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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 20-F
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934ORþ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934For the fiscal year ended March 31, 2008ORo
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934For the transition period from 
 toORo
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934Date of event requiring this shell company report
 Commission file number 001-15190
 Satyam Computer Services Limited
  N/A
(Translation of Registrants Name Into English)
    
    Republic of India
(Jurisdiction of Incorporation or Organization)
 
 
 
  Title of Each Class
    
    
    Name of Each Exchange on Which RegisteredAmerican Depositary Shares,
    
    
    The New York Stock Exchangeeach represented by two equity shares,par value Rs. 2.0 per share
  
 
    þ o
 o þ
  þ o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
  U.S. GAAP þ
    
    International Financial Reporting Standards issued by o
    
    Other oThe International Accounting Standards Board
  o þ
 o þ
 o o




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TABLE OF CONTENTS
 SATYAM COMPUTER SERVICES LIMITED
 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
    
    4ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
    
    4ITEM 3. KEY INFORMATION
    
    4ITEM 4. INFORMATION ON THE COMPANY
    
    19ITEM 4A. UNRESOLVED STAFF COMMENTS
    
    35ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
    
    35ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
    
    57ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
    
    65ITEM 8. FINANCIAL INFORMATION
    
    66ITEM 9. THE OFFER AND LISTING
    
    66ITEM 10. ADDITIONAL INFORMATION
    
    68ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    85ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
    
    86ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
    
    86ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
    
    86ITEM 15. CONTROLS AND PROCEDURES
    
    86ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
    
    87ITEM 16B. CODE OF ETHICS
    
    87ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    87ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
    
    88ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
    
    88ITEM 17. FINANCIAL STATEMENTS
    
    89ITEM 18. FINANCIAL STATEMENTS
    
    89ITEM 19. EXHIBITS
    
    89EX-8.1 List of Significant Subsidiaries.EX-12.1 Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act 2002.EX-12.2 Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act 2002.EX-13.1 Certification of Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act 2002.EX-13.2 Certification of Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act 2002.EX-15.1 Consent of Price Waterhouse, Independent Registered Public Accounting Firm.
  2




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CURRENCY OF PRESENTATION AND CERTAIN DEFINED TERMS
      FORWARD-LOOKING STATEMENTS MAY PROVE INACCURATE
  , .
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ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
  
 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
  
 ITEM 3. KEY INFORMATION
 Selected Financial Data
  Year Ended March 31,2008
    
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004(dollars in millions, except per share and per ADS data, or as stated otherwise)Statement of operations dataRevenues:IT services
    
    $
    2,093.2
    
    
    $
    1,432.5
    
    
    $
    1,082.7
    
    
    $
    786.7
    
    
    $
    565.1BPO
    
    
    44.9
    
    
    
    28.9
    
    
    
    13.6
    
    
    
    6.9
    
    
    
    1.3Total revenues
    
    
    2,138.1
    
    
    $
    1,461.4
    
    
    $
    1,096.3
    
    
    $
    793.6
    
    
    $
    566.4Cost of revenues(1)
    
    
    (1,359.2
    )
    
    
    (937.6
    )
    
    
    (689.0
    )
    
    
    (506.8
    )
    
    
    (343.6
    )Gross profit
    
    
    778.9
    
    
    
    523.8
    
    
    
    407.3
    
    
    
    286.8
    
    
    
    222.8Operating expenses:Selling, general and administrative expenses (2)
    
    
    (370.2
    )
    
    
    (232.2
    )
    
    
    (187.6
    )
    
    
    (124.3
    )
    
    
    (101.7
    )Total operating expenses
    
    
    (370.2
    )
    
    
    (232.2
    )
    
    
    (187.6
    )
    
    
    (124.3
    )
    
    
    (101.7
    )Operating income
    
    
    408.7
    
    
    
    291.6
    
    
    
    219.7
    
    
    
    162.5
    
    
    
    121.1Interest income
    
    
    67.4
    
    
    
    37.3
    
    
    
    26.3
    
    
    
    22.3
    
    
    
    20.3Interest expense
    
    
    (5.1
    )
    
    
    (3.6
    )
    
    
    (1.3
    )
    
    
    (0.4
    )
    
    
    (0.5
    )Gain on sale of shares in associated companies/
other investments
    
    
    
    
    
    
    
    
    
    
    43.6
    
    
    
    
    
    
    
    2.7Gain/(loss) on foreign exchange transactions
    
    
    (12.0
    )
    
    
    (3.3
    )
    
    
    0.3
    
    
    
    (4.6
    )
    
    
    (8.9
    )Gain/(Loss) on forward and option contracts
    
    
    9.0
    
    
    
    6.2
    
    
    
    (0.8
    )
    
    
    0.4
    
    
    
    2.3Other income
    
    
    1.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Income/(loss) before income taxes, minority
interest and equity in earnings/ (loss) of
associated companies
    
    
    469.8
    
    
    
    328.2
    
    
    
    287.8
    
    
    
    180.2
    
    
    
    137.0Income taxes
    
    
    (52.9
    )
    
    
    (30.6
    )
    
    
    (37.7
    )
    
    
    (25.3
    )
    
    
    (22.5
    )Minority interest
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    Income before equity in earnings/(losses) of
associated companies
    
    
    416.9
    
    
    
    297.6
    
    
    
    250.2
    
    
    
    154.9
    
    
    
    114.5Equity in earnings/ (losses) of associated
companies, net of taxes
    
    
    0.1
    
    
    
    0.8
    
    
    
    (0.8
    )
    
    
    (1.1
    )
    
    
    (2.6
    )Net income
    
    $
    417.0
    
    
    $
    298.4
    
    
    $
    249.4
    
    
    $
    153.8
    
    
    $
    111.9
 Year Ended March 31,2008
    
    2007
    
    2006
    
    2005
    
    2004(dollars in millions, except per share and per ADS data, or as stated otherwise)Earnings per share(3):Basic
    
    $
    0.63
    
    
    $
    0.46
    
    
    $
    0.39
    
    
    $
    0.24
    
    
    $
    0.18Diluted
    
    
    0.61
    
    
    
    0.45
    
    
    
    0.38
    
    
    
    0.24
    
    
    
    0.18Earnings per ADS:Basic
    
    
    1.26
    
    
    
    0.92
    
    
    
    0.78
    
    
    
    0.48
    
    
    
    0.36Diluted
    
    
    1.22
    
    
    
    0.90
    
    
    
    0.75
    
    
    
    0.48
    
    
    
    0.36Weighted average equity shares
used in computing earnings per
shares (in millions):Basic
    
    
    666.4
    
    
    
    652.5
    
    
    
    641.2
    
    
    
    632.4
    
    
    
    626.4Diluted
    
    
    679.4
    
    
    
    666.0
    
    
    
    662.8
    
    
    
    647.2
    
    
    
    634.2
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Year Ended March 31,2008
    
    2007
    
    2006
    
    2005
    
    2004(dollars in millions, except per share and per ADS data, or as stated otherwise)Weighted average equity shares
used in computing earnings per
ADS:Basic
    
    
    333.2
    
    
    
    326.3
    
    
    
    320.6
    
    
    
    316.2
    
    
    
    313.2Diluted
    
    
    339.7
    
    
    
    333.0
    
    
    
    331.4
    
    
    
    323.6
    
    
    
    317.1Cash dividend per equity share
    
    
    0.06
    
    
    
    0.13
    
    
    
    0.11
    
    
    
    0.12
    
    
    
    0.08Cash dividend per ADS
    
    
    0.12
    
    
    
    0.26
    
    
    
    0.22
    
    
    
    0.24
    
    
    
    0.17
 
 (1)
    
    Inclusive of stock-based compensation expense of $9.8 million, $12.8 million, Nil, $0.8
million and $0.9 million in fiscal 2008, 2007, 2006, 2005 and 2004 respectively.(2)
    
    Inclusive of stock-based compensation expenses of $13.0 million, $2.9 million, $0.8 million,
$1.1 million and $0.8 during the years ended March 31, 2008, 2007, 2006, 2005 and 2004
respectively.(3)
    
    The earnings per share data for fiscal 2004 through fiscal 2006 has been adjusted for the
October 10, 2006 two-for-one stock split (in the form of stock dividend) As at March 31,2008
    
    2007
    
    2006
    
    2005
    
    2004(dollars in millions)Balance sheet dataCash and cash equivalents
    
    $
    290.5
    
    
    $
    152.2
    
    
    $
    292.8
    
    
    $
    129.8
    
    
    $
    86.7Investments in bank deposits
    
    
    826.7
    
    
    
    767.6
    
    
    
    403.7
    
    
    
    411.6
    
    
    
    332.1Total assets
    
    
    2,243.3
    
    
    
    1,624.1
    
    
    
    1,181.2
    
    
    
    884.1
    
    
    
    713.8Total long-term debt, excluding current portion
    
    
    24.8
    
    
    
    22.2
    
    
    
    17.9
    
    
    
    1.2
    
    
    
    1.8Preferred stock of subsidiary (1)
    
    
    
    
    
    
    
    
    
    
    20.0
    
    
    
    20.0
    
    
    
    10.0Total shareholders equity
    
    
    1,861.8
    
    
    
    1,371.0
    
    
    
    994.4
    
    
    
    767.9
    
    
    
    633.9Capital stock(2)
    
    
    627.4
    
    
    
    587.2
    
    
    
    481.5
    
    
    
    449.5
    
    
    
    431.7
 
 (1)
    
    In fiscal 2007, 50% of preferred stock of subsidiary, Satyam BPO, has become mandatorily
redeemable at the target date of May 21, 2007 and has been reclassified as a current
liability, which was paid in fiscal 2008. The balance 50% got converted into equity shares of
Satyam BPO based on the terms of the existing subscription agreement.(2)
    
    Includes common stock and additional paid-in capital but excludes shares held by Satyam
Associate Trust or SC Trust. 5




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Risk Factors
 The following factors , together with the other information contained in this Annual Report and
other reports and documents submitted to, or filed with, the SEC, could affect our results. If any
of the following risks actually occur, our company could be seriously harmed, and the market price
of our ADSs could decline.
 Risks Related to Our Overall Operations
 Our revenues and profitability are difficult to predict and can vary significantly from period to
period which could cause our share price to decline significantly.
 .
 Any inability to manage our rapid growth could disrupt our business and reduce our profitability.
   
    
    recruiting and retaining sufficiently skilled technical, marketing and management
personnel
    
    providing adequate training and supervision to maintain our high quality standards;
    
    preserving our culture and values and our entrepreneurial environment; and
    
    developing and improving our internal administrative infrastructure, particularly our
financial, operational, communications and other internal systems
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The economic environment, pricing pressure and rising wages have negatively impacted our revenues
and operating results.
   Our business will suffer if we fail to anticipate and develop new services and enhance existing
services in order to keep pace with rapid changes in technology and the industries on which we
focus.
  Our revenues are highly dependent on customers primarily located in the United States and customers
concentrated in certain industries, and economic slowdowns or factors that affect the economic
health of the United States and our customers industries may affect our business.
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We face intense competition in the IT services and BPO markets which could prevent us from
attracting and retaining customers and could reduce our revenues.
  
    
    offshore IT services firms such as Infosys Technologies Limited, Tata Consultancy
Services Limited and Wipro Limited
    
    consulting firms such as Accenture, Bearing Point, Capgemini and Deloitte Consulting;
    
    divisions of large multinational technology firms such as Hewlett-Packard; and
    
    IT outsourcing firms such as Computer Sciences Corporation, Electronic Data Systems and
IBM Global Services;
   Our revenues are highly dependent upon a small number of customers.
   Our fixed-price contracts expose us to additional risks, many of which are beyond our control,
which may reduce the profitability of these contracts.
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Our customers may terminate projects before completion or choose not to renew contracts, many of
which are terminable at will, which could adversely affect our profitability.
  A number of our customer contracts may be conditioned upon our performance, which, if
unsatisfactory, could result in less revenues than previously anticipated.
  Some of our multi-year customer contracts contain certain provisions which, if triggered, could
result in lower future revenues and profitability under the contract.
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We may be unable to attract skilled professionals in the competitive labor market.
  We dedicate significant resources to develop international operations which may be more difficult
to manage and operate.
  We are investing substantial cash assets in new facilities and physical infrastructure and our
profitability could be reduced if our business does not grow proportionately.
  Restrictions on immigration may affect our ability to compete for and provide services to customers
in the United States and in other countries, which could hamper our growth and cause our revenues
to decline.
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We may engage in acquisitions, strategic investments, strategic partnerships or alliances or other
ventures that may or may not be successful.
    System failure could disrupt our business.
  We may be liable to our customers for damages caused by disclosure of confidential information or
system failure.
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Our success depends in large part upon our management team and key personnel and our ability to
attract and retain them.
  Our insiders, who are shareholders, may be able to influence the election of our board and may have
interests which conflict with those of our shareholders or holders of our ADSs.
  The value of our interest in our subsidiaries may decline.
  Impairment of goodwill on account of our investments may impact our net income under U.S. GAAP .
  Stock-based compensation expenses may significantly reduce our net income.
  a)
    
    compensation expense for all stock-based compensation awards granted prior to, but not
yet vested as of April 1, 2006, based on the grant-date fair value estimated in accordance
with the original provisions of SFAS 123 andb)
    
    Stock-based compensation expenses for all stock-based compensation awards granted after
April 1, 2006 is based on the grant-date fair value estimated in accordance with the
provisions of SFAS 123R. In accordance with the modified prospective transition method, our
consolidated financial statements for the prior periods have not been restated to reflect
and do not include, the impact of SFAS 123R. Depending on the grant date fair value and
future grants are made, amortization of deferred stock-based compensation may contribute to
reducing our operating income and net income. Our subsidiaries also have stock option
schemes which may generate stock-based compensation expenses and which have and in the past
reduced, and may in the future reduce our operating income and net income.
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Compliance with new and changing corporate governance and public disclosure requirements adds
uncertainty to our compliance policies and increases our costs of compliance.
     As a foreign private issuer, we are subject to different U.S. securities laws and rules than a
domestic issuer, which may, among other things, limit the information available to holders of our
securities.
  Terrorist attacks or a war could adversely affect our business, results of operations and financial
condition.
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Risks Related to Investments in Indian Companies
  The GoI has recently taken actions to curtail or eliminate tax benefits that we have historically
benefited from.
    Foreign investment restrictions under Indian law may adversely impact the value of our ADSs,
including, for example, restrictions that limit your ability to reconvert equity shares into ADSs,
which may cause our equity shares to trade at a discount or premium to the market price of our
ADSs.
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Regional conflicts or natural disasters in South Asia and elsewhere could adversely affect the
Indian economy, disrupt our operations and cause our business to suffer.
  Political instability could seriously harm business and economic conditions in India generally and
our business in particular.
  Currency exchange rate fluctuations may affect the value of our ADSs and our financial condition.
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Our ability to acquire companies organized outside India as part of our growth strategy depends on
the approval of the GoI and/or the RBI and failure to obtain this approval could negatively impact
our business.
  If we are unable to protect our intellectual property rights, or if we infringe on the intellectual
property rights of others, our business may be harmed.
      Indian laws limit our ability to raise capital outside India and may limit the ability of others to
acquire us, which could prevent us from operating our business or entering into a transaction that
is in the best interests of our shareholders.
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Conditions in the Indian securities market may affect the price or liquidity of our equity shares
and our ADSs.
   It may be difficult for you to enforce any judgment obtained in the United States against us or our
affiliates.
  
    
    effect service of process upon us outside India or these persons outside the jurisdiction
of their residence; or
    
    enforce against us in courts outside of India or these persons outside the jurisdiction
of their residence, judgments obtained in United States courts, including judgments
predicated solely upon the federal securities laws of the United States.
  You may be subject to Indian taxes arising out of capital gains on the sale of the underlying
equity shares.
  There may be less company information available in Indian securities markets than securities
markets in other countries.
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Risk Related to our ADSs and our Trading Market
 Historically, our ADSs have traded at a significant premium to the trading prices of our underlying
equity shares, a situation which may not continue.
  You may be restricted in your ability to exercise preemptive rights under Indian law and thereby
may suffer future dilution of your ownership position.
  Holders of ADSs may be restricted in their ability to exercise voting rights.
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An active or liquid trading market for our ADSs is not assured.
   The future sales of securities by our company or existing shareholders may harm the price of our
ADSs or our equity shares.
  
