Happiest Minds Technologies Ltd.
|BSE: 543227||Sector: IT|
|NSE: HAPPSTMNDS||ISIN Code: INE419U01012|
|BSE 00:00 | 30 Nov||1206.75||
|NSE 00:00 | 30 Nov||1205.55||
|Mkt Cap.(Rs cr)||17,721|
|Mkt Cap.(Rs cr)||17721.12|
Happiest Minds Technologies Ltd. (HAPPSTMNDS) - Director Report
Company director report
Your Directors take pleasure in presenting the Tenth Annual Reportcovering the highlights of the finances business and operations of your Company. Alsoincluded herein are the Audited Financial Statements of the Company (standalone andconsolidated) prepared in compliance with Ind AS accounting standards for the financialyear ended March 31 2021.
Highlights of Financial Performance
Note: Previous year's figures have been regrouped / reclassifiedwherever necessary to correspond with the current year's classification / disclosure.
A detailed analysis of the financials and business performance of theCompany during the year under review including the impact the COVID 19 pandemic had onyour Company's business is detailed below.
Management Discussion and Analysis
Management Discussion and Analysis as required under Schedule V of theSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 ("Listing Regulations") is provided separately in the AnnualReport.
Dividend & Transfer to Reserves
Your Company's policy on Dividend Distribution is available athttps://www.happiestminds.com/investors/policy-documents/.
In accordance with the said policy your Directors are pleased torecommend a final dividend of Rs. 3/- per equity share for the financial year ended March31 2021 (previous financial year - Nil). If the above recommendation is accepted by theMembers of the Company at the ensuing Annual General Meeting total outflow on thisaccount will be Rs. 44.06 Crores.
Your Directors do not propose to transfer any amounts to the generalreserves of the Company instead have recommended to retain the entire of profits for thefinancial year ended March 31 2021 in the profit and loss account.
Your Company did not have any amounts due or outstanding as at BalanceSheet date to be credited to the Investor Education and Protection Fund.
Mergers & Acquisitions
During the year under review your Company signed definitive agreementsto acquire with effect from January 1 2021 100% ownership interest in PGS Inc which hadpermission to Do Business As "DBA" - Pimcore Global Services a Houston USAbased digital e-commerce and data management solutions company for a cash consideration ofUS $8.25 million.
PGS has a strategic partnership with Pimcore Austria for deliveringsolutions around the opensource Pimcore framework which helps enterprises establish arobust digital presence through seamless data and experience management. PGS clienteleincludes customers across Retail CPG and Manufacturing verticals.
Prior to the acquisition PGS was a Customer of your Company. Revenuesof PGS for the fiscal ended December 31 2020 (pre-acquisition) was circa US$ 10.6 millionduring which period your Company counted PGS as one of its US$ 2M + customer. Your Companyhas been a Gold Partner of Pimcore for the past several years and now with thePlatinum/Strategic partnership and capability of PGS has acquired significantcapabilities on the framework while strengthening its global Digital Commerce practice.
Post-acquisition the name of the PGS Inc. has been changed to HappiestMinds Inc. while retaining the DBA as-is.
As of March 31 2021 your Company had one wholly owned subsidiarycompany viz. Happiest Minds Inc. USA (formerly PGS Inc.). The statement under Section129(3) of the Companies Act 2013 in respect of the subsidiary in Form AOC-1 is attachedas Annexure I. The Consolidated Accounts of your Company duly audited by the StatutoryAuditors are presented as part of this Report.
The financial statements together with related information and otherreports of the subsidiary are available on the website athttps://www.happiestminds.com/investors/
Your Company's policy on material subsidiary is also available on thewebsite at https://www.happiestminds.com/investors/ policy-documents/
We are happy to inform that your Company has received the followingrecognitions during the year:
> Ranked 73rd among India's Best Companies To Work for2020 by Great Place to Work
> Recognized among the Top 50 Best Workplaces for Women 2020 byGreat Place to Work
> Recognized by Intel's Winner Circle Program as a Solution PlusPartner for contributing towards the acceleration of 5G and virtual network transformation
> Awarded the Jalarushi Puraskar 2020 Appreciation Certificate fromBWSSB (Bengaluru Water Supply and Sewerage Board) for conservation and efficient use ofwater
> Awarded at the Best D&I Practices of Asia Seminar and Awards2020: D&I Company of the Year D&I Awareness Campaign and D&I TalentManagement Practice
> Awarded Peoplefirst's Leading Practices in Talent AcquisitionAward
Initial Public Offering & Listing
During the year your Company made an Initial Public Offering("IPO") of 42290091 equity shares of face value of ' 2 each of the Companyfor cash at a price of ' 166 per equity share including a premium of ' 164 per equityshare aggregating to ' 702.02 Crores comprising of a fresh issue of 6626506 equityshares aggregating to Rs. 110 Crores and an offer for sale of 8414223 equity shares byMr. Ashok Soota the Promoter and 27249362 equity shares by CMDB II the Investoraggregating to ' 592.02 Crores.
