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GI Engineering Solutions Ltd.

BSE: 533048 Sector: IT
NSE: GISOLUTION ISIN Code: INE065J01016
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NSE 05:30 | 01 Jan GI Engineering Solutions Ltd
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VOLUME 21
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OPEN 2.43
CLOSE 2.43
VOLUME 21
52-Week high 4.43
52-Week low 2.43
P/E
Mkt Cap.(Rs cr) 2
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

GI Engineering Solutions Ltd. (GISOLUTION) - Director Report

Company director report

Dear Shareholders

Your Directors have pleasure in presenting their Eleventh Annual Report of the Companytogether with the Audited Statement of Accounts for the Financial Year ended March 312017.

1. FINANCIAL RESULT

Summary of the Standalone performance of the Company for the year under review istabulated below:

Particulars March 31 2017 March 31 2016
Income 2.20 1.08
Operating Profit/ (Loss) before Depreciation Interest and Taxes (7.88) (10.65)
Less: Diminution in the value of investment in wholly owned subsidiary 2682.35 -
Profit/(Loss) before tax (2690.23) (10.65)
Less: Current Tax - -
Profit (Loss) After Tax (2690.23) (10.65)

2. DIVIDEND

Due to loss incurred during the year your directors regret their inability torecommend any dividend for the year ended March 31 2017.

3. SHARE CAPITAL

The paid up Equity Share Capital as on March 31 2017 was Rs. 86118780/- and 4.5%Redeemable Cumulative Preference Share Capital was Rs. 70000000/-. During the yearunder review the Company has not issued any Shares.

4. OPERATIONS

During the year under review the Company achieved the total income of Rs. 2.20 lacs ascompared to Rs. 1.08 lacs in the previous financial year. The Company incurred anoperating loss of Rs. 7.88 lacs. After providing for diminution in the value of investmentof your wholly owned subsidiary the loss after tax was Rs. 2690.23 lacs for the yearcompared to loss after tax of Rs. 10.65 lacs for the previous year. Management isevaluating various propositions to improve the financial situation and is hopeful ofarriving at some conclusion soon.

5. DEPOSITS

Your Company has neither invited nor accepted any deposits within the meaning ofSection 73 of the Companies Act 2013 and the Companies (Acceptance of Deposits) Rules2014.

6. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

The details of loans guarantees and investments are given in the notes to thefinancial statements.

7. SUBSIDIARY COMPANY

The Wholly Owned Subsidiary Company viz. Genesys Enterprises Inc. USA filed anapplication for voluntary dissolution with the Secretary of State of New York. Inaccordance with the General Circular issued by the Ministry of Corporate AffairsGovernment of India the Balance Sheet Profit and Loss Account and other documents of thesubsidiary company are not being attached with the Balance Sheet of the Company. TheCompany shall make available the audited financial statements and related information ofits subsidiaries to those members who wish to have copies of the same and these documentswill also be kept open for inspection by members at the registered office of the Companyduring working hours upto the date of the Annual General Meeting.

8. EXTRACT OF ANNUAL RETURN

The details forming part of the extract Annual Return in Form MGT-9 is annexed herewithas "Annexure A".

9. CONSOLIDATED FINANCIAL STATMENTS

In compliance with the Regulation 33 of SEBI (Listing Obligation and DisclosureRequirements) Regulations 2015 Consolidated financial statements of the Company and itssubsidiary has been prepared as per the applicable accounting standards specified inSection 133 of the Companies Act 2013 and issued by Institute of Chartered Accountants ofIndia. The audited consolidated financial statements together with Auditors Report formpart of the Annual Report.

10. MANAGEMENT DISCUSSION AND ANALYSIS

Management Discussion and Analysis of the financial conditions future outlook andresults of the operations of the Company for the year under the review as stipulatedunder Regulation 34(2)(e) of SEBI (LODR) Regulations 2015 is given under separate sectionof this Annual Report and forms part of the Directors' Report.