 ITEM 4. INFORMATION ON THE COMPANY
 Business Overview
 www.satyam.com
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,
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Industry Overview
 Global IT Services Overview
    Increased importance of IT to businesses.
  mpact of the Internet and other new technologies on business.
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 Managing and upgrading existing systems.
  Increasing trend towards adoption of global delivery model.
 Indian IT Services Industry Overview
   High quality delivery record.
  Large supply of English-speaking IT professionals.
  Significant cost advantage.
  Evolving beyond-cost proposition.
 Trends
   Enhanced expectations.
  Large, multi-year, end-to-end contracts.
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 Relationships with customers key senior management.
  Performance measurement.
  Increasing globalization of engineering and R&D.
 Our Competitive Strengths
   Comprehensive range of services combined with specialized industry expertise.
  Flexible, highly evolved delivery model. , , ,
  Established leadership position in consulting and enterprise business solutions.
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 Strong relationships with blue chip customers.
  Track record of high quality execution .
     Culture of innovation.
 Our Growth Strategy
   Building on our long-standing customer relationships to cross-sell our comprehensive range of
services.
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 Continuing to focus on enterprise-wide business solutions and high quality value-added services.
  Expanding our presence in existing markets and penetrating new geographic markets.
  Continuing to enhance our industry expertise.
  Develop a strong cadre of leaders.
  Enhancing our capabilities through technology alliances and acquisitions.
 Service Offerings
  25




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Application development and maintenance services
 Application development
  Application maintenance
  Consulting and enterprise business solutions
  Integrated Engineering solutions
 .
 Infrastructure management services
   (
 26




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Business Process Outsourcing
  Delivery of IT Services
  Offshore centers
   Offsite centers
   Nearshore centers
  27




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Onsite teams
  Quality and Project Management
   ®
 Customers
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Fiscal2008
    
    2007
    
    2006No. of $1+ million customers
    
    
    158
    
    
    
    116
    
    
    
    101No. of $5+ million customers
    
    
    36
    
    
    
    26
    
    
    
    22No. of $10+ million customers
    
    
    44
    
    
    
    31
    
    
    
    23
   Fiscal2008
    
    2007
    
    2006Banking, Financial services and insurance
    
    
    22.1
    %
    
    
    26.3
    %
    
    
    27.3
    %Manufacturing
    
    
    23.9
    
    
    
    27.0
    
    
    
    28.5TIMES
    
    
    22.0
    
    
    
    20.3
    
    
    
    18.4Healthcare and Pharma
    
    
    7.4
    
    
    
    7.2
    
    
    
    6.1Retail, Transportation and Logistics
    
    
    8.3
    
    
    
    5.8
    
    
    
    5.7Others
    
    
    16.3
    
    
    
    13.4
    
    
    
    14.0Total
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
 Sales and Marketing
     BPO Services and Satyam BPO
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1)
    
    Finance and Accounting: Our long-term relationship with global financial services companies
equips us with first-hand understanding of the industry evolution, critical business issues
and trends. Satyam has competencies in managing a multitude of finance and accounting
processes.
  2.)
    
    Human Resources: We offer customized, cost-effective and comprehensive human resource
services. Our customized, need-based, cost-effective and comprehensive human resource services
help customers achieve greater efficiency without relying on investing in people and
technology.
 3)
    
    Knowledge Process Outsourcing (KPO): We believe that we are one of the pioneers in offering
KPO services. We offer end-to-end solutions in the analytics domain across multiple industry
verticals suiting customers service requirements. Our experienced analytics team leverages
its consultancy experience in econometric and computing proficiency, and its industrial
expertise in market analytics, customer analytics, risk & decision analytics and expenditure
analytics to deliver industry-best solutions to clients.
 4)
    
    Customer Contact Services: We provide inbound and outbound contact center services around the
world, offering high-quality, cost-effective, and risk-proof coverage of a diverse and
geographically distributed customer base. Our customer contact services include customer care,
information dissemination, survey programs, data collection and customer complaints.
 5)
    
    Technical Helpdesk: Our IT helpdesk services provide technical solutions and support for
corporate employees. The GETS (Global Enterprise Technical Support) solution provides basic
hardware and software support, and technical and service desk support across a wide range of
applications, including specific technologies such as SAP, Oracle, Peoplesoft, and Ariba.
 6)
    
    Procure to Pay Outsourcing: We enable clients to overcome their procure to pay outsourcing
challenges by offering a broad range of services that encompass all categories of procure to
pay outsourcing functions. We provide our clients with an onsite-offshore structure, including
offerings such as transactional purchasing and supplier relationship management & strategic
sourcing support, that best encompasses a modular and scalable project model.
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1.)
    
    Healthcare, Insurance and Pharma: The healthcare, insurance and pharma practice at Satyam BPO
has been successfully managing and growing relationships with large global clients for the
past three years. Satyam BPO offers a wide spectrum of services in such practices, ranging
from simple data entry to high-end complex analytics across the value chain, as well as KPO,
customer contact centers, integrated revenue cycle management (IT-BPO), back-office
administration & pharma.2.)
    
    Banking & Financial Services (BFS): In the field of BFS, Satyam BPO provides outsourcing
solutions in retail, wholesale and investment banking. Satyam BPO has Subject Matter Experts
(SME) in the BFS domain, who have over eight decades of collective experience, and expertise
in providing outsourcing solutions which are customized to suit specific business requirements
of clients. We provide a cost-effective value proposition for our clients by using Six Sigma
and process re-engineering, and rely on the tenets of effective knowledge transfer, cultural
integration, management of the human capital and adherence to pre-defined business rules and
processes.3.)
    
    Manufacturing and Automotive: Satyam BPO offers a wide spectrum of process outsourcing
services to manufacturing and automotive companies around the world. Satyam BPO provides
services such as; procure-to-pay, production and industrial engineering, global enterprise
technical support, customer management and data, and document processing services.4.)
    
    Media and Telecom: The convergence of information, communication and entertainment holds
immense potential for Business Process Outsourcing (BPO). Satyam BPO provides a diverse
portfolio of comprehensive, high-quality BPO services to leading telecom and media
corporations. For telecom companies, our service offerings can be broadly classified into
assurance and billing, technical support, customer care and other back-office operations. Our
service offerings for the media industry can be broadly categorized as content development,
writing and editing services, data management and design.5.)
    
    Digital Media and Entertainment: The Digital Media and Entertainment team of Satyam BPO has
made inroads in the animation industry. Our offerings include visual effects (VFX), 3D
animation and multimedia, visualization (BEAMS) and gaming.
 Strategic Alliances
    31




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Employees
   Recruiting
  Learning and Developmental Training
  Retention
   32




---



##### Table of Contents



Competition
  
    
    consulting firms such as Accenture, Bearing Point, Capgemini and Deloitte Consulting;
    
    divisions of large multinational technology firms such as Hewlett-Packard and IBM;
    
    IT outsourcing firms such as Computer Sciences Corporation, Electronic Data Systems and
IBM Global Services; and
    
    offshore IT services firms such as Infosys Technologies Limited, Tata Consultancy
Services Limited and Wipro Limited.
   Communications Infrastructure
    33




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##### Table of Contents



Facilities
 I ,
    Intellectual Property
  Seasonality
  Government Regulation
  34




---



##### Table of Contents



ITEM 4A. UNRESOLVED STAFF COMMENTS
  
 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
  Overview
      35




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##### Table of Contents



36




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##### Table of Contents



Disclosures about Segments of an Enterprise and Related
Information,
 
    
    IT services:We provide a comprehensive range of IT services, including application
development and maintenance, consulting and enterprise business solutions, extended
engineering solutions and infrastructure management services. We seek to be the single
service provider capable of serving all of our customers IT requirements. Our consulting
and enterprise business solutions includes services in the area of enterprise resource
planning, customer relationship management and supply chain management, data warehousing and
business intelligence, knowledge management, document management and enterprise application
integration. We also assist our customers in making their existing computing systems
accessible over the Internet. The IT segment information also includes the results of
Citisoft and Knowledge Dynamics Pte Ltd, Singapore, or Knowledge Dynamics, which were
acquired during fiscal 2006 and Nitor acquired during fiscal 2008.
    
    BPO:We provide outsourced BPO services in areas such as human resources, finance and
accounting, customer care (such as voice, email and chat) besides also providing
industry-specific transaction processing services. We target our BPO services at the
insurance, healthcare, pharma, banking and financial services, manufacturing and automobile,
media and telecom and digital media & entertainment. Revenues from this business segment
currently do not constitute a significant proportion of our total revenues; however, we
anticipate that this proportion will increase over time. Our BPO services are offered
through our wholly-owned subsidiary, Satyam BPO.
 Revenues
   Year ended March 31,2008
    
    
    2007
    
    
    2006Segment
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)IT services
    
    $
    2,093.2
    
    
    
    97.9
    %
    
    $
    1,432.5
    
    
    
    98.0
    %
    
    $
    1,082.7
    
    
    
    98.8
    %BPO
    
    
    44.9
    
    
    
    2.1
    
    
    
    28.9
    
    
    
    2.0
    
    
    
    13.6
    
    
    
    1.2Total
    
    $
    2,138.1
    
    
    
    100.0
    %
    
    $
    1,461.4
    
    
    
    100.0
    %
    
    $
    1,096.3
    
    
    
    100.0
    %
 37




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##### Table of Contents



Revenues by technology
  Year ended March 31,2008
    
    
    2007
    
    
    2006Technology type
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)Application development and maintenance services
    
    $
    916.9
    
    
    
    43.8
    %
    
    $
    675.2
    
    
    
    47.1
    %
    
    $
    541.4
    
    
    
    50.0
    %Consulting and enterprise business solutions
    
    
    944.9
    
    
    
    45.2
    
    
    
    599.8
    
    
    
    41.9
    
    
    
    429.5
    
    
    
    39.7Extended engineering solutions
    
    
    143.0
    
    
    
    6.8
    
    
    
    93.5
    
    
    
    6.5
    
    
    
    70.2
    
    
    
    6.5Infrastructure management services
    
    
    88.4
    
    
    
    4.2
    
    
    
    64.0
    
    
    
    4.5
    
    
    
    41.6
    
    
    
    3.8Total
    
    $
    2,093.2
    
    
    
    100.0
    %
    
    $
    1,432.5
    
    
    
    100.0
    %
    
    $
    1,082.7
    
    
    
    100.0
    %
 Revenues by contract type
   Year ended March 31,2008
    
    
    2007
    
    
    2006Contract type
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)Time-and-material basis
    
    $
    1,425.1
    
    
    
    68.1
    %
    
    $
    873.2
    
    
    
    61.0
    %
    
    $
    702.8
    
    
    
    64.9
    %Fixed-price basis
    
    
    668.1
    
    
    
    31.9
    
    
    
    559.3
    
    
    
    39.0
    
    
    
    379.9
    
    
    
    35.1Total
    
    $
    2,093.2
    
    
    
    100.0
    %
    
    $
    1,432.5
    
    
    
    100.0
    %
    
    $
    1,082.7
    
    
    
    100.0
    %
 Revenues based on offshore and onsite/offsite
   38




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Year ended March 31,2008
    
    
    2007
    
    
    2006Location
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)Offshore
    
    $
    1,073.8
    
    
    
    51.3
    %
    
    $
    704.1
    
    
    
    49.2
    %
    
    $
    496.0
    
    
    
    45.8
    %Onsite/Offsite
    
    
    1,019.4
    
    
    
    48.7
    
    
    
    728.4
    
    
    
    50.8
    
    
    
    586.7
    
    
    
    54.2Total
    
    $
    2,093.2
    
    
    
    100.0
    %
    
    $
    1,432.5
    
    
    
    100.0
    %
    
    $
    1,082.7
    
    
    
    100.0
    %
 Revenues by top customers
  Revenues based on customer location
  Year ended March 31,2008
    
    
    2007
    
    
    2006Geographic location
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)United States
    
    $
    1,239.4
    
    
    
    59.3
    %
    
    $
    908.7
    
    
    
    63.4
    %
    
    $
    699.0
    
    
    
    64.6
    %Europe
    
    
    437.3
    
    
    
    20.9
    
    
    
    274.7
    
    
    
    19.3
    
    
    
    204.8
    
    
    
    18.9Asia Pacific
    
    
    291.3
    
    
    
    13.9
    
    
    
    160.9
    
    
    
    11.2
    
    
    
    111.2
    
    
    
    10.3India
    
    
    71.8
    
    
    
    3.4
    
    
    
    63.4
    
    
    
    4.4
    
    
    
    45.1
    
    
    
    4.2Rest of the world
    
    
    53.4
    
    
    
    2.5
    
    
    
    24.8
    
    
    
    1.7
    
    
    
    22.6
    
    
    
    2.1Total
    
    $
    2,093.2
    
    
    
    100.0
    %
    
    $
    1,432.5
    
    
    
    100.0
    %
    
    $
    1,082.7
    
    
    
    100.0
    %
 Expenses
 Cost of revenues
    39




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##### Table of Contents



Selling, general and administrative expenses
  Subsidiaries
  Citisoft
    Knowledge Dynamics
   Acquisition of Minority Interests in Satyam BPO
  40




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##### Table of Contents



Preferred Stock of Subsidiary
  Acquisition of Nitor
   Acquisition of Bridge
  Income Taxes
  41




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42




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##### Table of Contents



RESULTS OF OPERATIONS
  Year ended March 31,2008
    
    
    2007
    
    
    2006Statement of income:
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %
    
    
    Amount
    
    
    %(in millions, except percentages)Revenues:IT services
    
    $
    2,094.5
    
    
    
    98.0
    %
    
    $
    1,433.2
    
    
    
    98.1
    %
    
    $
    1,083.5
    
    
    
    98.8
    %BPO
    
    
    60.6
    
    
    
    2.8
    
    
    
    38.0
    
    
    
    2.6
    
    
    
    19.9
    
    
    
    1.8Inter-segment
    
    
    (17.0
    )
    
    
    (0.8
    )
    
    
    (9.8
    )
    
    
    (0.7
    )
    
    
    (7.1
    )
    
    
    (0.6
    )Total revenues
    
    
    2,138.1
    
    
    
    100.0
    
    
    
    1,461.4
    
    
    
    100.0
    
    
    
    1,096.3
    
    
    
    100.0Cost of revenues: (1)IT services
    
    
    (1,327.1
    )
    
    
    (62.1
    )
    
    
    (920.0
    )
    
    
    (63.0
    )
    
    
    (678.1
    )
    
    
    (61.9
    )BPO
    
    
    (47.9
    )
    
    
    (2.2
    )
    
    
    (26.9
    )
    
    
    (1.8
    )
    
    
    (17.6
    )
    
    
    (1.6
    )Inter-segment
    
    
    15.8
    
    
    
    0.7
    
    
    
    9.3
    
    
    
    0.6
    
    
    
    6.7
    
    
    
    0.6Total cost of revenues
    
    
    (1.359.2
    )
    
    
    (63.6
    )
    
    
    (937.6
    )
    
    
    (64.2
    )
    
    
    (689.0
    )
    
    
    (62.8
    )Gross profit:IT services
    
    
    767.4
    
    
    
    35.9
    
    
    
    513.2
    
    
    
    35.1
    
    
    
    405.4
    
    
    
    37.0BPO
    
    
    12.7
    
    
    
    0.6
    
    
    
    11.1
    
    
    
    0.8
    
    
    
    2.3
    
    
    
    0.2Inter-segment
    
    
    (1.2
    )
    
    
    (0.1
    )
    
    
    (0.5
    )
    
    
    (0.0
    )
    
    
    (0.4
    )
    
    
    (0.0
    )Total gross profit
    
    
    778.9
    
    
    
    36.4
    
    
    
    523.8
    
    
    
    35.8
    
    
    
    407.3
    
    
    
    37.2Operating expenses:Selling, general and administrative expenses: (2)IT services
    
    
    (354.6
    )
    
    
    (16.6
    )
    
    
    (219.0
    )
    
    
    (15.0
    )
    
    
    (176.8
    )
    
    
    (16.1
    )BPO
    
    
    (16.8
    )
    
    
    (0.8
    )
    
    
    (13.7
    )
    
    
    (0.9
    )
    
    
    (11.2
    )
    
    
    (1.0
    )Inter-segment
    
    
    1.2
    
    
    
    0.1
    
    
    
    0.5
    
    
    
    0.0
    
    
    
    0.4
    
    
    
    0.0Total selling, general and administrative expenses
    
    
    (370.2
    )
    
    
    (17.3
    )
    
    
    (232.2
    )
    
    
    (15.9
    )
    
    
    (187.6
    )
    
    
    (17.1
    )Operating income/(loss):IT services
    
    
    412.8
    
    
    
    19.3
    
    
    
    294.2
    
    
    
    20.1
    
    
    
    228.6
    
    
    
    20.9BPO
    
    
    (4.1
    )
    
    
    (0.2
    )
    
    
    (2.6
    )
    
    
    (0.2
    )
    
    
    (8.9
    )
    
    
    (0.8
    )Inter-segment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total operating income
    
    
    408.7
    
    
    
    19.1
    
    
    
    291.6
    
    
    
    20.0
    
    
    
    219.7
    
    
    
    20.0Interest income
    
    
    67.4
    
    
    
    3.2
    
    
    
    37.3
    
    
    
    2.6
    
    
    
    26.3
    
    
    
    2.4Interest expense
    
    
    (5.1
    )
    
    
    (0.2
    )
    
    
    (3.6
    )
    
    
    (0.2
    )
    
    
    (1.3
    )
    
    
    (0.1
    )Gain on sale of shares in associated companies/ others
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    43.6
    
