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Advanced Micronic Devices Ltd.

BSE: 517552 Sector: Health care
NSE: N.A. ISIN Code: INE903C01013
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VOLUME 121
52-Week high 10.50
52-Week low 5.00
P/E
Mkt Cap.(Rs cr) 3.35
Buy Price 6.20
Buy Qty 50.00
Sell Price 6.34
Sell Qty 60.00
OPEN 6.34
CLOSE 6.34
VOLUME 121
52-Week high 10.50
52-Week low 5.00
P/E
Mkt Cap.(Rs cr) 3.35
Buy Price 6.20
Buy Qty 50.00
Sell Price 6.34
Sell Qty 60.00

Advanced Micronic Devices Ltd. (ADVANCEDMICRON) - Director Report

Company director report

To

The Shareholders

Your Board is pleased to present the 35th Annual Report on the business and operationsof the Company together with the Audited Financial Statements and Auditors Report for thefinancial year ended 31st March 2016.

Financial Results

(Rs.) in Lakhs

Particulars Year Ended 31.03.2016 Year Ended 31.03.2015
Turnover and Profitability
Gross Sales 665.20 1247.85
Total Expenditure 2760.68 1308.84
Profit before Depreciation and Financial Charges (2095.48) (60.99)
Depreciation 07.24 377.84
Financial Charges 34.01 134.82
Profit before Tax (2136.73) (573.65)
Provision for Taxation - -
Profit after Tax (2136.73) (573.65)
Extraordinary item - (193.00)
Add: Profit brought forward from previous year (1190.71) (810.06)
Profit available for Appropriation from Operations (3327.44) (1190.71)
Appropriations
Proposed Dividend - -
Provision for Tax on Proposed Dividend - -
Balance in statement of Profit and Loss Account (3327.44) (1190.71)

Results from Operations

The total income for your company for the financial year ending March 2016 wasRs.665.20 lakhs against Rs.1247.85 Lakhs for the year ending March 2015 and decrease of53.30 % over the previous year due to right sizing of the ICTD and SED business.

During the year under review your Company has disposed of certain Assets identified asunproductive for business operation amounting to Rs. 255.15 Lakhs the proceeds of whichhave been utilized to pay off its statutory dues of Providend fund and TDS.

Turnover and Profitability

The gross sales and other income for the financial year under review was Rs.665.20Lakhs. The profit before tax (after depreciation and financial charges) was (Rs.2136.73)Lakhs and profit after Tax was(Rs.2136.73) Lakhs. This was due to writing-off of nonmoving stock and Bad debts accumulated over many years.

Appropriations Dividend

Your Directors have not recommended any Dividend for the year ended 31st March 2016.

Transfer to Reserve

An amount of Rs. (3327.44) Lakhs is proposed to be retained in statement of Profit andLoss.

Changes In Share Capital

There is no change in the Authorized Issued and Paid-up Share Capital of the Company.

Disclosure regarding issue of Equity Shares with Differential Rights

During the year under review the Company has not issued Shares with DifferentialRights.

Disclosure regarding issue of Employee Stock Options

During the year under review the Company has not issued Shares under Employee StockOptions.

Disclosure regarding issue of Sweat Equity Shares:

During the year under review the Company has not issued Sweat Equity Shares.

Management Discussion and Analysis Report:

The report as required is given as Annexure I and forms part of the Directors'Report.

Conservation of Energy

Your Company does not fall under the category of power intensive industries. Adequatemeasures have however been taken to reduce energy consumption by using Energy efficientComputer terminals. Low power consumption electrical equipments are used when requiredthereby enhancing energy efficiency.

Foreign Exchange Earnings and Outgo

Foreign Exchange Earning and outgo: The Company earned Rs. Nil Lakhs in ForeignExchange. The Foreign Exchange outgo was Rs. 13.42 Lakhs.

Particulars of Employees and Related Disclosures

There were no employees who were in receipt of remuneration in excess of Rupees OneCrore Two Lakhs or more or employed part of year and in receipt of remuneration in excessof Rupees Eight Lakhs Fifty Thousand or more a month under information as per Section197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Amendment Rules 2016.

