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Compucom Software Ltd.

BSE: 532339 Sector: Services
NSE: COMPUSOFT ISIN Code: INE453B01029
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VOLUME 22470
52-Week high 22.02
52-Week low 7.91
P/E 11.89
Mkt Cap.(Rs cr) 124.27
Buy Price 0.00
Buy Qty 0.00
Sell Price 15.70
Sell Qty 11.00
OPEN 15.50
CLOSE 15.30
VOLUME 22470
52-Week high 22.02
52-Week low 7.91
P/E 11.89
Mkt Cap.(Rs cr) 124.27
Buy Price 0.00
Buy Qty 0.00
Sell Price 15.70
Sell Qty 11.00

Compucom Software Ltd. (COMPUSOFT) - Director Report

Company director report

The Shareholder

Compucom Software Limited

Your Directors have immense pleasure in presenting their 22nd Annual Report on thebusiness and operations of the Company together with Audited Financial Statements for theyear ended on March 31 2016.

Financial Results:

The highlights of the financial results for the financial year 2015-2016 are asfollows: (Rs. in Lakhs)

Particulars 31.03.2016 31.03.2015
Total Income 5761.56 5519.08
Operating Expenditure 2869.49 2576.10
Operating Profit (PBDIT) 2892.07 2942.98
Finance Cost 342.87 495.41
Depreciation 1456.07 1427.55
Profit before Tax 1093.13 1020.02
Exceptional Items 78.13 231.27
Provision for Income Tax including Deferred Tax 318.28 230.15
Net Profit after Tax 696.72 558.60
Appropriation
Dividend 79.12 79.13
Dividend Tax 16.56 16.20
Transfer to General Reserve - -
Total Appropriations 95.68 95.33
Earnings per Share: Basic and Diluted (in Rs.)
Considering Extraordinary Items 0.88 0.71
Without Considering Extraordinary Items 0.88 0.71

Results of Operations:

Total revenues earned during the year amounted to Rs 5761.56 lakhs compared to that ofRs.5519.08 lakhs in the previous financial year. During the year under review the incomefrom operations is Rs.5576.37 lakhs compared to Rs 5251.17 lakhs in the previousfinancial year. This reflects increase of Rs. 325.2 lakhs which is mainly due to theincrease of income from Learning Solution business segment. The profit before tax hasincreased from Rs.1020.02 lakhs in the previous financial year to Rs 1093.13 lakhs in thecurrent financial year.

The Operating Profit during this period is Rs.2892.07 lakhs as compared to Rs. 2942.98lakhs in the previous financial year. As required by AS- 21 Consolidated FinancialStatements are provided in the later section of the Annual Report.

Business Operations:

(1) Software & E-Governance Services:

During the year the Company focused on the areas where higher margin was availablewith low risk factors. The revenue generated from this segment during the Financial Year2015-16 was Rs. 461.71 Lakhs as against Rs 456.51 Lakhs during the previous financialyear. This reflects increase of 1.14 % i.e. Rs. 5.20 Lakhs. Profit earned from thissegment amount to Rs. 223 Lakhs as compared to that of Rs. 159.71 Lakhs during theprevious Financial Year which has resulted in increase of 39.63% i.e. Rs. 63.29 Lakhs.

During the year 2015-16 the Company has been awarded one more project i.e. LDMSProject. The Company has generated revenue of Rs. 52.11 Lakhs in the last quarter of thisfinancial year.

(2) Learning Solutions:

During this year revenue from this segment is amounted to Rs. 4938.79 Lakhs against theprevious year revenue of Rs. 4605.43 Lakhs which shows an increase in revenue by 7.24%i.e; Rs. 333.36 Lakhs.

Learning Solution Segment mainly comprises ICT Phase II ICT Phase III ICT Bihar CALPII Computer Aided Training Programme and other projects. The Company has covered total8223 Govt. Schools and over 2 million learners under its educational Umbrella so far.These PPP Projects could not have been a success without the cooperation extended byEmployees Business Associates Vendors and Government officials. Apart from this theother projects that have completed successfully those are CALP-II worth Rs.10.41 Crorecovers 836 Govt. schools of Rajasthan has completed in September 2015. Most of theseprojects are in form of IT Infrastructure development at school levels.

The Company has been running successfully ICT Project Phase III worth Rs. 158.50Crore for 1373 Govt. Schools of Rajasthan. It has been commissioned in the month of Feb.2014 and will be a five (5) year project on BOOT model.

The Company has massive plans for capturing the advantage of Indian educationexpenditure planned through Govt. of India promoted PPP models across India fuelled by SarvaShiksha Abhiyan (SSA) Rashtriya Madhyamik Shiksha Abhiyan (RMSA) and skilldevelopment initiatives. Company is also planning to leverage in-house softwaredevelopment and satellite based technology skills for expansion in school and coachingBusiness.