    
    
    4.0Gain/ (loss) on foreign exchange transactions
    
    
    (12.0
    )
    
    
    (0.6
    )
    
    
    (3.3
    )
    
    
    (0.2
    )
    
    
    0.3
    
    
    
    0.0Gain/ (loss) on foreign exchange forward and option contracts
    
    
    9.0
    
    
    
    0.4
    
    
    
    6.2
    
    
    
    0.4
    
    
    
    (0.8
    )
    
    
    (0.1
    )Other income/(expense), net
    
    
    1.8
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Income before income taxes and equity in earnings/(losses) of
associated companies
    
    
    469.8
    
    
    
    22.0
    
    
    
    328.2
    
    
    
    22.5
    
    
    
    287.8
    
    
    
    26.3Income taxes
    
    
    (52.9
    )
    
    
    (2.5
    )
    
    
    (30.6
    )
    
    
    (2.1
    )
    
    
    (37.7
    )
    
    
    (3.4
    )Minority interest
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    0.0Equity in earnings/(losses) of associated companies, net of taxes
    
    
    0.1
    
    
    
    
    
    
    
    0.8
    
    
    
    0.1
    
    
    
    (0.8
    )
    
    
    (0.1
    )Net income
    
    $
    417.0
    
    
    
    19.5
    
    
    $
    298.4
    
    
    
    20.4
    
    
    $
    249.4
    
    
    
    22.7Depreciation
    
    
    39.7
    
    
    
    1.9
    
    
    
    32.4
    
    
    
    2.2
    
    
    
    30.6
    
    
    
    2.8
 
 (1)
    
    Inclusive of stock-based compensation expenses of $9.8 million, $12.8 million and $Nil for
the years ended March 31, 2008, 2007 and 2006 respectively in the IT services segments(2)
    
    Inclusive of stock-based compensation expenses of $13.0 million, $2.9 million and $0.8
million for the years ended March 31, 2008, 2007 and 2006 respectively in the IT services
segments. 43




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##### Table of Contents



Comparison of results for fiscal 2008 and fiscal 2007.
 Revenues.
     Cost of Revenues.
 Selling, general and administrative expenses.
 44




---



##### Table of Contents



Operating income.
 Interest income.
 Gain/(loss) on foreign exchange transactions.
 Gain/(Loss) on foreign exchange forward and option contracts.
 Income taxes.
 Equity in earnings/(losses) of associated companies, net of taxes.
 Net income.
 Comparison of results for fiscal 2007 and fiscal 2006.
 Revenues.
  45




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##### Table of Contents



Cost of Revenues.
 Selling, general and administrative expenses.
 Operating income.
 46




---



##### Table of Contents



Interest income.
 Gain on sale of investments.
 Gain/(loss) on foreign exchange transactions.
 Gain/(Loss) on foreign exchange forward and option contracts.
 Income taxes.
 Equity in earnings/(losses) of associated companies, net of taxes.
 Net income.
 Liquidity and Capital Resources
 Net cash provided by operating activities
    47




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##### Table of Contents



Net cash used in investing activities
     Net cash used in financing activities
      48




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##### Table of Contents



Amount
    
    Interest
    
    ComputationLoan Type
    
    Lenders
    
    outstanding
    
    (per annum)
    
    method(dollars in millions)Working capital term loan
    
    BNP Paribas
    
    
    10.7
    
    
    6 month LIBOR +0.95%
    
    FloatingExternal commercial borrowing
    
    BNP Paribas
    
    
    10.5
    
    
    6 month LIBOR +0.95%
    
    FloatingOverdraft facility
    
    BNP Paribas
    
    
    26.9
    
    
    6 month LIBOR +0.25%
    
    FloatingOther loans
    
    Various other parties
    
    
    6.0
    
    
    3.0%-14.5%
    
    FixedTotal
    
    
    
    
    
    
    54.1
   Payments due as at March 31, 2008,Within 1
    
    1-3
    
    3-5
    
    After 5Year
    
    Years
    
    Years
    
    Years
    
    Total(dollars in millions)Long-term debt
    
    
    19.0
    
    
    
    8.0
    
    
    
    0.2
    
    
    
    
    
    
    
    27.2Operating leases
    
    
    17.5
    
    
    
    33.9
    
    
    
    34.0
    
    
    
    13.4
    
    
    
    98.8Unconditional purchase obligations:Other commercial commitments
    
    
    101.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    101.0Bank guarantees
    
    
    9.3
    
    
    
    2.9
    
    
    
    8.2
    
    
    
    5.6
    
    
    
    26.0Gratuity Plan
    
    
    3.7
    
    
    
    10.3
    
    
    
    14.1
    
    
    
    27.5
    
    
    
    55.6Knowledge Dynamics deferred and earn-out consideration (1)
    
    
    0.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.7Nitor deferred and earn-out consideration (2)
    
    
    1.0
    
    
    
    1.6
    
    
    
    
    
    
    
    
    
    
    
    2.6Total contractual cash obligations.
    
    
    152.2
    
    
    
    56.7
    
    
    
    56.5
    
    
    
    46.5
    
    
    
    311.9
 
 (1)
    
    Earn-out consideration of Knowledge Dynamics is based on certain conditions.(2)
    
    Earn-out consideration of Nitor is based on certain conditions.  Stock-based Compensation
  49




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##### Table of Contents



Year
endedMarch 31, 2008Dividend yield
    
    
    0.78
    %Expected volatility
    
    
    57
    %Risk-free interest rate
    
    
    8
    %Expected term (in years)
    
    
    2.51
 Expected Term:
 Risk-Free Interest Rate:
 Expected Volatility:
 Expected Dividend:
 Estimated Pre-vesting Forfeitures:
 Effect of recently issued accounting pronouncements
    50




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##### Table of Contents



Critical Accounting Policies
    Revenue recognition
    51




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##### Table of Contents



▪
    
    We have established a direct relationship between units of input and productivity.▪
    
    We evaluate each contract and apply judgment to ensure the existence of a relationship
between efforts expended and productivity.▪
    
    We periodically ensure that no inefficiencies exist between the input and productivity
and that the incurrence of an input results in progress-to-completion.▪
    
    We periodically review and confirm by alternative measures the acceptability of the
results provided by the input measures with the output measures.
       52




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##### Table of Contents



▪
    
    we do not have any arrangements where services / deliverables are for trial or
evaluation purposes and we do not grant a right of return / exchange;▪
    
    the fees for these contracts are fixed and non refundable and delivery occurs on a
prorate basis as the services are rendered. The customer sign-off rights are generally
identical to those granted to all others within the same class of customer and for which
satisfaction can be generally assured without consideration of conditions specific to the
customer;▪
    
    we are able to objectively demonstrate that the deliverables meet the specified criteria
and that these provisions are not different from general or specific warranties and
accordingly should be accounted for as warranties in accordance with FAS 5, Accounting for
Contingencies. We are able to reliably estimate the related warranty costs based on a
demonstrated history of substantially similar transactions; and▪
    
    no uncertainty exists about customer acceptance once the services have been rendered. We
are able to reliably demonstrate that the criteria specified in the acceptance provisions
and all other revenue recognition criteria are met prior to formal customer sign-off. We
believe that we would be successful in enforcing a claim for payment even in the absence of
formal sign-off.
 Impairment of Goodwill
   ▪
    
    significant underperformance relative to expected historical or projected future
operating results;▪
    
    significant changes in the manner of our use of the acquired assets or the strategy for
our overall business;▪
    
    significant negative industry or economic trends;▪
    
    significant decline in our stock price for a sustained period; and▪
    
    our market capitalization relative to net book value.
     53




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Accounts Receivable
  Accounting for income taxes
   Stock-Based Compensation Expense
    Effects of Inflation
  54




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Exchange Rates
  Month
    
    Month end
    
    Average
    
    High
    
    Low(Rupees)April-2006
    
    
    44.86
    
    
    
    44.82
    
    
    
    45.09
    
    
    
    44.39May-2006
    
    
    46.22
    
    
    
    45.20
    
    
    
    46.22
    
    
    
    44.69June-2006
    
    
    45.87
    
    
    
    45.89
    
    
    
    46.25
    
    
    
    45.50July-2006
    
    
    46.49
    
    
    
    46.37
    
    
    
    46.83
    
    
    
    45.84August-2006
    
    
    46.43
    
    
    
    46.45
    
    
    
    46.61
    
    
    
    46.32September-2006
    
    
    45.95
    
    
    
    46.01
    
    
    
    46.38
    
    
    
    45.74October-2006
    
    
    44.90
    
    
    
    45.36
    
    
    
    45.97
    
    
    
    44.90November-2006
    
    
    44.59
    
    
    
    44.73
    
    
    
    45.26
    
    
    
    44.46December-2006
    
    
    44.11
    
    
    
    44.48
    
    
    
    44.70
    
    
    
    44.11January-2007
    
    
    44.07
    
    
    
    44.21
    
    
    
    44.49
    
    
    
    44.07February-2007
    
    
    44.08
    
    
    
    44.02
    
    
    
    44.21
    
    
    
    43.87March-2007
    
    
    43.10
    
    
    
    43.79
    
    
    
    44.43
    
    
    
    42.78April-2007
    
    
    41.04
    
    
    
    42.02
    
    
    
    43.05
    
    
    
    40.56May-2007
    
    
    40.36
    
    
    
    40.57
    
    
    
    41.04
    
    
    
    40.14June-2007
    
    
    40.58
    
    
    
    40.59
    
    
    
    40.90
    
    
    
    40.27July-2007
    
    
    40.18
    
    
    
    40.27
    
    
    
    40.42
    
    
    
    40.12August-2007
    
    
    40.63
    
    
    
    40.68
    
    
    
    41.15
    
    
    
    40.25September-2007
    
    
    39.75
    
    
    
    40.17
    
    
    
    40.81
    
    
    
    39.50October-2007
    
    
    39.26
    
    
    
    39.37
    
    
    
    39.72
    
    
    
    38.48November-2007
    
    
    39.52
    
    
    
    39.33
    
    
    
    39.68
    
    
    
    39.11December-2007
    
    
    39.41
    
    
    
    39.38
    
    
    
    39.55
    
    
    
    39.29January-2008
    
    
    39.31
    
    
    
    39.27
    
    
    
    39.55
    
    
    
    39.13February-2008
    
    
    39.96
    
    
    
    39.67
    
    
    
    40.11
    
    
    
    39.12March-2008
    
    
    40.02
    
    
    
    40.15
    
    
    
    40.46
    
    
    
    39.76
 RISK MANAGEMENT POLICY
    55




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##### Table of Contents



As at March 31,2008
    
    
    2007
    
    
    2006Amount
    
    
    Amount
    
    
    Amount(dollars in millions)Aggregate contracted principal amounts of contracts outstanding:Forward contracts
    
    $
    395.7
    
    
    $
    100.0
    
    
    $
    79.0Options contracts
    
    
    737.4
    
    
    
    352.6
    
    
    
    137.0Total
    
    $
    1,133.1
    
    
    $
    452.6
    
    
    $
    216.0Gains/(loss) on outstanding contracts:Forward contracts
    
    $
    (0.7
    )
    
    $
    2.1
    
    
    $
    0.4Options contracts
    
    
    (1.6
    )
    
    
    2.4
    
    
    
    (1.8
    )Total
    
    $
    (2.3
    )
    
    $
    4.5
    
    
    $
    (1.4
    )
  Year ended March 31,2008
    
    
    2007
    
    
    2006Amount
    
    
    Amount
    
    
    Amount(dollars in millions)Forward contracts
    
    $
    5.4
    
    
    $
    2.6
    
    
    $
    0.8Options contracts
    
    
    3.6
    
    
    
    3.6
    
    
    
    (1.6
    )Total
    
    $
    9.0
    
    
    $
    6.2
    
    
    $
    (0.8
    )
 Off-Balance Sheet Arrangements
  Foreign Currency Transactions/ Translation
    56




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##### Table of Contents



ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
  Directors
 Name
    
    Age
    
    PositionB. Ramalinga Raju
    
    
    52
    
    
    ChairmanB. Rama Raju
    
    
    48
    
    
    Managing Director and Chief Executive Officer(3)Ram Mynampati
    
    
    51
    
    
    President & Whole Time DirectorDr. Mangalam Srinivasan
    
    
    69
    
    
    Director(1)(2)Krishna G. Palepu
    
    
    53
    
    
    DirectorVinod K. Dham
    
    
    57
    
    
    Director(2)M. Rammohan Rao
    
    
    66
    
    
    Director(1)(2)T.R. Prasad
    
    
    66
    
    
    Director(1)(3)V.S. Raju
    
    
    67
    
    
    Director(1)(2)(3)
 Key Management Personnel
 Name
    
    Age
    
    PositionAnand T R
    
    
    52
    
    
    Director and Senior Vice President, Vertical Business Unit  TIMESHetzel Folden
    
    
    52
    
    
    Head  Global Strategic Deals GroupJayaraman G
    
    
    52
    
    
    Global Head  Corporate Governance and Company SecretaryJoseph Lagioia
    
    
    55
    
    
    Senior Vice President and Global Head of Consulting and Enterprise SolutionsKeshab Panda
    
    
    49
    
    
    Head  Europe OperationsManish Sukhlal Mehta
    
    
    51
    
    
    Global Head  Horizontal Competency Unit  SAP, Engineering & Spatial ServicesSrinidhi Sharma
    
    
    48
    
    
    Global Head  Infrastructure Management ServicesShailesh Shah
    
    
    47
    
    
    Head  Corporate Strategy GroupSrinivas V
    
    
    48
    
    
    Chief Financial OfficerSubramanian D
    
    
    48
    
    
    Director and Senior Vice President  Vertical Business Unit  Manufacturing,Automotive, Energy, Oil and Gas and UtilitiesTSK Murthy
    
    
    54
    
    
    Global Head, Senior Vice President, Integrated Engineering SolutionsVijay Prasad Boddupalli
    
    
    56
    
    
    Director and Senior Vice President  Horizontal Competency Unit  EnterpriseApplications and Business Intelligence SolutionsVirender Aggarwal
    
    
    47
    
    
    Director and Senior Vice President  Regional Business Unit-India, Middle East,Africa & Asia Pacific
 
 (1)
    
    Member of the Audit Committee(2)
    
    Member of the Compensation Committee(3)
    
    Member of the Investors Grievance Committee(4)
    
    Directors listed under key management personnel are directors of business/support units and
not members of our board of directors. 57




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##### Table of Contents



B. Ramalinga Raju
 B. Rama Raju
 Ram Mynampati
 Dr. Mangalam Srinivasan
 Prof. Krishna G. Palepu
 Vinod K. Dham
 Prof. M Rammohan Rao ,
 58




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##### Table of Contents



T.R. Prasad
 Prof. V. S. Raju
 Anand T.R.
 Hetzel Wayne Folden
 Jayaraman G.
 Joseph J Lagioia
 59




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##### Table of Contents



Keshab Panda
 Manish Sukhlal Mehta
 Shailesh Shah
 Sreenidhi Sharma
 Srinivas V.
 Subramanian D.
 Dr. T S K Murthy
 Vijay Prasad Boddupalli
 60




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##### Table of Contents



Virender Aggarwal
 Compensation of Directors and Key Management Personnel
    Annual Compensation
 $ in millionsName and Principal Position
    
    Salary
    
    
    Bonus
    
    
    Others (1)B. Rama Raju, Managing Director and Chief Executive Officer
    
    $
    0.09
    
    
    
    
    
    
    $
    0.02
 
 (1)
    
    Includes membership fees and housing allowance. Option Grants
  Employee Benefit Plans
  Our ASOP and ESOP Plans
  61




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##### Table of Contents



ASOP
   ASOP B
   ASOP ADS
   62




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##### Table of Contents



Associate Stock Option Plan  Restricted Stock Units (ASOP  RSUs)
  Associate Stock Option Plan  RSUs (ADS) (ASOP  RSUs(ADS))
  Satyam BPO ESOP
  Board Practices
 Board Composition
  
    
    at least two-thirds of our directors shall be subject to retirement; and
    
    in any given year, at least one-third of these directors who are subject to retirement
shall retire and be eligible for re-election at the annual meeting of our shareholders.
  Board Committees
  63




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##### Table of Contents



Directors Compensation
  Employment, Severance and Other Agreements
  Employees
  Share Ownership
  Equity Shares / (ADS)Beneficially OwnedBeneficial Owner
    
    Number
    
    PercentB. Rama Raju
    
    
    0 (1)(2
    )
    
    
    0.00B. Ramalinga Raju
    
    
    0 (2
    )
    
    
    0.00Ram Mynampati
    
    
    1,140,576
    
    
    
    0.17Dr. Mangalam Srinivasan
    
    
    (1,250
    )
    
    
    Krishna G Palepu
    
    
    (1,250
    )
    
    
    Vinod K Dham
    
    
    (1,250
    )
    
    
    M Rammohan Rao
    
    
    2,500
    
    
    
    T.R. Prasad
    
    
    
