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Sofcom Systems Ltd.

BSE: 538923 Sector: IT
NSE: N.A. ISIN Code: INE499Q01012
BSE 00:00 | 04 Mar Sofcom Systems Ltd
NSE 05:30 | 01 Jan Sofcom Systems Ltd
OPEN 47.15
PREVIOUS CLOSE 47.15
VOLUME 100
52-Week high 47.15
52-Week low 17.00
P/E
Mkt Cap.(Rs cr) 20
Buy Price 44.95
Buy Qty 1000.00
Sell Price 0.00
Sell Qty 0.00
OPEN 47.15
CLOSE 47.15
VOLUME 100
52-Week high 47.15
52-Week low 17.00
P/E
Mkt Cap.(Rs cr) 20
Buy Price 44.95
Buy Qty 1000.00
Sell Price 0.00
Sell Qty 0.00

Sofcom Systems Ltd. (SOFCOMSYSTEMS) - Director Report

Company director report

To The Members of

SOFCOMSYSTEMS LIMITED

Your Director’s have immense pleasure in presenting the 21st Board’s Reportof your Company together with the Audited Statement of Accounts and the Auditors’Report of your company for the financial year ended 31st March 2016.

1. FINANCIAL HIGHLIGHTS

Particulars 2015-2016 2014-2015 % Change
Revenue from Operations 12450000 52955444 76.48
Less: Expenses 12078206 52466572 76.97
Net Profit Before Tax 371794 488872 23.95
Provision for Tax 98381 88401 11.29
Net Profit After Tax 273413 400471 31.73
Surplus carried to Balance Sheet 273413 400471 31.73

(i) Results Of Operations:

Total revenues earned during the year amounted to Rs. 12450000 as compared to Rs.52955444 in the previous financial year.

(ii) Business Operations:

(1) Software Services :

During the year there was an increase of approximately 56.86 % in the income from saleof software. The revenue generated from this segment during the Financial Year 2015-16 wasRs. 1200000 as against Rs. 765000 during the previous financial year.

(2) Sale of Trading of Goods:

During the Previous year there was an income of Rs. 5.16 Crore from trading of goodswhich accounted for nearly 97.61% of the total of revenue. This year there is no incomefrom sale of trading of goods.

(3) Service Income:

During the year there is no increase and decrease in the income from consultancyservices. The revenue generated from this segment during previous Financial Year 2014-15was Rs. 498000/- during the previous financial year.

(4) Sale of Algorithms (IPR ):

During the Current year there is an income of Rs. 1.12 crores from Sale of Algorithms(IPR) which accounted for nearly 90.36% of the total of revenue of the company during theyear.

2. DIVIDEND

Company has made profits for the year 2015-16 but in order to ease the operations ofthe business plough back of the profits is done and therefore the directors are notrecommending any dividend for the financial year 2015-16.

3. AMOUNTS TRANSFERRED TO RESERVES

The Board of the company has transferred amount of profit to its general reserves.

4. INFORMATION ABOUT SUBSIDIARY/ JV/ ASSOCIATE COMPANY

(i) The company has an associate company Abok Spring Private Limited

(ii) Related Party Transactions- During the year under review the Company has notentered into any contracts or arrangements with related parties as per section 188(1) ofthe Companies Act 2013.

5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

The provisions of Section 125(2) of the Companies Act 2013 is not applicable as therewas no dividend declared and paid last year.

6. LISTING OF SHARES

The shares of your Company are listed at Bombay Stock Exchange Madras Stock Exchangeand Calcutta stock exchange.

7. MATERIAL CHANGES AND COMMITMENTS

As on the date of this report no material changes and commitments affecting thefinancial position of the Company have occurred between the end of the financial year towhich this financial statements relate.

8. EXTRACT OF ANNUAL RETURN

An Extract of Annual Return as required under section 92(3) of the Companies Act 2013and rule 12(1) of the Companies (Management and Administration) Rules 2014 in Form MGT-9is annexed in herewith.

9. DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(3)(c) of the Companies Act 2013 the Board of Directors of theCompany confirms that (a) In the preparation of the annual accounts for the financial yearended 31st March 2016 the applicable accounting standards had been followed along withproper explanation relating to material departures; (b) The directors had selected suchaccounting policies and applied them consistently and made judgments and estimates thatare reasonable and prudent so as to give a true and fair view of the state of affairs ofthe company at the end of the financial year and of the profit and loss of the company forthat period; (c) The directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;

(d) The directors had prepared the annual accounts on a going concern basis;

(e) The directors have down internal financial controls to be followed by the companyand that such internal financial controls are adequate and were operating effectively; and(f) The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

10. AUDITORS

(i) Statutory Auditors And Auditor’s Report

At the AGM held on 24th September 2014 the Members approved the appointmentof M/s R. Mohnot & Co. Chartered Accountants (FRN 001654C) Jaipur as StatutoryAuditors commencing from the Twentieth AGM till the conclusion of the Twenty-second AGMsubject to the annual approval of Shareholders. As recommended by the Audit Committee theBoard has proposed the ratification of appointment of M/s R. Mohnot & Co. CharteredAccountants as statutory auditors for F. Y. 2016-17. The appointment is accordinglyproposed in the Notice of the forthcoming AGM i.e. for fiscal 2017 for ratification bythe Members. There are no qualifications or adverse remarks in the Auditors’ Reportwhich require any clarification/ explanation. The Notes on financial statements areself-explanatory and needs no further explanation.

(ii) Secretarial Auditor and Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company with theapproval of its Board appointed M/s. Mahendra Khandelwal & Co. a firm of CompanySecretaries in Practice to undertake the Secretarial Audit of the Company for thefinancial year ended March 31 2016. The Secretarial Audit Report is annexed herewith asAnnexure B. There are no qualifications reservation or adverse remark or disclaimer madeby the auditor in the report save and except disclaimer made by them in discharge of theirprofessional obligation.

11. LOANS GUARANTEES AND INVESTMENTS

During the year under review there is no loan guarantee or investment made by theCompany under Section 186 of the Companies Act 2013.

12. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE OUTGO:

(i) Conservation of energy and Technology absorption

The particulars as required under the provisions of Section 134(3) (m) of the CompaniesAct 2013 in respect of conservation of energy and technology absorption have not beenfurnished considering the nature of activities undertaken by the company during the yearunder review

(ii) Foreign exchange earnings and Outgo

There were no foreign exchange earnings and outgo during the year under review.

13. DIRECTORS/KEY MANAGERIAL PERSONS

(i) Retirement by Rotation

As per section 152 of the Companies Act 2013 Mr. Kishore Mehta would retire byrotation at the forthcoming Annual General Meeting and are eligible for re-appointment.Mr. Kishore Mehta has offered himself for re-appointment.

(ii) Independent Directors

The Board of the Company at March 31 2016 consisted of 6 directors out of which 3 areindependent directors one is Managing Director and two are non-executive director.

All Independent Directors have given declaration that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16 of Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 which were placed at the Board meeting held on 21/03/2016.

(iii) Changes in the composition of Key Managerial Personnel (other than Board ofDirectors):

Anil Nahar was appointed as CFO of the Company in the Board meeting held on 31stMarch 2016 but he stepped down from his position due to his pre-occupation elsewhere. Hisresignation was taken and accepted by the Board in its meeting held on 17thJuly 2016. Hari Om Vijay was appointed as CFO of the Company in the Board Meeting held on17th July 2016 subject to approval of Members which is being sought in theNotice of the forthcoming General meeting.

(iv) Meetings

During the year 9 (Nine) Board Meetings 2 (Two) Nomination & RemunerationCommittee 5 (five) Audit Committee and 1(one) shareholders/investors grievance committeewere convened and held. The gap between the Meetings was within the period prescribedunder the Companies Act 2013.