(3) Wind Power Generation:

The Company has installed two Wind power generation plants in Jaisalmer (Rajasthan)with capacity of 0.6 MW each two at Sikar (Rajasthan) with capacity of 0.6 MW each &One Plant at Krishna (Andhra Pradesh) with capacity of 0.8 MW. Total wind power generationcapacity is 3.2 MW. The operation and maintenance of all these wind power project has beenout-sourced to M/s Wind World India (previously known as Enercon India Limited). Duringthe year revenue generated from this segment amounted to Rs. 175.87 Lakhs as compared toRs. 189.23 Lakhs during the previous year ended on March 31 2015 which shows a decreasein the revenue by 7.06%i.e. Rs. 13.36 Lakhs due to lower generation of units. Profitearned from this segment amount to Rs. 54.29 Lakhs as compared to that of Rs. 61.99 Lakhsduring the previous Financial Year which has resulted a decrease of 12.42% i.e. Rs. 7.7Lakhs.

4. Treasurey Activities:

The revenue generated from this segment during the Financial Year 2015-16 was Rs.185.19 Lakhs as against Rs. 267.91 Lakhs during the last financial year. During the yearthe revenue generated from treasury operations has decreased by 30.88% i.e. Rs. 82.72Lakhs. The following chart depicts revenue generated from operation for the year endedMarch 31 2016:-

Details of Subsidiary and associates Companies

The Company has two subsidiary Companies and one associate Company: Pursuant toprovisions of Section 129(3) of the Companies Act 2013 a statement containing salientfeatures of the financial statement of the Company's subsidiaries and associate in FormAOC-1 is provided in the later section of the Annual Report of the Company.

Pursuant to the provisions of Section 136 of the Companies Act 2013 the financialstatements of the Company consolidated financial statements along with relevant documentsand separate audited accounts in respect of subsidiaries are also available on thewebsite of the Company. During the year operations of following two subsidiaries werereviewed.

(A) ITneer Inc. is a wholly owned subsidiary Company of Compucom Software Limited.It has earned total revenue of US$ 1001417 during the financial year 2015-16 as comparedto US $ 957720 in the previous financial year. This reflects a increase of approx. 4.56%i.e. US $ 43697. The Company has earned profit of US$ 34969 as compared to the Profit ofUS $ 22547 in the previous financial year. The Company is operating out of its ownpremises in Atlanta USA. It is headed by Promoter Director Mr. Ajay Kumar Surana. Thecopy of the audited accounts together with the independent auditor's report is providedin a separate Section of this Annual Report.

(B) CSL Infomedia Pvt. Ltd. is another subsidiary Company of Compucom SoftwareLimited. It has earned total revenue of Rs. 567.11 Lakhs during the financial year 2015-16as compared to Rs. 412.92 Lakhs in the previous financial year which shows an increase of37.34% i.e. Rs. 154.19 Lakhs. The Company has earned Profit of Rs.105.67 Lakhs as comparedto the loss of Rs. 34.06 Lakhs in the previous financial year. The Company is mainlyoperating in multimedia Content Development Education TV Segment and SatelliteEducation. The copy of the audited accounts together with the independent Auditors Reportis provided in a separate section of this Annual Report. The Company has two TV Channelone "JAN TV" Satellite TV channel and "JAN TV PLUS" (anInfotainment Channel).Currently it is available on various cable networks across India andalso available live on jantvplus.in.

Dividend

Keeping the continuous track record of rewarding its shareholders your Directors arepleased to recommend a dividend @ 5% i.e. Rs. 0.10/ - per Equity share of Rs. 2/- each forthe Financial Year 2015-16 subject to approval of the shareholders at the ensuing AnnualGeneral Meeting.

Dividend declared & paid during last 15 (Fifteen) years:

Financial Year Dividend Rate
2000-01 25%
2001-02 10%
2002-03 25%
2003-04 25%
2004-05 25%
2005-06 30%
2006-07 30%
2007-08 15%
2008-09 10%
2009-10 10%
2010-11 15%
2011-12 15%
2012-13 20%
2013-14 20%
2014-15 5%

Book Value per Share:

Details of book value during the last 15 (Fifteen) years are as under:

Financial Year No of Shares Face Value per share Book Value Per share
(in Rs.)
2000-01 5025000 10 55.74
2001-02 5025000 10 65.6
2002-03 5025000 10 69
2003-04 5025000 10 79.9
2004-05 5025000 10 90.79
2005-06 5025000 10 98.73
2006-07 5025000 10 105.89
2007-08** 25125000** 2 (10) 22.79
2008-09*** 50250000*** 2 13.1
2009-10 50250000 2 14.47
2010-11**** 79125188**** 2 12.26
2011-12 79125188 2 12.97
2012-13 79125188 2 13.92
2013-14 79125188 2 14.74
2014-15 79125188 2 14.94
2015-16 79125188 2 15.70

**Equity share of face value of Rs.10 each subdivided into equity share of Face valueof Rs. 2/- each. Record date for the same was October 15 2007.

*** The Company issued bonus shares in the ratio of 1:1. Record date for the same wasDecember 26 2008.

****The Company issued bonus shares in the ratio of 1:2. Record date for the same wasOctober 20 2010.

**** Preferential issue of 37.50 Lakhs Equity shares allotted on November 4 2010.

Fixed Deposits/Deposits from Public

During the financial year 2015-16 your Company has not accepted any fixed deposits norrenewed any Fixed deposit falling within the definition of Section 73 74 and 76 of theCompanies Act 2013 read with the Companies (Acceptance of Deposits) Rules 2014.

