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Financial instruments | 12 Months Ended
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Mar. 31, 2020
Text block [abstract] |
Financial instruments | 19. Financial instruments Financial assets and liabilities (carrying value / fair value)
|  | As at March 31, |
|  | 2019 |  |  | 2020 |
Assets: |  |  |  |  |  |  |  |
Cash and cash equivalents |  | ₹ | 158,529 |  |  | ₹ | 144,499 |
Investments |  |  |  |  |  |  |  |
Financial instruments at FVTPL |  |  | 13,960 |  |  |  | 14,795 |
Financial instruments at FVTOCI |  |  | 191,964 |  |  |  | 164,884 |
Financial instruments at Amortized cost |  |  | 21,708 |  |  |  | 19,258 |
Other financial assets |  |  |  |  |  |  |  |
Trade receivables |  |  | 104,862 |  |  |  | 110,523 |
Unbilled receivables |  |  | 22,880 |  |  |  | 25,209 |
Other assets |  |  | 19,757 |  |  |  | 14,495 |
Derivative assets |  |  | 5,104 |  |  |  | 3,025 |
|  | ₹ | 538,764 |  |  | ₹ | 496,688 |
Liabilities: |  |  |  |  |  |  |  |
Trade payables and other payables |  |  |  |  |  |  |  |
Trade payables and accrued expenses |  | ₹ | 88,304 |  |  | ₹ | 78,129 |
Lease liabilities |  |  | — |  |  |  | 19,198 |
Other liabilities |  |  | 644 |  |  |  | 1,050 |
Loans, borrowings and bank overdrafts |  |  | 99,467 |  |  |  | 78,042 |
Derivative liabilities |  |  | 1,310 |  |  |  | 7,369 |
|  | ₹ | 189,725 |  |  | ₹ | 183,788 |
Offsetting financial assets and liabilities The following table contains information on other financial assets and trade payable and other liabilities subject to offsetting:
|  | Financial assets |
|  | Gross amounts of recognized other financial assets |  |  | Gross amounts of recognized financial liabilities set off in the balance sheet |  |  | Net amounts of recognized other financial assets presented in the balance sheet |
As at March 31, 2019 |  |  | 154,129 |  |  |  | (6,630 | ) |  |  | 147,499 |
As at March 31, 2020 |  |  | 157,304 |  |  |  | (7,077 | ) |  |  | 150,227 |
|  | Financial liabilities |
|  | Gross amounts of recognized trade payables and other payables |  |  | Gross amounts of recognized financial liabilities set off in the balance sheet |  |  | Net amounts of recognized trade payables and other payables presented in the balance sheet |
As at March 31, 2019 |  |  | 95,578 |  |  |  | (6,630 | ) |  |  | 88,948 |
As at March 31, 2020 |  |  | 86,256 |  |  |  | (7,077 | ) |  |  | 79,179 |
For the financial assets and liabilities subject to offsetting or similar arrangements, each agreement between the Company and the counterparty allows for net settlement of the relevant financial assets and liabilities when both elect to settle on a net basis. In the absence of such an election, financial assets and liabilities will be settled on a gross basis and hence are not offset.
