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Accel Frontline Ltd.

BSE: 532774 Sector: IT
NSE: AFL ISIN Code: INE020G01017
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VOLUME 1575
52-Week high 81.80
52-Week low 30.45
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Mkt Cap.(Rs cr) 100
Buy Price 33.60
Buy Qty 25.00
Sell Price 0.00
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OPEN 30.60
CLOSE 32.05
VOLUME 1575
52-Week high 81.80
52-Week low 30.45
P/E
Mkt Cap.(Rs cr) 100
Buy Price 33.60
Buy Qty 25.00
Sell Price 0.00
Sell Qty 0.00

Accel Frontline Ltd. (AFL) - Director Report

Company director report

To

THE MEMBERS OF ACCEL FRONTLINE LIMITED

Your Directors present the 21 st Annual Report of ACCEL FRONTLINE LIMITED (the Company)Standalone and Consolidated financial statement along with the Audited FinancialStatements for the financial year ended 31st March 2016.

1. FINANCIAL RESULTS

Rs in lakhs

Consolidated

Standalone

Particulars 2016 2015 2016 2015
Sales services & other income 51293 48734 32347 34209
Earnings before interest tax depreciation and amortization (EBITDA) 1498 5067 (892) 3577
Finance costs 2083 2255 1957 2128
Depreciation and amortization expense 1262 1203 846 1050
Operating Profit before Tax & Prior Period expenses (1847) 1609 (3695) 399
Prior Period Expenses / Income net 11465 1505 10003 1505
Provision for tax (Net) 370 (216) 61 (361)
Profit after tax (13682) 320 (13759) (745)
Minority Interest 822 414 - -
Profit after Minority Interest (14504) (94) (13759) (745)
Balance brought forward from previous year 1215 1514 712 1574
Amount available for appropriation (13289) 1420 (13047) 829
Transfer to Depreciation Reserve - 205 - 117
Balance carried to Balance Sheet (13289) 1215 (13047) 712

2. DIVIDEND

The Directors have not recommended dividend for the year ended 31st March 2016.

3. OPERATING RESULTS AND BUSINESS OPERATIONS

For the Financial Year 2015 - 16 your Company has achieved a revenue of ' 51293 lakhson a consolidated basis and ' 32347 lakhs on a standalone basis. The EBITDA on aconsolidated basis ' 1498 lakhs and on a standalone basis stood at ' (892) lakhs. TheCompany had to provide a sum of ' 11465 lakhs on a consolidated basis and ' 10003 lakhson a stand-alone basis on account of certain prior period and exceptional items accountedduring the year. This resulted in a net loss of '14504 lakhs on a consolidated basis and' 13759 lakhs on a standalone basis.

4. HUMAN RESOURCES DEVELOPMENT

The Company has been in the same line of business over the years and has in the pastyear identified technologies and areas having potential for future growth of the Company.The Company recognizes that employees are its main asset. In line with this the Companyhas initiated training of resources to meet the market requirements and deliver highquality services. Talent recognition and reward for performance is one of the key measuresto encourage and motivate employees. Regular Knowledge and skill upgradation trainingprograms are conducted by internal as well as external knowledge management experts.

5. DISCLOSURE AS PER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013

The Company has in place an Anti-Sexual Harassment policy in line with the requirementsof The Sexual Harassment of Women at the workplace (Prevention Prohibition &Redressal) Act 2013. Internal Complaints Committee (ICC) has been set up to redresscomplaints received regarding sexual harassment. All employees (permanent contractualtemporary trainees) are covered under this policy.

During the year under review there were no complaints received by the ICC and no caseswere pending for disposal.

6. BUSINESS EXCELLENCE AND QUALITY INITIATIVES

The company believes in sustained efforts to maintain highest levels of quality toenhance customer satisfaction. During the year the company continued to invest intechnologies infrastructure and processes in order to keep our quality management systemsupdated.

The company has certifications for:

• ISO 9001:2008 (Quality Management System)

• ISO 27001:2013 (Information Security Management System)

• ISO 20000-1:2011 (Service Management System)

• CMMI Level 3 Dev 1.3

The company is in the process of putting in place policies processes and systems thatwill not only enable strengthening and smooth functioning of the operations but alsoimprove the quality of operations.