Listing of Shares

Your Company's shares are listed at Bombay Stock Exchange Ltd. (BSE) National StockExchange of India Limited (NSE) and Calcutta Stock Exchange Limited (CSE) and the listingfee for the year 2016-17 has been duly paid. The Scrip Code of the Company is 532339 atBSE.

Number of Meetings of Board of Directors

Four (4) meetings of Board were held during this financial year. The dates on which theBoard Meetings were held are as follows:

May 29 2015; August 12 2015; November 6 2015; February 11 2016.

The intervening gap between any two meetings was within the period prescribed by theCompanies Act 2013 and SEBI (Listing Obligations & Disclosure Requirements)Regulations 2015.

Policy on Director's appointment and remuneration

The current policy is to have an appropriate mix of executive and independent Directorsto maintain the independence of the Board and separate its functions of governance andmanagement. As on March 31 2016 the Board consists of 8 members one of whom isexecutive or whole time Director 3 are Non-Executive & Non-Independent Directors and4 are Non-Executive & Independent Directors.

The policy of the Company on Director's appointment and remuneration includingcriteria for determining qualifications positive attributes independence of a Directorand other matters provided under Sub-section (3) of Section 178 of the Companies Act2013 adopted by the Board is as Annexure I of the Board's report. We affirm thatthe remuneration paid to the Directors is as per the terms laid out in the nomination andremuneration policy of the Company. The Policy is also available on the Company's Websiteat www.compucom.co.in

Details of appointment of Directors and KMPs and their resignation during the yearAppointments

Mr. Ghisa Lal Chaudhary was appointed as an Additional Director on the Board of theCompany w.e.f. 11th February 2016 and subject to the approval of the members at theensuing Annual General Meeting his appointment is being regularized as Independent andNon-Executive Director on the terms and conditions as mentioned in the resolution in theNotice.

Dr. Satish Kumar was appointed as an Additional Director on the Board of the Companyw.e.f. 25th May 2016 and subject to the approval of the members at the ensuing AnnualGeneral Meeting his appointment is being regularized as Independent and Non-ExecutiveDirector on the terms and conditions as mentioned in the resolution in the Notice.

Reappointment

During the year Mr. Ajay Kumar Surana is liable to retire by rotation and beingeligible has offered himself for re-appointment. Accordingly approval of the members issought for his reappointment at the ensuing Annual General Meeting.

Mr. Rajendra Prasad Udawat was re-appointed as an Additional Director on the Board ofthe Company w.e.f. 2nd April 2016 and subject to the approval of the members at theensuing Annual General Meeting his appointment is being regularized as Independent andNon-Executive Director on the terms and conditions as mentioned in the resolution in theNotice.

Dr. Anjila Saxena was re-appointed as an Additional Director on the Board of theCompany w.e.f. 3rd August 2016 and subject to the approval of the members at the ensuingAnnual General Meeting her appointment is being regularized as Independent andNon-Executive Director on the terms and conditions as mentioned in the resolution in theNotice.

The brief resume of the Directors seeking appointment/re-appointment in the forthcomingAnnual General Meeting in Pursuance of Regulation 36(3) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 is annexed to the Annual General Meetingnotice.

Retirement

During the year Mr. Rajendra Prasad Udawat & Mr. Stephen Carl Viehman asIndependent Directors retired on March 31 2016 and Dr. Anjila Saxena retired on July 312016.

Vigil Mechanism

The Company had implemented a vigil mechanism whereby employees Directors and otherstakeholders can report matters such as generic grievances corruption misconduct fraudmisappropriation of assets and non-compliance of code of conduct to the Company. Thepolicy safeguards the whistle blowers to report concerns or grievances and also provides adirect access to the chairman of the audit committee. During the year under review none ofthe personnel has been denied access to the chairman of Audit Committee.

The Vigil Mechanism Policy is available on the Company's website at www.compucom.co.in

DISCLOSURE UNDER THE SEXUAL HARASSMENT 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 its premises through various interventions and practices. TheCompany always endeavors to create and provide an environment that is free fromdiscrimination and harassment including sexual harassment.

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.

The following is a summary of sexual harassment complaints received and disposed offduring the year 2015-16

• Number of complaints received: NIL

• Number of complaints disposed off: NIL

Declaration of independence by Directors

The Independent Non-Executive Directors of the Company viz. Mr. Rajendra PrasadUdawat Dr. Anjila Saxena Mr Ghisa Lal Chaudhary Dr. Satish Kumar and Mr. Ramesh ChandJain have affirmed that they continue to meet all the requirements specified undersub-section (6) of section 149 of Companies Act 2013 and the Regulation 16 (1) (B)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.

Composition of Audit Committee: The Audit Committee comprises three Non-ExecutiveDirectors two of whom are Independent Directors and one is Non-Independent Director. Mr.Rajendra Prasad Udawat is the Chairman of the Audit Committee. The Members possessadequate knowledge of Accounts Audit and Finance. The composition of the Audit Committeemeets the requirements as per the Section 177 of the Companies Act 2013 and of Regulation18 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015.There are no recommendations of the Audit Committee which have not been accepted by theBoard.

