The Directors are pleased to present the Twenty Seventh Annual Report together with theAudited Accounts of the Company for the Financial Year ended March 31 2018.
Performance of the Company
|Particulars ||Standalone ||Consolidated |
| ||2017-18 || ||2017-18 || |
| ||USD ||Rs ||USD ||Rs |
|Revenue from operations ||223.36 ||14423.53 ||567.64 ||36655.82 |
|Profit before Tax (PBT) ||31.07 ||2006.62 ||50.19 ||3241.21 |
|Profit after Tax (PAT) ||27.49 ||1775.50 ||39.39 ||2543.67 |
Result of Operations
During the year under review the total revenues from operations (consolidated)increased to Rs 36655.82 million a growth of over 10.30% of the previous year. Earningsbefore interest tax depreciation and amortization was Rs 3738.11 million onconsolidated basis. Net profit after tax (consolidated) increased by 6.63% to Rs 2543.67million.
In US Dollar terms revenues from operations for the year on consolidated basis was Rs567.64 million as against Rs 494.39 million during the previous year a growth of 14.82%.Average realization rate was Rs 64.58 per US Dollar.
Standalone sales for the financial year 2017-18 grew by 9.08% to reach Rs 14423.53million. Net profit after tax increased to 4.88% to Rs 1775.50 million.
The Directors are pleased to recommend a final dividend of
Rs 2.40/-per equity share of face value of Rs 2/- each (120%) on the paid-up equityshare capital of the Company for the year under review. The total pay-out will amount toRs 571.43 million including dividend distribution tax.
The issued subscribed and paid-up capital of the Company as on March 31 2018 is Rs394.99 million consisting of 197498742 equity shares of Rs 2/- each.
For the bank loan limits of Rs 4445.5 million CRISIL has assigned the long termcredit rating of AA-.
Quality and Information Security
Quality Productivity and Innovation have been the three pillars that have driven ourpassion for continuous improvement in the way we determine and improve our processframework.
This commitment to quality is ratified by our consistent endeavor in certifyingourselves to the best standards in the industry. In the past year KPIT has beensuccessfully certified on the Quality Management System on ISO 9001:2015.
We continue to improve our Quality focus through internal initiatives and by certifyingagainst international standards.
In accordance with this we underwent an extensive CMMI-DEVR V1.3 (Development)appraisal which resulted in us being appraised at Maturity level 5 by the CMMI Institute.We also continue to maintain our certifications for Information Security Management (ISO27001:2013) and for Business Continuity Management (ISO 22301:2012).
Our productivity journey continues to be strengthened by the 600+ assets created inreusable repository by our practice teams. To further strengthen our competitive advantagein the
AMS space we have developed the Robotic Process Automation (RPA) Center of Excellence.Our experts have enabled some of our major customers to reap the benefits of RPA.
The bandwidth created by our productivity improvement initiatives is re-invested inlearning and innovation through our crowdsourcing platform - my Time. On this platformthe employees get to select their areas of learning and innovation and accordinglycomplete a proof of concept. The framework enables them to collaborate with technocratsfrom across the organization and encourages growth and active exchange of knowledge.
Active learning and collaboration are a crucial part of the culture at KPIT. TheProductivity Forum is a bi-annual platform for our project teams to share theirinnovations best practices and learnings. The practice teams also share the latest toolsautomations and industry best practices.
As on March 31 2018 the total Institutional shareholding in the Company was 54% ofthe total share capital.
During the year under review the Board of Directors of the Company approved a draftcomposite scheme for a) amalgamation of Birlasoft (India) Limited with the Company &b) Demerger of the engineering business into KPIT Engineering Limited a wholly ownedsubsidiary of the Company. The Company has received approval for the proposed merger fromCompetition Commission of India (CCI) and has filed with the Stock Exchanges andSecurities & Exchange Board of India (SEBI) for their approval. Consequent toapprovals from SEBI an application will be filed Law Tribunal (NCLT) for seeking furtherdirections.
Information about the Subsidiary Companies
As on March 31 2018 the Company had 17 subsidiaries including step-downsubsidiaries.