Having regard to the provisions of the first proviso to Section 136(1) of the Act andas advised the Annual Report excluding the information on Disclosures pertainingremuneration and other details as required under Section 197(12) of the Act read with Rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) AmendmentRules2016. is being sent to the members of the Company. The said information is availablefor inspection at the registered office of the Company during working hours and any memberinterested in obtaining such information may write to the Company and the same will befurnished on request.

Corporate Governance

The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements set out by SEBI. The report on CorporateGovernance as stipulated under the Listing Regulation forms an integral part of thisReport. The requisite certificate from the Practicing Company Secretary of the Companyconfirming compliance with the conditions of Corporate Governance is attached to thereport on Corporate Governance.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors state that:

a) In the preparation of the annual accounts for the year ended March 31 2016 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;

b) The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2016 and of the profit ofthe Company for the year ended on that date;

c) The Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors have prepared the annual accounts on a going concern basis;

e) The Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and

f) The Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.

LISTING OF SECURITIES

Your Company's Equity Share continues to remain listed on BSE Limited. As per therequirements of the Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 which came in effect from 1st December 2015 ashortened version of the Uniform Listing Agreement was signed by the Company with both theStock Exchanges. Your Company is yet to pay listing fees to the BSE Limited for thefinancial year 2016-17.

FIXED DEPOSITS

Your Company has not accepted any fixed deposits from the public during the financialyear under review.

DIRECTORS AND KEY MANAGERIAL PERSONNEL INDUCTION.

On the recommendation of Nomination and Remuneration Committee the Board appointed Mr.Somadas G.C. (DIN: 00678824) as an additional director in the category of IndependentDirector of the Company with effect from 26th April 2016. The directors seek your supportin confirming the appointment of Mr. Somadas G.C. in the ensuing Annual General Meeting.

RETIREMENT AND REAPPOINTMENTS

As per the provisions of the Companies Act 2013 Dr. Suchitra Misra (DIN: 002254365)retires by rotation and being eligible offers herself for re-appointment at the ensuingAnnual General Meeting. The Board of Directors recommends the appointment of Dr. SuchitraMisra.

None of the Independent Directors will retire at the ensuing Annual General Meeting.

DECLARATION BY INDEPENDENT DIRECTORS.

The Company has received necessary declaration from Independent Directors that theymeet the criteria of independence laid down in section 149(6) of the Companies Act 2013and the provisions of Regulation 16(1)(b) of the Securities and Exchange Board of India(Listing Obligations and Disclosure Requirements) Regulations 2015.

Training of Independent Directors.

To familiarize the new inductees with strategy operations and functions of our CompanySenior managerial personnel make presentations on Company's strategy Organizationstructure products technology and quality facilities. Further at the time ofappointment of an Independent Director the Company issues a formal letter of appointmentoutlining his or her role function duties and responsibilities as a Director.

None of the Directors of your Company are related to each other.

Based on the confirmations received none of the Directors are disqualified for beingappointed/re-appointed as Directors in terms of Section 164 the Companies Act 2013.During the year under review no stock options were issued to the Directors of theCompany.

POLICY ON DIRECTORS APPOINTMENT REMUNERATION AND EVALUATION.

Your Company has in place the Nomination Remuneration and Evaluation Policy of theCompany on directors appointment and remuneration including criteria for determiningqualifications positive attributes independence of director and other matters providedunder sub section (3) of Section 178 of the Companies Act 2013. The Policy also containsthe evaluation framework as stipulated under the SEBI Listing Regulation 2015 whichmandates that the Board shall monitor and review the Board evaluation framework. TheCompanies Act 2013 states that a formal annual evaluation needs to be made by the Boardof its own performance and that of its committees and individual directors. The evaluationof all the Directors and the Board as a whole was conducted based o the criteria andframework adopted by the Board.

MEETINGS OF THE BOARD

7 (Seven) Meetings of the Board of Directors were held during the year. For furtherdetails please refer report on Corporate Governance section in this Annual Report.