The issue opened on September 7 2020 and closed on September 9 2020.The issue was led by book running lead managers viz. ICICI Securities Ltd and NomuraFinancial Advisory and Securities (India) Pvt Ltd.
Your Company is happy to inform that the issue was oversubscribed 151times (i.e. around 71 times in RII 77 times in the QIB and 351 times in the NIIcategory). Your Company's entire paid-up share capital consisting of 146863556 equityshares were listed and admitted for dealing on the National Stock Exchange of IndiaLimited and BSE Limited with effect from September 17 2020 subject to fulfillment oflock-in conditions on certain shares.
The proceeds of IPO of ' 110 Crs were utilized for the objects asdisclosed in the Prospectus viz. ' 102.42 Crs towards working capital ' 3.03 Crs towardsgeneral corporate purpose and ' 4.55 Crs towards IPO expenses.
Your Company confirms that it has paid the Annual Listing Fees for theyear 2020-21 to National Stock Exchange of India Limited and BSE Limited.
During the year your Company allotted 6626506 equity shares of ' 2/-each as fresh issue of shares as part of IPO of the Company. With the said allotment thepaid-up equity share capital has increased to ' 293727112/- as on March 31 2021consisting of 146863556 equity shares of ' 2/- each.
Your Company has not issued shares with differential voting rights andsweat equity shares during the year under review.
Directors and Key Managerial Personnel
As on March 31 2021 the Board of Directors of your Company comprisedof six Directors viz. three Executive Directors and three Independent Directorsincluding two women Directors. As per the Articles of Association of the Company onethird of the Directors (other than Independent Directors) are liable to retire by rotationat the Annual General Meeting ("AGM") of the Company every year. Mr.Venkatraman Narayanan (DIN 01856347) retires by rotation at the ensuing 10thAGM and being eligible offers himself for re-appointment.
Your Board of Directors at its meeting held on November 4 2020 has(a) approved appointment of Mr. Joseph Vinod Anantharaju (having DIN No. 08859640) asExecutive Vice Chairman; (b) approved appointment/re-designation of Mr. VenkatramanNarayanan (having DIN No. 01856347) as Managing Director & CFO; and (c) acceptedresignation of Mr. Avneet Singh Kochar (having DIN No. 02415196) Non-Executive Directorand representative of erstwhile Investor - CMDB II.
Ms. Anita Ramachandran (DIN No. 00118188) Mr. Rajendra KumarSrivastava (DIN No. 07500741) and Ms. Shubha Rao Mayya (DIN No. 08193276) are theIndependent Directors on the Board with effect from June 4 2020. Pursuant to theprovisions of Section 149 of the Companies Act 2013 the independent directors havesubmitted declarations that each of them meet the criteria of independence as provided inSection 149(6) of the Companies Act 2013 along with Rules framed thereunder andRegulation 16(1)(b) of the Listing Regulations. There has been no change in thecircumstances affecting their status as independent directors of the Company. In theopinion of the Board the independent directors possess the requisite integrityexperience expertise and proficiency required under all applicable laws and the policiesof the Company.
Policy on Nomination and Remuneration of Directors
This policy on the nomination and remuneration of Directors KeyManagerial Personnel and Senior Management Personnel has been formulated by the Nominationand Remuneration Committee and approved by the Board of Directors of the Company. ThePolicy is guided by the principles and objectives as enumerated under the provisions ofthe Companies Act 2013 and the Listing Regulations to ensure reasonableness andsufficiency of remuneration to attract retain and motivate competent resources a clearrelationship of remuneration to performance and a balance between rewarding short andlong-term performance of the Company. Copy of the policy is uploaded on the Company'swebsite at https://www.happiestminds.com/investors/policy-documents/
We confirm that the remuneration paid to Directors Key ManagerialPersonnel and Senior Management Personnel is in accordance with the said policy of theCompany. The statement of Disclosure of Remuneration under Section 197 of Companies Act2013 and Rule 5(1) of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is attached to this report as Annexure II.