In order to achieve highest levels of quality and robust information securitypractices the Company will progressively endeavor to achieve enterprise-wide CMMI Level 5(for Development) in the near future.

7. DOCUMENTS PLACED ON THE WEBSITE (www.accelfrontline.com)

The following documents have been placed on the Company's website in compliance withthe Companies Act:

a. Financial Statements of the Company and Consolidated Financial Statements.

b. Separate audited accounts in respect of subsidiaries as per fourth proviso toSection 136(1).

c. Details of Vigil Mechanism for directors and employees to report genuine concerns asper proviso to Section 177(10).

d. The Terms and Conditions of appointment of independent directors.

e. Details of unpaid dividend as per Section 124(2).

8. SUBSIDIARY COMPANIES

The Company has subsidiaries operating in Singapore UAE Japan United States ofAmerica and United Kingdom which are not listed in India or abroad as of date. The Companyalso has a wholly owned unlisted Indian Subsidiary.

The Statutory Audit Report of the Subsidiary Companies for the financial year areplaced before the Audit Committee and reviewed by them.

Shareholders interested in obtaining a copy of the audited annual accounts of thesubsidiary Companies may write to the Company Secretary.

In terms of proviso to sub section (3) of Section 129 of the Act the salient featuresof the financial Statement of the subsidiaries is set out in the prescribed Form AOC-1which forms part of the Annual Report.

9. CORPORATE GOVERNANCE REPORT REQUIRED UNDER THE COMPANIES ACT 2013 AND SEBI (LODR)REGULATIONS 2015.

As per SEBI LODR Regulations 2015 Corporate Governance Report with Auditors'Certificate on Compliance with the conditions of Corporate Governance is attached and formpart of this report.

10. MANAGEMENT DISCUSSION & ANALYSIS

The Management Discussion and Analysis and various initiatives and future prospects ofthe Company are enclosed separately as Annexure-II to this report.

11. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 134(5) of the Act and based on therepresentations received from the present management the directors hereby confirm that:

i. the present management in the preparation of the annual accounts for the financialyear 2015-16 have followed the applicable accounting standards and there were no materialdepartures except for recognition of revenue and valuation of inventories done by theprevious management.

ii. the present management have selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for the financial year;

iii. the present management have taken proper and sufficient care to the best of theirknowledge and ability for the maintenance of adequate accounting records in accordancewith the provisions of the Act. They confirm that they have put in place adequate systemsand controls for safeguarding the assets of the Company and for preventing and detectingfraud and other irregularities subject to para 8 (c) relating to internal controls.

iv. the present management have prepared the annual accounts on a going concern basis;

v. the present management have laid down internal financial controls to be followed bythe Company and that such internal financial controls are adequate and operating properlyhowever the auditors have opined that the company has not maintained adequate internalfinancial controls over financial reporting as mentioned in para 9 relating to internalcontrols. The present management is in the process of strengthening the same.

vi. the present management have put in place proper systems to ensure compliance withthe provisions of all applicable laws subject to the above matters and that such newlyintroduced systems are adequate and have been operating effectively since they have beenput in.

12. Auditors and Secretarial Auditor Report.

(a) Management responses to the qualifications in the auditor's report:

1. Provisions for bad and doubtful debts:

As disclosed in Note 30 to the financial statements during the financial year theCompany under the present management had undertaken an exercise to validate the quality ofthe Trade receivables by appointing an independent consultant from one of the big fouraccounting firms. Based on the Special Audit (Review) Report and ongoing exerciseconducted by the present management on certain other areas including inventories fixedassets etc. the Company had concluded that there was over-ride of financial controlswhen the Company was under the previous management resulting in financial mis-managementprior to the operations being handed over to the present management by the previousmanagement in operation control of the Company in two stages in May 2015 and September2015.The same has been provided/written off in the books which is disclosed in thefinancial results as prior period items (which pertain to transactions prior to 31st March2015) / exceptional items. The management is of the opinion that these provisions/writeoff's are appropriate as on date.

2. Valuation of Inventories:

As disclosed in Note 33 to the financial statements the company has rectified thesoftware recording of the inventory transactions to reflect the weighted average cost ofinventory. The company is taking necessary steps to correct the opening valuation of thestocks during the current financial year.