11. CORPORATE GOVERNANCE

The Company is committed to maintain the highest standards of Corporate Governancerequirements set out by SEBI. In compliance with Regulation 34 and Schedule V of SEBI(LODR) Regulations 2015 report on the Corporate Governance along with a certificatefrom the Statutory Auditors of the Company on compliance with the provisions is annexedand forms part of the Annual Report.

12. VIGIL MECHANISM/WHISTLE BLOWER POLICY

The Company has established a Whistle blower mechanism in place to deal with instancesof unethical behavior fraud or mismanagement. The said policy has been explained in theCorporate Governance Report and also displayed on the Company's website under the‘Investors' section at www.giesl.com

13. DIRECTORS & KEY MANAGERIAL PERSONNEL

Mrs. Saroja Malik Director of the Company retires by rotation at this Annual and beingeligible offers herself for re-appointment. The Board recommends her reappointment.

Further the term of office of Mr. Sajid Malik as ‘Managing Director' expires inthe current financial year and is therefore re-appointed with effect from November 302017 for a period of five (5) years by the Board of Directors on recommendation of theNomination & Remuneration Committee of the Board subject to approval of members inthe ensuing Annual General Meeting. The Board recommends their reappointment for membersapproval at the ensuing Annual General Meeting.

Pursuant to Regulation 36(3) of SEBI (LODR) Regulations 2015 brief resume of Mrs.Saroja Malik and Mr. Sajid Malik nature of their expertise in specific functional areaand names of Companies in which they are Director and Member/Chairman of Committees ofBoard are provided in the Corporate Governance Report forming part of the Annual Report.The Company has received declarations from all the Independent Directors of the Companyconfirming that they meet the criteria of independence as prescribed both undersub-section (6) of Section 149 of the Companies Act 2013 and under Regulation 25 of SEBI(LODR) Regulations 2015.

Given the current size of operations of the company the company is facing challengesin short listing suitable candidates for the position of Chief Financial Officer andCompany Secretary. The company is continuing its effort in this direction and hopes tofill up both the vacancies as soon as possible.

14. PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act 2013 and under regulation 25 of theSEBI (LODR) Regulations 2015 the Board has carried out the annual evaluation of its ownperformance and each of the directors individually as well as of the working of itsCommittees. The manner in which the evaluation has been carried out is explained in detailin the Corporate Governance Report which forms part of this Annual Report.

15. AUDITORS a) STATUTORY AUDITORS

M/s Dixit Dattatray & Associates Chartered Accountants Mumbai (ICAI RegistrationNo. 102665W) Statutory Auditors of the Company hold office upto the current AnnualGeneral Meeting and are not eligible to be re-appointed for the next term due to end oftheir tenure. The Board places on record its sincere appreciation of the service renderedby M/s Dixit Dattatray & Associates.

In view of the same the Board has proposed that M/s Sachin Phadke & AssociatesChartered Accountants (Firm Registration No. 133898W) be appointed as Statutory Auditorsof the Company for the period of 5 years from FY 2017-18 to FY 2021-22 subject toshareholders' approval at the ensuing Annual General Meeting and ratification at everyAnnual General Meeting thereafter.

They have confirmed that their appointment if made at the Annual General Meetingwill be within the limits prescribed under the Companies Act 2013. They have alsoconfirmed that they hold a valid peer review certificate as prescribed under SEBI (LODR)Regulations 2015.

Members are requested to consider their appointment and authorise the Board ofDirectors (including committee thereof) to fix their remuneration for the FY 2017-18. TheNotice convening the 11th Annual General Meeting contains the resolution for theirappointment. b) AUDITORS' REPORT

There are no qualifications reservations adverse remarks or disclaimers made by theStatutory Auditors in their Audit Report for the financial year ended March 31 2017. c)INTERNAL CONTROLS SYSTEM AND THEIR ADEQUACY

The Company has in place an Internal Control System commensurate with the size andscale of its operations. The Internal Control System provides reasonable assurance withregard to recording and providing reliable information compliance with applicable lawsrules and regulations.