None of the Executive Directors of the Company were in receipt of anycommission from the Company or any remuneration from the subsidiaries of the Company.
Familiarization Program for Independent Directors
The Company has in place a familiarization program for its IndependentDirectors. The objective of the program is to familiarize Independent Directors on ourBoard with the business of the Company industry in which the Company operates businessmodel challenges etc. through various programs which largely around interaction withsubject matter experts within the Company meetings with our business leads and functionalheads on a regular basis.
The familiarization program and other disclosures as specified underthe Listing Regulations is available on the Company's website athttps://www.happiestminds.com/investors/disclosures/Details-of-Familiarization-programme.pdf
Since your Company became listed only from the part of the financialyear under review it could not conduct an exercise to evaluate the performance of theBoard Committees of the Board Chairman of the Board Individual Directors and theIndependent Directors. However it proposes to do from the current financial year onwardson an annual basis.
Committees of the Board
The details of the powers functions composition and meetings of theCommittees of the Board held during the year are given in the Report on CorporateGovernance section forming part of the Annual Report.
The Board of Directors of the Company met fourteen times during theyear under review. The details of these Board Meetings are provided in the in the Reporton Corporate Governance section forming part of the Annual Report. The necessary quorumwas present for all the meetings. The maximum interval between any two meetings did notexceed 120 days.
Your Company has taken adequate steps to adhere to all the stipulationslaid down in the Listing Regulations. A report on Corporate Governance is disclosedseparately in the Annual Report.
A Certificate from M/s. V Sreedharan & Associates a firm ofCompany Secretaries in practice confirming the compliance with the conditions ofCorporate Governance as stipulated under the said Regulations is attached as Annexure VIIto this Report.
Employees Stock Option Plan (ESOP)
Your Company had three ESOP schemes viz. ESOP 2011 ESOP 2015 and USESOP 2011. With effect from May 13 2020 i.e. prior to IPO your Company merged ESOP 2011into ESOP 2015. Post IPO the new employee stock option plan called 'Happiest MindsEmployee Stock Option Scheme 2020' ("ESOP 2020") which is in compliance withthe requirements of the Securities and Exchange Board of India (Share Based EmployeeBenefits) Regulations 2014 is in effect.
In view of the new scheme no further grant of employee stock optionswill be made under the old schemes i.e. merged ESOP 2015 or under US ESOP 2011. Allfurther grants of employee stock option will only be made under the new employee stockoption plan i.e. ESOP 2020.
During the year under review no fresh grants were made ESOP 2020 buthowever your Company facilitated transfer of 673280 Equity Shares of '2/- each by theHappiest Minds Technologies Share Ownership Plans Trust to the employees who exercisedtheir options under the old schemes.
The additional details of stock options are provided under Notes toFinancial Statements (Standalone).
Pursuant to the requirements of the SEBI (Share Based EmployeeBenefits) Regulations 2014 a certificate has been issued by the Statutory Auditors ofthe Company confirming that the Plan has been implemented in accordance with the saidRegulations and in accordance with the resolution passed by the Company in the GeneralMeeting.
As required under the SEBI (Share Based Employee Benefits) Regulations2014 the applicable disclosures as on March 31 2021 are uploaded on the website of theCompany at https://www.happiestminds.com/investors/disclosures/.
Code for Prevention of Insider Trading
Your Company has adopted a Code of Conduct to regulate monitor andreport trading by designated persons and their immediate relatives as per the requirementsunder the Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015. This Code of Conduct also includes code for practices and proceduresfor fair disclosure of unpublished price sensitive information which has been madeavailable at https://www.happiestminds.com/investors/policy-documents/
The Vigil Mechanism as envisaged in the Companies Act 2013 the Rulesprescribed thereunder and the Listing Regulations is implemented through the Company'sWhistle Blower Policy to enable all its employees consultants (part time full time andtemporary employees) of the Company and its subsidiary companies and its associatecompanies to report genuine concerns to provide for adequate safeguards againstvictimization of persons who use such mechanism and make provision for direct access tothe Chairman of the Audit Committee. Your Directors affirm that no employee/consultant hasbeen denied access to the Audit Committee.