Board Evaluation

As per the provisions of the Companies Act 2013 and SEBI (Listing obligation andDisclosure Requirements) Regulations 2015 the formal annual evaluations needs to be madeby the Board of its own performance and that of its committees and individual Directors.Schedule IV of the Companies Act 2013 states that the performance evaluation ofIndependent Directors shall be done by the entire Board of Directors excluding theDirector being evaluated.

The evaluation of all the Directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board. The evaluation process has been explained inthe Corporate Governance report section in this Annual Report. The Board approved theevaluation results as collated by the Nomination and Remuneration Committee.

Training of Independent Directors

Every new Independent Director of the Board attends an orientation program. Tofamiliarize the new inductees with the strategy operations and functions of our Companythe executive Directors / senior managerial personnel make presentations to the inducteesabout the Company's strategy operations product and service offerings markets softwaredelivery organization structure finance human resources technology quality facilityand risk management.

Further at the time of appointment of an independent Director the Company issues aformal letter of appointment outlining his/ her role function duties andresponsibilities as a Director.

Familiarization Programme for Independent Directors:

The Company believes that the Board be continuously empowered with the knowledge of thelatest developments in the Company's business and the external environment affecting theindustry as a whole. To this end the Directors were given presentations on the globalbusiness environment as well as all business areas of the Company including businessstrategy risk opportunities. Monthly updates on performance/developments givinghighlights of performance of the Company during each month including the developments /events having impact on the business of the Company are also sent to all the Directors.The details of familiarization programs imparted to Independent Directors is disclosed onthe Company's website at www.compucom.co.in.

Performance evaluation:

Pursuant to the provisions of the Companies Act 2013 and Regulation 17(10) 19(4) andpart D of Schedule II of the SEBI (LODR Regulations) 2015 a Board Evaluation Policy hasbeen framed and approved by the Nomination and Remuneration Committee (N & RC) and bythe Board.

The Board carried out an annual performance evaluation of its own performance theIndependent Directors individually as well as the evaluation of the working of theCommittee of the Board. The Performance evaluation of all the Directors was carried out bythe Nomination and Remuneration Committee. The Performance evaluation of the Chairman andthe Non- Independent Directors was carried out by the Independent Directors.

Corporate Social Responsibility Committee

As per Section 135 of Companies Act 2013 the Company constituted a Corporate SocialResponsibility(CSR) Committee for formulating and recommending to Board a CorporateSocial Responsibility policy (CSR Policy) which indicate the activities to be undertakenby the Company as specified in Schedule VII of the Companies Act 2013 to recommend theamount of expenditure to be incurred on the activities and to monitor the Corporate SocialResponsibility Policy of the Company from time to time.

The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure II of this report in the prescribed format of the Companies(Corporate Social Responsibility Policy) Rules 2014. The Policy is available on theCompany's website at www.compucom.co.in

Internal financial control systems

The Company has put in place an adequate system of internal control commensurate withits size and nature of business. These systems provide a reasonable assurance in respectof providing financial and operational information complying with applicable statutessafeguarding of assets of the Company and ensuring compliance with corporate policies. TheAudit Committee reviews adherence to internal control systems and internal audit reports.

Loans guarantees and investments in securities by the Company

The particulars of Loans Guarantees and Investments have been disclosed on theFinancial Statements.

Transfer to Reserves

The Company doesn't transfer any amount to reserves.

Statutory Auditors and Auditors' Report

The Company has received consent from M/s. S Misra & Associates CharteredAccountants to the effect that their appointment if made would be within the prescribedlimits under Section 139 of the Companies Act 2013 and that they are not disqualified forappointment within the meaning of Section 141 of the said Act. Accordingly the Board ofDirectors has recommended the ratification of appointment as Statutory Auditors.

At the Company's 20th Annual General Meeting (AGM) held on August 27 2014 M/s S.Misra & Associates Chartered Accountants were appointed as the Company's StatutoryAuditors from the conclusion of the 20th Annual General Meeting till the Conclusion of the23rd AGM. In terms of the section 139(1) of the Companies Act 2013 appointment of theStatutory Auditors to hold office from the conclusion of 20th Annual general meeting untilthe conclusion of 23rd Annual General Meeting is placed for your ratification.

The Auditors Report to the shareholders for the year under review does not contain anyqualification.

No frauds have been reported by the Auditors under Section 143(12) of the CompaniesAct 2013 requiring disclosure in the Board's Report

Secretarial Audit Report

As per Section 204 of Companies Act 2013 read with Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 every Listed Company is required toappoint Secretarial Auditor to carry out Secretarial Audit of the Company.

In consonance with the requirements of Section 204 of the Companies Act 2013 and rulesmade thereunder M/s V. M. & Associates Company Secretaries in Practice Jaipur wasappointed to conduct the secretarial audit of the Company for the financial year 2015-16.

A Secretarial Audit Report issued by M/s V. M. & Associates Company Secretaries inpractice in respect of the secretarial audit of the Company for the financial year ended31st March 2016 is given in Annexure III to this Report. The Report does notcontain any observation or qualification requiring explanation or comments from the Boardunder Section 134(3)of the Companies Act2013.