Fair value Financial assets and liabilities include cash and cash equivalents, trade receivables, unbilled receivables, finance lease receivables, employee and other advances, eligible current and non-current assets, loans, borrowings and bank overdrafts, trade payable and accrued expenses, and eligible current liabilities and non-current liabilities. The fair value of cash and cash equivalents, trade receivables, unbilled receivables, loans, borrowings and bank overdrafts, trade payables and accrued expenses, other current financial assets and liabilities approximate their carrying amount largely due to the short-term nature of these instruments. The Company’s long-term debt has been contracted at market rates of interest. Accordingly, the carrying value of such long-term debt approximates fair value. Further, finance lease receivables are periodically evaluated based on individual credit worthiness of customers. Based on this evaluation, the Company records allowance for estimated losses on these receivables. As at March 31, 2020 and 2019, the carrying value of such receivables, net of allowances approximates the fair value. Investments in liquid and short-term mutual funds, which are classified as FVTPL are measured using net asset values at the reporting date multiplied by the quantity held. Fair value of investments in commercial papers, certificate of deposits and bonds classified as FVTOCI is determined based on the indicative quotes of price and yields prevailing in the market at the reporting date. Fair value of investments in equity instruments classified as FVTOCI is determined using market and income approaches. The fair value of derivative financial instruments is determined based on observable market inputs including currency spot and forward rates, yield curves, currency volatility etc. Fair value hierarchy The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows: Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). Level 3 – Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs). The following table presents fair value of hierarchy of assets and liabilities measured at fair value on a recurring basis:
|  | As at March 31, 2019 |  |  | As at March 31, 2020 |
Particular |  | Fair value measurements at reporting date |  |  | Fair value measurements at reporting date |
|  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |  |  | Level 1 |  |  | Level 2 |  |  | Level 3 |
Assets |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  |  | 3,149 |  |  |  | — |  |  |  | 3,149 |  |  |  | — |  |  |  | 1,382 |  |  |  | — |  |  |  | 1,382 |  |  |  | — |
Others |  |  | 1,955 |  |  |  | — |  |  |  | 1,955 |  |  |  | — |  |  |  | 1,643 |  |  |  | — |  |  |  | 1,643 |  |  |  | — |
Investments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Investment in liquid and short-term mutual funds |  |  | 13,960 |  |  |  | 13,960 |  |  |  | — |  |  |  | — |  |  |  | 14,795 |  |  |  | 14,795 |  |  |  | — |  |  |  | — |
Investment in equity instruments |  |  | 6,916 |  |  |  | — |  |  |  | 248 |  |  |  | 6,668 |  |  |  | 9,297 |  |  |  | — |  |  |  | 119 |  |  |  | 9,178 |
Commercial paper, Certificate of deposits and bonds |  |  | 185,048 |  |  |  | 6,865 |  |  |  | 178,183 |  |  |  | — |  |  |  | 155,587 |  |  |  | 12,983 |  |  |  | 142,604 |  |  |  | — |
Liabilities |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash flow hedges |  |  | (130 | ) |  |  | — |  |  |  | (130 | ) |  |  | — |  |  |  | (4,057 | ) |  |  | — |  |  |  | (4,057 | ) |  |  | — |
Others |  |  | (1,180 | ) |  |  | — |  |  |  | (1,180 | ) |  |  | — |  |  |  | (3,312 | ) |  |  | — |  |  |  | (3,312 | ) |  |  | — |
The following methods and assumptions were used to estimate the fair value of the level 2 financial instruments included in the above table. Derivative instruments (assets and liabilities): The Company enters derivative financial instruments with various counterparties, primarily banks with investment grade credit ratings. Derivatives valued using valuation techniques with market observable inputs are mainly interest rate swaps, foreign exchange forward contracts and foreign exchange option contracts. The most frequently applied valuation techniques include forward pricing, swap models and Black Scholes models (for option valuation), using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates, interest rate curves and forward rate curves of the underlying. As at March 31, 2020, the changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationships and other financial instruments recognized at fair value. Investment in commercial papers, certificate of deposits and bonds: Fair value of these instruments is derived based on the indicative quotes of price and yields prevailing in the market as at reporting date. The following methods and assumptions were used to estimate the fair value of the level 3 financial instruments included in the above table. Investment in equity instruments: Fair value of these investments is determined using market and income approaches. Details of assets and liabilities considered under Level 3 classification
|  | Investment in equity instruments |
Balance as at April 1, 2018 |  | ₹ | 5,685 |
Additions |  |  | 2,869 |
Transfers out of level 3 |  |  | (647 | )
Disposal |  |  | (1,341 | )
Gain recognized in foreign currency translation reserve |  |  | 203 |
Loss recognized in other comprehensive income |  |  | (101 | )
Balance as at March 31, 2019 |  | ₹ | 6,668 |
Balance as at April 1, 2019 |  | ₹ | 6,668 |
Additions |  |  | 2,124 |
Transfers out of level 3 |  |  | — |
Disposal |  |  | (1,327 | )
Gain recognized in foreign currency translation reserve |  |  | 855 |
Gain recognized in other comprehensive income |  |  | 858 |
Balance as at March 31, 2020 |  | ₹ | 9,178 |
Description of significant unobservable inputs to valuation:
As at March 31, 2019 |  |  |  |  |  |  |  |  |  |  |  |  |
Items |  | Valuation technique |  | Significant unobservable input |  | Movement by |  |  | Increase ( ₹ ) |  |  | Decrease ( ₹ ) |
Unquoted equity investments |  | Discounted cash flow model |  | Long term growth rate Discount rate |  |  | 0.5 0.5 | % % |  |  | 201 (243 | ) |  |  | (187 256 | )
As at March 31, 2020 |  |  |  |  |  |  |  |  |  |  |  |  |
Items |  | Valuation technique |  | Significant unobservable input |  | Movement by |  |  | Increase ( ₹ ) |  |  | Decrease ( ₹ ) |
Unquoted equity investments |  | Discounted cash flow model |  | Long term growth rate Discount rate |  |  | 0.5 0.5 | % % |  |  | 298 (388 | ) |  |  | (273 404 | )
As at March 31, 2019 and 2020, 0.5 percentage point increase/(decrease) in the unobservable inputs used in fair valuation of other Level 3 assets does not have a significant impact in its value.