    
    
    
    V.S. Raju
    
    
    
    
    
    
    All directors and executive officers as a group
    
    
    3,075,016
    
    
    
    0.46
 
 (1)
    
    Includes 1,000 equity shares held by B. Rama Rajus wife, B. Radha Raju. B. Rama Raju
disclaims beneficial ownership of any equity shares held by B. Radha Raju.(2)
    
    B. Ramalinga Raju and B. Rama Raju control SRSR Holdings Private Limited, which holds
approximately 8.3% of our outstanding equity shares as of March 31, 2008. 64




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##### Table of Contents



ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
 Share Ownership
    Identity of Person or Group
    
    Number
    
    Percentage (%)FMR Corp.(1)
    
    
    61,412,491
    
    
    
    9.2
    %SRSR Holdings Private Limited(2)
    
    
    55,728,000
    
    
    
    8.3
    %
 
 (1)
    
    Information based on a report on Schedule 13G jointly filed by FMR Corp. and Edward C.
Johnson with the SEC on February 14, 2004 and as amended on February 14, 2005, February 14,
2006, August 10, 2006, February 14, 2007 and February 14, 2008. Based on Amendment No. 5 to
the Schedule 13G filed by FMR Corp. and Edward C. Johnson with the SEC on February 14, 2008
FMR Corp. has sole voting power for 9,955,914 equity shares and sole dispositive power for
61,412,491 equity shares. Edward Johnson has sole voting and dispositive power for 61,412,491
equity shares.(2)
    
    Information based upon a report on Schedule 13G filed by SRSR Holdings Private Limited, with
the SEC on September 21, 2006. Related Party Transactions
  65




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##### Table of Contents



ITEM 8. FINANCIAL INFORMATION
 Financial Statements
  Legal Proceedings
   Dividends
   
 ITEM 9. THE OFFER AND LISTING
 Trading Markets
   66




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##### Table of Contents



Price History
  Annual high and low market prices
 Rupee price per
    
    U.S. dollar priceequity share(1)
    
    per equity shareFiscal year ended March 31,(2)
    
    High
    
    Low
    
    High
    
    Low2003
    
    
    145.93
    
    
    
    87.55
    
    
    
    3.07
    
    
    
    1.842004
    
    
    195.50
    
    
    
    63.65
    
    
    
    4.50
    
    
    
    1.472005
    
    
    221.00
    
    
    
    125.00
    
    
    
    5.07
    
    
    
    2.872006
    
    
    431.00
    
    
    
    182.20
    
    
    
    9.69
    
    
    
    4.102007
    
    
    524.90
    
    
    
    270.50
    
    
    
    12.18
    
    
    
    6.282008
    
    
    522.30
    
    
    
    305.00
    
    
    
    13.01
    
    
    
    7.742009 (through June 30, 2008)
    
    
    544.00
    
    
    
    390.65
    
    
    
    12.91
    
    
    
    9.80Fiscal 2007:First Quarter
    
    
    445.00
    
    
    
    270.50
    
    
    
    9.70
    
    
    
    5.90Second Quarter
    
    
    432.00
    
    
    
    325.68
    
    
    
    9.40
    
    
    
    7.09Third Quarter
    
    
    498.10
    
    
    
    396.00
    
    
    
    11.29
    
    
    
    8.98Fourth Quarter
    
    
    524.90
    
    
    
    404.00
    
    
    
    12.18
    
    
    
    9.37Fiscal 2008:First Quarter
    
    
    513.80
    
    
    
    435.00
    
    
    
    12.67
    
    
    
    10.20Second Quarter
    
    
    522.30
    
    
    
    401.50
    
    
    
    13.01
    
    
    
    10.08Third Quarter
    
    
    490.00
    
    
    
    401.00
    
    
    
    12.52
    
    
    
    10.15Fourth Quarter
    
    
    480.00
    
    
    
    305.00
    
    
    
    12.13
    
    
    
    7.74Fiscal 2009:First Quarter
    
    
    544.00
    
    
    
    390.65
    
    
    
    12.91
    
    
    
    9.80Monthly prices:October 2007
    
    
    490.00
    
    
    
    412.00
    
    
    
    12.52
    
    
    
    10.47November 2007
    
    
    485.00
    
    
    
    406.20
    
    
    
    12.37
    
    
    
    10.34December 2007
    
    
    465.00
    
    
    
    401.00
    
    
    
    11.80
    
    
    
    10.15January 2008
    
    
    451.00
    
    
    
    305.00
    
    
    
    11.44
    
    
    
    7.74February 2008
    
    
    480.00
    
    
    
    389.00
    
    
    
    12.13
    
    
    
    9.86March 2008
    
    
    444.70
    
    
    
    358.00
    
    
    
    11.03
    
    
    
    8.91April 2008
    
    
    499.50
    
    
    
    390.65
    
    
    
    12.35
    
    
    
    9.80May 2008
    
    
    544.00
    
    
    
    464.90
    
    
    
    12.91
    
    
    
    11.19June 2008
    
    
    541.90
    
    
    
    431.25
    
    
    
    12.79
    
    
    
    10.05
 
 (1)
    
    Data derived from the BSE website. The prices and volumes quoted on the NSE may be different.(2)
    
    For comparative purposes, the price per equity share data above is adjusted for the October
10, 2006 two-for-one stock split (in the form of stock dividend)  U.S. dollarPrice per ADSHigh
    
    LowFiscal2004
    
    
    17.68
    
    
    
    3.632005
    
    
    14.25
    
    
    
    8.002006
    
    
    21.95
    
    
    
    10.50
 67




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##### Table of Contents



U.S. dollarPrice per ADSHigh
    
    Low2007
    
    
    25.94
    
    
    
    13.982008
    
    
    30.89
    
    
    
    20.112009 (through June 30, 2008)
    
    
    29.84
    
    
    
    22.21Fiscal 2007First Quarter
    
    
    22.25
    
    
    
    13.98Second Quarter
    
    
    20.50
    
    
    
    15.34Third Quarter
    
    
    24.50
    
    
    
    19.29Fourth Quarter
    
    
    25.94
    
    
    
    19.35Fiscal 2008First Quarter
    
    
    26.25
    
    
    
    22.04Second Quarter
    
    
    29.46
    
    
    
    22.22Third Quarter
    
    
    30.89
    
    
    
    23.28Fourth Quarter
    
    
    27.56
    
    
    
    20.11Monthly pricesSeptember 2007
    
    
    26.25
    
    
    
    23.13October 2007
    
    
    30.80
    
    
    
    24.67November 2007
    
    
    30.89
    
    
    
    23.28December 2007
    
    
    28.65
    
    
    
    24.59January 2008
    
    
    26.75
    
    
    
    21.04February 2008
    
    
    27.56
    
    
    
    23.05March 2008
    
    
    26.11
    
    
    
    20.02April 2008
    
    
    26.66
    
    
    
    22.21May 2008
    
    
    29.84
    
    
    
    24.85June 2008
    
    
    29.00
    
    
    
    24.26
  U.S. dollarPrice per ADSHigh
    
    LowJanuary 2008
    
    
    26.60
    
    
    
    19.54February 2008
    
    
    28.00
    
    
    
    23.35March 2008
    
    
    25.47
    
    
    
    20.08April 2008
    
    
    26.00
    
    
    
    22.50May 2008
    
    
    28.00
    
    
    
    25.80June 2008
    
    
    28.50
    
    
    
    24.50
 
 ITEM 10. ADDITIONAL INFORMATION
 Corporate Governance
  68




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Standard for U.S. Listed Companies
    
    Our PracticeDirector Independence
    
    
    
    Five of our nine directors, namely Dr. (Mrs.) Mangalam Srinivasan, Mr. Vinod Dham, Prof. M Rammohan Rao, Mr. T R Prasad and Prof. V S Raju are independent within the meaning of the NYSE standards.
    
    A majority of the board must consist of independent directors.Independence is defined by various criteria including the absence of a
material relationship between the director and the listed company. For
example, directors who are employees, are immediate family of the chief
executive officer or receive over $100,000 per year in direct compensation
from the listed company are not independent. Directors who are employees of
or otherwise affiliated through immediate family with the listed companys
independent auditor are also not independent.
    
    The non-management directors of each company must meet at regularly scheduled
executive sessions without management.
    
    
    
    Our non-management directors do
not meet periodically without
management directors.Audit Committee
    
    Listed companies must have an audit committee that satisfies the requirements
of Rule 10A-3 under the Securities Exchange Act. The rule requires that the
audit committee (i) be comprised entirely of independent directors; (ii) be
directly responsible for the appointment, compensation and oversight of the
independent auditor; (iii) adopt procedures for the receipt and treatment of
complaints with respect to accounting and auditing issues; (iv) be authorized to
engage independent counsel and other advisors it deems necessary in performing
its duties; and (v) be given sufficient funding by the board of directors to
compensate the independent auditors and other advisors as well as for the
payment of ordinary administrative expenses incurred by the committee.
    
    
    
    We have an audit committee which
meets all of the requirements of
Rule 10A-3.
    
    The audit committee must consist of at least three members, and each member
must be independent within the meaning established by the NYSE.
    
    
    
    Our audit committee consists of
four members and all the members
are independent under the NYSEs
rules.
    
    The audit committee must have a written charter that addresses the
committees purpose and responsibilities.
    
    Our audit committee has a charter
outlining the committees purpose
and responsibilities.At a minimum, the committees purpose must be to assist the board in
the oversight of the integrity of the companys financial statements,
the companys compliance with legal and regulatory requirements, the
independent auditors qualifications and independence and the
performance of the companys internal audit function and independent
auditors.The audit committee is also required to review the independent auditing
firms annual report, describing the firms internal quality control
procedures, any material issues raised by the most recent internal
quality control review or peer review of the firm and any steps taken to
address such issues. The audit committee is also to assess the auditors
independence by reviewing all relationships between the company and
its
 69




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##### Table of Contents



auditor. It must establish the companys hiring guidelines for
employees and former employees of the independent auditor.The committee must also discuss the companys annual audited financial
statements and quarterly financial statements with management and the
independent auditors, the companys earnings press releases, as well as
financial information and earnings guidance provided to analysts and
rating agencies, and policies with respect to risk assessment and risk
management. It must also meet periodically with the internal auditors
and the board of directors.
    
    Each listed company must have disclosed whether their board of directors has
identified an Audit Committee Financial Expert, and if not the reasons why
the board has not done so.
    
    
    
    We do not have an individual
serving on our audit committee as
an Audit Committee Financial
Expert, as defined in applicable
rules of the Securities and
Exchange Commission. This is
because our board of directors
has determined that no individual
audit committee member possesses
all of the attributes required by
the definition of Audit
Committee Financial Expert.
    
    Each listed company must have an internal audit function.
    
    
    
    We have a separate department for
our internal audit function.Compensation Committee
    
    Listed companies must have a
compensation committee composed entirely
of independent board members as defined
by the NYSE listing standards.
    
    
    
    Our compensation committee has four members, each of whom is independent
within the meaning of the NYSE standards.
    
    The committee must have a written
charter that addresses its purpose and
responsibilities. These responsibilities
include (i) reviewing and approving
corporate goals and objectives relevant
to CEO compensation; (ii) evaluating CEO
performance and compensation in light of
such goals and objectives for the CEO;
(iii) based on such evaluation,
reviewing and approving CEO compensation
levels; (iv) recommending to the board
non-CEO compensation, incentive
compensation plans and equity-based
plans; and (v) producing a report on
executive compensation as required by
the Securities and Exchange Commission
to be included in the companys annual
proxy statement or annual report. The
committee must also conduct an annual
performance self-evaluation.
    
    
    
    Our compensation committee reviews among other things our general
compensation structure, and reviews and recommends the compensation and
benefits of directors and the chief executive officer, subject to
ratification by the Board of Directors.Nominating/Corporate Governance Committee
    
    Listed companies must have a
nominating/corporate governance
committee composed entirely of
independent board members.
    
    
    
    We do not have a nominating/corporate governance committee.The committee must have a written
charter that addresses its purpose
and responsibilities, which include
(i) identifying qualified
individuals to become board member;
(ii) selecting, or recommending
that the board select, the director
nominees for the next annual
meeting of shareholders; (iii)
developing and recommending to the
board a set of corporate governance
principles applicable to the
company; (iv) overseeing the
evaluation of the board and
management; and (v) conducting an
annual performance evaluation of
the committee.Equity-Compensation Plans
    
    Shareholders must be given the
opportunity to vote on all
equity-compensation plans and material
revisions thereto, with
    
    
    
    The Company is in compliance with this requirement.
 70




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limited exceptions.Corporate Governance Guidelines
    
    Listed companies must adopt and
disclose corporate governance
guidelines.
    
    
    
    We are fully compliant with Clause 49 of the listing agreement of Indian
Stock Exchanges, with regard to corporate governance guidelines.Code of Business Conduct and Ethics
    
    All listed companies, U.S. and
foreign, must adopt and disclose a code
of business conduct and ethics for
directors, officers and employees, and
promptly disclose any waivers of the
code for directors or executive
officers.
    
    
    
    We have adopted a Code of Business Conduct and Ethics Policy, which is
available at www.satyam.com.
 Reporting requirements for shareholders under Dutch FMSA
   Memorandum and Articles of Association
  Objects and Purposes
  (i)
    
    manufacturing and selling computer systems, peripherals, accessories, consumables and other
computer Products
 (ii)
    
    designing and developing computer systems and applications software for our own use and for
sale and designing and developing systems and applications software for or on behalf of
manufacturers, owners and users of computer systems and digital or electronic equipment; and
 71




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(iii)
    
    providing electronic data processing centers, word processing, software consultancy, system
studies, management consultancy, feasibility studies and computer training
 Board of Directors
  Managerial remuneration
     Equity Shares
   Dividends
   72




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##### Table of Contents



(i)
    
    the rate of dividend to be declared may not exceed 10.0% of its paid up capital or the
average of the rate at which dividends were declared by the company in the prior five years,
whichever is less(ii)
    
    the total amount to be drawn from the accumulated profits earned in the previous years and
transferred to the reserves may not exceed an amount equivalent to 10.0% of its paid up
capital and free reserves, and the amount so drawn is to be used first to set off the losses
incurred in the fiscal year before any dividends in respect of preference or equity shares are
declared; and(iii)
    
    the balance of reserves after withdrawals shall not fall below 15.0% of its paid up capital
  Bonus Shares
  Preemptive Rights and Issue of Additional Shares
   Annual General Meetings of Shareholders
  73




---



##### Table of Contents



Voting Rights
    Audit and Annual Report
  Register of Shareholders; Record Dates; Transfer of Shares
    74




---



##### Table of Contents



Disclosure of Ownership Interest
  Buy back of shares
  Liquidation Rights
  Takeover Code
  75




---



##### Table of Contents



Material Contracts
  Exchange Controls
 General
      76




---



##### Table of Contents



Foreign Direct Investment
   Investment by Non-Resident Indians
  Investment by Foreign Institutional Investors
  77




---



##### Table of Contents



Ownership Restrictions
      Voting Rights of Deposited Equity Shares Represented by ADSs
  Taxation
  78




---



##### Table of Contents



Indian Taxation
 General. shares
   
    
    a period or periods amounting to 182 days or more; or
    
    60 days or more if within the four preceding years he/she has been in India for a period
or periods amounting to 365 days or more; or
    
    182 days or more, in the case of a citizen of India or a person of Indian origin living
abroad who visits India and within the four preceding years has been in India for a period
or periods amounting to 365 days or
    
    182 days or more, in the case of a citizen of India who leaves India for the purposes of
employment outside India in any previous year and has within the four preceding years been
in India for a period or periods amounting to 365 days or more.
  Taxation of Distributions.
  Taxation of Capital Gains.
  79




---



##### Table of Contents



Capital Losses.
 Withholding Tax on Capital Gains.
 80




---



##### Table of Contents



Buy-back of Securities.
 Tax Treaties.
 Stamp Duty and Transfer Tax.
 Wealth Tax.
 Gift Tax and Estate Duty.
 Service Tax.
 Recent Developments  Budget 
 
    
    Rate of tax on short-term capital gains under Section 111A & Section 115AD increased to 15
per cent.
    
    Securities Transaction Tax (STT) and Commodities Transaction Tax (CTT) paid in the course
of business to be allowed as business deduction.
    
    Excise duty increased on packaged software from 8 per cent to 12 per cent, same as the
service tax of 12 per cent on customized software.
    
    Parent company allowed to set off the dividend received from its subsidiary against
dividend distributed by the parent company; provided that the dividend received has been
subjected to dividend distribution tax and the parent company is not a subsidiary of another
company.
    