In accordance with Section 129(3) of the Companies Act 2013 (hereinafter referred toas "the Act") the Company has prepared consolidated financial statements of theand all its subsidiary companies which forms a part of the
Annual Report. A statement containing salient features of the financial statements ofthe subsidiary companies in 1 is annexed to this Report as "Annexure 1".
In accordance with Section 136(1) of the Act the Annual
Report of the Company containing the standalone and the consolidated financialstatements and all other required to be attached thereto have been placed on the websiteof the Company www.kpit.com. Further a report on the highlights of performance ofsubsidiaries and their contribution to the overall performance of the Company has alsobeen placed on the website of the Company. Members interested in obtaining a printed copyof the audited annual accounts of the subsidiary companies may write to the CompanySecretary at the Company's registered office.
During the year Mr. Anant Talaulicar Mr. Nickhil Jakatdar & Ms.
Alka Bharucha were appointed as Additional & Independent Directors of the Companyfor a period of 5 years w.e.f October
21 2017 January 24 2018 & May 23 2018 respectively subject to shareholdersapproval. Dr. Klaus Blickle & Mr. Anjan Lahiri were appointed as Additional Directorsw.e.f January 24 2018 & May 23 2018 respectively. Owing to his other businesscommitments and preoccupations
Mr. Sanjay Kukreja resigned from the directorship of the
Company w.e.f. September 15 2017. Dr. R.A. Mashelkar ceased to be a Director of theCompany w.e.f. August 24 2017. The Board places on record its appreciation and valuableservices provided by them during their tenure.
In accordance with Section 152 of the Act Mr. Kishor Patil retires by rotation at theforthcoming Annual General Meeting and being eligible offers himself for re-appointment.The Board recommends his re-appointment.
Key Managerial Personnel
The following persons have been designated as Key Managerial the scheme
Personnel of the Company pursuant to Sections 2(51) and 203 of the Act read with theRules framed thereunder: with the National Company
1. Mr. Kishor Patil - Chief Executive Officer (CEO) and Managing Director;
2. Mr. Anil Patwardhan - Chief Financial Officer (CFO) till May
3. Ms. Sneha Padve - Company Secretary.
Mr. Vinit Teredesai has been appointed as the Chief Company Financial Officer of theCompany w.e.f. May 24 2018.
AOC- Pursuant to the provisions of Section 139(1) of the Act read with the Companies(Audit and Auditors) Rules 2014 M/s. B S R & Co. LLP Chartered Accountants wereappointed as the Statutory Auditors of the Company in the Annual General
Meeting held on July 25 2014 for a period of five years. documents The Notes onfinancial statements referred to in the Auditors' Report are self-explanatory and do notcall for any further comments. The report does not contain any qualification reservationor adverse remark.
The Board of Directors of the Company appointed Dr. K. R.
Chandratre Practicing Company Secretary as the Secretarial Auditor to conduct auditfor the year under review. The Secretarial Auditor's report for the year under review isannexed to this Report as "Annexure 2". The report does not contain anyqualification reservation or adverse remark.
A separate section on Corporate Governance with a detailed compliance report thereonforms a part of this Report. The Auditors' Certificate in respect of compliance with theprovisions concerning Corporate Governance forms a part of this Annual Report asrequired under the Securities and Exchange Board of India (Listing Obligations andDisclosure
Requirements) Regulations 2015 (hereinafter referred to as "the SEBI (LODR)Regulations 2015").
Management Discussion and Analysis
A detailed review of the operations performance and future outlook of the Company andits business is given in the
Management Discussion and Analysis Report which forms a part of this Report.
Awards & Recognition
KPIT wins multiple accolades at Dassault Systemes' 2018 Value Solutions SalesConvention
KPIT recognized with theInfluentialMarketing Most Leaders Award for the thirdconsecutive year
KPIT recognized at The CSR Journal Excellence Awards 2017
KPIT wins Best Event-led Communication Campaign
Award at the Indian Communications Summit 2017
KPIT Woman Leader acknowledged as Science and Technology Leader of the Year 2017
KPIT receives Special Recognition by UITP India
KPIT wins Smart Cities India Award 2017
KPIT wins ERP Cloud Partner of the Year Award for service excellence in India
KPIT awarded Outstanding Green Vehicle Integrated
Solution Provider of the Year' at 8th Green Vehicle
Convention event Beijing China
Particulars of Employees
A statement containing the names of every employee employed throughout the financialyear and in receipt of remuneration of
Rs 1 crore 2 lakhs or more or employed for part of the year and in receipt of Rs 8.5lakh or more a month and other employees as required under Rule 5(2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed to thisReport as "Annexure 3(a)".
