Infosys Limited American Depositary Shares

Ladies and gentlemen, good day and welcome to the Infosys Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode. And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, you may signal for an operator by pressing star and zero on your touch-tone telephone. Please note that this conference is being recorded. I now hand the conference over to Mr. Sandeep Mahindra. Thank you and over to you, sir.

Thanks, Karuna. Hello, everyone, and welcome to Infosys Earnings Calls to discuss QCFI 20 earnings release. Happy New Year to everyone on the call. This is Sandeep from the Investor Relations Team in Bangalore. Joining us today on this call is Chairman Mr. Nandan Militani, CEO and MD Mr. Salil Parekh, CEO Mr. Praveen Rao, CEO Mr. Nilanjan Roy, along with other members of the Senior Management Team. This call will be for 90 minutes and will be divided into two parts. For the first 30 minutes, our chairman, Mr. Nandan Milikarni, will talk about and take questions on the whistleblower matters and the recently concluded investigation. That will be followed by the regular earnings call format in the next 60 minutes, with opening comments by Salil Praveen and Nandan, followed by Q&A. Please note that anything which we say which refers to our outlook for the future is a forward-looking statement, which must be written in conjunction with the risk that the company faces. A full statement and explanation of these risks is available in our filing with the SEC, which can be found on www. I'd now like to pass it on to Nandan.

Thank you, Sandeep, and I'd like to welcome all of you to this call. I'm pleased to say that the Infosys Audit Committee did not find any evidence of financial impropriety or executive misconduct, and there is absolutely no change in previously related financial statements. So everything has come out clean. We have had a very thorough investigation done. This was done by independent legal counsel Shardul Amarchan Mangaldas, along with Price Waterhouse Coopers. We also had Ernst & Young as our internal auditors. And as you know, our certifying auditors are Deloitte. So this has gone through the scrutiny of all the various groups. And there is absolutely no issues of restatement or anything of that type. The audit committee has taken this very seriously and they've done a very thorough investigation. Just to give you a sense of the scale of the investigation, 128 interviews with 77 people, 46 custodians for data were nominated and their review was over 210,000 documents with over 8 terabytes of data which were processed. This investigation began when they appointed Shardul Amarchan on October 21st and concluded today. And so it's been a very intense several weeks, which have occupied investigators as well as our people, our board members, our management team, and also our general counsel in the field. Now, the investigation review was done for the period from Jan 1st, 2018 to September 30th, 2019, and the investigative team was given complete, unrestricted access to every person and every piece of information that was there, and it was ensured that the company, its director, and its employees cooperated fully and extensively in this investigation. Now, apart from the fact that we had a very thorough investigation, we have also made sure that all the key findings of the investigation are put out in the public domain. So this is not some one statement thing. This is a detailed thing. We have taken each of the allegations, be it on the business side or be it about the CEO, And on a point-by-point basis, the allegations have been answered and we have given the answers. And as you will find, I would say almost all of it, it's very clear that the allegations are unsubstantiated. There are a couple regarding one large deal where there was a question whether the method of auditing, a method of whether to use a percentage of completion method for cost or to use a straight line method for revenue recognition and for that. Now the company as a policy has been using both the SLM method and the POC method and a very large number of projects are in SLM method. However, the company from time to time based upon the nature of the contract has chosen to operate on the POC method and POC method was selected for this Both these methods are in line with both accounting standards as well as the policy of the company. And therefore we are quite comfortable that the company's actions on this have been correct. The other matter which is also related to the same contract is some service credit. And there has been a point made by the investigators about that. And here again, we have reviewed the investigation and this is about whether something has to be reversed or non-accounted or whatever. And it is very clear that it is neither qualitatively nor quantitatively material to the reported revenues of operating guidance because the cumulative effect of this is in the range of 0.02 to 0.03%. It's a very, very minuscule amount just a couple of million dollars compared to the multi-billion dollar revenue that it has. And therefore, this is not relevant and would have had no impact on any of our revenue, margin, all this stuff. So these are the only two things which are there and the audit committee has taken a view on both. So overall, we have, you know, everything else is unsubstantiated. There were also a number of allegations made about the CEO, some of which were bordering on the comics. But anyway, we have taken them one by one and shown clearly that there is no – all of them have been addressed. And we are very happy that the CEO has come out of this investigation with flying colors. And I am very grateful to Salil because Salil and his – team have had to really face a lot of questions, and they are thorough professionals, whether it's Salil, whether it's our CFO, Nilanjan Roy, or all the outstanding members of our finance department, Jayesh, Deepak Balla, Sachin Zute, Amrita Srikant, Sandeep Mahendru, and others. All of them are outstanding professionals. And they've had to deal with both closing the books as well as closing this investigation. And they have done that brilliantly with high integrity. And therefore, I think we are very, very pleased. The board, the chair, the audit committee, everybody is pleased that our management team has come out so well. And the board continues to have the fullest confidence in Salil and his management team. And we believe that this episode, this distraction, has actually made us stronger, more committed to our goals, brought us all together, and we are now very, very confident that having put this distraction to rest, we can get on with our business of running a great company. So I will stop at this point, and I'll be happy to take questions. And I will take questions, and after I finish my session, I'll hand over to Sandeep. after which we'll get down to the real purpose of this call, which is to discuss the business performance of Infosys.