COMMITTEES OF THE BOARD.

Currently the Board has Four Committee: Audit and Risk Management CommitteeNomination and Remuneration Committee Stakeholders Relationship Committee and CorporateSocial Responsibility Committee. A detailed note on the Composition and Scope of theCommittees is provided under the Corporate Governance Section in this Annual Report.

AUDITORS

Based on the recommendation of Audit and Risk Management Committee the Board ofDirectors appointed M/s. B.V. Swamy & Co. Chartered Accountants Bangalore asStatutory Auditors for the financial year 2015-16 to fill up the causal vacancy in placeof M/s. Anand Amarnath & Associates Chartered Accountants Bangalore with effectfrom 30th May 2016.

Casual vacancy caused by the reason other than resignation of Auditors can be filled upby the Board and the Auditor so appointed by the Board shall hold office till theconclusion of ensuing Annual General Meeting.

As the term of M/s. B.V. Swami & Co. Statutory Auditor comes to an end at theconclusion of ensuing Annual General Meeting approval of members is sought at the ensuing35th Annual General Meeting to appoint M/s. B.V. Swami & Co. Chartered AccountantsBangalore as Statutory Auditors for the Financial year 2016-17.

M/s. B.V. Swami & Co Chartered Accountants have conveyed their consent to beappointed as the statutory Auditors of the Company.

SECRETARIAL AUDITOR

The Board has appointed Mr. Vijayakrishna KT Practising Company Secretary to conductSecretarial Audit for the financial year 2015-16. The Secretarial Audit Report for thefinancial year ended March 31 2016 is annexed herewith marked as Annexure II in the Formof MR 3 to this Report. The Board of Directors of the Company hereby furnish followingexplanations and clarifications with respect the observations made by the SecretarialAuditors in their report dated July 292016 under the heading observations in points (a)to (d):

(a) The Company will take necessary steps to comply the appointment of InternalAuditor.

(b) The Company will take necessary steps to comply the appointment of cost Auditor.

(c) Due to technical issues in making the requisite returns digitally signing the sameand uploading delays occurred in filings of certain returns. Extreme levels of care andcaution will be exercised to ensure that such delays do not occur again and Company willtake necessary steps to appoint CFO & Company Secretary during the current FinancialYear.

(d) The Company will ensure & take corrective action to strengthen Secretarialstandards.

RISK MANAGEMENT

The Company has laid down risk assessment and minimization procedures which are in linewith the best practices in the Industry and as per its experience and objectives. The riskmanagement systems is reviewed periodically and up dated.

INTERNAL FINANCIAL CONTROLS.

The Company has in place adequate internal financial controls with reference tofinancial statements. During the year such controls were tested and no reportablematerial weakness in the design or operation were observed.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

All contracts / arrangements / transactions entered by the Company during the financialyear with related parties were in the ordinary course of business and on an arm's lengthbasis. During the year the Company had not entered into any contract / arrangement /transaction with related parties which could be considered material in accordance with thepolicy of the Company on materiality of related party transactions. Accordingly thedisclosure of Related Party Transactions as required under Section 134(3)(h) of CompaniesAct 2013 in Form AOC-2 is not applicable.

The Policy on materiality of related party transactions and dealing with related partytransactions as approved by the Board may accessed on the Company's website at the link:http://www.amdlcorp.com/pdf/AMD-Policy on Related Party Transactions. Your Directors drawattention of the members to Note 7A to the financial statement which sets out relatedparty disclosures.

PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED

During the year under review the Company has not given any loan Guarantees or madeInvestments within the meaning of Section 186 of the Companies Act 2013.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility Committee (CSR Committee appointed by the Board)has formulated and recommended to the Board a Corporate Social Responsibility Policy (CSRPolicy) indicated the activities to be undertaken by the Company which has been approvedby the Board. The CSR policy may be accessed on the Company's website at the linkhttp://www.amdlcorp.com/ AMDL-CSR Policy.pdf.

Owing to the accumulated losses and continues losses for the immediate three precedingFinancial Years it is not mandatary to spend on CSR activity.