Derivative assets and liabilities: The Company is exposed to foreign currency fluctuations on foreign currency assets / liabilities, forecasted cash flows denominated in foreign currency and net investment in foreign operations. The Company follows established risk management policies, including the use of derivatives to hedge foreign currency assets / liabilities, foreign currency forecasted cash flows and net investment in foreign operations. The counter parties in these derivative instruments are primarily banks and the Company considers the risks of non-performance by the counterparty as non-material. The following table presents the aggregate contracted principal amounts of the Company’s derivative contracts outstanding:
|  |  |  |  |  |  |  |  |  |  | (in million) |
|  | As at March 31, |
|  | 2019 |  |  | 2020 |
|  | Notional |  |  | Fair value |  |  | Notional |  |  | Fair value |
Designated derivative instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sell: Forward contracts |  | USD | 333 |  |  | ₹ | 1,410 |  |  | USD | 1,011 |  |  | ₹ | (2,902 | )
|  | € | — |  |  |  | — |  |  | € | 121 |  |  | ₹ | 231 |
|  | £ | — |  |  |  | — |  |  | £ | 52 |  |  | ₹ | 240 |
|  | AUD | 97 |  |  | ₹ | 15 |  |  | AUD | 144 |  |  | ₹ | 741 |
Range forward option contracts |  | USD | 1,067 |  |  | ₹ | 1,149 |  |  | USD | 474 |  |  | ₹ | (1,057 | )
|  | £ | 191 |  |  | ₹ | 68 |  |  | £ | 98 |  |  | ₹ | (13 | )
|  | € | 153 |  |  | ₹ | 349 |  |  | € | 39 |  |  | ₹ | 85 |
|  | AUD | 56 |  |  | ₹ | 39 |  |  | AUD | — |  |  |  | — |
Interest rate swaps |  | USD | 75 |  |  | ₹ | (11 | ) |  | USD | — |  |  |  | — |
Non-designated derivative instruments |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Sell: Forward contracts * |  | USD | 1,182 |  |  | ₹ | 1,359 |  |  | USD | 1,314 |  |  | ₹ | (3,116 | )
|  | € | 32 |  |  | ₹ | 55 |  |  | € | 59 |  |  | ₹ | 34 |
|  | £ | 1 |  |  | ₹ | (1 | ) |  | £ | 81 |  |  | ₹ | 112 |
|  | AUD | 82 |  |  | ₹ | 28 |  |  | AUD | 56 |  |  | ₹ | 115 |
|  | SGD | 11 |  |  | ₹ | 1 |  |  | SGD | 7 |  |  | ₹ | 8 |
|  | ZAR | 56 |  |  | ₹ | 14 |  |  | ZAR | 17 |  |  | ₹ | 1 |
|  | CAD | 56 |  |  | ₹ | 40 |  |  | CAD | 51 |  |  | ₹ | 153 |
|  | SAR | 123 |  |  | ₹ | (1 | ) |  | SAR | 60 |  |  | ₹ | (1 | )
|  | AED | 9 |  |  |  | ^ |  |  | AED | — |  |  |  | — |