(i) Committee of the Boards

A detailed note on the Board and its committees is provided under the corporategovernance report section in this Annual Report. The composition of the committee’sis as follows:

(I) Audit Committee:

Composition Category of Director
(1) Krishnanand Parmanand Pant (Chairman) Non-Executive Independent Director
(2) Sanjay Kumar Verma (Member) Non-Executive Independent Director
(3) Arnab Banerjee (Member) Non-Executive Independent Director

(II) Shareholder’s Grievance Committee:

Composition Category of Director
(1) Krishnanand Parmanand Pant (Chairman) Non-Executive Independent Director
(2) Sanjay Kumar Verma (Member) Non-Executive Independent Director
(3) Arnab Banerjee (Member) Non-Executive Independent Director

(III) Remuneration Committee:

Composition Category of Director
(1) Krishnanand Parmanand Pant (Chairman) Independent Director
(2) Sanjay Kumar Verma (Member) Independent Director
(3) Arnab Banerjee (Member) Independent Director

(IV) Nomination and Remuneration Policy

The Board has on the recommendation of the Nomination and Remuneration Committeeframed a policy for selection and appointment of Directors Key Managerial Personnel andSenior Management. As the company is virtually an inactive company no remuneration ispaid to the Directors.

14. DEPOSITS

The company has not accepted any deposits from the public falling within the ambit ofSection 73 of the Companies Act 2013 read with the Companies (Acceptance of DepositRules) 2014 during the year.

15. CORPORATE SOCIAL RESPONSIBILITY

The Company has not constituted Corporate Social Responsibility Committee as it doesnot meet the criteria of Section 135 of Companies Act 2013 read with the Companies(Corporate Social Responsibility Policy) Rules 2014.

16. RATIO OF REMUNERATION TO EACH DIRECTOR

In view of inadequate profits no remuneration is paid to the Directors.

17. PARTICULARS OF EMPLOYEES

(i) None of the employees of the company was in receipt of the remunerationexceeding the 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.

(ii) None of the Director’s was paid remuneration during the financial yearunder review.

The Company does not have any material information to report in accordance to Rule 5of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014.

18. CORPORATE GOVERNANCE

The corporate governance framework adopted by the Company already encompassessignificant portion of the recommendations contained in the ‘Corporate GovernanceVoluntary Guidelines 2009’ issued by the Ministry of Corporate Affairs Government ofIndia.

19. VIGIL MECHANISM

The Company has established a vigil mechanism for grievances redressal of Directors andEmployees of the Company which will help in reporting genuine concerns or grievances ofDirectors and Employees. (Annexure C).

20. SHARES

During the Financial Year 2015-16 there was no change in the share capital of theCompany.

a. Buy Back: The Company has not bought back any of its securities during the year.

b. Sweat Equity: The Company has not issued any Sweat Equity Shares during theyear.

c. Bonus Shares: No Bonus Shares were issued during the year.

d. Employees Stock Option Plan: The Company has not provided any Stock OptionScheme to the employees.

21. INTERNAL CONTROL SYSTEMS

The Company has put in place an adequate system of internal control commensurate withits size scale complexity and nature of business. These systems provide a reasonableassurance in respect of providing financial and operational information complying withapplicable statutes safeguarding of assets of the Company and ensuring compliance withcorporate policies. The Audit Committee reviews adherence to internal control systems andinternal audit reports.

22. RISK MANAGEMENT POLICY

The Company has its Risk Management Policy to identify and deal with the risks andthreats that could impact the organization. Risk Management Policy is available forinspection at the Registered Office of the Company during business hours on any workingday.

23. PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES:

The particulars of contracts or arrangements entered into by the Company with relatedparties referred to in sub-section (1) of section 188 of the Companies Act 2013 includingcertain arms length transactions under the proviso thereto have been disclosed in Form No.AOC -2 annexed.

24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

There are no significant and material orders passed by the regulators or courts orTribunals impacting the going concern status and company’s operation in future.

25. ACKNOWLEDGEMENT

Your Directors wish to express their grateful appreciation to the continuedco-operation received from the Banks Government Authorities Customers Vendors andShareholders during the year under review. Your Directors also wish to place on recordtheir deep sense of appreciation for the committed service of the Executives staff andWorkers of the Company.

Date: 01/08/2016 By Order of the Board
Place: JAIPUR For SOFCOMSYSTEMS LIMITED
CIN:L72200RJ1995PLC010192
SD/-
ANSHUKANOONGO
(Company Secretary)