    Crèche facilities, sponsorship of an employee-sportsperson, organising sports events for
employees and guest houses excluded from the purview of fringe benefit tax.
 U.S. Taxation
  81




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##### Table of Contents




    
    banks;
    
    financial institutions;
    
    insurance companies;
    
    regulated investment companies;
    
    real estate investment trusts;
    
    broker dealers;
    
    traders that elect to mark to market;
    
    tax-exempt entities;
    
    persons liable for alternative minimum tax;
    
    U.S. expatriates;
    
    persons holding an ADS or equity share as part of a straddle, hedging, conversion or
integrated transaction;
    
    persons that actually or constructively own 10% or more of our voting stock;
    
    persons who acquired ADSs or equity shares pursuant to the exercise of any employee share
option or otherwise as compensation; or
    
    persons holding ADSs or equity shares through partnerships or other pass-through
entities.
 PROSPECTIVE PURCHASERS ARE URGED TO CONSULT THEIR TAX ADVISORS ABOUT THE APPLICATION OF THE U.S.
FEDERAL TAX RULES TO THEIR PARTICULAR CIRCUMSTANCES AS WELL AS THE STATE, LOCAL, FOREIGN AND OTHER
TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF ADSs OR EQUITY SHARES.
  
    
    an individual who is a citizen or resident of the United States;
    
    a corporation (or other entity taxable as a corporation for U.S. federal income tax
purposes) organized under the laws of the United States, any State thereof or the District
of Columbia
    
    an estate whose income is subject to U.S. federal income taxation regardless of its
source; or
    
    a trust that (1) is subject to the primary supervision of a court within the United
States and the control of one or more U.S. persons for all substantial decisions or (2) has
a valid election in effect under applicable U.S. Treasury regulations to be treated as a
U.S. person.
  82




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##### Table of Contents



Dividends and Other Distributions on the ADSs or Equity Shares
     83




---



##### Table of Contents



Sale or Other Disposition of ADSs or Equity Shares
   Stamp Duty and Transfer Tax
  Passive Foreign Investment Company
  
    
    at least 75% of its gross income is passive income, or
    
    at least 50% of the value of its assets (based on an average of the quarterly values of
its assets during such year) is attributable to assets that produce passive income or are
held for the production of passive income.
  U.S. Information Reporting and Backup Withholding
   84




---



##### Table of Contents



Documents On Display
  
   Subsidiary Information
  
 Item 11: Quantitative and Qualitative Disclosure about Market Risk
   As at March 31,2008
    
    2007
    
    2006Total Recorded
    
    Total Recorded
    
    Total RecordedAmount
    
    Fair Value
    
    Amount
    
    Fair value
    
    Amount
    
    Fair Value( dollars in millions)Debt:Variable rate short-term debt
    
    $
    26.9
    
    
    
    
    
    
    $
    26.9
    
    
    $
    10.5
    
    
    
    
    
    
    $
    10.5
    
    
    $
    4.1
    
    
    
    
    
    
    $
    4.1Average interest rate
    
    
    
    
    
    
    8.44
    %
    
    
    
    
    
    
    
    
    
    
    6.71
    %
    
    
    
    
    
    
    
    
    
    
    5.33
    %Variable rate long term debt
    
    $
    21.2
    
    
    
    
    
    
    $
    21.2
    
    
    $
    20.5
    
    
    
    
    
    
    $
    20.5
    
    
    $
    16.1
    
    
    
    
    
    
    $
    16.1Average interest rate
    
    
    
    
    
    
    8.01
    %
    
    
    
    
    
    
    
    
    
    
    7.23
    %
    
    
    
    
    
    
    
    
    
    
    5.58
    %Fixed rate long-term debt
    
    $
    6.0
    
    
    
    
    
    
    $
    6.0
    
    
    $
    3.3
    
    
    
    
    
    
    $
    3.3
    
    
    $
    4.2
    
    
    
    
    
    
    $
    4.2Average interest rate
    
    
    
    
    
    
    10.00
    %
    
    
    
    
    
    
    
    
    
    
    7.93
    %
    
    
    
    
    
    
    
    
    
    
    7.78
    %
 Limitations
     85




---



##### Table of Contents



ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
   
 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
  
 ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
  
 ITEM 15. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures
   Managements Report on Internal Control Over Financial Reporting
  
    
    pertain to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets;
 86




---



##### Table of Contents




    
    provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting
principles, and that our receipts and expenditures are being made only in accordance with
authorizations of our management and members of our board of directors; and
 
    
    provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of our assets that could have a material effect on our
financial statements.
  Internal Control  Integrated Framework.
   Changes in Internal Control over Financial Reporting
  
 ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
  
 ITEM 16B. CODE OF ETHICS
  
 ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
  Audit RelatedFiscal Year
    
    Audit Services
    
    Services
    
    Tax Services
    
    Other Services
    
    Total2008
    
    
    $
    1,172,159
    
    
    $
    421,490
    
    
    $
    309,925
    
    
    $
    14,983
    
    
    $
    1,918,5572007
    
    
    $
    873,959
    
    
    $
    342,411
    
    
    $
    328,723
    
    
    $
    257,167
    
    
    $
    1,802,260
 87




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##### Table of Contents



Audit Services
  Audit Related Services
  Tax Services
  Other Services
   
 ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
  
 ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  88




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##### Table of Contents



ITEM 17. FINANCIAL STATEMENTS
  
 ITEM 18. FINANCIAL STATEMENTS
 Financial Statement
  Report of Independent Registered Public Accounting Firm
    
    F-2Consolidated Balance Sheets as of March 31, 2008 and 2007
    
    F-3Consolidated Statements of Income for the three years ended March 31, 2008
    
    F-4Consolidated Statements of Shareholders Equity and Comprehensive Income for the
three years ended March 31, 2008
    
    F-5Consolidated Statements of Cash Flows for the three years ended March 31, 2008
    
    F-8Notes to the Consolidated Financial Statements
    
    F-9Financial Statement Schedule
    
    F-36
 
 ITEM 19. EXHIBITS
 Number
    
    Description1.1
    
    
    
    Memorandum and Articles of Association of Satyam Computer Services Limited. (1)1.2
    
    
    
    Certificate of Incorporation of Satyam Computer Services Limited. (2)2.1
    
    
    
    Specimens of Share Certificates. (2)2.2
    
    
    
    Deposit Agreement dated May 14, 2001, by and among Satyam Computer Services Limited,
Citibank, N.A. (as Depositary) and the holders from time to time of American Depositary
Receipts issued thereunder (including as an exhibit, the form of American Depositary
Receipt). (3)2.3
    
    
    
    Letter Agreement dated November 7, 2007 by and between Satyam Computer Services Limited and
Citibank, N.A., supplementing the Deposit Agreement dated May 14, 2001 by and among Satyam
Computer Services Limited, Citibank, N.A. (as Depositary) and the holders from time to time of
American Depositary Receipts issued thereunder (including as an exhibit, the form of American
Depositary Receipt) as amended by letter agreement dated September 4, 2002. (4)4.1
    
    
    
    Associate Stock Option Plan. (2)4.2
    
    
    
    Associate Stock Option Plan B, as amended and restated. (5)4.3
    
    
    
    Associate Stock Option Plan ADS, as amended and restated. (5)4.4
    
    
    
    Associate Stock Option Plan-RSUs(ADS). (6)4.5
    
    
    
    Associate Stock Option Plan-RSUs. (7)8.1
    
    
    
    List of Significant Subsidiaries. (8)12.1
    
    
    
    Certification of Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act 2002. (8)12.2
    
    
    
    Certification of Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act 2002. (8)13.1
    
    
    
    Certification of Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act 2002. (8)
 89




---



##### Table of Contents



Number
    
    Description13.2
    
    Certification of Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act 2002. (8)15.1
    
    Consent of Price Waterhouse, Independent Registered Public Accounting Firm. (8)15.2
    
    Amended and Restated Audit Committee Charter (4)
 
 (1)
    
    Previously filed as an exhibit to our Registration Statement on Form F-3 (File No.
333-122996) filed on February 25, 2005 and incorporated herein by reference.(2)
    
    Previously filed as an exhibit to our Registration Statement on Form F-1 (File No. 333-13464)
filed on May 7, 2001 and incorporated herein by reference.(3)
    
    Previously filed as an exhibit to our Annual Report on Form 20-F (File No. 001-15190) filed
on August 13, 2001 and incorporated herein by reference.(4)
    
    Previously submitted as an exhibit to our Quarterly Report on Form 6-K (File No. 000-27811)
submitted on January 28, 2008 and incorporated herein by reference.(5)
    
    Previously filed as an exhibit to our Annual Report on Form 20-F (File No. 001-15190) filed
on April 28, 2006 and incorporated herein by reference.(6)
    
    Previously filed as an exhibit to our Form S-8 (File No. 333-139949) filed on January 12,
2007 and incorporated herein by reference.(7)
    
    Previously filed as an exhibit to our Annual Report on Form 20-F (File No. 001-15190) filed
on April 30, 2007 and incorporated herein by reference.(8)
    
    Filed herewith. 90




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##### Table of Contents



SIGNATURES
  SATYAM COMPUTER SERVICES LIMITEDBy:
    /s/  B. Rama RajuName:
    B. Rama RajuTitle:
    Managing Director and Chief Executive OfficerBy:
    /s/ V. SrinivasName:
    V SrinivasTitle:
    Director and Senior Vice President &
Chief Financial Officer  91




---



##### 



SATYAM COMPUTER SERVICES LIMITED
 INDEX TO THE US GAAP CONSOLIDATED FINANCIAL STATEMENTS
 PageReport of Independent Registered Public Accounting Firm
    
    F-2Consolidated Balance Sheets as of March 31, 2008 and 2007
    
    F-3Consolidated Statements of Income for the three years ended March 31, 2008
    
    F-4Consolidated Statements of Shareholders Equity and Comprehensive Income for
the three years ended March 31, 2008
    
    F-5Consolidated Statements of Cash Flows for the three years ended March 31, 2008
    
    F-8Notes to the Consolidated Financial Statements
    
    F-9Financial Statement Schedule
    
    F-36
  F-1




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
  Internal Control  Integrated Framework
   
 F-2




---



##### Table of Contents



Satyam Computer Services Limited
 
 Consolidated Balance Sheets  (US Dollars in million except per share data and as stated otherwise)
 As of March 31,2008
    
    
    2007AssetsCurrent assetsCash and cash equivalents
    
    
    290.5
    
    
    
    152.2Investments in bank deposits
    
    
    826.7
    
    
    
    Accounts receivable, net of allowance for doubtful debts
    
    
    508.4
    
    
    
    364.2Unbilled revenue
    
    
    81.5
    
    
    
    38.6Deferred income tax assets
    
    
    23.7
    
    
    
    17.1Prepaid expenses and other receivables
    
    
    131.7
    
    
    
    37.1Total current assets
    
    
    1,862.5
    
    
    
    609.2Investments in bank deposits
    
    
    
    
    
    
    767.6Investments in associated companies
    
    
    4.7
    
    
    
    4.6Premises and equipment, net
    
    
    236.6
    
    
    
    163.1Goodwill, net
    
    
    80.0
    
    
    
    32.7Intangible assets, net
    
    
    15.6
    
    
    
    7.4Other assets
    
    
    43.9
    
    
    
    39.5Total assets
    
    
    2,243.3
    
    
    
    1,624.1Liabilities and shareholders equityCurrent liabilitiesShort-term and current portion of long-term debt
    
    
    29.3
    
    
    
    12.10.05% Cumulative convertible redeemable preference shares of a subsidiary, par value
Rs.10 (US$0.25)* per share (Nil and 45,505,000 shares as of March 31, 2008 and 2007
respectively)
    
    
    
    
    
    
    13.6Accounts payable
    
    
    32.4
    
    
    
    16.8Accrued expenses and other current liabilities
    
    
    238.3
    
    
    
    148.6Unearned and deferred revenue
    
    
    33.1
    
    
    
    20.1Total current liabilities
    
    
    333.1
    
    
    
    211.2Long-term debt
    
    
    24.8
    
    
    
    22.2Retirement benefit obligation  Gratuity
    
    
    12.6
    
    
    
    8.1Deferred income tax liabilities
    
    
    11.0
    
    
    
    11.6Total liabilities
    
    
    381.5
    
    
    
    253.1Contingencies and Commitments (Note No.18)Minority interest
    
    
    
    
    
    
    Shareholders equityCommon stock  par value Rs.2 (US$0.05)* per equity share
(800 million equity shares authorized as of March 31, 2008 and 2007. 670,479,293 and
667,196,009 equity shares issued and outstanding as of March 31, 2008 and 2007
respectively)
    
    
    36.1
    
    
    
    36.0Additional paid-in capital
    
    
    592.4
    
    
    
    552.4Shares subscribed but unissued
    
    
    0.5
    
    
    
    1.8Retained earnings
    
    
    1,069.8
    
    
    
    721.1Accumulated other comprehensive income
    
    
    164.1
    
    
    
    60.91,862.9
    
    
    
    1,372.2Shares held by the SC-Trust under associate stock option plan(2,201,680 and 2,295,880 equity shares as of March 31, 2008 and 2007 respectively)
    
    
    (1.1
    )
    
    
    (1.2
    )Total shareholders equity
    
    
    1,861.8
    
    
    
    1,371.0Total liabilities and shareholders equity
    
    
    2,243.3
    
    
    
    1,624.1
 *
    
    The par value in US$ has been converted at the closing rate as of March 31, 2008, 1US$ = Rs 40.02  F-3




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##### Table of Contents



Satyam Computer Services Limited
 
 Consolidated Statements of Income  (US Dollars in million except per share data and as stated otherwise)
 Year ended March 31,2008
    
    
    2007
    
    
    2006Revenue
    
    
    2,138.1
    
    
    
    1,461.4
    
    
    
    1,096.3Cost of revenue
(Includes stock-based compensation of US$9.8, US$12.8 and US$ Nil for
the years ended March 31, 2008, 2007 and 2006 respectively)
    
    
    (1,359.2
    )
    
    
    (937.6
    )
    
    
    (689.0
    )Gross profit
    
    
    778.9
    
    
    
    523.8
    
    
    
    407.3Selling, general and administrative expenses(Includes stock-based compensation of US$13.0, US$2.9 and US$0.8 for
the years ended March 31, 2008, 2007 and 2006 respectively)
    
    
    (370.2
    )
    
    
    (232.2
    )
    
    
    (187.6
    )Total operating expenses
    
    
    (370.2
    )
    
    
    (232.2
    )
    
    
    (187.6
    )Operating income
    
    
    408.7
    
    
    
    291.6
    
    
    
    219.7Interest income
    
    
    67.4
    
    
    
    37.3
    
    
    
    26.3Interest expense
    
    
    (5.1
    )
    
    
    (3.6
    )
    
    
    (1.3
    )Other income, net
    
    
    1.8
    
    
    
    
    
    
    
    Gain on sale on investments
    
    
    
    
    
    
    
    
    
    
    43.6Gain/(Loss) on foreign exchange transactions
    
    
    (12.0
    )
    
    
    (3.3
    )
    
    
    0.3Gain/(Loss) on forward and option contracts
    
    
    9.0
    
    
    
    6.2
    
    
    
    (0.8
    )Income before income taxes and equity in earnings/(losses) of
associated companies
    
    
    469.8
    
    
    
    328.2
    
    
    
    287.8Income taxes
    
    
    (52.9
    )
    
    
    (30.6
    )
    
    
    (37.7
    )Minority interest
    
    
    
    
    
    
    
    
    
    
    0.1Income before equity in earnings/(losses) of associated companies
    
    
    416.9
    
    
    
    297.6
    
    
    
    250.2Equity in earnings/(losses) of associated companies, net of taxes
    
    
    0.1
    
    
    
    0.8
    
    
    
    (0.8
    )Net income
    
    
    417.0
    
    
    
    298.4
    
    
    
    249.4Earnings per share:Basic
    
    
    $0.63
    
    
    
    $0.46
    
    
    
    $0.39Diluted
    
    
    $0.61
    
    
    
    $0.45
    
    
    
    $0.38Weighted average number of shares used in computing earnings per share
(in million)Basic
    
    
    666.4
    
    
    
    652.5
    
    
    
    641.2Diluted
    
    
    679.4
    
    
    
    666.0
    
    
    
    662.8
  F-4




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##### Table of Contents



Satyam Computer Services Limited
 
 Consolidated Statements of Shareholders Equity and Comprehensive Income  (US Dollars in million except per share data and as stated otherwise)
 AccumulatedAdditional
    
    Shares
    
    Deferred
    
    
    
    
    
    other
    
    Shares held
    
    TotalCommon Stock
    
    paid-in
    
    subscribed
    
    stock-based
    
    Retained
    
    comprehensive
    
    by
    
    ShareholdersShares
    
    Par Value
    
    capital
    
    but unissued
    
    compensation
    
    earnings
    
    income/(loss)
    
    SC-Trust
    
    EquityBalance as of March 31, 2005
    
    
    638,530,582
    
    
    
    17.4
    
    
    
    433.6
    
    
    
    0.1
    
    
    
    (0.3
    )
    
    
    289.0
    
    
    
    29.6
    
    
    
    (1.5
    )
    
    
    767.9Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    249.4
    
    
    
    
    
    
    
    
    
    
    