3. Provisions for Inventory:

As disclosed in Note 32 to the financial statements based on the 100% physicalverification of its inventories conducted by the management the company has provided forthe material discrepancies in the financial statements. The company is also in the processof evaluating and strengthening the existing process.

4. Fixed assets of the company:

As disclosed in Note 31 to the financial statements the company had conducted physicalverification of certain block of assets and have written off value of non-existent assetsin its financial statements. The company has initiated a reconciliation process and thesame will be completed during the current financial year.

5. Recognition of revenue:

As disclosed in Note 20(a) to the financial statements during the previous year thecompany had recognized revenue of ' 397 lakhs with a cost of ' 368 lakhs for shipmentsmade during the previous year and received by the customer during the current financialyear. The then management recognized the revenue in the previous year itself as itbelieved that the risk relating to the shipments had been transferred during that period.

6. Preparation of accounts on going concern basis:

As disclosed in Note 34 to the financial statements the company had a net loss of '13759 lakhs negative cash flows of ' 430 lakhs negative net worth of ' 2356 lakhs andcurrent liabilities exceed current assets by ' 6458 lakhs. The company has prepared theaccounts on a going concern basis as it has availed adequate facilities with various banksto meet its obligations over the next 12 months and have made a cash profit of ' 423 lakhsduring the quarter ended 30th June 2016.

(b) Qualifications by the Secretarial Auditor and management response:

1. An order under Sections 11(1) 11(2)(j) 11(4) and 11 B of SEBI Act 1992 read withSection 12A of Securities Contracts (Regulations) Act 1956 from SEBI dated 22nd July2015 was received against the Company and its Promoters towards non-compliance withminimum public shareholding norms. However the Company is now compliant with the MinimumPublic Shareholding norms.

The Company has on 18th March 2016 received the final order from SEBI revoking thedirections issued vide order dated 22nd July 2015 against the Company its DirectorsPromoter and Promoter Group.

2. One of the shareholder of the company M/s. Accel Limited represented by its ChairmanMr. N.R. Panicker has filed a Company petition under Section(s) 397 398 402 403 and 406of the Companies Act 1956 before the Company Law Board Chennai Bench (now redesignatedas the National Company Law Tribunal at Chennai) wherein inter-alia the Company (M/s.Accel Frontline Limited) and all its present Directors Chief Financial Officer and thenCompany Secretary have been named as respondents.

The Directors do not immediately expect any financial implications arising from thesame.

3. The Company had suo moto engaged an Independent Consultant from one of the big fouraccounting firms to examine the quality of Bills receivable of the company and othertransactions arising out of their work procedures initially for the 3 year period ended31st March 2015 and subsequently extended to 31st December 2015. The report of the saidaccounting firm ("Special Audit (Review) Report") was presented to the Board ofthe Company on 14th March 2016. The preliminary findings of the Independent Auditor wereintimated to the Stock Exchanges on 9th February 2016 and the final findings wereintimated on 14th March 2016.

4. During the year under review the Board of Directors of the Company at their meetingheld on 20th March 2016 had suspended Mr. N.R. Panicker from his position as ExecutiveChairman of the Company based on the discussions on the Special Audit (Review) Report.

5. The Company had made an application to the SEBI and Stock Exchanges seekingextension of time till 31st August 2016 for adopting the audited financial results forthe year ended 31st March 2016. Subsequently the Company had adopted the auditedfinancial results for the year ended 31st March 2016 on 1st August 2016.

6. The Company had made an application to the Registrar of Companies Chennai seekingextension of time for three months till 31st December 2016 to hold the Annual GeneralMeeting. In consideration of the company's application the Office of Registrar ofCompanies (ROC) Chennai vide its order dated 30th September 2016 had approved theapplication and granted extension of time for three months till 31st December 2016 tohold the Annual General Meeting.

13. DISCLOSURES MADE BY THE COMPANY UNDER REGULATION 30 OF THE SEBI (LODR) REGULATIONS2015 TO THE STOCK EXCHANGES

(i) The Company had suo-moto appointed an Independent Consultant from one of the bigfour accounting firms to examine the quality of bills receivables of the company for theperiod of 3 years ended March 2015. The company had informed the Stock Exchanges on 9thFebruary 2016 of the preliminary findings and on 14th March 2016 of the findings of thefinal report.