The ratio of the remuneration of each director to the median employee's remunerationand other details prescribed in
Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are annexed to this Report as"Annexure 3(b)".
Employees Stock Option Plan (ESOPs)
Information relating to ESOPs of the Company is annexed to this Report as"Annexure 4". The information is being provided in compliance with Regulation 14of the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations2014.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013
The Company has a policy on prevention of sexual harassment and has put in place aredressal mechanism for resolving complaints received with respect to sexual harassmentand discriminatory employment practices for all genders. There was no case on sexualharassment registered for the last year.
As a part of our orientation programs for all new joinees we mandate that theycomplete an e-learning module on the same as well.
The Company has not accepted any deposits as on March 31 2018.
Information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Act read with Rule 8 of theCompanies (Accounts) Rules 2014 Conservation of Energy
KPIT always undertakes various activities to reduce energy consumption and achieveconservation of resources. Many initiatives taken in this connection have been detailed inthe previous Board's Reports which the Company continues to implement. Apart from thoseinitiatives the following PAN India measures were undertaken to reduce energy consumptionresulting in Pune (30%) Bangalore (15%) and Mumbai (19%) saving over the period of 6years. Few initiatives undertaken in FY17-18 are:
Replaced 1000 CFL (56/72W) with energy efficient LED lights (18/20W) (resulting intosavings of 1.5 lakh units per year).
Features of energy efficient Phase-3 campus:
Sun path analysis done to design building North cladded with Glass and South mix ofwall and Glass and cladded with fins to avoid direct sun rays
The glazing along the south and west is in a form of Double Glazing with reflectiveglasses
This reduces the heat load on the building
A VRF with latest digital scroll energy efficient HVAC system installed
Use of natural light by designing optimum building width
Lighting load reduced substantially by using task lighting and using energy efficientLED lights
UPS installed with latest energy efficient Modular technology with 98% efficiency
Energy efficient equipment installed e.g. MRL lifts Hydro Pneumatic pumping etc.
Terrace kept vacant to adopt Solar (150 KVA)
The following initiatives were undertaken at the Company level to create awarenessabout importance of environmental protection and reducing pollution:
At Maan village Hinjawadi in association with Hinjawadi Companies Association KPITplanted 160 saplings.
Water Conservation through Mass Volunteering supported 8 villages benefitting1895people this year with 1.5 million litres of water
Covered 1 village under Government of Maharashtra's
Jalyukta Shivar Abhiyan
Through Zero Garbage Initiative 570 Chronic Black Spots have been eliminated
Environment Week Celebration: The Environment Week on the "World EnvironmentDay" is been celebrated for the past seven years since 2010
Conservation of Private Forests in Koyna Chandoli corridor by planting 5000 saplings
Aerial Reforestation in Bengaluru by 15000 seed-ball bombings
Occupational Health and Safety Assessment Series (OHSAS)
The following activities were carried out by the Company under OHSAS in 2017-18:
Health Risk Assessment was mandated during the GMC enrollment drive
Zumba and Yoga was continued as a practice looking at the popularity
Health Carnival was introduced for the first time in KPIT across all locations. oSubsidized health check-up packages offered for employees o BMI Eye Skin Hair &Scalp analysis Pulmonary test
Dietician and Dental Checkup was done free of cost for all employees o Health checkuptools provided at a discounted price o New apps were introduced to employees for buyingmedicines and booking for health check-ups at discounted rates
On Occasion of International Women's Day "Anemia Free
KPIT Campaign" was held o Anemia awareness session was held o Complete Haemogramtest was held free of cost for women employees. o Women found with deficiency wasconsulted by our in house doctor.