    249.4Other comprehensive incomeLoss on foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13.8
    )
    
    
    
    
    
    
    (13.8
    )Total Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    235.6Issuance of common stock
    
    
    10,368,496
    
    
    
    0.2
    
    
    
    30.3
    
    
    
    (0.1
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30.4Shares subscribed but unissued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.4Deferred stock-based compensation
    
    
    
    
    
    
    
    
    
    
    0.9
    
    
    
    
    
    
    
    (0.9
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Amortization of deferred stock-based compensation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.8Shares transferred by SC-Trust to employees
    
    
    
    
    
    
    
    
    
    
    0.3
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.3
    
    
    
    0.6Cash dividend paid at the rate of US$0.11 per
share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (41.3
    )
    
    
    
    
    
    
    
    
    
    
    (41.3
    )Balance as of March 31, 2006
    
    
    648,899,078
    
    
    
    17.6
    
    
    
    465.1
    
    
    
    0.4
    
    
    
    (0.4
    )
    
    
    497.1
    
    
    
    15.8
    
    
    
    (1.2
    )
    
    
    994.4
  F-5




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##### Table of Contents



Satyam Computer Services Limited  Consolidated Statements of Shareholders Equity and Comprehensive Income  (US Dollars in million except per share data and as stated otherwise)
 AccumulatedAdditional
    
    Shares
    
    Deferred
    
    
    
    
    
    other
    
    Shares held
    
    TotalCommon Stock
    
    paid-in
    
    subscribed
    
    stock-based
    
    Retained
    
    comprehensive
    
    by
    
    ShareholdersShares
    
    Par Value
    
    capital
    
    but unissued
    
    compensation
    
    earnings
    
    income/(loss)
    
    SC-Trust
    
    EquityBalance as of March 31, 2006
    
    
    648,899,078
    
    
    
    17.6
    
    
    
    465.1
    
    
    
    0.4
    
    
    
    (0.4
    )
    
    
    497.1
    
    
    
    15.8
    
    
    
    (1.2
    )
    
    
    994.4Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    298.4
    
    
    
    
    
    
    
    
    
    
    
    298.4Other comprehensive income/(loss)Gain on foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    46.3
    
    
    
    
    
    
    
    46.3Total Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    344.7Adjustments on adoption of SFAS 158,
net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1.2
    )
    
    
    
    
    
    
    (1.2
    )Issuance of common stock
    
    
    18,296,931
    
    
    
    0.7
    
    
    
    64.1
    
    
    
    (0.4
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    64.4Stock split (effected in the form of
dividend)
    
    
    
    
    
    
    17.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (17.7
    )
    
    
    
    
    
    
    
    
    
    
    Shares subscribed but unissued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.8Gain on dilution of interest in subsidiary on
issuance of new shares, net of taxes (Refer
note 4)
    
    
    
    
    
    
    
    
    
    
    7.9
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7.9Reversal of Deferred stock based compensation
on adoption of SFAS 123R
    
    
    
    
    
    
    
    
    
    
    (0.4
    )
    
    
    
    
    
    
    0.4
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    15.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15.7Cash dividend paid at the rate of
US$0.13 per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (56.7
    )
    
    
    
    
    
    
    
    
    
    
    (56.7
    )Balance as of March 31, 2007
    
    
    667,196,009
    
    
    
    36.0
    
    
    
    552.4
    
    
    
    1.8
    
    
    
    
    
    
    
    721.1
    
    
    
    60.9
    
    
    
    (1.2
    )
    
    
    1,371.0
  F-6




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##### Table of Contents



Satyam Computer Services Limited  Consolidated Statements of Shareholders Equity and Comprehensive Income  (US Dollars in million except per share data and as stated otherwise)
 AccumulatedAdditional
    
    Shares
    
    
    
    
    
    other
    
    Shares held
    
    TotalCommon Stock
    
    paid-in
    
    subscribed
    
    Retained
    
    comprehensive
    
    by
    
    ShareholdersShares
    
    Par Value
    
    capital
    
    but unissued
    
    earnings
    
    income/(loss)
    
    SC-Trust
    
    EquityBalance as of March 31, 2007
    
    
    667,196,009
    
    
    
    36.0
    
    
    
    552.4
    
    
    
    1.8
    
    
    
    721.1
    
    
    
    60.9
    
    
    
    (1.2
    )
    
    
    1,371.0Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    417.0
    
    
    
    
    
    
    
    
    
    
    
    417.0Other comprehensive income/(loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Gain on foreign currency translation
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104.8
    
    
    
    
    
    
    
    104.8Amortization of actuarial loss under SFAS 158, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1.6
    )
    
    
    
    
    
    
    (1.6
    )Total Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    520.2Issuance of common stock
    
    
    3,283,284
    
    
    
    0.1
    
    
    
    16.1
    
    
    
    (1.8
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14.4Shares subscribed but unissued
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.5
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.5Gain on dilution of interest in subsidiary on
issuance of new shares, net of taxes (Refer note
3(c))
    
    
    
    
    
    
    
    
    
    
    1.0
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.0Stock based compensation expense
    
    
    
    
    
    
    
    
    
    
    22.8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22.8Shares transferred by SC-Trust to employees
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    0.2Cash dividend paid at the rate of US$0.06
per share
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (68.3
    )
    
    
    
    
    
    
    
    
    
    
    (68.3
    )Balance as of March 31, 2008
    
    
    670,479,293
    
    
    
    36.1
    
    
    
    592.4
    
    
    
    0.5
    
    
    
    1,069.8
    
    
    
    164.1
    
    
    
    (1.1
    )
    
    
    1,861.8
  F-7




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##### Table of Contents



Satyam Computer Services Limited
 
 Consolidated Statements of Cashflows  (US Dollars in million except per share data and as stated otherwise)
 Year ended March 31,2008
    
    
    2007
    
    
    2006Cash Flows From Operating ActivitiesNet income
    
    
    417.0
    
    
    
    298.4
    
    
    
    249.4Adjustments to reconcile net income to net cash provided by operating
activities:Depreciation and amortization
    
    
    41.5
    
    
    
    33.6
    
    
    
    31.5Stock-based compensation
    
    
    22.8
    
    
    
    15.7
    
    
    
    0.8Deferred income taxes
    
    
    (11.3
    )
    
    
    (6.7
    )
    
    
    (5.1
    )Gain on sale of investments
    
    
    
    
    
    
    
    
    
    
    (43.6
    )Loss on sale of premises and equipment
    
    
    0.6
    
    
    
    0.3
    
    
    
    0.2Minority Interest
    
    
    
    
    
    
    
    
    
    
    (0.1
    )Equity in (earnings)/losses of associated companies, net of taxes
    
    
    (0.1
    )
    
    
    (0.8
    )
    
    
    0.8Changes in assets and liabilities:Accounts receivable, net and unbilled revenue
    
    
    (155.0
    )
    
    
    (127.7
    )
    
    
    (81.9
    )Prepaid expenses and other receivables, net
    
    
    (91.5
    )
    
    
    13.4
    
    
    
    (31.7
    )Other assets, net
    
    
    1.8
    
    
    
    (17.5
    )
    
    
    (1.8
    )Accounts payable
    
    
    12.9
    
    
    
    3.8
    
    
    
    (2.5
    )Accrued expenses and other current liabilities
    
    
    83.0
    
    
    
    38.4
    
    
    
    40.1Unearned and deferred revenue
    
    
    11.4
    
    
    
    7.6
    
    
    
    6.1Other liabilities non-current
    
    
    6.0
    
    
    
    3.0
    
    
    
    0.5Net cash provided by operating activities
    
    
    339.1
    
    
    
    261.5
    
    
    
    162.7Cash Flows From Investing ActivitiesProceeds from maturity of bank deposits
    
    
    
    
    
    
    408.0
    
    
    
    Investment in bank deposits
    
    
    
    
    
    
    (745.6
    )
    
    
    Purchase of premises and equipment
    
    
    (96.7
    )
    
    
    (81.5
    )
    
    
    (54.1
    )Proceeds from sale of premises and equipment
    
    
    0.9
    
    
    
    0.5
    
    
    
    0.3Payment for acquisition of subsidiaries, net of cash acquired
    
    
    (60.5
    )
    
    
    (4.1
    )
    
    
    (13.7
    )Proceeds from sale of investments
    
    
    
    
    
    
    
    
    
    
    62.3Net cash used in investing activities
    
    
    (156.3
    )
    
    
    (422.7
    )
    
    
    (5.2
    )Cash Flows From Financing ActivitiesProceeds from short-term debt
    
    
    26.7
    
    
    
    10.9
    
    
    
    3.6Repayment of short-term debt
    
    
    (11.3
    )
    
    
    (4.7
    )
    
    
    (1.2
    )Proceeds from long-term debt
    
    
    0.9
    
    
    
    4.3
    
    
    
    16.3Repayment of long-term debt
    
    
    (3.9
    )
    
    
    (3.9
    )
    
    
    (2.7
    )Issuance of common stock
    
    
    14.6
    
    
    
    64.4
    
    
    
    31.0Shares subscribed but unissued
    
    
    0.5
    
    
    
    1.8
    
    
    
    0.4Redemption of preferred stock of subsidiary
    
    
    (13.8
    )
    
    
    
    
    
    
    Cash dividends paid
    
    
    (68.3
    )
    
    
    (56.7
    )
    
    
    (41.3
    )Net cash (used in)/provided by financing activities
    
    
    (54.6
    )
    
    
    16.1
    
    
    
    6.1Effect of exchange rate changes on cash and cash equivalents
    
    
    10.1
    
    
    
    4.5
    
    
    
    (0.6
    )Net change in cash and cash equivalents
    
    
    138.3
    
    
    
    (140.6
    )
    
    
    163.0Cash and cash equivalents at the beginning of the year
    
    
    152.2
    
    
    
    292.8
    
    
    
    129.8Cash and cash equivalents at the end of the year
    
    
    290.5
    
    
    
    152.2
    
    
    
    292.8Supplementary information:Cash paid during the year for:Income taxes
    
    
    46.5
    
    
    
    32.8
    
    
    
    44.9Interest
    
    
    4.9
    
    
    
    2.6
    
    
    
    1.3Non-cash items:Capital leases and hire purchase
    
    
    5.2
    
    
    
    2.3
    
    
    
    2.5Deferred consideration for acquisition of subsidiaries
    
    
    
    
    
    
    5.9
    
    
    
    4.6
  F-8




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 1. Description of Business
 Satyam Satyam Computer Services
  2. Summary of Significant Accounting Policies
 a) Principles of Consolidation and Basis of Presentation
      b) Use of Estimates
  c) Foreign Currency Translation
  F-9




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
   d) Revenue Recognition
      e) Cash and Cash Equivalents
  f) Premises and Equipment
   F-10




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  g) Research and development Costs
  h) Goodwill and Other Intangible Assets
   i) Impairment of Long-lived Assets
 Accounting for the Impairment or Disposal of Long-Lived Assets
 j) Investments
 Accounting for Certain
Investments in Debt and Equity Securities
  k) Cost of Revenue and Selling, General and Administrative Expenses
   l) Advertising Expenses
  m) Employee Benefits
 i) Provident Fund
  ii) Gratuity Plan
  F-11




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
   iii) Superannuation Plan
  n) Income Taxes
 Accounting for Income Taxes
  o) Earnings per Share
 Earnings Per Share
 p) Stock-Based Compensation
   F-12




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 Pro forma disclosure
  (US$ in million except per share data)Year endedMarch 31,2006Net IncomeAs reported
    
    
    249.4Add: Charge under APB25
    
    
    0.8Less: Charge under FAS123
    
    
    (22.2
    )Pro forma
    
    
    228.0Earnings Per Share:BasicAs reported
    
    
    $0.39Pro forma
    
    
    $0.36DilutedAs reported
    
    
    $0.38Pro forma
    
    
    $0.35
 Note: The pro forma disclosures shown above are not representative of the effects on net income and earnings per share in future years.
   Year endedMarch 31, 2006Dividend yield
    
    
    0.75
    %Expected volatility
    
    
    57
    %Risk-free interest rate
    
    
    7
    %Expected term (in years)
    
    
    1.95
 q) Derivative financial instruments
 Accounting for Derivative
Instruments and Hedging Activities
 r) Recently issued accounting pronouncements
   F-13




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
    s) Reclassification
  3. Acquisitions
   a) Citisoft Plc.
   F-14




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
   b) Knowledge Dynamics Pte Ltd (Knowledge Dynamics).
   c) Acquisition of Minority interests in Satyam BPO
    d) Acquisition of Nitor Global Solutions Ltd., (Nitor)
   F-15




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 e) Bridge Strategy Group
  4. Preferred Stock of Subsidiary
  5. Investments in bank deposits
  6. Investments in associated companies
  US$ in millionAs of March 31,2008
    
    
    2007Satyam Venture
    
    
    3.5
    
    
    
    3.5CA Satyam
    
    
    1.2
    
    
    
    1.1Total
    
    
    4.7
    
    
    
    4.6
 Satyam Venture
  CA Satyam
  F-16




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  Sify
    7. Premises and Equipment
  US$ in millionAs of March 31,2008
    
    
    2007Freehold land
    
    
    9.6
    
    
    
    8.9Leasehold land
    
    
    2.2
    
    
    
    1.9Premises
    
    
    30.4
    
    
    
    24.5Computers including servers
    
    
    165.4
    
    
    
    131.2System software
    
    
    31.0
    
    
    
    24.7Office equipment
    
    
    88.4
    
    
    
    69.0Furniture and fixtures
    
    
    60.5
    
    
    
    47.4Vehicles
    
    
    13.7
    
    
    
    9.0Assets under construction
    
    
    115.6
    
    
    
    70.8Total
    
    
    516.8
    
    
    
    387.4Less: Accumulated depreciation
    
    
    (280.2
    )
    
    
    (224.3
    )Premises and equipment, net
    
    
    236.6
    
    
    
    163.1
  Premises
    
    28 yearsComputers including servers
    
    2 -5 yearsSystem Software
    
    3 yearsOffice equipment
    
    5 yearsFurniture and fixtures
    
    5 yearsVehicles
    
    5 years
  F-17




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 8. Goodwill
  US$ in millionAs of March 31,2008
    
    
    2007GoodwillAcquisition of Citisoft Plc
    
    
    15.6
    
    
    
    15.0Acquisition of Knowledge Dynamics Pte Limited
    
    
    2.2
    
    
    
    2.1Acquisition of Nitor Global Solutions Limited
    
    
    1.7
    
    
    
    Acquisition of minority interest inSatyam Enterprise Solutions Limited
    
    
    12.8
    
    
    
    11.9Satyam Technologies Inc.
    