|  | PLN | 38 |  |  | ₹ | 15 |  |  | PLN | 34 |  |  | ₹ | 13 |
|  | CHF | 10 |  |  |  | ^ |  |  | CHF | 7 |  |  | ₹ | 4 |
|  | QAR | 3 |  |  | ₹ | (1 | ) |  | QAR | 19 |  |  | ₹ | (8 | )
|  | TRY | 28 |  |  | ₹ | 12 |  |  | TRY | 30 |  |  | ₹ | 31 |
|  | NOK | 29 |  |  | ₹ | 4 |  |  | NOK | 19 |  |  | ₹ | 16 |
|  | OMR | 1 |  |  | ₹ | (1 | ) |  | OMR | 2 |  |  | ₹ | 1 |
|  | SEK | 35 |  |  | ₹ | 5 |  |  | SEK | 13 |  |  | ₹ | 4 |
|  | MYR | — |  |  |  | — |  |  | MYR | 20 |  |  | ₹ | 1 |
|  | JPY | — |  |  |  | — |  |  | JPY | 325 |  |  |  | ^ |
Range forward option contracts |  | USD | 150 |  |  | ₹ | 161 |  |  | USD | — |  |  |  | — |
|  | € | 31 |  |  | ₹ | 12 |  |  | € | — |  |  |  | — |
|  | £ | 71 |  |  | ₹ | 57 |  |  | £ | — |  |  |  | — |
Buy: Forward contracts |  | USD | 730 |  |  | ₹ | (971 | ) |  | USD | 480 |  |  | ₹ | 972 |
|  | JPY | 154 |  |  |  | ^ |  |  | JPY | — |  |  |  | — |
|  | MXN | 9 |  |  |  | ^ |  |  | MXN | 11 |  |  | ₹ | (9 | )
|  | DKK | 75 |  |  | ₹ | (13 | ) |  | DKK | 9 |  |  |  | ^ |
|  |  |  |  |  | ₹ | 3,794 |  |  |  |  |  |  | ₹ | (4,344 | )
* | USD 1,182 and USD 1,314 includes USD/PHP sell forward of USD 117 and USD 176 as at March 31, 2019 and 2020, respectively.
^ | Value is less than ₹ 1
The following table summarizes activity in the cash flow hedging reserve within equity related to all derivative instruments classified as cash flow hedges:
|  | As at March 31, |
|  | 2019 |  |  | 2020 |
Balance as at the beginning of the year |  | ₹ | (143 | ) |  | ₹ | 3,019 |
Deferred cancellation gain/ (loss), net |  |  | 6 |  |  |  | (201 | )
Changes in fair value of effective portion of derivatives |  |  | 1,069 |  |  |  | (2,312 | )
Net gain/(loss) reclassified to consolidated statement of income on occurrence of hedged transactions * |  |  | 2,087 |  |  |  | (3,382 | )
Gain/(loss) on cash flow hedging derivatives, net |  | ₹ | 3,162 |  |  | ₹ | (5,895 | )
Balance as at the end of the year |  |  | 3,019 |  |  |  | (2,876 | )
Deferred tax thereon |  |  | (604 | ) |  |  | 561 |
Balance as at the end of the year, net of deferred tax |  | ₹ | 2,415 |  |  | ₹ | (2,315 | )
* | Includes net gain/(loss) reclassified to revenue (March 31, 2019: ₹ 2,585, March 31, 2020: ₹ (4,761)) and cost of revenues (March 31, 2019: ₹ (498), March 31, 2020: ₹ 1,379).