VIGIL MECHANISM / WHISTLE BLOWER POLICY

The Company promotes ethical behavior in all its business activities and has put inplace a mechanism for reporting illegal or unethical behavior. The Company has a vigilmechanism and Whistle Blower policy under which the employees are free to reportviolations of applicable laws and regulations and the code of conduct to chief vigilanceofficer and Audit and Risk Management Committee of the Board. The Company further confirmsthat no personal have been denied access to the Audit & Risk Management Committee.

The Policy on vigil mechanism and whistle blower policy may be accessed on theCompany's website at the link: http://www. amdlcorp.com/AMDL-Whistle Blower Policy.pdf

EXTRACT OF ANNUAL RETURN

Extract of Annual Return of the Company is annexed herewith as Annexure III to thisReport.

SIGNIFICANT AND MATERIAL ORDERS.

No order was passed by any court or regulator or tribunal during the year under reviewwhich impacts going concern status of the Company.

DISCLOSURE UNDER THE SEXUAL HARSSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013:

Your Company has always believed in providing a safe and harassment free workplace forevery individual working in Company's premises through various interventions andpractices. The Company always endeavors to create and provide an environment that is freefrom discrimination and harassment including sexual harassment.

A policy on prevention of Sexual Harassment at Workplace has been released by theCompany. The policy aims at prevention of harassment of employees and lays down theguidelines for identification reporting and prevention of undesired behavior. Threemember Internal Complaints Committee (ICC) was set up from the senior management withwomen employees' constitution majority. The ICC is responsible for redressal of complaintsrelated to sexual harassment and follows the guidelines provided in the policy.

No complaints pertaining to sexual harassment was reported during the year.

Auditors Observations:

The Board of Directors of the Company would like to give the following explanations andclarifications with respect to the qualifications/ observations made by the Auditors intheir Report dated 14th June 2016 for the Financial Statements under the heading Basisfor

Qualified Opinion in points .

• Point No.1 The terminals were designed for banking application about 10 yearsago and manufactured later without envisioning at the technology changes the Bank's willimplement due to the emerging trends in plastic cards payment industry. The Terminalsbecame NON-MOVER. We have started finding customers for this terminal for NON-BANKINGapplications. Our long time business associate and system integrator successfullycompleted Indian Railways project of testing the Terminal for non- banking application toissue Platform Tickets and collection of parking fees and Terminals were deployed inselect places. In the unlikely event if Indian Railways changes their business plan todeploy Mobile Based Solution instead of terminal then in the present Business year we needto write off the complete Terminal stock and also the terminals are aged by stocking andwe have to carefully tread whether we can sell the Terminals or write –off due toimpending warranty services.

We will sell the Multi Para Monitors and other stock lying in custom bonded warehousethru our resellers & working on various options to clear the inventory fast

• Point No.2 The Company is making constant efforts to recover the longoutstanding overdues.

• Point No.3 We have been getting the Quarterly Management Certified BranchAccounts from our branch @ USA which is incorporated in the Company's books of accountsand that the audit of this unit in US is not mandatary.

• Point No.4 We have to stop operations since there were VAT payment delayed andwe propose to restart operation soon.

• Point No.6 This has primarily arisen because of obsolete inventory write off andlong outstanding receivables over 6 Months.

• Point No.8 We are working with the appropriate Income Tax Authorities forRectification Order on this amount of Rs 355.09 Lacs and as per our records we haveeffected this payments.

• Point No.9 We are working towards making this payment.

• Point No.10 We are working out a plan for revival of business and will implementthe same soon.

Acknowledgements

Your Directors would like to place on record their gratitude for all the guidance andcooperation received from all its clients vendors bankers financial institutionsbusiness associates advisors regulatory and government authorities.

Your Directors also take this opportunity to thank all its investors and stakeholdersfor their continued support and all employees for their valuable contribution anddedicated service.

For and on behalf of the Board of Directors
Place: Bengaluru P V CHANDRASEKAR VIVEK KUMAR MALHOTRA
Date : 29th July 2016 Managing Director Whole-time Director