Engagement through Wellness o Laughter Session o Masala Bhangra Sessions o Tug of War oAwareness session linked to the WHO days o Newsletters are sent via Wellness ID onInternational days currently observed by the United Nations o Skin and Scalp check-upcamps on campus for employees o "Health Warrior" Various fitness employees o"Health Tips for the week" mails shared with the employees o Iyengar Yogasessions from renowned Yoga instructor
Executive Health Check-ups for Senior Grade employees
Health Check-ups for employees (35 years and above)
Health Check-ups were done from HOD.life at discounted rates o Anemia Profile oPancreas Profile o Diabetes o Lipid Profile o Kidney Profile o Iron deficiency o Vitamin Ddeficiency
Last year we rolled out an initiative to implement integrated collaboration platformusing Cisco's Web Ex technology. This has led to substantial cost reductions vis-a-vistraditional audio conferencing services while providing a seamless meeting experience thatis greatly enhanced by features like one touch audio/video calling' from any deviceapplication and presentation sharing personalized meeting rooms for relevant usersmeeting recording and sharing etc. As a logical next step the same platform is gettingupgraded to Cisco Spark - an app for continuous teamwork with video meetings messagingfile sharing and white boarding. Cyber security is becoming more and more important in thedigital age. Advancement of digital technologies are enabling hackers to use smartalgorithms to generate more sophisticated attacks. Traditional tools have too muchdependency on people to continuously monitor and take preventive actions to protectorganization from advance threats. However it is difficult to protect customer andorganizational assets from threats generated by Smart machines and cannot be defended justby Smart people. Hence we relooked at our cyber security architecture and investedsubstantially in securing our infrastructure against advance threats in the digital age.In addition to Next Generation Firewall implementation to protect perimeter security thisyear the implementation of the
Next Generation firewall in datacenter (to monitor East to West traffic)was a majorstep forward. It is helping us in securing business applications and infrastructure fromadvanced threats even in the LAN and WAN network. We have increased the footprint andpenetration of TRAPs' from Palo Alto Networks for Advance Threat Protectionsolutions on end points. This solution protects end user devices against Advanced Malwaresand Exploits. Recently we also invested in another tool from Palo Alto NetworksMagnifier behavioral We also launched various analytics'. This tool identifiesbehavioral anomalies to expose hard-to-detect threats such as targeted attacks maliciousinsiders risky behavior and compromised endpoints. When used along with
Next Generation Firewallthetoolefficientlyand automatically identifies abnormalactivity in the network while providing us with the exact information to rapidly evaluatepotential threats then isolate and remove those threats from the network before they canperform real damage.
On the smart Campus front we have taken our story to the next level and created moreimproved user experience by using technologies such as Face recognition and Voice basedassistant. Integrating these technologies in Kassist App now with one click'reporting of incidents is done by scanning the
QR codes applied in designated common areas. Voice based access to functionality hasalso been added.
A key focus area this year was on creating a Digital Lab' wherein we havedesigned and developed various solutions based on digital technologies to change the userexperience in the office optimizing cost and increase the productivity. Few applicationsthat were born out of the lab are:
Book your seat: Employee can book his/her seat for a day or a week using KIOSK orapp. Once the seat is booked by the time user gets the appropriate network and VOIP phonegets configured as per the user profile. We also build a capability on adjusting theheight of the workplace table using the same App.
Smart Mirror a mirror that doubles up as a voice assistant for providinginformation such as time to reach a place eating place around nearest exit in case ofevacuation game scores etc.
Under the aegis of the Digital Lab we have also created a Centre of Excellence (CoE)with an aim to showcase transformational use cases that are built using digitaltechnologies. The lab will be available for use by customers to co-innovate with us thesolutions as per their need. Another very strategic initiative we rolled out this year was#Think Digital'. This initiative was to build digital culture across theorganization ensuring all employees understand power of digital technologies to solvecustomer problems in innovative ways and also improve business productivity by taskautomation and process augmentation. We launched various e-learning modules to createdigital mindset and we got excellent response by having 11000+ employees becoming
Digi technical Champ Certified. training to reskill employees on new age digitaltechnologies and also conducted workshops for customer facing teams to educate them ondigital trends and solving customer problems differently. To improve the effectiveness ofsystems and creating differentiated experience for employees this year we have developedintelligent ERP by upgrading our Systems of Record to SAP S/4 Hana and building Systems ofEngagement using cloud native technologies like microservices and containers. Also toimprove in the moment effectiveness of employees we are developing Systems ofIntelligence using advance analytics. Some of the dashboards giving real time insightswere already rolled out last year. We are working on predictive analytics in variousbusiness areas and will be rolled out soon to business users.