The Secretarial Audit report for the financial year ended 31st March 2016 isself-explanatory and does not call for any further comments.

The Board has re-appointed M/s V. M. & Associates Company Secretaries in PracticeJaipur as Secretarial Auditor of the Company to carry out secretarial audit of the Companyfor the financial year 2016-17.

Internal Audit Report

As per Section 138 of Companies Act 2013 read with Companies (Accounts) Rules 2014every Listed Company is required to appoint Internal Auditor to carry out Internal Auditof the Company.

In consonance with the requirements of Section 138 of the Companies Act 2013 and rulesmade thereunder Mr. Girish Kumar Gupta Chartered Accountant was appointed to conductthe internal audit of the Company for the financial year 2015-16. No major internal auditobservations were observed during the period under review.

Corporate Governance Report and Management Discussion and Analysis Report

The Company is committed to observe good corporate governance practices. The report onCorporate Governance for the financial year ended March 31 2016 as per Regulation 34(3)read with Schedule V of the SEBI (Listing Obligation and Disclosure Requirements)Regulations 2015 form a part of this Annual Report. The requisite certificate fromauditors of the Company confirming compliance with the conditions of Corporate Governanceis annexed to this report.

Conservation of Energy Research & Development Technology Absorption ForeignExchange and Outgo

The particulars as prescribed under Section 134 (3) (m) of the Companies Act 2013 readwith the Rule 8(3) of the Companies (Accounts) Rules 2014 are annexed to this Report as AnnexureIV.

Transactions with related parties

Information on transactions with related parties pursuant to Section 188(1) along withthe justification for entering into such contract or arrangement in Form AOC-2 is annexedto this Report as Annexure V.

Particulars of Employees

1. None of the employees of the Company was in receipt of the remuneration exceedingthe limits prescribed u/s 197 (12) read with rule 5 sub-rule 2 of The Companies(Appointment and Remuneration of Managerial Personnel) of the Companies Act 2013 duringthe year under review.

2. The ratio of the remuneration of each Director to the median employee's remunerationand other details in terms of subsection 12 of Section 197 of the Companies Act 2013 readwith Rule 5(1) of The Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are forming part of this report as Annexure VI.

Extract of Annual Return

An extract of the Annual Return in Form MGT-9 in compliance with Section 92 of theCompanies Act 2013 read with Rules made thereunder is annexed to this Report as AnnexureVII.

Transfer of Unclaimed Dividend to Investor Education and Protection Fund (IEPF)

Pursuant to the provisions of Section 124(5) of the Companies Act 2013 dividend duefor refund which remains unpaid or unclaimed for a period of seven years from the date ofits transfer to unpaid dividend/unclaimed account is required to be transferred by theCompany to Investor Education and Protection Fund (IEPF) established by the CentralGovernment under the provisions of Section 125 of the Companies Act 2013. During theyear no amount was due to be transferred to Investor Education and Protection Fund.

Human Resource Management

Your Company draws its strength from a highly engaged and motivated workforce whosecollective passion and commitment has helped the organization scale new heights. HumanResource policies and processes have evolved to stay relevant to the changingdemographics enhance organizational ability and remain compliant with the changingregulatory requirements. The Company has created a favorable work-environment thatencourages innovation and nurturing of commercial and managerial talents in itsoperations.

Trade Relations

The Company maintained healthy cordial and harmonious Industrial relations at alllevels. The Directors wish to place on record their appreciation for the valuablecontribution by the employees of the Company.

Quality Assurance

Sustained commitment to the highest levels of quality best in class service managementand robust information security practices helped the Company attain the followingmilestone during the year.

The Company is an ISO 9001:2000 organization certified by Det Norske Veritas (DNV)since 1998. These standards enable us to identify risks at the initial planning stage ofthe project. The Company firmly believes in the pursuits of excellence to compete in thisemerging and growing software market. Our focus has been on providing quality products andservices to our customers. The Company achieved CMMI level-3 certification and continuesto implement the certification quality level in its operation.

Directors' Responsibility Statement

Based on the framework of internal financial controls established and maintained by theCompany reviews performed by management in concurrence with the Audit committee theCompany's internal financial controls were adequate and effective as on 31st March 2016.

In compliance with Section 134(5) of the Companies Act 2013 the Board of Directors tothe best of their knowledge and hereby confirm the following: (a) In the preparation ofthe annual accounts the applicable Accounting Standards have been followed along withproper explanations and disclosures relating to material departures; (b) The Directorshave selected relevant accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitand loss of the Company for that period; (c) The Directors had taken proper and sufficientcare for the maintenance of adequate accounting records in accordance with the provisionsof this Act for safeguarding the assets of the Company and for preventing and detectingfraud and other irregularities; (d) The Directors had prepared the annual accounts on agoing concern basis; (e) The Directors had laid down internal financial control to befollowed by the Company and that such internal financial controls are adequate andoperating effectively; and (f) The Directors have devised proper system to ensurecompliance with the provisions of all applicable laws and that such system were adequateand operating effectively.

Acknowledgement

The Directors take this opportunity to thank all Investors associates and businesspartners clients strategic alliance partners technology partners vendors financialinstitutions/banks regulatory and government authorities media and stock exchanges fortheir continued support during the year. The Directors place on record their appreciationof the contribution made by all the employees at all levels for their dedicated serviceand continued excellent work throughout the year.