(ii) The Board of Directors had suspended Mr. N.R. Panicker from his position asExecutive Chairman of the Company based on the discussions by the Board on the SpecialAudit (Review) Report at the meeting held on 20th March 2016.The term of Mr. N R Panickeras Director of the Company has ended on 31st March 2016. A sub-committee comprising of 3Independent Directors the Executive Director and CFO was formed to recommend to the Boardfurther actions.

(iii) One of the shareholder of the company M/s. Accel Limited represented by itsChairman Mr. N R Panicker has filed a Company petition under Section(s) 397 398 402 403and 406 of the Companies Act 1956 before the erstwhile Company Law Board ChennaiBench(now re-designated as the National Company Law Tribunal at Chennai) against theCompany all its present Directors the Chief Financial Officer and then CompanySecretary.

14. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

The particulars as prescribed under Rule 8(3) of the Companies (Accounts) Rules 2014are set out in an Annexure-III to this Report.

15. SEPARATE MEETING OF INDEPENDENT DIRECTORS

The Independent Directors met on 14th March 2016 and evaluated the performance ofNon-Independent Directors and the Board as a whole. Further details are available in theCorporate Governance Report.

16. EVALUATION OF THE BOARD'S PERFORMANCE

The Board has carried out an evaluation of its own performance also that of itsDirectors individually and its Committees. The manner in which the evaluation has beencarried out is explained in the Corporate Governance report.

17. AUDITORS

Pursuant to the provisions of Section 139 of the Act and the rules framed thereunderM/s. Walker Chandiok & Co LLP Chartered Accountants Chennai bearing (ICAIRegistration No 001076N/ N500013) were appointed as Statutory Auditors for a period offive years till the conclusion of the 24th Annual General Meeting (AGM) which was subjectto ratification at every AGM be and is hereby ratified to hold the office from theconclusion of this AGM till the conclusion of the next AGM of the Company.

18. PARTICULARS OF EMPLOYEES

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rules 5(1) of the Company (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annual Report.

No employees draws remuneration in excess of the limits in terms of the provisions ofthe Section 197(12) of the Companies Act 2013 read with Rules 5(2) & 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

19. FIXED DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public were outstanding as on the date of thebalance sheet.

20. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP)

• Mr. N.R. Panicker was suspended as Executive Chairman on 20th March 2016 andsubsequently retired as Director on 31st March 2016.

• In accordance with Section 149 and other applicable provisions of the CompaniesAct 2013 Mr. R. Ramaraj was re-appointed as an Independent Director for a further periodof three years i.e. from 31st October 2015 to 30th October. 2018.

• Mr. Bin Cheng Director is liable to retire by rotation at the ensuing AnnualGeneral Meeting and being eligible offers himself for re-appointment.

• Mrs. Sweena Nair Company Secretary and KMP resigned as Company Secretary andCompliance Officer w.e.f 21st October 2016.

• Mr. S. Sundaramurthy was appointed as the Company Secretary and ComplianceOfficer (KMP) of the Company w.e.f. 21st October 2016.

21. ACKNOWLEDGEMENTS

The Directors wish to convey their appreciation to business associates for theirsupport and contribution during the year. The Directors would also like to thank theemployees shareholders customers suppliers alliance partners and bankers for thecontinued support given by them to the Company and their confidence reposed in the presentmanagement.

For and on behalf of the Board

R.Ramaraj Malcolm F. Mehta
Director Executive Director

Place : Chennai

Date : 21st October 2016

ANNEXURE - I TO THE DIRECTOR'S REPORT

1. EXTRACT OF ANNUAL RETURN

The Extract of Annual Return as provided under Sub-Section (3) of Section 92 of theCompanies Act 2013 ( the "Act") is enclosed at Annexure-IV in the prescribedform MGT-9 and forms part of this Report.

2. NUMBER OF MEETINGS OF THE BOARD

11 meetings of the Board of Directors of the Company were held during the year. Fordetails of the meetings please refer the Corporate Governance Report which forms part ofthis Report.

3. INDEPENDENT DIRECTOR S' DECLARATION

Mr. R. Ramaraj Mr. Raj Khalid and Ms. Ruchi Naithani who are Independent Directorshave submitted a declaration that each of them meet the criteria of independence asprovided in Sub-Section (6) of Section 149 of the Act and SEBI LODR Regulations. Furtherthere have been no change in the circumstances which may affect their status asindependent director during the year.

