CAPRICORN SYSTEMS GLOBAL SOLUTIONS LIMITED
Your Directors have pleasure in presenting the 34th (Thirty Fourth) Annual Report ofyour Company together with the Audited Accounts for the financial year ended 31st March2019 and the report of the Auditors thereon.
The summarized results of your Company are given in the table below:
| ||(Figures in Rs.) ||(Figures in Rs.) |
|Particulars ||31-03-2019 ||31-03-2018 |
|Revenue from Operations ||37100148 ||35767575 |
|Other Income ||0 ||0 |
|Total Income ||37100148 ||35767575 |
|Employee Benefit Expense ||32720715 ||31227236 |
|Depreciation and Amortization Expense ||314559 ||377210 |
|Other Expenses ||4275832 ||3710153 |
|Total Expenditure ||37311106 ||35314599 |
|Profit from operations before other income ||(210958) ||452976 |
|Other Income ||837260 ||1234573 |
|Profit/(Loss) Before finance costs and exceptional items ||626302 ||1687549 |
|Less : Finance Cost ||641361 ||1191719 |
|Profit / (Loss) Before Tax ||(15059) ||495830 |
|Less : Tax Expense ||52693 ||275685 |
|Other Comprehensive Income (Net of Tax) ||(13512773) ||- |
|Profit / (Loss) for the year after Tax ||(13580524) ||220146 |
THE STATE OF THE COMPANY AFFAIRS
The operations of the company have been constant over the years. The revenue of thecompany has witnessed a marginal increase during the year. However some of the long termcontracts that the company is entered have come up for review during the year and thecompany was successful in extending the same for a shorter period of time ranging from 6-9months Considering the impact of the possible closure of some of the contracts company ismaking efforts to acquire new contracts from various sources.
REVIEW OF OPERATIONS:
Turnover for the year ended 31st March 2019 was Rs. 37100148/- as against Rs.35767575/- in the previous year. The Net Profit for the year was at Rs. (13580524) asagainst Rs 220146/- in the previous year.
Material Changes and Commitments if any affecting the Financial Position of theCompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report.
There are no Material Changes and Commitments affecting the financial position of theCompany which occurred between the end of the financial year to which the financialstatements relate and the date of this Report.
INDUSTRY STRUCTURE AND DEVELOPMENT:
The company is engaged in the business of software development providing BusinessProcess Out sourcing consultancy services in the fields of software and allied services.The industry is expected to grow at the moderate rate compared to the earlier period andthe company is expecting to expand its business areas to capitalize on the its longstanding tract record for its growing.
LISTING OF EQUITY SHARES:
The Company's Equity shares are presently listed on BSE Limited and the Company haspaid the Annual Listing Fees to the said Stock Exchanges for the financial year 2018-2019
To conserve the resources in the Expansion of the business operations your directorsdid not recommend any dividend during the year.
TRANSFER TO RESERVES
There was transfer of Rs (13580524)/- to Reserves during the financial year underreport.
The Authorized Share Capital of the Company remains unchanged during the financial year2018-19
CHANGE IN NAUTURE OF BUSINESS IF ANY:
During the year under review there has been no change in the nature of business of theCompany.
PERFORMANCE AND FINANCIAL POSITION OF THE SUBSIDIARY COMPANY:
The Company does not have any subsidiaries or associate companies. Hence the requiredinformation under this head is not being attached to the report.
The Corporate Governance Report and a certificate by the Statutory Auditors regardingcompliance of the conditions of corporate governance by your Company as stipulated inListing Regulations SEBI 2015 of the Listing Agreement with Stock Exchanges are annexed tothis Report.
STATEMENT ON DECLARATION GIVEN BY INDEPENDENT DIRECTORS:
All the Independent Directors have given declarations of Independence as requiredpursuant to Section 149 (7) of the Companies Act 2013 stating that they meet the criteriaof Independence as provided in subsection (6) of Section 149 of the Companies Act 2013.
NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS
The Board of Directors duly met 5 times during the year viz 29.05.2018 14.08.201831.08.2018 14.11.2018 14.02.2019. The intervening gap between any two Board Meetings waswithin the period prescribed under the provisions of the Companies Act 2013. All therecommendations given by the Audit Committee are accepted by the Board.
CHANGE OF DIRECTORS AND MANAGEMENT
During the financial year under the review there is change in the constitution of theBoard of Company.
During the financial year as per Section 149 152 read with Schedule IV and all otherapplicable provisions of the Companies Act 2013 (including any statutory modification(s)or re-enactment thereof for the time being in force) read with the Companies (Appointmentand Qualification of Directors) Rules 2014 and clause 49 of Listing Agreement Mr.Valluri Chandra Rao (DIN: 08329674) was appointed as Additonal Director of the companyfrom 14/02/2019.
During the year Mr Anand Balwantrao Deshmukh Independent Director [DIN: 03110963] wasdisqualified u/s 164 (2) of companies act 2013 the director resigned from the boarddated 29/05/2018 as per section 167 of the act and under disqualification provisions asapplicable.
During the financial year pursuant to the provisions of Section 203 of the CompaniesAct 2013 read with Companies (Appointment and Remuneration) Rules 2014 Ms MaruthiPadmaja P was appointed as Company Secretary of Company w.e.f 14/11/2018.