    
    4.0
    
    
    
    3.7Satyam BPO Limited
    
    
    43.7
    
    
    
    Total
    
    
    80.0
    
    
    
    32.7
  US$ in millionYear ended March 31,2008
    
    
    2007Goodwill at the beginning of the year
    
    
    32.7
    
    
    
    27.6Acquisitions during the year
    
    
    45.1
    
    
    
    4.4Change due to foreign exchange
    
    
    2.2
    
    
    
    0.7Goodwill at the end of the year
    
    
    80.0
    
    
    
    32.7
 9. Intangible assets, net
  US$ in millionAs of March 31,2008
    
    2007Range of
    
    Gross
    
    
    
    
    
    Net
    
    Gross
    
    
    
    
    
    Netlife
    
    carrying
    
    Accumulated
    
    intangible
    
    carrying
    
    Accumulated
    
    intangible(in years)
    
    amount
    
    amortization
    
    assets
    
    amount
    
    amortization
    
    assetsCustomer Related intangibles
    
    
    8-12
    
    
    
    18.1
    
    
    
    (3.5
    )
    
    
    14.6
    
    
    
    8.5
    
    
    
    (1.9
    )
    
    
    6.6Trade name
    
    
    3-5
    
    
    
    0.9
    
    
    
    (0.3
    )
    
    
    0.6
    
    
    
    0.9
    
    
    
    (0.2
    )
    
    
    0.7Non-compete agreement
    
    
    2
    
    
    
    0.1
    
    
    
    
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    Internally developed
Technology
    
    
    3
    
    
    
    0.3
    
    
    
    
    
    
    
    0.3
    
    
    
    0.1
    
    
    
    
    
    
    
    0.1Total
    
    
    
    
    
    
    19.4
    
    
    
    (3.8
    )
    
    
    15.6
    
    
    
    9.5
    
    
    
    (2.1
    )
    
    
    7.4
   US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006Identifiable intangibles at the beginning of the year
    
    
    7.4
    
    
    
    6.6
    
    
    
    Acquisitions during the year
    
    
    9.8
    
    
    
    1.1
    
    
    
    8.0Amortization during the year
    
    
    (1.8
    )
    
    
    (1.2
    )
    
    
    (0.9
    )Change due to foreign exchange
    
    
    0.2
    
    
    
    0.9
    
    
    
    (0.5
    )Identifiable intangibles at the end of the year
    
    
    15.6
    
    
    
    7.4
    
    
    
    6.6
  Estimated amortization expense:
    
    US$ in millionsFor the year ended March 31,2009
    
    
    2.42010
    
    
    2.32011
    
    
    2.12012
    
    
    1.92013
    
    
    1.6Beyond 2013
    
    
    5.3
 F-18




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 10. Income Taxes
  US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006Foreign taxesCurrent
    
    
    8.5
    
    
    
    10.4
    
    
    
    15.4Deferred
    
    
    (3.1
    )
    
    
    (0.7
    )
    
    
    (0.8
    )Domestic taxesCurrent
    
    
    55.7
    
    
    
    26.9
    
    
    
    27.4Deferred
    
    
    (8.2
    )
    
    
    (6.0
    )
    
    
    (4.3
    )Aggregate taxes
    
    
    52.9
    
    
    
    30.6
    
    
    
    37.7
  US$ in millionYear ended March 31,2008
    
    2007
    
    2006Net income before taxes
    
    
    469.8
    
    
    
    328.2
    
    
    
    287.8Enacted tax rates in India
    
    
    33.99
    %
    
    
    33.66
    %
    
    
    33.66
    %Computed tax expense
    
    
    159.7
    
    
    
    110.5
    
    
    
    96.9Tax effect due to non-taxable export income
    
    
    (119.9
    )
    
    
    (98.4
    )
    
    
    (75.3
    )Difference arising from different tax rates in other tax jurisdictions
    
    
    6.4
    
    
    
    12.0
    
    
    
    10.2Difference arising from different tax rates on gain on sale of investment
    
    
    
    
    
    
    
    
    
    
    (7.0
    )Stock- based compensation (non-deductible)
    
    
    0.9
    
    
    
    4.0
    
    
    
    0.3Changes in valuation allowance, including losses of subsidiaries
    
    
    1.4
    
    
    
    1.7
    
    
    
    5.4Effect of tax rate change
    
    
    0.1
    
    
    
    
    
    
    
    0.1Others
    
    
    4.3
    
    
    
    0.8
    
    
    
    7.1Income taxes recognized in the statements of income
    
    
    52.9
    
    
    
    30.6
    
    
    
    37.7
   F-19




---



##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  US$ in millionAs of March 31,2008
    
    
    2007Deferred tax assets:Operating loss carry forwards
    
    
    30.0
    
    
    
    26.6Provision for accounts receivable, advances and investments
    
    
    7.7
    
    
    
    4.2Premises and equipment
    
    
    1.4
    
    
    
    3.3Provision for gratuity and unutilized leaves
    
    
    20.2
    
    
    
    12.8Gross deferred tax assets
    
    
    59.3
    
    
    
    46.9Less: Valuation allowance
    
    
    (30.0
    )
    
    
    (26.6
    )Total deferred tax assets
    
    
    29.3
    
    
    
    20.3Deferred tax liabilities:Premises and equipment
    
    
    (2.5
    )
    
    
    (6.3
    )Provision for accounts receivable and advances
    
    
    (3.7
    )
    
    
    (3.0
    )Intangible assets
    
    
    (5.0
    )
    
    
    (2.5
    )Investments in associated companies and gain on dilution
    
    
    (3.5
    )
    
    
    (2.8
    )Total deferred tax liabilities
    
    
    (14.7
    )
    
    
    (14.6
    )Net deferred tax assets
    
    
    14.6
    
    
    
    5.7
    US$ in millionAs of March 31,2008
    
    
    2007Deferred income tax assets  current portion
    
    
    23.7
    
    
    
    17.1Deferred income tax assets  non-current portion (included in other assets)
    
    
    5.6
    
    
    
    3.3Deferred income tax liabilities  current portion (included in accrued
expenses and other liabilities)
    
    
    (3.7
    )
    
    
    (3.1
    )Deferred income tax liabilities  non-current portion
    
    
    (11.0
    )
    
    
    (11.6
    )Net deferred tax asset
    
    
    14.6
    
    
    
    5.7
  F-20




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 11. Borrowings
 Short-term debt
  Long-term debt
  US$ in millionAs of March 31,2008
    
    
    2007Secured debts,representing obligation
principally to banks and
financial institutions 0.95% above 6 month LIBOR working
capital term loan maturing serially
through fiscal 2009
    
    
    10.7
    
    
    
    10.0 0.95% above 6 month LIBOR external
commercial borrowing maturing serially
through fiscal 2009
    
    
    10.5
    
    
    
    10.6Hire Purchase Loans
    
    
    6.0
    
    
    
    3.2Total Debt
    
    
    27.2
    
    
    
    23.8Less: Current portion of long-term debt
    
    
    (2.4
    )
    
    
    (1.6
    )Long-term debt, net of current portion
    
    
    24.8
    
    
    
    22.2
   Unused lines of credit
  US$ in millionAs of March 31,2008
    
    
    2007Short-term debt
    
    
    1.6
    
    
    
    9.0Non-fund facilities  Bank Guarantees
    
    
    33.4
    
    
    
    16.2Total Unused lines of credit
    
    
    35.0
    
    
    
    25.2
 F-21




---



##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 12. Employee Benefits
 The Gratuity Plan
  US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006Accumulated benefit obligation at the beginning of the year
    
    
    12.1
    
    
    
    7.6
    
    
    
    5.7Change in projected benefit obligationProjected benefit obligation at beginning of the year
    
    
    10.2
    
    
    
    7.8
    
    
    
    5.2Service cost
    
    
    3.0
    
    
    
    2.1
    
    
    
    1.9Interest cost
    
    
    1.0
    
    
    
    0.6
    
    
    
    0.4Actuarial loss/(gain)
    
    
    2.7
    
    
    
    0.6
    
    
    
    0.9Benefits paid
    
    
    (1.3
    )
    
    
    (1.2
    )
    
    
    (0.5
    )Effect of exchange rate changes
    
    
    0.7
    
    
    
    0.3
    
    
    
    (0.1
    )Projected benefit obligation at end of the year
    
    
    16.3
    
    
    
    10.2
    
    
    
    7.8Funded status of the plans
    
    
    (16.3
    )
    
    
    (10.2
    )
    
    
    (7.8
    )Unrecognized net actuarial loss
    
    
    
    
    
    
    
    
    
    
    1.3Retirement benefit obligation at the end of the year
    
    
    (16.3
    )
    
    
    (10.2
    )
    
    
    (6.5
    )Less: Current portion of retirement benefit obligation
    
    
    3.7
    
    
    
    2.1
    
    
    
    1.6Retirement benefit obligation  non-current
    
    
    (12.6
    )
    
    
    (8.1
    )
    
    
    (4.9
    )The components of net gratuity costs are reflected below:Service cost
    
    
    3.0
    
    
    
    2.1
    
    
    
    1.9Interest cost
    
    
    1.0
    
    
    
    0.6
    
    
    
    0.4Amortization
    
    
    0.2
    
    
    
    0.1
    
    
    
    Net gratuity costs
    
    
    4.2
    
    
    
    2.8
    
    
    
    2.3
  Weighted-average assumptions used to determine benefit obligations:
 Year ended March 31,2008
    
    
    2007
    
    
    2006Discount rate
    
    
    9.8
    %
    
    
    9.8
    %
    
    
    8.0
    %Long-term rate of compensation increase
    
    
    7.0
    %
    
    
    7.0
    %
    
    
    7.0
    %
 Weighted-average assumptions used to determine net periodic benefit cost:
 Year ended March 31,2008
    
    
    2007
    
    
    2006Discount rate
    
    
    9.8
    %
    
    
    9.8
    %
    
    
    8.0
    %Long-term rate of compensation increase
    
    
    7.0
    %
    
    
    7.0
    %
    
    
    7.0
    %
 Cash Flows
  For the financial year ended March 31,
    
    Expected contribution2010
    
    
    4.52011
    
    
    5.82012
    
    
    7.22013
    
    
    6.92014 - 2017
    
    
    27.5
 F-22




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  Before
    
    
    
    
    
    
    Afterapplication of
    
    
    
    
    
    
    application ofSFAS 158
    
    
    Adjustments
    
    
    SFAS 158Current assets  Deferred income taxes
    
    
    17.0
    
    
    
    0.1
    
    
    
    17.1Non-current assets  Other assets
    
    
    39.0
    
    
    
    0.5
    
    
    
    39.5Total Assets
    
    
    1,623.5
    
    
    
    0.6
    
    
    
    1,624.1Current liabilities  Accrued expenses and other current liabilities
    
    
    148.4
    
    
    
    0.2
    
    
    
    148.6Long-term liabilities  Gratuity, excluding current portion
    
    
    6.5
    
    
    
    1.6
    
    
    
    8.1Total Liabilities
    
    
    251.3
    
    
    
    1.8
    
    
    
    253.1Accumulated other comprehensive income, net of tax
    
    
    62.1
    
    
    
    (1.2)
    
    
    
    60.9Total Shareholders Equity
    
    
    1,372.2
    
    
    
    (1.2)
    
    
    
    1,371.0
  Provident Fund
  Superannuation Plan
  13. Earnings per Share
    (US$ in millions except per share data and as stated otherwise)Year ended March 31,2008
    
    
    2007
    
    
    2006Net income
    
    
    417.0
    
    
    
    298.4
    
    
    
    249.4Equity Shares:Average outstanding shares (in millions)
    
    
    666.4
    
    
    
    652.5
    
    
    
    641.2Dilutive effect of Associate Stock Options (in millions)
    
    
    13.0
    
    
    
    13.5
    
    
    
    21.6Share and share equivalents(in millions)
    
    
    679.4
    
    
    
    666.0
    
    
    
    662.8Earnings per shareBasic
    
    
    $0.63
    
    
    
    $0.46
    
    
    
    $0.39Diluted
    
    
    $0.61
    
    
    
    $0.45
    
    
    
    $0.38
 F-23




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 14. Stock-based Compensation Plans
 ASOP plan
  ASOP B plan
  ASOP ADS plan
  Associate Stock Option Plan  Restricted Stock Units (ASOP  RSUs)
  Associate Stock Option Plan  RSUs (ADS) (ASOP  RSUs (ADS))
  F-24




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedNumber of
    
    Average
    
    Number of
    
    Average
    
    Number of
    
    Averageequity
    
    Exercise
    
    equity
    
    Exercise
    
    equity
    
    ExerciseASOP Plan
    
    shares
    
    Price
    
    shares
    
    Price
    
    shares
    
    PriceBalance at the beginning of the Year
    
    
    146,200
    
    
    $
    1.69
    
    
    
    106,600
    
    
    $
    1.42
    
    
    
    481,000
    
    
    $
    1.18Granted
    
    
    
    
    
    
    
    
    
    
    130,000
    
    
    $
    1.67
    
    
    
    88,000
    
    
    $
    1.37Exercised
    
    
    (94,200
    )
    
    $
    1.69
    
    
    
    (90,400
    )
    
    $
    1.39
    
    
    
    (462,400
    )
    
    $
    1.13Cancelled
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Lapsed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at the end of the Year
    
    
    52,000
    
    
    $
    2.04
    
    
    
    146,200
    
    
    $
    1.69
    
    
    
    106,600
    
    
    $
    1.42Exercisable at the end of the period
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average fair value of options
granted during the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    11.87
    
    
    
    
    
    
    $
    7.45
     Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageNumber of
    
    Exercise
    
    Number of
    
    Exercise
    
    Number of
    
    ExerciseASOP B
    
    equity shares
    
    Price
    
    equity shares
    
    Price
    
    equity shares
    
    PriceBalance at the beginning of the Year
    
    
    19,976,210
    
    
    $
    3.89
    
    
    
    45,605,388
    
    
    $
    3.74
    
    
    
    53,660,630
    
    
    $
    3.57Granted
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,579,552
    
    
    $
    4.71Exercised
    
    
    (2,866,407
    )
    
    $
    4.04
    
    
    
    (17,448,659
    )
    
    $
    3.80
    
    
    
    (9,039,604
    )
    
    $
    3.05Cancelled
    
    
    (1,424,297
    )
    
    $
    4.49
    
    
    
    (8,180,519
    )
    
    $
    3.88
    
    
    
    (5,595,190
    )
    
    $
    3.77Lapsed
    
    
    (44,379
    )
    
    $
    5.79
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at the end of the Year
    
    
    15,641,127
    
    
    $
    4.18
    
    
    
    19,976,210
    
    
    $
    3.89
    
    
    
    45,605,388
    
    
    $
    3.74Exercisable at the end of the year
    
    
    10,429,602
    
    
    $
    4.32
    
    
    
    6,001,418
    
    
    $
    4.06
    
    
    
    10,248,808
    
    
    $
    3.43Weighted average fair value of options
granted during the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    6.69
   F-25




---



##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedAverage
    
    
    
    
    
    Average
    
    
    
    
    
    AverageNumber of
    
    Exercise
    
    Number of
    
    Exercise
    
    Number of
    
    ExerciseASOP (ADS)
    
    equity shares
    
    Price
    
    equity shares
    
    Price
    
    equity shares
    
    PriceBalance at the beginning of the year
    
    
    2,922,128
    
    
    $
    4.89
    
    
    
    3,982,684
    
    
    $
    4.12
    
    
    
    5,031,604
    
    
    $
    3.71Granted
    
    
    
    
    
    
    
    
    
    
    40,000
    
    
    $
    10.02
    
    
    
    640,860
    
    
    $
    5.74Exercised
    
    
    (280,988
    )
    
    $
    3.57
    
    
    
    (848,272
    )
    
    $
    2.89
    
    
    
    (1,328,892
    )
    
    $
    2.69Cancelled
    
    
    (73,424
    )
    
    $
    8.12
    
    
    
    (252,284
    )
    
    $
    4.42
    
    
    
    (360,888
    )
    
    $
    7.41Lapsed
    
    
    (1,480
    )
    
    $
    2.94Balance at the end of the year
    
    
    2,566,236
    
    
    $
    5.36
    
    
    
    2,922,128
    
    
    $
    4.89
    
    
    
    3,982,684
    
    
    $
    4.25Exercisable at the end of the year
    
    
    2,180,892
    
    
    $
    4.84
    
    
    
    1,985,282
    
    
    $
    8.33
    
    
    
    1,865,764
    
    
    $
    2.97Weighted average fair value of options
granted during the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    12.50
    
    
    
    
    
    
    $
    8.57
    Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedNumber of
    
    Average
    
    Number of
    
    Average
    
    Number of
    
    Averageequity
    
    Exercise
    
    equity
    
    Exercise
    
    equity
    
    ExerciseRSU Plan
    
    shares
    
    Price
    
    shares
    
    Price
    
    shares
    
    PriceBalance at the beginning of the year
    
    
    3,293,140
    
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Granted
    
    
    159,000
    
    
    $
    4.73
    
    
    
    3,293,140
    
    
    $
    0.05
    
    
    
    
    
    
    
    Exercised
    
    
    (120,449
    )
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancelled
    
    
    (181,489
    )
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Lapsed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at the end of the year
    
    
    3,150,202
    
    
    $
    0.29
    
    
    
    3,293,140
    
    
    $
    0.05
    
    
    
    
    
    
    
    Exercisable at the end of the year
    
    
    662,107
    
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average fair value of options
granted during the year
    
    
    
    
    
    $
    8.06
    
    
    
    
    
    
    $
    10.43
    
    
    
    
    
    
    
    
    F-26




---



##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedNumber of
    
    Average
    
    Number of
    
    Average
    
    Number of
    
    Averageequity
    
    Exercise
    
    equity
    
    Exercise
    
    equity
    
    ExerciseRSU ADS Plan
    
    shares
    
    Price
    
    shares
    
    Price
    
    shares
    
    PriceBalance at the beginning of the year
    
    
    473,240
    
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Granted
    
    
    87,000
    
    
    $
    5.76
    
    
    
    473,240
    
    
    $
    0.05
    
    
    
    
    
    
    
    Exercised
    
    
    (15,440
    )
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancelled
    
    
    (45,370
    )
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Lapsed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at the end of the year
    
    
    499,430
    
    
    $
    1.04
    
    
    
    473,240
    
    
    $
    0.05
    
    
    
    
    
    
    
    Exercisable at the end of the year
    
    
    92,292
    
    
    $
    0.05
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average fair value of options
granted during the year
    
    
    
    
    
    $
    8.93
    
    
    
    
    
    
    $
    11.31
    
    
    
    
    
    
    
    
     Outstanding
    
    
    ExercisableWeighted
    
    
    
    
    
    
    
    
    
    
    WeightedAverage
    
    
    Weighted
    
    
    Number of
    
    
    Average
    
    
    Number ofExercise Price
    
    
    Average
    
    
    equity shares
    
    
    Exercise Price
    
    
    equity sharesRange of Exercise Price
    
    
    (per equity
    
    
    remaining
    
    
    arising out of
    
    
    (per equity
    
    
    arising out of(per equity share)
    
    
    share)
    
    
    contractual life
    
    
    options
    
    
    share)
    
    
    optionsRs.2.00
    
    
    $0.05
    
    
   
