v3.23.2
Employee Benefit Plans
 6 Months Ended
Jun. 30, 2023
Retirement Benefits [Abstract]  
Employee Benefit Plans Employee Benefit PlansThe Company’s Gratuity Plan in India (the “India Plan”) provides for a lump sum payment to vested employees on retirement or upon termination of employment in an amount based on the respective employee’s salary and years of employment with the Company. In addition, the Company’s subsidiary operating in the Philippines conforms to the minimum regulatory benefit, which provide for lump sum payment to vested employees on retirement from employment in an amount based on the respective employee’s salary and years of employment with the Company (the “Philippines Plan”). Liabilities with regard to the India Plan and the Philippines Plan are determined by actuarial valuation using the projected unit credit method. Current service costs for these plans are accrued in the year to which they relate. Actuarial gains or losses or prior service costs, if any, resulting from amendments to the plans are recognized and amortized over the remaining period of service of the employees.
The India Plan is partially funded whereas the Philippines Plan is unfunded. The Company makes annual contributions to the India Plan established with insurance companies. Fund managers manage these funds and calculate the annual contribution required to be made by the Company and manage the India Plan, including any required payouts. These funds are managed on a cash accumulation basis and interest is declared retrospectively on March 31 of each year. The Company expects to earn a return of approximately 7.0% per annum on the India Plan for the year ending on December 31, 2023.

Change in Plan Assets
Plan assets as of January 1, 2023$14,449 
Actual return692 
Employer contribution— 
Benefits paid*(542)
Effect of exchange rate changes121 
Plan assets as of June 30, 2023
$14,720 

* Benefits payments were substantially made through the plan assets during the six months ended June 30, 2023.

Components of net periodic benefit costs recognized in unaudited consolidated statements of income and actuarial (gain)/loss reclassified from AOCI, were as follows:
 Three months ended June 30,Six months ended June 30,
 2023202220232022
Service cost$953 $958 $1,909 $1,948 
Interest cost393 313 788 636 
Expected return on plan assets(264)(221)(527)(449)
Amortization of actuarial (gain)/loss, gross of tax(23)149 (48)304 
Net gratuity cost$1,059 $1,199 $2,122 $2,439 
Amortization of actuarial (gain)/loss, gross of tax$(23)$149 $(48)$304 
Income tax effects on above(18)(45)(37)(92)
Amortization of actuarial (gain)/loss, net of tax$(41)$104 $(85)$212 
The Company maintains several 401(k) plans (the “401(k) Plans”) under Section 401(k) of the Internal Revenue Code of 1986, as amended (the “Code”), covering all eligible employees, as defined in the Code as a defined social security contribution plan. The Company may make discretionary contributions of up to a maximum of 3.0% of employee compensation within certain limits.

The Company’s accrual for contribution to the 401(k) Plans was as follows:

Three months ended June 30,Six months ended June 30,
2023202220232022
Contribution to the 401(k) Plans$1,178 $1,026 $3,564 $3,043 

The Company’s contribution for various defined social security contribution plans on behalf of employees in foreign subsidiaries of the Company was as follows:
Three months ended June 30,Six months ended June 30,
2023202220232022
Contributions to the defined social security contribution plans$5,604 $4,549 $10,996 $8,762