The related hedge transactions for balance in cash flow hedging reserves as at March 31, 2020 are expected to occur and be reclassified to the consolidated statement of income over a period of three years. As at March 31, 2019 and 2020 there were no significant gains or losses on derivative transactions or portions thereof that have become ineffective as hedges or associated with an underlying exposure that did not occur. Sale of financial assets From time to time, in the normal course of business, the Company transfers accounts receivables, unbilled receivables, net investment in finance lease receivables (financials assets) to banks. Under the terms of the arrangements, the Company surrenders control over the financial assets and transfer is without recourse. Accordingly, such transfers are recorded as sale of financial assets. Gains and losses on sale of financial assets without recourse are recorded at the time of sale based on the carrying value of the financial assets and fair value of servicing liability. The incremental impact of such transactions on our cash flow and liquidity for the year ended March 31, 2018, 2019 and 2020 is not material. In certain cases, transfer of financial assets may be with recourse. Under arrangements with recourse, the Company is obligated to repurchase the uncollected financial assets, subject to limits specified in the agreement with the banks. These are reflected as part of loans and borrowings in the consolidated statement of financial position. Financial risk management Market Risk Market risk is the risk of loss of future earnings, to fair values or to future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments, foreign currency receivables, payables and loans and borrowings. The Company’s exposure to market risk is a function of investment and borrowing activities and revenue generating activities in foreign currency. The objective of market risk management is to avoid excessive exposure of the Company’s earnings and equity to losses. Risk Management Procedures The Company manages market risk through a corporate treasury department, which evaluates and exercises independent control over the entire process of market risk management. The corporate treasury department recommends risk management objectives and policies, which are approved by senior management and Audit Committee. The activities of this department include management of cash resources, implementing hedging strategies for foreign currency exposures, borrowing strategies, and ensuring compliance with market risk limits and policies. Foreign currency risk The Company operates internationally, and a major portion of its business is transacted in several currencies. Consequently, the Company is exposed to foreign exchange risk through receiving payment for sales and services in the United States and elsewhere and making purchases from overseas suppliers in various foreign currencies. The exchange rate risk primarily arises from foreign exchange revenue, receivables, cash balances, forecasted cash flows, payables and foreign currency loans and borrowings. A significant portion of the Company’s revenue is in the U.S. Dollar, the United Kingdom Pound Sterling, the Euro, the Canadian Dollar and the Australian Dollar, while a large portion of costs are in Indian rupees. The exchange rate between the rupee and these currencies has fluctuated significantly in recent years and may continue to fluctuate in the future. Appreciation of the rupee against these currencies can adversely affect the Company’s results of operations. The Company evaluates exchange rate exposure arising from these transactions and enters foreign currency derivative instruments to mitigate such exposure. The Company follows established risk management policies, including the use of derivatives like