The Whistle Blower Policy is available athttps://www.happiestminds.com/investors/policy-documents/
During the year under review your Company did not receive anycomplaints under the said policy.
Pursuant to Section 92(3) of the Companies Act 2013 read with readwith Rule 12 of the Companies (Management and Administration) Rules 2014 copy of theAnnual Return of the Company for financial year 2019-20 prepared in accordance withSection 92(1) of the Act has been placed on the website and is available athttps://www.happiestminds.com/investors/disclosures/
Software Technology Park
The entire Indian operations of the Company have been registered underthe Software Technology Parks of India (STPI) Scheme.
Your Company has not accepted any fixed deposits during the year underreview and as such no amount of principal or interest was outstanding on the date ofBalance Sheet.
Significant & Material Orders passed by the Regulators or Courts orTribunals
During the year under review your Directors confirm that there were nosignificant and material orders passed by the Regulators or Courts or Tribunals impactingthe going concern status of your Company and its future operations.
Loans Guarantees and Investments
Pursuant to Section 186 of the Companies Act 2013 and Schedule V ofthe Listing Regulations disclosure on particulars relating to Loans Advances Guaranteesand Investments are provided as part of the financial statements.
Related Party Transactions
The policy on related party transactions is available athttps://www.happiestminds.com/investors/policy-documents/
Particulars of the Contracts or Arrangements with related partiesreferred to in Section 188(1) in the format specified as Form AOC- 2 forms part of thisReport as Annexure III. Further details of related party transaction are provided in Notesto Financial Statements (both Standalone and Consolidated).
During the year under review your Company has not provided anyloans/advances in the nature of loan to any subsidiary company associates andfirms/companies in which Directors are interested.
Auditors & Auditors Report
The current Statutory Auditors of the Company M/s. S.R. Batliboi andAssociates LLP Chartered Accountants (ICAI registration number 101049W/ E300004) willhold office till the conclusion of ensuing tenth Annual General Meeting of the Company.Based on the recommendations of the Audit Committee the Board at its meeting held on May12 2021 has approved appointment of M/s. Deloitte Haskins & Sells (ICAI registrationnumber 008072S) as Statutory Auditors for a term of 5 years i.e. from the conclusion ofthe ensuing 10th AGM upto the conclusion of the 15th AGM subject toMembers approval.
The Auditors Report does not contain any qualification reservation oradverse remark on the financial statements for the financial year ended March 31 2021.The Notes on financial statements referred to in the Auditors' Report are self-explanatoryand do not call for any further comments.
Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed M/s. V Sreedharan & Associates a firm of Company Secretaries inpractice to undertake the Secretarial Audit of the Company. The Secretarial Audit Reportissued by them for the financial year ended March 31 2021 is attached as Annexure VIII tothis Report. The Secretarial Audit Report does not contain any qualificationsreservations or adverse remarks.
During the year under review the Statutory Auditors and SecretarialAuditors have not reported any instances of frauds committed in the Company by itsofficers or employees to the Audit Committee under Section 143(12) of the Companies Act2013 details of which needs to be mentioned in this Report.
Sustainability and Corporate Social Responsibility (CSR)
Company's Sustainability Environment Social and Governance Reportingis provided separately as part of the Annual Report.
The annual report on CSR including a brief outline of the CSR Policyand the activities undertaken during the year under review is enclosed as Annexure IV tothis Report. The CSR policy is available athttps://www.happiestminds.com/investors/policy-documents/.
Your Company under the supervision of the Executive Board hasestablished a well-defined framework and procedures on organization wide risk and itsmanagement. The framework encompasses significant risk in areas of Information securityoperations delivery and key support functions. Under the framework and proceduresdetailed risk management guidelines have been prescribed and implemented covering RiskIdentification Analysis Response Tracking and Management Discussion and Mitigation.Risk registers are maintained by respective functions and project teams. These arecentrally reviewed and periodically monitored by compliance and governance teamsidentified as the owner for the area of risk. The CISO CIO and Engineering and BusinessExcellence Team (EBE) work together with the Executive Board in achieving the above.