Research and Development (R&D) Activity
1. KPIT's Intelligent Transport System' received an award under the categorySmart Urban Mobility' on 12th May 2017 at One Mega Event 2017'. The award wasgiven by Shri D. N. Modi IAS Commissioner - Gandhinagar Municipal Corporation.
2. KPIT received Special Recognition from UITP India for its entry 'Helping Indiadouble its public transport usage with smart and green technologies'. KPIT was selected by
UITP India to acknowledge the bouquet of transportation solutions that it provides.
3. KPIT Technologies is a Frost & Sullivan 2018 Manufacturing Leadership Awardwinner. KPIT has been selected from a considerable pool of nominees to receive twoprestigious awards for its Integrated Intelligent Transport System and its REVOLOprojects.
The total amount spent on R & D activities is given below:
R & D expenses for the year ended March 31 2018
|Particulars ||Amount ||Key Project Details |
| ||(Rs in million) || |
|Expensed in the statement of profit and loss (Refer Note 1) ||199.11 ||Solar Bus_Program (HEV) ITS Eng Innovation |
|Capital work-in-progress ||110.42 ||K-BIKE |
|Assets capitalized during the year ||9.89 || |
|Total ||319.43 || |
Out of total R & D expenditure of Rs 199.11 million eligible R & D revenueexpenditure under Section 35(2AB) of the Income Tax Act
1961 for the Company is Rs 141.94 million.
A separate section on R&D activities forms a part of this Annual Report.
Foreign Exchange Earnings and Outgo
Given the global nature of the business of the Company exports always form its thrust.Total foreign exchange earnings during the year have been Rs 9969.73 million (previousyear Rs 9586.28 million) and foreign exchange outgo (including imports) has been Rs494.55 million (previous year Rs 705.62 million).
Six meetings of the Board of Directors were held during the year. More details aboutthe meetings are available in the Report on Corporate Governance which forms a part ofthis Annual Report.
Committees of Board
The details regarding Committees of the Board of Directors of the Company are given inthe report on Corporate Governance which forms a part of this Annual Report.
Independence of the Board
The Board of Directors of the Company comprises of optimum number of IndependentDirectors. Based on the confirmation/ disclosures received from the Directors and onevaluation of the relationships disclosed the following Non-Executive Directors areIndependent in terms of Regulation 16(1)(b) of the SEBI (LODR) Regulations 2015 andSection 149(6) of the Act:
1. Ms. Lila Poonawalla
2. Mr. Adi Engineer
3. Prof. Alberto Sangiovanni Vincentelli
4. Mr. Anant Talaulicar
5. Mr. Nickhil Jakatdar
6. Ms. Alka Bharucha
Company's Policy on Directors' appointment and remuneration
Pursuant to the provisions of Section 134(3)(e) of the Act the policy of the Companyon the appointment and remuneration of Directors including criteria for determiningqualifications positive attributes independence of a director and other matters providedunder Section 178(3) of the Act is annexed to this Report as "Annexure 5".
Particulars of loans guarantees or investments under Section 186 of the Act
Particulars of loans guarantees or investments made during the year under reviewpursuant to the provisions of Section 186 of the Act are as below:
|Name of the subsidiary ||Nature of transaction ||Duration ||Rate of Interest (%) ||Amount (Rs in million) ||Purpose |
|1 Impact Automotive Solutions Limited ||Investment ||NA ||NA ||367.50 ||Equity infusion |
|2 Impact Automotive Solutions Limited ||Loan given ||5 years ||9.15% p.a. ||100.00 ||Working capital loan |
|3 Yantra Digital Services Private Limited ||Guarantee ||3 years ||NA ||149.16 ||For setting up credit facilities |
|4 KPIT Engineering Limited ||Investment ||NA ||NA ||1.00 ||Equity infusion |
Particulars of contracts or arrangements with related parties referred to in Section188(1) of the Act
Pursuant to the provisions of Section 134(3)(h) of the Act the particulars ofcontracts or arrangements with related parties referred to in Section 188(1) of the Actand prescribed in Form
AOC-2 of Companies (Accounts) Rules 2014 is annexed to this Report as "Annexure6".