4. POLICY OF DIRECTORS' APPOINTMENT AND REMUNERATION

Company's policy on Directors' appointment and remuneration including criteria fordetermining qualifications positive attributes independence of a director and othermatters provided under section 178(3) of the Act are covered in Corporate GovernanceReport which forms part of this Report. Further information about elements ofremuneration package of individual directors is provided in the extract of Annual Returnas provided under Section 92(3) of the Act is enclosed at Annexure-IV in the prescribedform MGT-9 and forms part of this Report.

5. CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

As provided under Regulation 34 read with Schedule V of the SEBI (Listing Obligationsand Disclosure Requirements) Regulations 2015 all Board members & Senior ManagementPersonnel have affirmed compliance with Accel Frontline Limited's Code of Conduct for theyear ended 31st March 2016.

6. RELATIONSHIP BETWEEN DIRECTORS INTER-SE

None of the transactions with any of the related parties were in conflict with theCompany's interest. Attention of members is drawn to the disclosure of transactions withrelated parties set out in 37 of Summary of significant accounting policies and otherexplanatory information of standalone financial Statements forming part of the Annualreport.

The Company's major related party transactions are generally with its subsidiaries andassociates. The related party transactions are entered into based on consideration ofvarious business exigencies such as synergy in operations sectorial specialization andthe Company's long term strategy for sectoral investment's optimization of market shareprofitability legal requirements liquidity and capital resources of subsidiaries andassociates.

All related party transactions are negotiated on arm's length basis and are intendedto further the Company's interests.

The particulars of transactions between the Company and its related parties as per theAccounting Standard 18 "Related Party Disclosures" referred under Section 188 ofthe Companies Act 2013 are set out in the notes to Accounts for the Annual Report. Therehave been no materially significant related party transactions which may have potentialconflicts with the interest of the company.

7. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS

Long term loans and advances as at 31st March 2016 include security deposits anddeposits with Statutory/Government authorities. Short term loans and advances as at 31stMarch 2016 include rent and other deposits advance to associate companies and otherloans and advances.

8. TRANSACTIONS WITH RELATED PARTIES

The Company has entered into contract / arrangements with the related parties in theordinary course of business and on arm's length basis. Thus provisions of Section 188(1)of the Act are not applicable.

9. INTERNAL CONTROL

The Statutory Auditors have reported the following:

a. The Company did not have appropriate internal controls over revenue with respect torecognition of revenue assessment of recoverability of trade receivables which hasresulted or could have potentially resulted in material misstatement in the value of theCompany's revenue trade receivables and resultant impact on the loss after tax and thereserves and surplus.

b. The Company did not have appropriate internal controls over inventory with respectto receipt issue for production of inventory and valuation of inventory which resultedor could have potentially resulted in material misstatement in the value of Company'sinventory trade payables cost of sales and resultant impact on the loss after tax andthe reserves and surplus.

c. The Company did not have appropriate internal controls over physical verification offixed assets which resulted or could have potentially resulted in material misstatement inthe value of Company's fixed assets depreciation and resultant impact on the loss aftertax and the reserves and surplus.

d. The Company did not have appropriate internal controls over recording of expensesand accounting of prepaid expenses which resulted or could have potentially resulted inmaterial misstatement in the value of the Company which resulted or could have potentiallyresulted in material misstatement in the and the reserves and surplus.

Responses of the management to the above qualifications:

The present management is of the view that there was override of financial controls bythe previous management before handing over the management of the company to the presentmanagement. The Company under the present management has initiated the following steps torectify the above during the financial year 2016-17 to make it compliant with internalcontrol requirements:

a) have introduced changes in its accounting software to bring in controls forrecognition of revenue invoicing and trade receivables. This will also reduce manualintervention.

b) have appointed an Independent Consultant to evaluate the internal controls overaccounting of inventories and suggest appropriate controls for implementation.

c) have conducted 100% physical verification of certain block of assets and isconsidering an appropriate way to maintain adequate records and control over its assets.

d) have strengthened the controls relating to accounting of expenses.