For and on behalf of the Board
(Surendra Kumar Surana) (Shubh Karan Surana)
Managing Director & CEO Director
(DIN:-00340866) (DIN:- 00341082)
Jaipur
August 03 2016

Annexure I

Annexures to the Board Report:

Nomination and Remuneration Policy

The policy on appointment and remuneration of Directors and Key Managerial Personnelprovides an underlying basis and guide for human resources management thereby aligningplans for Strategic growth of the Company. The policy is pursuant to section 178(4) of theCompanies Act 2013. The policy is also available on our website.

The Remuneration Committee of Compucom Software Limited ("the Company") wasconstituted consisting of three Independent Directors. The Board reconstituted theCommittee consisting of 3 Non-Executive Directors of which majority are IndependentDirectors.

OBJECTIVE:

The Nomination and Remuneration Committee and this Policy is in compliance with Section178 of the Companies Act 2013 and as per Regulation 19 of the SEBI (Listing Obligationand Disclosure Requirements) Regulations 2015.

The Key Objectives of the Committee would be:

a) To guide the Board in relation to appointment and removal of Directors KeyManagerial Personnel and Senior Management.

b) To evaluate the performance of the members of the Board and provide necessaryReport to the Board for further evaluation of the Board.

c) To recommend to the Board on Remuneration payable to the Directors KeyManagerial Personnel and Senior Management.

DEFINITIONS:

(a) Key Managerial Personnel: Key Managerial Personnel means—

(i) Chief Executive Officer or the Managing Director or the Manager;

(ii) Company Secretary

(iii) Whole-Time Director;

(iv) Chief Financial Officer; and

(v) Such other Officer as may be prescribed.

(b) Senior Management: Senior Management means personnel of the Company who aremembers of its core management team excluding the Board of Directors. This would alsoinclude all members of management one level below the Executive Directors including allfunctional heads.

ROLE OF COMMITTEE:

The role of the Committee inter alia will be the following:

a) To formulate a criteria for determining qualifications positive attributes andindependence of a Director.

b) To recommend to the Board the appointment and removal of Senior Management

c) To carry out evaluation of Director's performance and recommend to the Boardtheir appointment / removal based on his/ her performance.

d) To recommend to the Board on (i) policy relating to remuneration for DirectorsKey Managerial Personnel and Senior Management and (ii) Executive Directors Remunerationand incentive.

e) To make recommendations to the Board concerning any matters relating to thecontinuation in office of any Director at any time including the suspension or terminationof service of an Executive Director as an employee of the Company subject to the provisionof the law and their service contract;

f) Ensure that level and composition of remuneration is reasonable and sufficientRelationship of remuneration to performance is clear and meets appropriate performancebenchmarks

g) To devise a policy on Board diversity;

h) To develop a succession plan for the Board and to regularly review the plan;

MEMBERSHIP:

a) The Committee shall consist of a minimum 3 Non-Executive Directors majority ofthem being Independent.

b) Minimum two (2) members shall constitute a quorum for the Committee meeting.

c) Membership of the Committee shall be disclosed in the Annual Report.

d) Term of the Committee shall be continued unless terminated by the Board ofDirectors.

CHAIRMAN:

a) Chairman of the Committee shall be a Non-Executive Independent Director.

b) Chairperson of the Company may be appointed as a member of the Committee butshall not be a Chairman of the Committee.

c) In the absence of the Chairman the members of the Committee present at theMeeting shall choose one amongst them to act as Chairman.

d) Chairman of the Nomination and Remuneration Committee Meeting could be presentat the Annual General Meeting or may nominate some other member to answer theshareholders' queries.

FREQUENCY OF MEETINGS:

The meeting of the Committee shall be held at such regular intervals as may berequired.

COMMITTEE MEMBERS' INTERESTS:

a) A member of the Committee is not entitled to be present when his or her ownremuneration is discussed at a meeting or when his or her performance is being evaluated.

b) The Committee may invite such executives as it considers appropriate to bepresent at the meetings of the Committee.

SECRETARY:

a) The Company Secretary of the Company shall act as Secretary of the Committee.

VOTING:

a) Matters arising for determination at Committee meetings shall be decided by amajority of votes of members present and voting and any such decision shall for allpurposes be deemed a decision of the Committee.

b) In the case of equality of votes the Chairman of the meeting will have acasting vote.

NOMINATION DUTIES:

The duties of the Committee in relation to nomination matters include:

• Ensuring that there is an appropriate induction & training Programme inplace for new Directors and members of Senior Management and reviewing its effectiveness;

• Ensuring that on appointment to the Board Non-Executive Directors receive aformal letter of appointment in accordance with the Guidelines provided under theCompanies Act 2013;

• Identifying and recommending Directors who are to be put forward for retirementby rotation.

• Determining the appropriate size diversity and composition of the Board;

• Setting a formal and transparent procedure for selecting new Directors forappointment to the Board;

• Developing a succession plan for the Board and Senior Management and regularlyreviewing the plan;

• Evaluating the performance of the Board members and Senior Management in thecontext of the Company's performance from business and compliance perspective;

• Making recommendations to the Board concerning any matters relating to thecontinuation in office of any Director at any time including the suspension or terminationof service of an Executive Director as an employee of the Company subject to the provisionof the law and their service contract.