Material changes and commitments affecting the financial position of the Company
The Board of the Company approved at its meeting held on January 29 2018 a draftcomposite scheme for: (a) amalgamation of Birlasoft (India) Limited with the Company and(b) demerger of the engineering business of the Company into KPIT Engineering Limited awholly owned subsidiary of the Company to be renamed as KPIT Technologies Limited interms of the Draft Scheme and other agreements that are to be executed between theCompany Birlasoft and other parties. The completion of the Proposed Merger and ProposedDemerger will be subject to terms of such agreements and receipt of necessary approvalssuch as SEBI & NCLT.
Due to this the Business IT segment of the Company and the business run by Birlasoft(India) Limited will get merged into the Company whereas the engineering business of theCompany will be demerged into new engineering Co and this is a material re-structuringactivity undertaken by the Company. This is not likely to have any adverse impact on theCompany however it willfinancial position of the Company affect the consequent to saidmerger & demerger.
Change in nature of business
KPIT is engaged in two business segments (i) the enterprise resource planning businessof Oracle and SAP digital business
IMS and EPLM business; and (ii) engineering business which includes solutions ofelectronic or mechanical engineering and usage of this data for diagnostics maintenanceand tracking of assets and related connectivity solutions including data and analyticsbeyond embedded or mechanical engineering and their connectivity and integration withbackend IT systems and platforms.
The Proposed Merger of Birlasoft into the Company and the subsequent Proposed Demergerwill create two specialized companies focused on:
1. Business IT and consulting with strong expertise into enterprise resource planningdigital solutions and consulting with wider industry coverage
2. Deep domain expertise in auto engineering and mobility solutions This will enableboth companies to have sharp focus retain and attract best talent bring better value tocustomers and make necessary investments in building technologies and solutions.
This will accelerate profitable growth and industry recognition in respective areas.
The engineering business of the Company includes solutions of electronic or mechanicalengineering and usage of this data for diagnostics maintenance and tracking of assets andrelated connectivity solutions including data and analytics beyond embedded or mechanicalengineering and their connectivity and integration with backend IT systems and platformsand this will remain the core business of the new engineering Company going forward.
Significant and material orders and material orders passed by the There are nosignificant regulators or courts or tribunals impacting the going concern status andCompany's operations in future.
Risk Management Policy
A mechanism to identify assess monitor and mitigate various risks to key businessobjectives of the Company is in place. A write-up on Enterprise Risk Management isincluded in this Annual Report.
Internal Control Systems and Adequacy of Internal
The internal control systems of the Company are adequate considering the nature of itsbusiness size and complexity. The Statutory Auditors as well as the Internal Auditors ofthe Company review the same on periodical basis. Further if any and action taken reportson the significant same are considered by Audit Committee at their meeting.
The Act has made it mandatory for the Directors in their
Responsibility Statement in the Board's Report to state that
"the directors in the case of a listed company has laid down internal financialcontrols to be followed by the Company and are adequate that and were such internalfinancial operating effectively". The above statement has to be affirmed to by theStatutory Auditors in their Audit Report.
