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PCS Technology Ltd.

BSE: 517119 Sector: Consumer
NSE: N.A. ISIN Code: INE834B01012
BSE LIVE 15:05 | 22 Aug 21.00 0.50
(2.44%)
OPEN

20.60

HIGH

21.25

LOW

20.00

NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 20.60
PREVIOUS CLOSE 20.50
VOLUME 2200
52-Week high 36.00
52-Week low 20.00
P/E 10.61
Mkt Cap.(Rs cr) 44
Buy Price 20.00
Buy Qty 368.00
Sell Price 21.00
Sell Qty 15.00
OPEN 20.60
CLOSE 20.50
VOLUME 2200
52-Week high 36.00
52-Week low 20.00
P/E 10.61
Mkt Cap.(Rs cr) 44
Buy Price 20.00
Buy Qty 368.00
Sell Price 21.00
Sell Qty 15.00

PCS Technology Ltd. (PCSTECHNOLOGY) - Director Report

Company director report

The Members

PCS TECHNOLOGY LIMITED

Your Directors of the Company are pleased to present you the 35th Annual Report of theCompany along with the statement of Audited Financial Statements for the financial yearended 31st March 2016.

FINANCIAL RESULTS

Key highlights of standalone Financial Results of the Company for the financial year2015-16 are tabulated below:

(Rs. In lakhs)
Particulars Financial Year ended Financial Year ended
31.03.2016 31.03.2015
Net sales and services 6323 10046
Gross Profit 810 972
Depreciation 111 105
Profit for the year from Operations 699 867
Corporate Social Responsibility Expense 5 10
Provision for Taxation (Net) 140 312
Profit for the year / available for Appropriation 554 545
Balance of Profit/(Loss) available in Balance Sheet 1983 1545

OPERATIONS

During the year under review your Company has achieved Net Sales of Rs. 6323 lakhs asagainst Rs. 10046 lakhs in the previous year.

In the current year the Company did not solicited computer hardware business and thishad the impact on the total sales and services. However the Company has maintained thelevel of the Profit for the year.

Adequacy of Internal Financial Control: The Company has in place adequate internalcontrol procedures commensurate with the size of the Company and the nature of itsbusiness.

SCHEME OF AMALGAMATION AND ARRANGEMENT

Pursuant to the Scheme of Amalgamation and Arrangement between PCS InternationalLimited Mauritius (‘PIL Mauritius’ or ‘the Transferor Company’) andPCS Technology Limited (‘PTL’ or ‘the Company’ or ‘the TransfereeCompany’) and their respective Shareholders under Sections 391 to 394 read withSections 100 to 103 of the Companies Act 1956 and Section 52 of the Companies Act 2013and other applicable provisions of the Companies Act 1956 and the Companies Act 2013("the Scheme") sanctioned by the Hon’ble High Court of Bombay vide itsorder dated 8th May 2015 and the approval of the Registrar of Companies Mauritius forthe removal of the name of "PCS International Limited" Mauritius (PIL) fromtheir record on 3rd June 2015 the Wholly Owned Subsidiary Company PIL Mauritius mergedwith the "PCS Technology Limited" ("the Company") with effect from April1 2014 ("the appointed date"). The Scheme came into effect on 18th June2015 the day on which the Company has filed the Bombay High Court order with theRegistrar of Companies Pune and pursuant thereto the entire business and all the assetsand liabilities duties and obligations of PIL Mauritius have been transferred to andvested in the Company with effect from 1st April 2014. As the amalgamating company i. e.PIL Mauritius was Wholly Owned Subsidiary Company no equity shares were exchanged toeffect the amalgamation in respect thereof.

According to the aforesaid Scheme of Amalgamation and Arrangement the differencebetween the value of net assets and liabilities of the PIL Mauritius taken over andcancellation of inter-company balances by the Company and after adjusting for certainstressed assets of the Company totaling to Rs.6387.22 lakhs have been charged to theSecurity Premium Capital Reserve and General Reserves aggregating to Rs. 5737.19 lakhs inthe same sequence netting off the current and deferred tax credit of Rs. 650.03 lakhs. Thenecessary entries in the books of accounts of the Company have been made to this effect incurrent financial year.

EXTRACTS OF ANNUAL RETURN

In accordance with sub-section (3) of Section 92 in the Form MGT 9 of the CompaniesAct 2013 an extracts of the Annual Return in prescribed format is annexed and marked as Annexure1 to the Board’s Report.

DIVIDEND

In order to conserve the resources of the Company your Directors express theirinability to recommend any dividend for the financial year ended 31st March 2016.

RESERVES

Since the Company do not recommend any dividend it is not required to transfer anyamount to the General Reserve of the Company for the year under review.

