tcs anual report analysis

Submitted by:

Aadyant VashishthAkshay KumarDipti SoniLavi VarshnaeyMohit GehaniVikash Kumar

Financial Accounts Analysis of

Tata Consultancy Services(TCS)

About TCS1. Tata Consultancy Services (TCS), a part of the

Tata group, provides information technology and management consultation services to organizations in more than 53 countries.

2. The company was founded in the year 1968 and is based in Mumbai.

3. It has over 89,000 trained IT consultants in 47 countries.

4. The company offers e-business, application development and maintenance, architecture and technology consulting, engineering, security, infrastructure development and management and quality consulting services.

CONTINUED….. The company disclosed rise of 25.30% in consolidated net profit on y-o-y

basis to Rs 36.58 billion, while total income increased 26.31% y-o-y basis to Rs 168.73 billion for the quarter ended March 2013. In addition, TCS offers software packages for electronic banking, insurance billing, customer relationship management, and hospital management. It caters to finance and banking, insurance, telecommunication, transportation, retail, manufacturing, pharmaceutical, energy and utility industries.

The company generates around 19% of its revenues from the manufacturing industry, and 6% of its revenues from its engineering and industrial services (EIS) business

The company generated consolidated revenues of USD 4.3 billion for the fiscal year ended March 2007. TCS went public in 2004, raising USD 1.17 billion in one of the largest initial public offerings.

Future Prospects

Diligenta, a subsidiary of TCS, has announced that it has entered the UK BPO life assurance market having secured a USD 486 million deal with Pearl, the Peterborough based closed fund group. Diligenta will provide BPO services over an initial 12-year period for Pearl group in processing and administration.

TCS has been recommended enterprise-wide for ISO 9001:2000, BS 7799-2:2002 and BS 15000-1:2002 certifications. This is the largest, enterprise-wide multiple certification of an IT solutions organization to date. It is the company`s second enterprise-wide achievement after it became the first company to be assessed enterprise-wide, for CMMI and PCMM at Level 5 in 2004.

CONTINUED….TCS has planned a CAPEX of Rs 10,000 million for the current

financial year. It employs more than 60,000 people and will be adding more than 30,000 this year. This will amount to net addition of around 25,000 employees. The company plans to increase its headcount in Hyderabad to 10,000 by 2010 from over 4,200 now.

TCS is planning to open an outsourcing center in Poland and thereby mark its presence in 34 countries across the world.

Tata Consultancy Services is negotiating about 5 to 10 IT services deals of USD 50 to USD 100 million each across various verticals.

Past Performance By 2008, TCS's e-business activities were

generating over US$500 million in annual revenues.

On 25 August 2004, TCS became a publicly listed company.

In 2005, TCS became the first India-based IT services company to enter the bioinformatics market.

In 2006, TCS designed an ERP system for the Indian Railway Catering and Tourism Corporation.

In 2008, TCS undertook an internal restructuring exercise which aimed to increase the company's agility.

CONTINUED…. TCS entered the small and medium enterprises market for

the first time in 2011, with cloud-based offerings.[25] On the last trading day of 2011, TCS overtook RIL to achieve the highest market capitalization of any India-based company.

In the 2011/12 fiscal year, TCS achieved annual revenues of over US$10 billion for the first time.

In May 2013, TCS was awarded a six-year contract worth over INR 1100 crores to provide services to the Indian Department of Posts.

In 2013 TCS moved from the 13th position to 10th position in the League of top 10 global IT services companies

POLICIES ADOPTED BY TCS ACCOUNTING POLICY

ACCOUNTINGSTANDARD

PROVISION AVAILABLE UNDER ACCOUNTING STANDARD

Disclosure of Accounting Policies

AS-1 -

Cash Flow Statements AS-3 Small and Medium sized Entities may not disclose their cash flow statement.

Net Profit And Loss AS-5 Special Disclosure for disposal of items of fixed assets and long term investments.Litigation Settlements.

Depreciation AS-6 Not Applicable on Assets with Unlimited Life.

Revenue Recognition AS-9 Not Applicable on Revenue Arising from Construction Contracts, Lease Agreements and Government Grants.

Earnings Per Share AS-20 Small and Medium sized Entities may not disclose their diluted earning per share.

RELEVANT SECTIONS USED BY TCS

SECTION DETAIL OF SECTION

303 Registration of Directors

305 Duty of directors etc. to make disclosures

313 Appointment and term of office of alternate directors.

317 Managing director not to be appointed for more than five years at a time

319 Payment to director, etc. for loss of office ,etc. in connection with transfer of undertaking, etc.

337 Removal for Fraud or Breach or Trust

353 Time of Payment Of Remuneration

PROFIT AND LOSS A/C

REVENUE PART OF P&L A/C:

TOTAL REVENUE OF THE COMPANY HAD RISEN BY 24.19%

2012 20130

10000

20000

30000

40000

50000

60000

40789

50656

REVENUE GRAPH

from oper-ation, 96%

other income, 4%

DISTRIBUTION OF REVENUE

from operationother income

WHAT ARE THE

REVENUE FROM OTHER

INCOME?

REVENUE FROM OTHER INCOMES INCLUDE:

EXPENSES PART OF P&L A/C:

TOTAL EXPENSE OF THE COMPANY HAD RISEN BY 27.45%

2012 20130

5000

10000

15000

20000

25000

30000

35000

40000

27423

34953

REVENUE GRAPH

HOW HAD DEPRICIATIO

N BEEN CHARGED?

