. The computation of liability and disclosure in accordance with the provisions of AS 15 cannot be implemented.

For the year ended March 31,2010, the Company contributed Rs 1,422 Million (2009: Rs 1,402 Million) to PR

8. Employee stock option

i) Employees covered under Stock Option Plans and Restricted Stock Unit (RSU) Option Plans are granted an option to purchase shares of the Company at the respective exercise prices, subject to requirements of vesting conditions. These options generally vest over a period of five years from the date of grant. Upon vesting, the employees can acquire one equity share for every option. The maximum contractual term for aforementioned stock option plans is generally 10 years.

ii) The stock compensation cost is computed under the intrinsic value method and amortised on a straight line basis over the total vesting period of five years. For the year ended March 31, 2010, the Company has recorded stock compensation expense of Rs. 1,224 Million, (2009: Rs 1,685 Million).

iii) The compensation committee of the board evaluates the performance and other criteria of employees and approves the grant of options. These options vest with employees over a specified period subject to fulfillment of certain conditions. Upon vesting, employees are eligible to apply and secure allotment of Companys shares at a price determined on the date of grant of options. The particulars of options granted under various plans are tabulated below. (The numbers of shares in the table below are adjusted for any stock splits and bonus shares issues).

9. The Company had received tax demands from the Indian income tax authorities for the financial years ended March 31, 2001, 2002, 2003 and 2004 aggregating to Rs. 11,127 Million (including interest of Rs. 1,503 Million). The tax demand was primarily on account of denial of deduction claimed by the Company under Section 10A of the Income Tax Act 1961, in respect of profits earned by its undertakings in Software Technology Park at Bangalore. The appeals filed by the Company for the above years to the first appellate authority were allowed in favour of the Company, thus deleting substantial portion of the demand raised by the Income tax authorities. On further appeal filed by the income tax authorities, the second appellate authority upheld the claim of the company for the years ended March 31, 2001, 2002, 2003 and 2004. In December 2008, the Company received, on similar grounds, an additional tax demand of Rs. 5,388 Million (including interest of Rs. 1,615 Million) for the financial year ended March 31, 2005. The Company has filed an appeal against the said demand which is pending before the first appellate authority.

During December 2009, the company received the draft assessment order, on similar grounds, with a demand of Rs. 6,757 Million (including interest of Rs. 2,050 Million) for the financial year ended March 31, 2006. The Company has filed an objection against the said demand before the Dispute Resolution Panel and the Assessing officer within the time limits permitted under the statute.

Considering the facts and nature of disallowance and the order of the first appellate authority upholding Companys claims for earlier years, the Company expects the final outcome of the above disputes in Wipros favour.

10. The Management has identified enterprises which have provided goods and services to the Company and which qualify under the definition of micro and small enterprises, as defined under Micro, Small and Medium Enterprises Development Act, 2006. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at March 31, 2010 has been made in the annual financial statements based on information received and available with the Company. The Company has not received any claim for interest from any supplier under the said Act.

11. Borrowings

The Company entered into an arrangement with a consortium of banks to obtain External Commercial Borrowings (ECB) during the year ended March 31, 2008. Pursuant to this arrangement the Company has availed ECB of approximately 35 billion Yen repayable in full in March 2013. The ECB is an unsecured borrowing and the Company is subject to certain customary restrictions on additional borrowings and quantum of payments for acquisitions in a financial year.

12. Income Tax

The provision for taxation includes tax liability in India on the companys worldwide income. The tax has been computed on the worldwide income as reduced by the various deductions and exemptions provided by the Income tax act in India (Act) and the tax credit in India for the tax liabilities payable in foreign countries.

Most of the companys operations are through units in Software Technology Parks (STPs). Income from STPs is eligible for 100% deduction for the earlier of 10 years commencing from the fiscal year in which the unit commences operations or March 31, 2011. The Company also has operations in Special Economic Zones (SEZs). Income from SEZs are eligible for 100% deduction for the first 5 years, 50% deduction for the next 5 years and 50% deduction for another 5 years subject to fulfilling » certain conditions.

Pursuant tothe amendments in the Act, the company has calculated its tax liability after considering the provisions of law relating to Minimum Alternate Tax (MAT). As per the Act, any excess of MAT paid over the normal tax payable can be carried forward and set off against the future tax liabilities. Accordingly an amount of Rs. 195 Million (March 31, 2009: Rs. 126 Million) is included under Loans and Advances in the balance sheet as of March 31, 2010.

13. The Company publishes standalone financial statements along with the consolidated financial statements in the annual report. In accordance with the accounting standard 17, Segment Reporting, the company has disclosed the segment information in the consolidated financial statements.

14. Corresponding figures for previous periods presented have been regrouped, where necessary, to conform to the current period classification.

15. Additional Information Schedule VI.



 
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