A certificate from M/s. Aakash Agarwal a practicing Company Secretary has beenprocured that none of the Directors on the Board of the Company have been debarred ordisqualified from being appointed or continuing as directors of companies by theBoard/Ministry of Corporate Affairs or any such statutory authority and forms part of thisreport.
AS PER THE PROVISIONS OF INDEPENDENT DIRECTORS
The performance of the Individual Directors on the Board and the Committees thereof isdone by the Board and the Independent Directors in their exclusive meeting done as per thepolicy formulated by the Board in this regard.
INTERNAL FINANCIAL CONTROL
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the requirement of Section 134(5) of the Act and based on therepresentations received from the management the directors hereby confirm that: i. In thepreparation of the annual accounts for the financial year 2018-19 the applicableaccounting standards have been followed and there are no material departures; ii. selectedsuch accounting policies and applied them consistently and made judgments and estimatesthat are reasonable and prudent so as to give a true and fair view of the state of affairsof the Company at the end of the financial year and of the profit of the Company for thefinancial year; iii. and sufficient care to the best of their knowledge and ability forthe maintenance of adequate accounting records in accordance with the provisions of theAct. They confirm that there are adequate systems and controls for safeguarding the assetsof the Company and for preventing and detecting fraud and other irregularities; iv.prepared the annual accounts on a going concern basis; v. laid down internal financialcontrols to be followed by the Company and that such internal financial controls areadequate and operating properly; and vi. devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively
RISK AND RISK MITIGATION POLICY:
The operations of the company are dependent on the export to overseas markets Theinternational economic environment directly influences the spending patterns of theindustry on the Information Technology. Also with the growing demand for the skilledmanpower and ever growing business environment poses risk of availability of skilled manpower. With the employee friendly policies the company pursued the employee retention ratehas been very high in the company.
CORPORATE SOCIAL RESPONSIBILITY:
Your Company does not fall under any of the criteria specified under the provisions ofCompanies Act 2013. Hence the Company has not constituted any committee and is notrequired to furnish information required under the provisions of the said Act.
PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS:
There have been no loans guarantees and investments under Section 186 of the Actduring the financial year 2018-2019.
TRANSACTIONS WITH RELATED PARTIES:
There are related party transactions during the year except that entered in theordinary course of business and on arm's length basis. There were no materiallysignificant related party transactions between your Company and the Directors promotersKey Managerial Personnel and other designated persons which may have a potential conflictwith the interest of company at large.
Form AOC 2 for disclosure of particulars of contracts / arrangements entered into byyour company with related parties is attached herewith as Annexure I.
TECHNOLOGY ABSORPTION ENERGY CONSERVATION & FOREIGN EXCHANGE EARNINGS AND OUTGO:
Information in accordance with clause (m) of sub section (3) of Section 134 of theCompanies Act 2013 is annexed herewith as Annexure II.
Particulars of employees pursuant to Section 134 (3) (q) and Section 197 (12) of theCompanies Act 2013 read with Rule 5 (1) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 forming part of the Directors' Report for the year endedMarch 31 2019 as Annexure III.
PARTICULARS OF EMPLOYEES:
There are no employees in the company whose names are required to be furnished as perthe information and statement containing particulars of employees required pursuant toSection 197 of the Companies Act 2013 read with Rule 5 (1) and Rule 5 (2) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The Nomination and remuneration committee of the Company has affirmed that theremuneration is as per the Remuneration policy of the Company.
Your Directors take this opportunity to record their deep appreciation of thecontinuous support and contribution from all employees of the Company.
EXTRACT OF ANNUAL RETURN:
As required under Sub-Section (3) of Section 92 of the Companies Act 2013 and Rule12(1) of the Companies (Management and Administration) Rules 2014 an extract of AnnualReturn in Form MGT 9 forms part of this report as Annexure IV.
During the year under review your Company has not accepted any fixed deposits and assuch no amount of principal or interest was outstanding as of the Balance Sheet date.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and Rule 9 of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas appointed M/s Aakash Agarwal Company Secretaries to undertake the Secretarial Auditof the Company for the financial year 20182019. The Secretarial Audit report is annexedherewith as Annexure V
DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION ANDREDRESSAL) ACT 2013:
The Company has zero tolerance for sexual harassment at workplace and has adopted apolicy on prevention prohibition and redressal of sexual harassment at workplace in linewith the provisions of Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013 and the rules framed there under. During the financial year2018-2019 the Company has not received any complaints on sexual harassment.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme save and except ESOP referred to in this Report.
4. Cost Audit is not applicable for the financial year 2018-19.
5. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.
Your Directors place on record their sincere thanks to bankers business associatesconsultants and various Government Authorities for their continued support extended toyour Companies activities during the year under review. Your Directors also acknowledgesgratefully the shareholders for their support and confidence reposed on your Company.
| ||For and on behalf of the Board |
| ||For Capricorn Systems Global Solutions Limited |
|Place: HYDERABAD ||Sd/- |
|Date : 30th August 2019 ||S. Man Mohan Rao |
| ||Managing Director |
| ||DIN : 00109433 |