DETAILS OF DEPRICIATION CHARGED IN P&L A/C

METHOD USED FOR CHARGING DEPRICIATION: THEY ARE USING BOTH METHOD FOR

DEPRICIATION OF FIXED ASSET

1. STRAIGH LINE METHOD

2. WRITTEN DOWN VALUE METHOD

STRAIGHT LINE METHOD OF DEPRICIATION:

UNDER THIS METHOD OF DEPRICIATION DEPRICIATION IS EVENLY DISTRIBUTED THROUGH OUT THE USEFUL LIFE OF FIXED ASSET

WRITTEN DOWN VALUE METHOD:-

UNDER THIS METHOD OF DEPRICIATION AMOUNT OF DEPRICIATIN CHARGED IN STARTING YEARS IS HIGHER THAN THE DEPRICIATION CHARGED IN LATER YEARS.

DEPRICIATION A/c

DETAILS OF PROFIT BEFORE AND AFTER TAX EARNED IN P&L A/C:

PROFIT AFTER TAX OF THE COMPANY HAD RISEN BY 16.50%

PROFIT BEFORE TAX PROFIT AFTER TAX0

2000400060008000

1000012000140001600018000

1336610975

15703

12786

Chart Title

2012 2013

PROFIT BEFORE TAX OF THE COMPANY HAD RISEN BY 17.48%

P & L A/c ANALYSIS 2012-13

•THOUGH THE PERCENTAGE RISE IN EXPENDITURE IS MORE THAN THE PERCENTAGE RISE IN REVENUE BY 3.26% BUT THE COMPANY HAD MADE A RISE IN OVERALL PROFIT OF 16.50% FROM 2012 TO 2013

% RISE IN REVENUE % RISE IN EXPENDITURE % RISE IN PROFIT0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

24.19%27.45%

16.50%

P&L ANALYSIS

Series 1

RISE IN THE VALUE OF SHARE:

PERCENTAGE RISE IN SHARE VALUE IS 16.50%

2012 201350

52

54

56

58

60

62

64

66

55.95

65.22RISE IN VALUE OF SHARES

Series 1

BALANCE SHEET

EQUITY and LIABLITY PART OF BALANCE SHEET :

SHARE CAPITAL AND SHAREHOLDER’S FUND:

PREF-ERENCE SHARE

34%

EQUITY SHARE

66%

%DISTRIBUTION OF SHARES

PREFERENCE SHAREEQUITY SHARE

2011-12 2012-130

5000

10000

15000

20000

25000

30000

35000

24856

30562RISE IN SHAREHOLDER’S FUND

THERE IS 22.95% RISE IN SHAREHOLDER’S FUND FROM 2012 TO 2013

RESERVES AND SURPLUS DISTRIBUTION:

76% NET PROFIT76%

6% SECURITIES PREMIUM RESERVE

6%

0.00800000000000001

0.002

17% GENERAL RESERVE17%

Sales

76% NET PROFIT

6% SECURITIES PREMIUM RESERVE

0.8% FOREIGN CURRENCY TRANSLATION RESERVE

0.2% HEDGING RESERVE A/C

17% GENERAL RESERVE

DISTRIBUTION OF EQUITY AND LIABLITY:

SHARE-HOLDER'S

FUND76%

NON-CURRENT LIABLITY

2%

CURRENT LIABLITY

22%

2012-13

SHAREHOLDER'S FUNDNON-CURRENT LIABLITYCURRENT LIABLITY

SHAREHOLDE

R'S FUND72%

NON-CUR-RENT

LI-ABLITY

2%

CUR-RENT

LI-ABLITY

26%

2011-12

SHAREHOLDER'S FUNDNON-CURRENT LIABLITYCURRENT LIABLITY

ASSETS PART OF BALANCE SHEET:

DISTRIBUTION AND RISE OF ASSET:

FIXED ASSET45%

CURRENT ASSET55%

Sales

FIXED ASSETCURRENT ASSET

THEIR IS 10.06% RISE IN FIXED ASSET AND 42.14% RISE IN CURRENT ASSET. OVERALL INCREASE IN ASSET IS 25.53 %

FIXED ASSET CURRENT ASSET0

5000

10000

15000

20000

25000

1771916538

19503

23508

RISE OF ASSET

2012 2013

CASH FLOW FROM OPERATING EXPENSES:

2012 20130

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

3174

9156CASH FLOW

THERE HAD BEE 188.5 % RISE IN CASH FROM OPERATING ACTIVITY

CASH FLOW FROM INVESTING ACTIVITY:

2012 2013

-4000

-3500

-3000

-2500

-2000

-1500

-1000

-500

0

500

1000

433

-3482

CASH FLOW

THERE HAD BEEN 904% DECREASE IN CASH FLOW FROM INVESTING ACTIVITY.

CASH FLOW FROM FINANCING ACTIVITIES:

2012 20130

500

1000

1500

2000

2500

3000

3500

4000

4500

3280

4054CASH FLOW

THERE HAD BEEN 23.60% RISE IN CASH FROM FINANCIAL ACTIVITIES.

RATIO ANALYSIS

CURRENT RATIO=(CURRNT ASSET/CURRENT LIABLITY)CURRENT RATIO C.A/C.L 2.42

NET WORKING CAPITAL

C.A-C.L 13831

QUICK RATIO LIQUID ASSET/C.L 2.32

DEBT EQUITY RATIO LONG TERM DEBT/(OWNERS CAPITAL-INTANGIBLE ASSET)

0.02

GROSS PROFIT RATIO (PROFIT BEFORE TAX/NET SALES)*100

31%

OPERATING PROFIT RATIO

(REVENUE FROM OPERATION-EXPENSE ON OPERATION)/NET SALES

62%

NET PROFIT RATIO PROFIT AFTER TAX/TOTAL REVENUE

25.24%

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