    Rs. 2.24
   
    
   6.39 years

    
    
    3,403,632
    
    
    
    Rs. 2.24
   
    
    
    754,399Rs.4.00
    
    
    $0.10
    
    
    
    $0.06
    
    
    
   
    
    
    
    
    $0.06Rs. 77.33
    
    
    $1.93
    
    
   
    Rs. 161.16
   
    
    3.95 years
    
    
    
    11,448,337
    
    
    
    Rs.238.86
   
    
    
    7,724,584Rs. 185.49
    
    
    $4.63
    
    
    
    $4.03
    
    

   
    
    
    
    
    $5.97Rs.185.50
    
    
    $4.64
    
    
   
    Rs.222.00
   
    
    3.81 Years
    
    
    
    5,486,628
    
    
    
    Rs.327.23
   
    
    
    3,722,312Rs. 430.68
    
    
    $10.76
    
    
    
    $5.55
    
    
   
    
    
   
    
    
    $8.18Rs.430.69
    
    
    $10.76
    
    
   
    Rs.512.21
   
    
    3.95 Years
    
    
    
    1,570,398
    
    
    
    Rs.695.33
   
    
    
    1,163,598Rs.861.91
    
    
    $21.54
    
    
    
    $12.87
    
    
   
    
    
    
    
    
    $17.37
 The US$ numbers in the above tables have been translated using the closing exchange rate as of
March 31, 2008 1US$= Rs 40.02
 There are no grants with the exercise price in the range of Rs.4.01- Rs 77.32 (US$0.11 - US$1.92).
 Stock-based compensation
  F-27




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##### Table of Contents



Satyam Computer Services LimitedNotes to the Consolidated Financial Statements
  Fringe Benefit tax
    Year ended March 31,2008
    
    2007Dividend yield
    
    
    0.78
    %
    
    
    0.78
    %Expected volatility
    
    
    57
    %
    
    
    59
    %Risk-free interest rate
    
    
    8
    %
    
    
    8
    %Expected term (in years)
    
    
    2.51
    
    
    
    2.46
 Expected Term:
 Risk-Free Interest Rate:
 Expected Volatility:
 Expected Dividend:
 Estimated Pre-vesting Forfeitures:
 Stock based compensation plan of Satyam BPO
  F-28




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
  Year ended March 31,2008
    
    2007
    
    2006Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    WeightedNumber of
    
    Average
    
    Number of
    
    Average
    
    Number of
    
    Averageequity
    
    Exercise
    
    equity
    
    Exercise
    
    equity
    
    ExerciseESOP Plan
    
    shares
    
    Price
    
    shares
    
    Price
    
    shares
    
    PriceBalance at the beginning of the year
    
    
    998,702
    
    
    $
    1.86
    
    
    
    1,215,506
    
    
    $
    1.80
    
    
    
    813,578
    
    
    $
    1.83Granted
    
    
    
    
    
    
    
    
    
    
    324,000
    
    
    
    1.77
    
    
    
    655,000
    
    
    $
    1.77Exercised
    
    
    (358,952
    )
    
    $
    2.02
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Cancelled
    
    
    
    
    
    
    
    
    
    
    (540,804
    )
    
    
    1.77
    
    
    
    (253,072
    )
    
    $
    1.77Lapsed
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Balance at the end of the year
    
    
    639,750
    
    
    $
    2.00
    
    
    
    998,702
    
    
    $
    1.86
    
    
    
    1,215,506
    
    
    $
    1.80Exercisable at the end of the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Weighted average fair value of options
granted during the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    1.77
    
    
    
    
    
    
    $
    1.77
  15. Segmental Reporting
 Disclosures about Segments of an Enterprise and Related
Information,
  IT services
 Business Process Outsourcing
  Business Segments
 ITServices
    
    BPO
    
    Elimination
    
    ConsolidatedtotalsFor the year ended March 31, 2008Revenue  External customers
    
    
    2,093.2
    
    
    
    44.9
    
    
    
    
    
    
    
    2,138.1Revenue  Inter-segment
    
    
    1.3
    
    
    
    15.8
    
    
    
    (17.1
    )
    
    
    Total Revenues
    
    
    2,094.5
    
    
    
    60.7
    
    
    
    (17.1
    )
    
    
    2,138.1Operating income / (loss)
    
    
    412.7
    
    
    
    (4.0
    )
    
    
    
    
    
    
    408.7Equity in earnings/(losses) of
associated companies, net of
taxes
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    0.1Net income / (loss)
    
    
    421.6
    
    
    
    (4.6
    )
    
    
    
    
    
    
    417.0Segment assets
    
    
    2,179.5
    
    
    
    104.9
    
    
    
    (41.1
    )
    
    
    2,243.3Depreciation and amortization
    
    
    36.7
    
    
    
    4.8
    
    
    
    
    
    
    
    41.5
 F-29




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 ITServices
    
    BPO
    
    Elimination
    
    ConsolidatedtotalsCapital expenditure
    
    
    98.0
    
    
    
    3.9
    
    
    
    
    
    
    
    101.9For the year ended March 31, 2007Revenue  External customers
    
    
    1,432.5
    
    
    
    28.9
    
    
    
    
    
    
    
    1,461.4Revenue  Inter-segment
    
    
    0.6
    
    
    
    9.2
    
    
    
    (9.8
    )
    
    
    Total Revenues
    
    
    1,433.1
    
    
    
    38.1
    
    
    
    (9.8
    )
    
    
    1,461.4Operating income / (loss)
    
    
    294.0
    
    
    
    (2.4
    )
    
    
    
    
    
    
    291.6Equity in earnings/(losses) of
associated companies, net of
taxes
    
    
    0.8
    
    
    
    
    
    
    
    
    
    
    
    0.8Net income / (loss)
    
    
    302.7
    
    
    
    (4.3
    )
    
    
    
    
    
    
    298.4Segment assets
    
    
    1,605.3
    
    
    
    42.5
    
    
    
    (23.7
    )
    
    
    1,624.1Depreciation and amortization
    
    
    30.4
    
    
    
    3.2
    
    
    
    
    
    
    
    33.6Capital expenditure
    
    
    79.6
    
    
    
    4.2
    
    
    
    
    
    
    
    83.8For the year ended March 31, 2006Revenue  External customers
    
    $
    1,082.7
    
    
    $
    13.6
    
    
    
    
    
    
    $
    1,096.3Revenue  Inter-segment
    
    
    0.8
    
    
    
    6.4
    
    
    
    (7.2
    )
    
    
    Total Revenues
    
    
    1,083.5
    
    
    
    20.0
    
    
    
    (7.2
    )
    
    
    1096.3Operating income / (loss)
    
    
    228.5
    
    
    
    (8.8
    )
    
    
    
    
    
    
    219.7Equity in earnings/(losses) of
associated companies, net of
taxes
    
    
    (0.8
    )
    
    
    
    
    
    
    
    
    
    
    (0.8
    )Net income
    
    
    259.0
    
    
    
    (9.6
    )
    
    
    
    
    
    
    249.4Segment assets
    
    
    1,170.8
    
    
    
    27.7
    
    
    
    (17.3
    )
    
    
    1,181.2Depreciation and amortization
    
    
    29.0
    
    
    
    2.5
    
    
    
    
    
    
    
    31.5Capital expenditure
    
    
    53.4
    
    
    
    3.2
    
    
    
    
    
    
    
    56.6
 The capital expenditure in the above table represents the additions to premises and equipment
(fixed assets) of each segment.
 Geographic Information
  Year ended March 31,2008
    
    
    2007
    
    
    2006Revenues from
    
    
    
    
    
    
    Revenues from
    
    
    
    
    
    
    Revenues fromexternal
    
    
    Long-lived
    
    
    external
    
    
    Long-lived
    
    
    external
    
    
    Long-livedcustomers
    
    
    assets
    
    
    customers
    
    
    assets
    
    
    customers
    
    
    assetsUnited States
    
    
    1,285.0
    
    
    
    4.4
    
    
    
    924.0
    
    
    
    4.1
    
    
    
    711.2
    
    
    
    4.0Europe
    
    
    439.8
    
    
    
    1.5
    
    
    
    276.5
    
    
    
    1.4
    
    
    
    206.3
    
    
    
    0.9Asia Pacific
    
    
    288.9
    
    
    
    6.3
    
    
    
    160.7
    
    
    
    2.4
    
    
    
    111.2
    
    
    
    2.0India
    
    
    68.5
    
    
    
    319.6
    
    
    
    75.2
    
    
    
    194.8
    
    
    
    45.1
    
    
    
    133.1Rest of the World
    
    
    55.9
    
    
    
    0.4
    
    
    
    25.0
    
    
    
    0.5
    
    
    
    22.5
    
    
    
    0.8Total
    
    
    2,138.1
    
    
    
    332.2
    
    
    
    1,461.4
    
    
    
    203.2
    
    
    
    1,096.3
    
    
    
    140.8
 The long-lived assets in the above table represent premises and equipment, goodwill and intangible
assets of each segment.
 F-30




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 16. Related Party Transactions
  US$ in millionYear ended March 31,2008
    
    2007
    
    2006Infrastructure and other services provided by Satyam toSatyam Venture
    
    
    0.3
    
    
    
    0.5
    
    
    
    0.5CA Satyam
    
    
    0.1Total
    
    
    0.4
    
    
    
    0.5
    
    
    
    0.6Infrastructure and other services received by Satyam fromSify, its subsidiaries and associated companies
    
    
    
    
    
    
    
    
    
    
    2.9Satyam Venture
    
    
    6.8
    
    
    
    8.6
    
    
    
    8.6CA Satyam
    
    
    2.6
    
    
    
    0.2
    
    
    
    Total
    
    
    9.4
    
    
    
    8.8
    
    
    
    11.5
  US$ in millionAs of March 31,2008
    
    2007Amount due from/(to) associated companiesSatyam Venture
    
    
    (1.8
    )
    
    
    (2.6
    )Total
    
    
    (1.8
    )
    
    
    (2.6
    )
 17. Shareholders Equity and Dividends
 Increase in authorized share capital
  Stock Split (in the form of stock dividend)
  Dividends
    F-31




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 18. Contingencies and Commitments
 a) Knowledge Dynamics and Nitor
  b) Bank guarantees
  c) Capital commitments
  d) Operating leases
   e) Venture Global Engineering LLC, USA
  19. Concentration of Credit Risk
  Year ended March 31,2008
    
    
    2007
    
    
    2006Revenues generated from top two customersCustomer I
    
    
    4.88
    %
    
    
    6.34
    %
    
    
    8.80
    %Customer II
    
    
    4.85
    %
    
    
    4.41
    %
    
    
    5.14
    %Total revenues from top five customers
    
    
    19.27
    %
    
    
    21.04
    %
    
    
    24.21
    %
 F-32




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 20. Financial Instruments
 Forward and options contracts
   US$ in millionAs of March 31,2008
    
    
    2007Aggregate contracted principal amounts of contracts outstanding:Forward contracts
    
    
    395.7
    
    
    
    100.0Options contracts
    
    
    737.4
    
    
    
    352.6Total
    
    
    1,133.1
    
    
    
    452.6Balance sheet exposure:Forward contracts
    
    
    (0.7
    )
    
    
    $2.1Options contracts
    
    
    (1.6
    )
    
    
    2.4Total
    
    
    (2.3
    )
    
    
    4.5
   US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006Forward contracts
    
    
    5.4
    
    
    
    2.6
    
    
    
    0.8Options contracts
    
    
    3.6
    
    
    
    3.6
    
    
    
    (1.6
    )Total
    
    
    9.0
    
    
    
    6.2
    
    
    
    (0.8
    )
 Fair value
  F-33




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##### Table of Contents



Satyam Computer Services Limited
Notes to the Consolidated Financial Statements
 21. Schedules of Balance sheet
 a) Cash and Cash Equivalents
  US$ in millionAs of March 31,2008
    
    
    2007Cash and bank balances
    
    
    290.5
    
    
    
    138.2Cash equivalents
    
    
    
    
    
    
    14.0Cash and cash equivalents
    
    
    290.5
    
    
    
    152.2
 b) Accounts receivable and allowance for doubtful debts
  US$ in millionAs of March 31,2008
    
    
    2007Customers (trade)
    
    
    539.1
    
    
    
    386.9Related parties
    
    
    0.3
    
    
    
    0.1Less: Allowance for doubtful debts
    
    
    (31.0
    )
    
    
    (22.8
    )Accounts receivable, net
    
    
    508.4
    
    
    
    364.2
  c) Prepaid Expenses and Other Receivables
  US$ in millionAs of March 31,2008
    
    
    2007Interest accrued on bank deposits
    
    
    68.1
    
    
    
    Prepaid expenses
    
    
    11.5
    
    
    
    8.1Directors liability insurance
    
    
    0.2
    
    
    
    0.3Advance for expenses
    
    
    34.3
    
    
    
    9.3Loans and advance to employees
    
    
    18.1
    
    
    
    13.8Other advances and receivables
    
    
    4.8
    
    
    
    4.9Forward and Option contracts
    
    
    
    
    
    
    4.5Less: Allowance for doubtful advances
    
    
    (5.3
    )
    
    
    (3.8
    )Prepaid expenses and other receivables
    
    
    131.7
    
    
    
    37.1
   d) Other Assets
  US$ in millionAs of March 31,2008
    
    
    2007Interest accrued on bank deposits
    
    
    
    
    
    
    15.1Deposits
    
    
    37.1
    
    
    
    20.8Loans and advances to employees due after one year
    
    
    0.9
    
    
    
    0.9Deferred taxes on income
    
    
    5.6
    
    
    
    3.3Others
    
    
    2.0
    
    
    
    1.0Less: Allowance for doubtful advances
    
    
    (1.7
    )
    
    
    (1.6
    )Other Assets
    
    
    43.9
    
    
    
    39.5
  F-34




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##### Table of Contents



Satyam Computer Services Limited  Notes to the Consolidated Financial Statements
 e) Accrued Expenses and Other Current Liabilities
  US$ in millionAs of March 31,2008
    
    
    2007Accrued expenses
    
    
    158.7
    
    
    
    99.0Forward and Option contracts
    
    
    2.3
    
    
    
    Unclaimed dividend
    
    
    1.8
    
    
    
    1.5Provision for taxation, net of payments
    
    
    26.4
    
    
    
    15.5Provision for gratuity and unutilized leave
    
    
    45.4
    
    
    
    29.5Deferred taxes on income
    
    
    3.7
    
    
    
    3.1Accrued expenses and other current liabilities
    
    
    238.3
    
    
    
    148.6
 22. Subsequent events
 a) S&V Management consulting
  b) Computer Associates stake in CA-Satyam JV
  c) Caterpillars business division
  F-35




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##### Table of Contents



Satyam Computer Services Limited  Notes to the Consolidated Financial Statements
 
 Financial
Statement Schedule  Valuation and qualifying accounts
 1. Change in valuation allowance on deferred tax assets:
 US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006At the beginning of the year
    
    
    26.6
    
    
    
    24.0
    
    
    
    21.1Change during the year
    
    
    1.4
    
    
    
    1.7
    
    
    
    3.3Change due to foreign exchange
    
    
    2.0
    
    
    
    0.9
    
    
    
    (0.4
    )At the end of the year
    
    
    30.0
    
    
    
    26.6
    
    
    
    24.0
 2. Allowance for doubtful accounts on trade accounts receivable:
 US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006At the beginning of the year
    
    
    22.8
    
    
    
    19.1
    
    
    
    17.5Additions
    
    
    8.5
    
    
    
    3.6
    
    
    
    4.2Write offs, net of recoveries
    
    
    (2.3
    )
    
    
    (0.6
    )
    
    
    (2.2
    )Change due to foreign exchange
    
    
    2.0
    
    
    
    0.7
    
    
    
    (0.4
    )At the end of the year
    
    
    31.0
    
    
    
    22.8
    
    
    
    19.1
 3. Allowance for doubtful advances:
 a) Prepaid Expenses and Other Receivables
 US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006At the beginning of the year
    
    
    3.8
    
    
    
    2.3
    
    
    
    1.7Additions
    
    
    1.2
    
    
    
    1.3
    
    
    
    0.6Write offs, net of recoveries
    
    
    
    
    
    
    
    
    
    
    Change due to foreign exchange
    
    
    0.3
    
    
    
    0.2
    
    
    
    At the end of the year
    
    
    5.3
    
    
    
    3.8
    
    
    
    2.3
 b) Other Assets
 US$ in millionYear ended March 31,2008
    
    
    2007
    
    
    2006At the beginning of the year
    
    
    1.6
    
    
    
    1.5
    
    
    
    1.5Additions
    
    
    
    
    
    
    
    
    
    
    Write offs, net of recoveries
    
    
    
    
    
    
    
    
    
    
    Change due to foreign exchange
    
    
    0.1
    
    
    
    0.1
    
    
    
    At the end of the year
    
    
    1.7
    
    
    
    1.6
    
    
    
    1.5
 F-36