As per explanation provided to Section 134(5)(e) of the Act
"internal financial controls" means "the policies and procedures adoptedby the Company for ensuring the orderly and efficient conduct of its business includingadherence to the Company's policies the safeguarding of its assets the prevention anddetection of frauds and errors the accuracy and completeness of the accounting recordsand the timely preparation of reliable financial Components of internal control defineinternal control over financial reporting as "a process designed by or under thesupervision of CEO and CFO" office and effected and approved by the Board ofDirectors and management to provide reasonable assurance regarding the reliability offinancial for external purposes in accordance with Indian Accounting Standard (IND-AS) andincludes those policies and procedures that:
Pertain to the maintenance of records that in reasonable the transactions and detailaccurately and fairly reflect dispositions of the assets and liabilities of the Company;
Provide reasonable assurance that transactions are recorded as necessary to permitpreparation of financial statements in accordance with IND-AS and that receipts andexpenditures of the Company are being made only in accordance with authorizations ofmanagement and Directors of the Company; and
Provide reasonable assurance regarding prevention or timely detection of unauthorizedacquisition use or disposition of the Company's assets that could have a material effecton the financial statements.
Audit Committee Recommendations
During the year all the recommendations of the Audit Committee were accepted by theBoard. The composition of the
Audit Committee is as mentioned in the Report on Corporate Governance which forms apart of this Annual Report.
Corporate Social Responsibility (CSR)
The Policy on Corporate Social Responsibility of the Company and the details about thedevelopment of CSR Policy and initiatives taken by the Company on CSR during the year asper the Companies (Corporate Social Responsibility Policy) Rules 2014 has been annexed tothis Report as "Annexure 7".
Formal Annual Evaluation by the Board
A separate meeting of the Independent Directors of the Company was held on February 142018 in which a formal evaluation of performance of the Board Committees and theindividual Directors was carried out. The performance evaluation was conducted based onthe criteria specified in the Act Regulation 17 of the SEBI (LODR) Regulations 2015 andGuidance Note on Board Evaluation issued by SEBI.
The feedback based on evaluation was discussed with the Chairman of the Board and givento the Directors.
The Company has established a vigil mechanism as per
Regulation 22 of the SEBI (LODR) Regulations 2015 for
Directors and employees to report their genuine concerns. The details of the same areexplained in the Report on Corporate Governance. The Policy on Vigil Mechanism may beaccessed and the preparation of financial statements on the Company's website at the link:(http://www.kpit.com/ company/investors/corporate-governance).
Extract of Annual Return
The details forming part of the extract of the Annual Return in Form MGT-9 is annexedto this Report as "Annexure 8".
Responsibility Statement of the Board of Directors
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors state that: i) in the preparation of theannual accounts for the year ended March 31 2018 the applicable accounting standardshave been followed along with proper explanation relating to material departures if any;ii) they have selected such 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 as at March 31 2018 and of the profit of theCompany for the year ended March 31 2018; iii) they have taken proper and sufficient carefor the maintenance of adequate accounting records in accordance with the provisions ofthe Act for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities; iv) the annual financial going concern basis; v) they have laiddown internal financial followed by the Company and that such internal financial controlsare adequate and are operating effectively and vi) they have devised proper systems toensure compliance with the provisions of all applicable laws and that such systems areadequate and operating effectively.
CEO & CFO Certification
Certificate by Mr. Kishor Patil CEO & Managing Director and Mr. Anil PatwardhanChief Financial Officer pursuant to the provisions of Regulation 17(8) of the SEBI (LODR)Regulations
2015 for the year under review was placed before the Board of
Directors of the Company at its meeting held on May 23 2018. A copy of suchcertificate forms a part of the Report on
We take this opportunity to thank all the shareholders of the Company for theircontinued support.
We thank our customers vendors investors and bankers for their continued supportduring the year. We place on record our appreciation of the contribution made by ouremployees at all levels. Our consistent growth was made possible by their hard worksolidarity co-operation and support.
We further thank the governments of various countries where we have our operations. Wealso thank the Government of India particularly the Ministry of Communication andInformation Technology the Ministry of Commerce the Ministry of Finance the Ministry ofCorporate Affairs the Customs and Excise Departments the Income Tax Department theReserve Bank of India the State Governments the Software Developmentstatementshavebeenprepared Centers (SDCs)/Special Economic a Zones (SEZs) NaviMumbai
Chennai Bengaluru Hyderabad Noida Pune and all other government agencies for theirsupport and look forward for their continued support in future. controls to be
| ||For and on behalf of the Board of Directors |
|Pune ||S. B. (Ravi) Pandit |
|May 23 2018 ||Chairman & Group CEO |