10. RISK MANAGEMENT

The Risk Management is overseen by the Audit Committee of the Company on a continuousbasis. The Committee oversees Company's process and policies for determining risktolerance and review management's measurement and comparison of overall risk tolerance toestablished levels. Major risks identified by the businesses and functions aresystematically addressed through mitigating actions on a continuous basis. For detailsplease refer to the Management Discussion and Analysis report which form part of the BoardReport.

11. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS (Weblink: www.accelfrontline.com)

The Company has practice of conducting familiarization program of the IndependentDirectors as detailed in the Corporate Governance Report which forms part of the AnnualReport.

12. VIGIL MECHANISM

The Company has established a vigil mechanism for Directors and employees to reporttheir genuine concerns. For details please refer to the Corporate Governance Reportattached to this Report

13. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES

Subsidiaries of the Company are engaged in the business of providing ITES services orbusiness solutions or consulting including business process outsourcing services. Therehas been no material change in the nature of the business of the subsidiaries. TheCompany's wholly owned subsidiary consists of:

1. Accel Systems & Technologies PTE Limited Singapore 2. Accel Frontline DMCCDubai 3. Accel North America Inc. 4. Accel IT Resources Ltd. 5. Network Programs (USA)Inc. 6. Networks Programs (Japan) Inc. USA 7. Accel Japan KK Japan and 8. AccelTechnologies Limited U.K. The subsidiaries earned revenue of ' 18945 lakhs during theFinancial Year 2015 -16 compared to ' 14525 lakhs during Financial Year 2014-15registering a growth of 30% over the previous financial year. The Net Profits of thesesubsidiaries declined by 84% on consolidated basis to ' 159 lakhs during Financial Year2015-16 compared to ' 1146 lakhs during Financial Year 2014-15 on account of prior periodand exceptional items. Despite significant increase in revenue the profitability waslower primarily due to prior period and exceptional items being accounted for in Dubaisubsidiary to the tune of almost ' 1332 Lakhs.

Financial position of each of the subsidiaries is provided in a separate statementAOC-1 attached to the Financial Statement pursuant to first proviso to Section 129(3) ofthe Act.

14. PARTICULARS OF REMUNERATION

The information required under Section 197 of the Act and the Rules made there-underin respect of employees of the Company is follows:-

(a) The ratio of the remuneration of each director to the median remuneration of theemployees of the Company for the financial year;

Except Mr. Malcolm F. Mehta and Mr. N.R. Panicker (upto 20th March 2016) no directorswere in receipt of remuneration except sitting fees. For this purpose Sitting fees paidto the Directors have not been considered as Remuneration.

Name of the Directors Ratio to median remuneration Remuneration paid (Rs in lakhs)
Mr. Malcolm F. Mehta* 163.59 301.42
Mr. N.R. Panicker (upto 67.15 123.72
20th March 2016)

* M/s CAC Holdings Corporation Japan is reimbursing the cost and other expensesincurred by the Company for the employment of Mr. Malcolm F. Mehta

(b) The percentage increase in remuneration of each Director Chief Executive OfficerChief Financial Officer Company Secretary or Manager if any in the financial year;

Name of the Person % increase in remunaration
Mr. Malcolm F. Mehta Executive Director 31.54
Mr. R. Neelakantan Chief Financial Officer NIL
Mrs. Sweena Nair Company Secretary 23.96

(c) The percentage increase in the median remuneration of employees in the financialyear; - NIL

(d) The number of permanent employees on the rolls of Company;

There were 2606 permanent employees on the rolls of Company.

(e) Average percentile increase already made in the salaries of employees other thanthe managerial personnel in the last financial year and its comparison with the percentileincrease in the managerial remuneration and justification thereof and point out if thereare any exceptional circumstances for increase in the managerial remuneration;

The average increase in salaries of employees other than managerial personnel in2015-16 was 12.34%. Percentage increase in the managerial remuneration for the year was31.54%.

(f) Affirmation that the remuneration is as per the remuneration policy of the Company;

The Company's remuneration policy is based on the performance of the employees and thatof the Company. The Company's compensation consists of fixed component benefits andvariable pay based on the individual's performance which is measured through the annualappraisal process.

15. PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON EXECUTIVE DIRECTORS

During the year the Non-Executive Directors of the Company had no pecuniaryrelationship or transactions with the Company.

For and on behalf of the Board

Place : Chennai
Date : 21st October 2016
R.Ramaraj Malcolm F. Mehta
Director Executive Director