foreign exchange forward/option contracts to hedge forecasted cash flows denominated in foreign currency. The Company has designated certain derivative instruments as cash flow hedges to mitigate the foreign exchange exposure of forecasted highly probable cash flows. The Company also designates foreign currency borrowings as hedge against respective net investments in foreign operations. As at March 31, 2020, a ₹ 1 increase in the spot exchange rate of the Indian rupee with the U.S. dollar would result in approximately ₹ 1,972 (consolidated statement of income ₹ 658 and other comprehensive income ₹ 1,314) decrease in the fair value, and a ₹ 1 decrease would result in approximately ₹ 1,912 (consolidated statement of income ₹ 658 and other comprehensive income ₹ 1,254) increase in the fair value of foreign currency dollar denominated derivative instruments (forward and option contracts). The below table presents foreign currency risk from non-derivative financial instruments as at March 31, 2019 and 2020:
|  | As at March 31, 2019 |
|  | US $ |  |  | Euro |  |  | Pound Sterling |  |  | Australian Dollar |  |  | Canadian Dollar |  |  | Other currencies # |  |  | Total |
Trade receivables |  | ₹ | 39,896 |  |  | ₹ | 8,030 |  |  | ₹ | 5,212 |  |  | ₹ | 3,542 |  |  | ₹ | 1,528 |  |  | ₹ | 3,880 |  |  | ₹ | 62,088 |
Unbilled receivables |  |  | 8,038 |  |  |  | 1,609 |  |  |  | 3,146 |  |  |  | 1,225 |  |  |  | 204 |  |  |  | 743 |  |  |  | 14,965 |
Contract assets |  |  | 4,706 |  |  |  | 1,445 |  |  |  | 2,270 |  |  |  | 836 |  |  |  | 150 |  |  |  | 598 |  |  |  | 10,005 |
Cash and cash equivalents |  |  | 21,997 |  |  |  | 2,884 |  |  |  | 1,573 |  |  |  | 1,003 |  |  |  | 1,928 |  |  |  | 2,204 |  |  |  | 31,589 |
Other assets |  |  | 8,553 |  |  |  | 1,173 |  |  |  | 4,056 |  |  |  | 1,038 |  |  |  | 1,033 |  |  |  | 4,544 |  |  |  | 20,397 |
Loans, borrowings and bank overdrafts |  |  | (50,516 | ) |  |  | (20 | ) |  |  | (21 | ) |  |  | (33 | ) |  |  | — |  |  |  | (21 | ) |  |  | (50,611 | )
Trade payables, accrued expenses and other liabilities |  |  | (27,202 | ) |  |  | (5,779 | ) |  |  | (4,646 | ) |  |  | (1,526 | ) |  |  | (806 | ) |  |  | (2,787 | ) |  |  | (42,746 | )
Net assets/ (liabilities) |  | ₹ | 5,472 |  |  | ₹ | 9,342 |  |  | ₹ | 11,590 |  |  | ₹ | 6,085 |  |  | ₹ | 4,037 |  |  | ₹ | 9,161 |  |  | ₹ | 45,687 |
|  | As at March 31, 2020 |
|  | US $ |  |  | Euro |  |  | Pound Sterling |  |  | Australian Dollar |  |  | Canadian Dollar |  |  | Other currencies # |  |  | Total |
Trade receivables |  | ₹ | 42,329 |  |  | ₹ | 8,860 |  |  | ₹ | 7,735 |  |  | ₹ | 3,044 |  |  | ₹ | 1,388 |  |  | ₹ | 4,522 |  |  | ₹ | 67,878 |
Unbilled receivables |  |  | 11,127 |  |  |  | 1,030 |  |  |  | 2,221 |  |  |  | 784 |  |  |  | 291 |  |  |  | 1,126 |  |  |  | 16,579 |
Contract assets |  |  | 5,517 |  |  |  | 1,559 |  |  |  | 2,850 |  |  |  | 654 |  |  |  | 146 |  |  |  | 790 |  |  |  | 11,516 |
Cash and cash equivalents |  |  | 13,481 |  |  |  | 3,978 |  |  |  | 1,697 |  |  |  | 586 |  |  |  | 1,292 |  |  |  | 1,733 |  |  |  | 22,767 |
Other assets |  |  | 49,835 |  |  |  | 4,314 |  |  |  | 3,283 |  |  |  | 413 |  |  |  | 1,447 |  |  |  | 1,805 |  |  |  | 61,097 |
Loans, borrowings and bank overdrafts |  |  | (36,578 | ) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | (36,578 | )
Lease Liabilities |  |  | (3,393 | ) |  |  | (2,606 | ) |  |  | (373 | ) |  |  | (214 | ) |  |  | (16 | ) |  |  | (1,412 | ) |  |  | (8,014 | )
Trade payables, accrued expenses and other liabilities |  |  | (27,457 | ) |  |  | (3,419 | ) |  |  | (3,718 | ) |  |  | (1,228 | ) |  |  | (605 | ) |  |  | (3,087 | ) |  |  | (39,514 | )
Net assets/ (liabilities) |  | ₹ | 54,861 |  |  | ₹ | 13,716 |  |  | ₹ | 13,695 |  |  | ₹ | 4,039 |  |  | ₹ | 3,943 |  |  | ₹ | 5,477 |  |  | ₹ | 95,731 |