MATERIAL CHANGES & COMMITMENTS AFFECTING THE FINANCIAL POSITIONS OF THE COMPANY

There have been no material changes and commitments affecting the financial positionof the Company which occurred during between the end of the financial year to which thefinancial statements relate and the date of this report.

ANNUAL PERFORMANCE EVALUATIONS

The Board evaluated the effectiveness of its functioning and that of the Committees andof individual directors by seeking their inputs on various aspects of Board/ CommitteeGovernance.

Further the Independent Directors at their meeting reviewed the performance of BoardChairman of the Board and of Non-Executive Directors

The criteria for performance evaluation as laid down by the Nomination Committee arementioned in Corporate Governance attached to the Directors’ Report of the Company.

DIRECTORS

Retirement by Rotation

As per Article 135 of the Articles of Association of the Company Mr. A. K. Patni (Din-00014194) Director of the Company retire by rotation at the ensuing Annual GeneralMeeting and being eligible offer himself for re-appointment on the Board of your company.

Declaration given by Independent Director

The Company has received necessary declaration from each independent director underSection 149 (7) of the Companies Act 2013 that he/she meets criteria of independencelaid down in Section 149 (6) of the Companies Act 2013 and Regulation 16 (1)(b) ofSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015. None of the independent directors are due for re-appointment.

Board and Audit Meetings

During the year under review four Board Meetings and four Audit Committee Meetingswere convened and held. The details of which are given in the Corporate Governance Report.The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013.

Remuneration Policy

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy on directors’ appointment and remuneration including criteria fordetermining qualifications positive attributes including independence of a directors ofthe Company.

The Remuneration Policy is stated in the Corporate Governance Report.

COMMITTEES OF THE BOARD

Currently the Board has four Committees the Audit Committee Stakeholders’Relationship Committee Nomination and Remuneration Committee and Corporate SocialResponsibility Committee (CSR Committee). The Composition of each of the committee ismentioned in the Annexure 2 of the Boards’ Report.

STATUTORY AUDITOR

Mr. S. C Bandi of Messrs S.C Bandi & Co. Chartered Accountants (registration no.130850W) Mumbai who are the statutory auditors of the Company hold office until theconclusion of the ensuing AGM and are eligible for re-appointment. Members of the Companyat the AGM held on 17 September 2014 had approved the appointment of Messrs S.C Bandi& Co as the Statutory Auditors for a period of two financial years i.e. up to 31March 2017. As required by the provisions of the Companies Act 2013 their appointmentshould be ratified by members each year at the AGM. Accordingly requisite resolutionforms part of the notice convening the AGM

SECRETARIAL AUDITOR

Mr. Bhavesh Desai of M/s. B. Desai & Associates Practicing Company Secretary wasappointed to conduct the secretarial audit of the Company for the financial year 2015-16as required under Section 204 of the Companies Act 2013 and Rules thereunder. TheSecretarial Audit report for FY 2015-16 forms part of the Annual report as Annexure 3to the Board’s Report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There have been no significant and material orders passed by the regulators or courtsor tribunals impacting the going concern status and Company’s operations.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to sub-section (3C) of Section 134 of the Companies Act 2013 the Board ofDirectors of the Company hereby confirms that:

1 In the preparation of the Annual Accounts the applicable Accounting Standards havebeen followed along with proper explanation relating to material departures;

2 Appropriate accounting policies have been selected and applied consistently and havemade 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 31st March 2016 and of the profitof the company for the said year;

3 Proper and sufficient care has been taken for the maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the company and for preventing and detecting fraud and other irregularities;

4 Annual Accounts have been prepared on a going concern basis.

5 Internal Financial controls are followed by the Company in adequate manner and areoperating effectively.

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

CORPORATE SOCIAL RESPONSIBILITY (CSR)

In view of the provisions relating to CSR contained in new Companies Act 2013 theBoard of Directors of your Company has set up a CSR Committee comprising four directorsviz. Mr. G M Dave a Non-Executive Independent Director Mr. G. K. Patni Non-ExecutiveDirector Mr. A. K. Patni Non-Executive Director and Mr. H. C. Tandon Managing Directorand CEO of the Company. The Committee will oversee and monitor its CSR activities in linewith the CSR policy of the Company in compliance with the provisions of the Companies Act2013 CSR has been integral part of the Company. The CSR policy on the Company is displayedon Company‘s website www.pcstech.com. CSR report along with the CSR activates areannexed herewith in the report and marked as Annexure 4.

Initiations taken by the Company for CSR :

During the year under review the Company has contributed Rs. 5 lakhs in the ChiefMinister Public Relief Fund Tamil Nadu in the month of December 2015. The Company hascontributed in CSR activities as prescribed u/s 135 (5) of Companies Act 2013. TheBalance amount of Rs. 899417 (Rupees Eight Lakhs Ninety Nine Thousand Four Hundred andSeventeen only) will be contributed by the Company in the next financial year 2016-17.