The Audit Committee reviews audit reports submitted by the Internal Auditors on aregular basis. d) SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act 2013 M/s. Roy Jacob& Co. Practicing Company Secretaries (CP No. 8220) have been appointed to undertakethe Secretarial Audit of the Company for the financial year ended on March 31 2017. TheSecretarial Audit Report forms part of this annual report as

"Annexure B".

16. PARTICULARS OF EMPLOYEES

Managing Director does not receive any remuneration from the Company and the Companydoes not have employee drawing remuneration in excess of limits prescribed under section197 read with Rule 5 of The Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014. Hence the information under this Proviso and Rule is not beingprovided.

17. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO

The company continues to endeavor to reduce energy consumption. The company has notcarried out any research and development activity or has imported any technology for itsoperations. There were no foreign exchange earning or outgo during the year under review.Therefore details of the same are not annexed to this report.

18. MEETINGS

During the year five Board Meetings and five Audit Committee Meetings were dulyconvened and held. The details of which are given in the Corporate Governance Report. Theintervening gap between the Meetings was within the period prescribed under the CompaniesAct 2013.

19. NOMINATION AND REMUNERATION POLICY

The Board has on the recommendation of the Nomination & Remuneration Committeeframed a policy for selection and appointment of Directors Senior Management and theirremuneration. The Remuneration Policy is explained in the Corporate Governance Report.

20. SEXUAL HARASSMENT

During the year under review there were no cases filed pursuant to the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013.

21. RISK MANAGEMENT

Risks are events situations or circumstances which may negatively impact the Company'sBusiness. Risk management is a structured approach to manage uncertainty. The Company isadopting a formal approach to identify and evaluate business risks.

22. SIGNIFICANT & MATERIAL ORDERS PASSED BY REGULATORS/COURTS IF ANY

There are no significant material orders passed by the Regulators/Courts which wouldimpact the going concern status of your Company and its future operations.

23. MATERIAL CHANGES & COMMITMENTS

There are no material changes and commitments affecting the financial position of theCompany occurred between the date of Financial Statements and Boards Report.

24. RELATED PARTY TRANSACTIONS

All related party transactions that were entered in the ordinary course of businessduring the financial year were on an arm's length basis and in compliance with theapplicable provisions of the Companies Act 2013 and Regulation 23 of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. There are no materiallysignificant related party transactions made by the Company during the financial year2016-17. All Related Party Transactions are placed before the Audit Committee as also theBoard for approval. The policy on Related Party Transactions as approved by the Board isuploaded on the Company's website. The disclosure on Related Party Transactions is made inthe Financial Statement of the Company.

25. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 134 (5) of the Companies Act 2013 withrespect to Directors' Responsibility Statement your directors hereby confirm that; a) Inthe preparation of the annual accounts for the financial year ended March 31 2017 theapplicable accounting standards had been followed along with proper explanation relatingto their material departures wherever applicable; 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 or loss of the Company forthe year under review; c) The directors had taken proper and sufficient care for themaintenance of adequate accounting records in accordance with the provisions of theCompanies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities;

d) The directors had prepared the annual accounts for the financial year ended March 31 2017 on a going concern basis;
e) The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;
f) The directors have devised proper systems to ensure compliance with the provision of all applicable laws and that such systems were adequate and operating effectively.
26. ACKNOWLEDGEMENT
Your Company and its Directors wish to place on record their sincere thanks to the Members of the Company Bankers State Government Local Bodies Customers Suppliers Executives at all levels for their continuous cooperation and assistance.

For and on behalf of the Board of Directors

SAJID MALIK SAROJA MALIK
MANAGING DIRECTOR DIRECTOR
(DIN: 00400366) (DIN: 00400421)
Place: Mumbai
Date: May 30 2017