• Delegating any of its powers to one or more of its members or the Secretary ofthe Committee;

• Recommend any necessary changes to the Board.

• Considering any other matters as may be requested by the Board.

REMUNERATION DUTIES:

The duties of the Committee in relation to remuneration matters include:

• To consider and determine the Remuneration Policy based on the Performance andalso bearing in mind that the remuneration is reasonable and sufficient to attract retainand motivate members of the Board and such other factors as the Committee shall deemappropriate all elements of the remuneration of the members of the Board.

• To approve the remuneration of the Senior Management including Key ManagerialPersonnel of the Company maintaining a balance between fixed and incentive pay reflectingshort and long term performance objectives appropriate to the working of the Company.

• To delegate any of its powers to one or more of its members or the Secretary ofthe Committee.

• To consider any other matters as may be requested by the Board.

• Professional indemnity and liability insurance for Directors and SeniorManagement.

MINUTES OF COMMITTEE MEETING:

• Proceedings of all meetings must be in minutes and signed by the Chairman of theCommittee. Minutes of the Committee Meetings will be tabled at the subsequent Board andCommittee Meeting.

For and on behalf of the Board
(Surendra Kumar Surana) (Mr. Ghisa Lal Chaudhary)
Managing Director & CEO Chairperson of Nomination & Remuneration Committee
(DIN:-00340866) (DIN:- 03602194)
Jaipur
August 03 2016

Conservation of energy research and development technology absorption foreignexchange earnings and outgo

[Particulars to Clause (m) of Sub-section (3) of Section 134 of Companies Act 2013and Rules 8(3) of the Companies (Accounts) Rules 2014]

CONSERVATION OF ENERGY

The nature of the Company's operation is not energy intensive and entails low level ofenergy consumption. However significant measures are being taken for the conservation ofenergy and the management is constantly evaluating new technologies and investing in theinfrastructure to make more energy efficient. Significant measures have been taken toreduce energy consumption by using energy-efficient equipment's include:

• Incorporating new technologies in the air-conditioning systems in upcomingfacilities to optimize power conservation.

• Identification and replacement of low-efficient machinery (AC) in a phasedmanner.

• Identification and replacement of outdated and low efficient UPS systems in aphased manner.

• Conducting continuous energy-conservation awareness and training sessions foroperational personnel.

• The Company has installed 100KWA Solar PV roof top plant for captive use.

(i) Research & Development (R&D)

(a) Our efforts in R&D have helped us offer new services to clients in the areas ofsoftware Engineering convergence Knowledge- driven information system Security andPrivacy and Distributed Computing. Education and Software development being the mainfocus of the Company. Compucom lays emphasis on the research and development activitiesand is continuously improving its business by research and development. The Company haslaid out training programs to improve and upgrade skills of its employees to keep pacewith the changing market scenario.

The Company is undertaking software assignments which involves lot of research workduring various phases of software development life cycle. Continual infusion of newtechnology need research activities during its absorption and usage. The Company takesevery measure to adopt newer methodologies in software development business.

(b) Specific areas in which R & D carried out by the Company

Software products development inter-operability of multiple operating systemstelecom CRM VOIP E-Governance are the areas in which Company performs research anddevelopment activities.

(c) Benefits derived as a result of R & D

Our research labs are well equipped and are instrumental in providing expertise in theareas of software performance solutions testing prototype developments and providing endto end solutions to the clients to suit their requirement.

Research and development activities have helped in providing new and better solutionsto the customers. R&D activities help in enhancing technical skills which arecritical for providing the end-to-end solutions to the clients.

(d) Future plan of action

Your Company lays emphasis on continuous research and development activities. Futurebenefits are expected to flow in from initiatives undertaken during the year. The Companycontinues to focus its efforts on innovations in software development processes and otherIT related projects.

(e) Expenditure on R & D:

The Company's R&D activity is part of its normal software development activitiesand is a continuous process. Company is not having the separate R & D department so itwill not be prudent to assign capital and recurring expenses specifically to the researchand development activities.

(ii) Technology absorption adaptation and innovation:

The Company realizes that in order to stay competitive and avoid obsolescence it wouldhave to invest in technology across multiple product line and services offered by it. Inorder to maintain its position of leadership your Company has continuously andsuccessfully developed state-of-the-art methods for absorbing adapting and effectivelydeploying new technologies. Hence the Company is making every effort to develop methodsfor adopting and effectively deploying new technologies.

(a) Efforts made towards technology absorption adaptation and innovation:

Company lays greater emphasis on technology absorption and innovations as the Companyis engaged in the business marked with rapid technology changes and obsolescence. Companystrives to keep pace with the rapid changes and adopt new technologies periodically to bein line with competitive market conditions.

(b) Benefits derived as a result of the above efforts:

The adoption of the latest technology and innovative ideas has enabled your Company tohave an edge on others due to higher productivity better services and increased consumerconfidence. It also has enabled the Company to come out with innovative ideas so as toexplore new areas of generating the revenue.