CORPORATE GOVERNANCE

A report on Corporate Governance and Management Discussion Analysis is included as apart of the Annual Report along with a Certificate from the Statutory Auditors of theCompany regarding compliance of conditions of Corporate Governance as stipulated underRegulation 27 of SEBI (LODR) Regulation 2015. Corporate Governance report annexedherewith and marked as Annexure 5.

SUBSIDIARY COMPANY

In accordance with Section 129(3) of the Companies Act 2013 a statement containingsalient features of the financial statements of the subsidiary companies for the financialyear ended 31st March 2016 of PCS Technology USA. Inc. PCS Positioning Systems (India)Limited and PCS Infotech Limited in Form AOC-1 is annexed an marked as Annexure-6(A)of the Annual Report.

In accordance with third proviso to Section 136(1) of the Companies Act 2013 theAnnual Report of your Company containing therein its audited financial statementstogether with related information and other reports of each of the subsidiary companieshave also been placed on the website of the Company at www. pcstech.com

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES REFERRED TO INSUB-SECTION (1) OF SECTION 188 IN THE PRESCRIBED FORM

The particulars of contracts or arrangements with related parties referred to inSection 188(1) as prescribed in Form AOC-2 of the rules prescribed under Chapter IXrelating to Accounts of Companies under the Companies Act 2013 of the Annual Report isannexed and marked as Annexure- 6(B). DISCLOSURE AS PER THE SEXUAL HARASSMENT OF WOMENAT WORKPLACE (PREVENTION PROHIBITION AND REDRESSAL) ACT 2013

The Company has put in place a Policy on Prevention of Sexual Harassment in line withthe provisions of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the Rules made thereunder. Internal Complaints Committee (ICC)has been set up to redress complaints if any received regarding sexual harassment. Allemployees whether permanent contractual temporary etc have been covered under thisPolicy. The Policy is gender neutral. During the year under review no complaints allegingsexual harassment were received by the Company.

RELATED PARTY TRANSACTIONS

All transactions entered into with Related Parties as defined under the Companies Act2013 and pursuant to Regulation 23 of Securities and Exchange Board of India (listingobligations and disclosure requirements) regulations 2015 during the financial year werein compliance to the provisions of Section 188 of the Companies Act 2013. There were nomaterially significant transactions with related parties during the financial year whichwere in conflict with the interest of the Company. Suitable disclosure as required by theAccounting Standards (AS18) has been made in the notes to the Financial Statements. TheBoard has approved a policy for related party transactions which has been uploaded on theCompany’s website.

DEPOSITS

Your Company has neither invited nor accepted any deposits from the public so far.

CODE OF CONDUCT

The Board of Directors has approved a Code of Business Conduct which is applicable tothe Members of the Board and all employees. The Code has been posted on the Company’swebsite www. pcstech.com. The Code lays down the standard of conduct which is expected tobe followed by the Directors and the designated employees in their business dealings andin particular on matters relating to integrity in the work place in business practicesand in dealing with stakeholders. The Code gives guidance through examples on the expectedbehavior from an employee in a given situation and the reporting structure. All the BoardMembers and the Senior Management personnel have confirmed compliance with the Code.

CONSOLIDATED FINANCIAL STATEMENT

The consolidated Financial Statements have been prepared in accordance with theprovisions of Section 129 of the Companies Act 2013 applicable Accounting Standards andthe provisions of the LODR Regulation 2015 with Stock Exchanges and forms part of thisAnnual Report.

PARTICULARS OF EMPLOYEES

The table containing the names and other particulars of employees in accordance withthe provisions of Section 197 (12) of the Companies Act 2013 read with Rule 5 (1) of theCompanies (Appointment and Remuneration of Managerial Personnel ) Rules 2014 is appendedas Annexure 7 to the Board’s Report. During the financial year there were noemployees drawing remuneration in excess of the monetary ceiling prescribed under Section197 read with Rule 5 (2) of The Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 in respect of employees of the Company.

CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO

The Information required under the above heads in accordance with the provision ofsection 134(3) (m) of the Companies Act 2013 read with the Companies (Disclosure ofParticulars in the Report of the Board of Directors) Rules 1988 are given in Annexure‘8’ to this report.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

The particulars of loans guarantees given and Investments made during the year underreview under Section 186 of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 are annexed to this report and marked as Annexure9 ACKNOWLEDGEMENTS

Your Directors express their warm appreciation to all the employees at various unitsfor their diligence and contribution made towards the growth of the Company. The Board ofDirectors place on record their appreciation for the un-stinted support by the Bankers andFinancial Institutions and confidence given by the Customers Suppliers and Shareholdersat all levels towards the growth and development of the Company.

On behalf of the Board of Directors
A.K. Patni
Vice Chairman
Mumbai May 16 2016