DIRECTORS' REPORT To, The Members, CAPRICORN SYSTEMS GLOBAL SOLUTIONS LIMITED Your Directors have pleasure in presenting the Thirtieth Annual Report of your Company together with the Audited Accounts for the financial year ended 31st March, 2015 and the report of the Auditors thereon STATE OF COMPANY'S AFFAIRS: OPERATIONS & FUTURE PROPSECTS: The performance of the company during the year has been consistent as compared to the earlier periods. The company has been successful in obtaining the repeat works from the customers . With a committed and stable order books the company expects to maintain the level of operations with marginal increase in the ensuring periods. With the general upward trend being witnessed in the IT and ITES industry the company expects to leverage its core strengths of highly skilled manpower optimally by entering into new and strategic alliances. INDUSTRY STRUCTURE AND DEVELOPMENT: The company is engaged in the business of software development, providing Business Process Out sourcing, consultancy services in the fields of software and allied services. LISTING OF EQUIT SHARES: The Company's Equity shares are presently listed on BSE Limited and the Company has paid the Annual Listing Fees to the said Stock Exchanges for the financial year 2014 - 2015. TRANSFER TO RESERVES: Profit earned by the comapny after taxes Amounting Rs.10.39 Lakhs is being transfered to Reserves. CHANGE IN NAUTURE OF BUSINESS, IF ANY: During the year under review, there has been no change in the nature of business of the Company. MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THE FINANCIAL YEAR AND DATE OF REPORT: There are no material changes and commitments in the business operations of the Company from the financial year ended 31st March, 2015 to the date of signing of the Directors Report. PERFORMANCE AND FINANCIAL POSITION OF THE SUBSIDIARY COMPANY: The Company does not have any subsidiaries or associate companies. Hence the required information under this head is not being attached to the report. CORPORATE GOVERNANCE: The Corporate Governance Report and a certificate by the Statutory Auditors regarding compliance of the conditions of corporate governance by your Company as stipulated in clause 49 of the Listing Agreement with Stock Exchanges, are annexed to this Report. STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS: All the Independent Directors have given declarations of Independence, as required pursuant to Section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of Independence as provided in subsection (6) of Section 149 of the Companies Act, 2013. MEETING OF INDEPENDENT DIRECTORS: The performance of the Individual Directors on the Board and the Committees thereof is done by the Board and the Independent Directors in their exclusive meeting done as per the policy formulated by the Board in this regard. VIGIL MECHANISM: In terms of the provisions of Section 177 of the Companies Act, 2013 your Company has formulated a Whistle Blower Policy as a Vigil Mechanism. This mechanism aims for conducting the affairs in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behaviour. All permanent employees of the Company are covered under the policy. This mechanism is for the employees to report concerns about unethical behaviour, actual or suspected fraud or violation of Code of Conduct and Ethics. It also provides for adequate safeguards against victimization of employees who avail of the mechanism and allows direct access to the Chairman of the Audit Committee in exceptional cases. BOARD EVALUATION: Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the performance evaluation of the Board, the Committees of the Board and Individual Directors is done on annual basis. The evaluation is done by the Board, Nomination and Remuneration Committee and Independent Directors with specific focus on the performance and effective functioning of the Board and Individual Directors. CHANGES IN DIRECTORS: INDUCTIONS: On the recommendations of the nomination and remuneration committee, the Board appointed Mrs. Lakshmi Gurram (DIN: 07154551) as an Independent Director on the Board with effect from 31st March, 2015. We seek your support in confirming the appointment of Mrs. Lakshmi Gurram (DIN: 07154551) in the ensuing Annual General Meeting. RE - APPOINTMENTS: As per the provisions of the Companies Act 2013, Sri S. Man Mohan Rao (DIN: 00109433) retires at the ensuing Annual General Meeting and being eligible, seek his re-appointment. The Board recommends his re-appointment. RESIGNATIONS: None of the Directors have resigned during the year under review. CHANGES IN KEY MANAGERIAL PERSONNEL: There have been no changes in the Key Managerial Personnel. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS: During the year under review 6 Board meetings were held during the Financial Year 2014-15 on the following dates:- 29/05/2014, 11/08/2014, 01/09/2014, 14/11/2014, 13/02/2015 & 31/03/2015 . The intervening gap between any two Board Meetings was within the period prescribed under the provisions of the Companies Act, 2013. All the recommendations given by the Audit Committee are accepted by the Baord. INTERNAL FINANCIAL CONTROL: The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures. DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to the requirement of Section 134(5) of the Act, and based on the representations received from the management, the directors hereby confirm that: i.in the preparation of the annual accounts for the financial year 2014 - 15, the applicable accounting standards have been followed and there are no material departures; ii.selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the financial year; iii.and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Act. They confirm that there are adequate systems and controls for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv.prepared the annual accounts on a going concern basis; v laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating properly; and vi. devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively RISK AND RISK MITIGATION POLICY: The domestic and international economic environment directly influences the spending patterns of the industry on the Information Technology. And also the margins of the companies are affected by any changes in the government regulations like taxation and also the increased competition from other countries. CORPORATE SOCIAL RESPONSIBILITY: Your Company does not fall under any of the criteria specified under the provisions of Companies Act, 2013. Hence the Company has not constituted any committee and is not required to furnish information required under the provisions of the said Act. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS: There have been no loans, guarantees and investments under Section 186 of the Act during the financial year 2014 - 15. TRANSACTIONS WITH RELATED PARTIES: There were no related party transactions during the year except that entered in the ordinary course of business and on arms length basis. There were no materially significant related party transactions between your Company and the Directors, promoters, Key Managerial Personnel and other designated persons which may have a potential conflict with the interest of company at large. Form AOC - 2 for disclosure of particulars of contracts / arrangements, entered into by your company with related parties is attached herewith as Annexure - I. TECHNOLOGY ABSORPTION, ENERGY CONSERVATION & FOREIGN EXCHANGE EARNINGS AND OUTGO: Information in accordance with clause (m) of sub section (3) of Section 134 of the Companies Act, 2013 is annexed herewith as Annexure - II. DIRECTORS REPORT : Particulars of employees pursuant to Section 134 (3) (q) and Section 197 (12) of the Companies Act, 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forming part of the Directors' Report for the year ended March 31, 2015 as Annexure III. PARTICULARS OF EMPLOYEES: There are no employees in the company whose names are required to be furnished as per the information and statement containing particulars of employees required pursuant to Section 197 of the Companies Act, 2013 read with Rule 5 (1) and Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Nomination and remuneration committee of the Company has affirmed that the remuneration is as per the Remuneration policy of the Company. Your Directors take this opportunity to record their deep appreciation of the continuous support and contribution from all employees of the Company. EXTRACT OF ANNUAL RETURN: As required under Sub-Section (3) of Section 92 of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014 an extract of Annual Return in Form MGT - 9 forms part of this report as Annexure - IV. DEPOSITS: During the year under review your Company has not accepted any fixed deposits and, as such, no amount of principal or interest was outstanding as of the Balance Sheet date. AUDITORS: Statutory Auditors: At the Annual General Meeting held on September 30, 2014 M/s. Satyanarayana & Co., Chartered Accountants, were appointed as the Statutory Auditors of the Company to hold office till the conclusion of the 32nd Annual General Meeting. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. Satyanarayana & Co., Chartered Accountants, as the statutory auditors of the Company is placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that if they are reappointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. There are no specifications, reservations, adverse remarks on disclosures by the Statutory Auditors in their report. They have not reported any incident of fraud to the Audit Committee of the Company during the year under review. Secretarial Auditor: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the Company has appointed M/s DSMR & Associates, Company Secretaries to undertake the Secretarial Audit of the Company for the financial year 2014 - 2015. The Secretarial Audit report is annexed herewith as Annexure - V DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013: The Company has zero tolerance for sexual harassment at workplace and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. During the financial year 2014-15, the Company has not received any complaints on sexual harassment. SIGNIFICANT AND MATERIAL ORDERS PASSED BY REGULATORS OR COURTS OR TRIBUNALS: There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future. ACKNOWLEDGEMENTS: Your Directors place on record their appreciation for the assistance and co-operation extended by the Bankers, STPI, Customs and Central Excise and various State and Central Government Agencies. Your Directors also thank all the Customers, Members and Employees for their valuable support and confidence in the Company. For and on behalf of the Board For Capricorn Systems Global Solutions Limited Sd/-S. Man Mohan Rao Managing Director DIN : 00109433 Place: HYDERABAD Date : 31st August 2015 |