(iii) Foreign Exchange Earnings and Outgo:

(a) Activities relating to exports initiative taken to increase exportsdevelopment of new export market for product and services and export plans: The Company isin the business of software exports. All the efforts of the Company are geared to increasethe business of software exports of different products and services in various exportoriented markets.

During the financial year 2015-16 the revenue derived from export activities was Rs375.23 Lakhs. The Company focuses on export projects which attract higher margins atlower risks. The Company has established marketing arrangement in the foreign countriesvide its subsidiary and other marketing agreements.

(b) Total Foreign Exchange Earnings and Outgo:

The details of foreign exchange earnings and outgo are given in the notes on accounts.FOB value exports: Rs.37522577 /- (Previous year Rs. 32615751/-) CIF value ofimports: NIL (Previous year: NIL)

Other expenses incurred in foreign currency on manpower administrative and marketingexpenses Rs. 72033 (Previous year: NIL)

For and on behalf of the Board
(Surendra Kumar Surana) (Shubh Karan Surana)
Managing Director & CEO Director
(DIN:-00340866) (DIN:- 00341082)
Jaipur
August 03 2016

 

Particulars of contract / arrangements made with related parties
[Particulars to Clause (h) of Sub-section (3) of Section 134 of Companies Act 2013 and Rules 8(2) of the Companies (Accounts) Rules 2014-AOC-2]
Form No. AOC-2

This Form pertains to the disclosure of particulars of contract / arrangements enteredinto by the Company with related parties referred to in Sub-section (1) of Section 188 ofthe Companies Act 2013 including certain arm's length transaction under third provisothereto.

3. Details of contracts or arrangements or transactions not on an arm's length basis:

(a) Name(s) of the related party and nature of relationship
(b) Nature of Contracts/arrangements/transactions
(c) Duration of Contracts/ arrangements/ transaction
(d) Salient terms of the contracts or arrangements or transactions including the value if any NIL (All Contracts or arrangements or transactions with related parties are at arm's length basis)
(e) Justification for entering into such contracts or arrangements or transactions
(f) Date(s) of approval by the Board
(g) Amount paid as advances if any
(h) Date on which the special resolution was passed in general meeting as required under first proviso to section 188
2. Details of material contracts or arrangements or transactions at arm's length basis
(a) Name(s) of the related party and nature of relationship
(b) Nature of Contracts/arrangements/transactions
(c) Duration of Contracts/ arrangements/ transaction NIL
(d) Salient terms of the contracts or arrangements or transactions including the valueif any
(e) Date(s) of approval by the Board if any
(f) Amount paid as advances if any

For and on behalf of the Board

(Surendra Kumar Surana) (Shubh Karan Surana)

Managing Director& CEO Director

(DIN:-00340866) (DIN:- 00341082)

Place: Jaipur

Date: August 3 2016

Information pursuant to Section 197 of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 i) Theratio of the remuneration of each Director to the median remuneration of the employees ofthe Company for the financial year 2015-16 and the percentage increase in remuneration ofeach Director Chief Financial Officer Chief Executive Officer Company Secretary in thefinancial year 2015-16:

Name of Director's and KMP Remuneration and Sitting Fees % increase in remuneration in the financial year Ratio of remuneration to median remuneration of employees
Mr. Surendra Kumar Surana
Managing Director & CEO 1800000 18.11% 13.72
Mr. Shubh Karan Surana 39000# N.A. N.A.
Mr. Ajay Kumar Surana 12000# N.A. N.A.
Mrs. Trishla Rampuria* 12000# N.A N.A
Mr. Stephen Carl Viehman** 9000# N.A. N.A.
Mr. Rajendra Prasad Udawat 36000# N.A. N.A.
Mr. G. L. Chaudhary*** NIL N.A. N.A.
Mr. Ramesh Chand Jain 24000# N.A. N.A.
Dr. Anjila Saxena 24000# N.A. N.A.
Mrs. Swati Jain Company Secretary 96822 8.70% 0.74
Mr. Sanjeev Nigam CFO 593000 N.A.**** 4.52

*Appointed as an Additional Director w.e.f August 12 2015 and regularized as Directorin the Annual General Meeting held on 24 September 2015.

**Retired as the Director of Company w.e.f. March 31 2016.

***Appointed as the Additional Director of Company w.e.f. February 11 2016

# Director Sitting Fees

****Appointed as a CFO of the Company w.e.f. March 25 2015

ii) The percentage increase in the median remuneration of employees in the financialyear: 5.10%

iii) The number of permanent employees on the rolls of Company: 578 as on March 312016.

iv) 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:

• Average increase in remuneration of employees exceeding KMPs: 12.15%

• KMP salary increases are decided based on the Company's performance individualperformance Inflation prevailing industry trends and benchmarks.

v) Affirmation that the remuneration is as per the Remuneration Policy of the Company:

The Company affirms remuneration is as per the Remuneration Policy of the Company.

For and on behalf of the Board
(Surendra Kumar Surana) (Shubh Karan Surana)
Managing Director& CEO Director
(DIN:-00340866) (DIN:- 00341082)
Place: Jaipur
Date: August 3 2016

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