# | Other currencies reflect currencies such as Swiss Franc, UAE Dirham, Saudi Riyal, Singapore Dollar, etc.
As at March 31, 2019 and 2020, respectiv ely, every 1% increase/decrease in the respective foreign curren cies compared to functional currency of the Company would impact results by approximately ₹ 457 and ₹ 957, respectively. Interest rate risk Interest rate risk primarily arises from floating rate borrowing, including various revolving and other lines of credit. The Company’s investments are primarily in short-term investments, which do not expose it to significant interest rate risk. From time to time, the Company manages its net exposure to interest rate risk relating to borrowings by entering into interest rate swap agreements, which allows it to exchange periodic payments based on a notional amount and agreed upon fixed and floating interest rates. Certain borrowings are also transacted at fixed interest rates. If interest rates were to increase by 100 bps as on March 31, 2020, additional net annual interest expense on floating rate borrowing would amount to approximately ₹ 773. Credit risk Credit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this, the Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, forward looking macroeconomic information, analysis of historical bad debts and ageing of accounts receivable. Individual risk limits are set accordingly. No single customer accounted for more than 10% of the accounts receivable as at March 31, 2019 and 2020, or revenues for the year ended March 31, 2018, 2019 and 2020. There is no significant concentration of credit risk. Counterparty risk Counterparty risk encompasses issuer risk on marketable securities, settlement risk on derivative and money market contracts and credit risk on cash and time deposits. Issuer risk is minimized by only buying securities which are at least AA rated in India based on Indian rating agencies. Settlement and credit risk is reduced by the policy of entering transactions with counterparties that are usually banks or financial institutions with acceptable credit ratings. Exposure to these risks are closely monitored and maintained within predetermined parameters. There are limits on credit exposure to any financial institution. The limits are regularly assessed and determined based upon credit analysis including financial statements and capital adequacy ratio reviews. Liquidity risk Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. The Company’s corporate treasury department is responsible for liquidity and funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company’s net liquidity position through rolling forecasts on the basis of expected cash flows. As at March 31, 2020, cash and cash equivalents are held with major banks and financial institutions. The table below provides details regarding the remaining contractual maturities of significant financial liabilities at the reporting date. The amounts include estimated interest payments and exclude the impact of netting agreements, if any.
|  | As at March 31, 2019 |
|  | Carrying value |  |  | Less than 1 year |  |  | 1-2 years |  |  | 2-4 years |  |  | Beyond 4 years |  |  | Total |
Loans, borrowings and bank overdrafts * |  | ₹ | 99,467 |  |  | ₹ | 73,559 |  |  | ₹ | 24,887 |  |  | ₹ | 4,309 |  |  | ₹ | — |  |  | ₹ | 102,755 |
Trade payables and accrued expenses |  |  | 88,304 |  |  |  | 88,304 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 88,304 |
Derivative liabilities |  |  | 1,310 |  |  |  | 1,310 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 1,310 |
Other liabilities |  |  | 644 |  |  |  | 644 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 644 |
|  | As at March 31, 2020 |
|  | Carrying value |  |  | Less than 1 year |  |  | 1-2 years |  |  | 2-4 years |  |  | Beyond 4 years |  |  | Total |
Loans, borrowings and bank overdrafts * |  | ₹ | 78,042 |  |  | ₹ | 74,663 |  |  | ₹ | 4,761 |  |  | ₹ | 119 |  |  | ₹ | — |  |  | ₹ | 79,543 |
Lease Liabilities * |  |  | 19,198 |  |  |  | 7,322 |  |  |  | 6,128 |  |  |  | 5,425 |  |  |  | 2,192 |  |  |  | 21,067 |
Trade payables and accrued expenses |  |  | 78,129 |  |  |  | 78,129 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | 78,129 |
Derivative liabilities |  |  | 7,369 |  |  |  | 7,231 |  |  |  | 90 |  |  |  | 48 |  |  |  | — |  |  |  | 7,369 |
Other liabilities |  |  | 1,050 |  |  |  | 899 |  |  |  | 88 |  |  |  | 63 |  |  |  | — |  |  |  | 1,050 |
* | Includes future cash outflow toward s estimated interest on borrowings and lease liabilities
The balanced view of liquidity and financial indebtedness is stated in the table below. This calculation of the net cash position is used by the management for external communication with investors, analysts and rating agencies:
|  | As at March 31, |
|  | 2019 |  |  | 2020 |
Cash and cash equivalents |  | ₹ | 158,529 |  |  | ₹ | 144,499 |
Investments |  |  | 220,716 |  |  |  | 189,635 |
Loans, borrowings and bank overdrafts |  |  | (99,467 | ) |  |  | (78,042 | )
|  | ₹ | 279,778 |  |  | ₹ | 256,092 |

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