The Executive Board with the assistance of the CISO CIO and EBE followa process covering the steps below in identifying areas of risk in the Organization. Theprocess covers:
> Identification of key risk areas
> Assessment of key risks for probability and impact
> Formulation of response
> Identification of Owners
> Participation by Owners in outlining mitigation plans
> Reporting on adequacy and effectiveness
> Acceptance of residual risk
Your Company while designing its strategy in drawing up of its longterm business plan it makes provision to accommodate broader/ higher level of risk thanit expects/envisages so that Company is prepared to sustain in the eventuality ofunforeseen level of risk.
Significant risks areas which have been identified and are constantlymonitored are:
1. Financial Risks:
a. Foreign currency fluctuation;
b. Customer credit;
c. Profitability and sustenance of the business;
d. Availability of credit and liquidity management.
2. Business Risks:
a. Concentration of revenues;
b. New emerging disruptive technologies and their impact on businessand delivery;
c. Shrinking product development cycles.
d. Customers insourcing.
3. Operational Risks:
a. Data privacy social media
b. Talent availability and timely staffing of projects
c. Optimal resource utilization
d. Contractual commitments and project delivery challenges
e. Business continuity
f. COVID 19 Pandemic
4. Legal and Regulatory:
a. Compliance with local legislation in the geographies we operate in
b. Dynamic and ever changing immigration and travel laws.
5. Projects Delivery related risk
a. Related to change meeting timelines estimated effort
b. Quality of deliverables
6. Information Security Risks
a. Loss of Customer Artifacts Digital Assets (Code database etc.) orIP
b. Privacy breach sharing of sensitive data e.g. PII without requisiteapprovals
c. Malware and Ransomware attacks
Oversight of the framework is provided by the Risk Management Committeeof the Board of Directors A Risk Management Policy has also been adopted based on thisframework copy of the policy is available at https://www.happiestminds.com/investors/policy-documents/.
People well-being was the key theme for FY'21. Your Company saw 99% ofthe workforce working virtually adapting to the new normal. Your Company's PeoplePractice function worked closely with the business to help Happiest Minds manage thetransition to a complete Work from Home. The people function focused on 3C'sCommunication Care and Collaboration framework to support Happiest Minds through thepandemic.
The business environment was quite volatile from the beginning. All theexisting organizational processes and structures needed a major rehaul to adapt to thevirtual work environment. Continuous communication was vital to reduce anxiety andambiguity among people. People Practice conducted multiple connect programs including thevirtual town hall leadership connects benefits communication series regularcommunication from Executive Board People Practice and Business Leaders to alleviate allapprehension about job security business future etc. and build trust and confidenceamong team members.
People's well-being is the topmost priority for your Company. Under theCare program your Company launched many initiatives to support Happiest Minds and theirfamilies including Tele Doctor Consultation Mithra - for Counselling Support COVIDLeaves Leave Donation Program Ergonomics consultation parenting under lockdown andmultiple webinars on emotional physical and financial wellness.
Happiest Minds working from Home from different cities and townsvirtually required a different level of collaboration. Your Company constituted COVIDTaskforce to make quick decisions to adapt to the changing environment use collaborativetechnology tools for collaboration and engagement and Internal First Responder Team tosupport COVID affected Happiest Minds and their families. There was an immense focus onrecognizing the exemplary efforts of Happiest Minds who provided uninterrupted servicesto the customers during these challenging times. Intensive Reward and Recognition programwere organized including a personalized note of appreciation to the Happiest Minds andtheir families from the leadership.
Your Company implemented corporate-wide recruitment onboardingup-skilling training talent development performance evaluation talent reviewsuccession planning and compensation programs without any significant disruption. Thepeople practice function has a representative present in each major geographies to supportHappiest Minds. Your Company conducted the Happiest Minds Pulse Survey in which 93% ofHappiest Minds affirmed that they have enhanced their effort towards personal well-beingand happiness since they joined the Company.
As per the Great Place to Work ("GPTW") survey results yourCompany was awarded and was among Top 100 India's Best Companies to Work for in 2020among Top 50 India's Best Workplaces for Women by GPTW. Your Company also got recognizedas the 'Diversity & Inclusion (D&I) Company of the Year' by the Women LeadershipForum of Asia & LNOD Round Table. Many other people and culture awards speak volumesabout the people's practices in the Company.
Your Company continually strives to provide people with competitive andinnovative compensation packages. We work with industry partners and consultants tobenchmark our compensation and benefits programs with leading organizations in theindustry. Our compensation packages include a combination of fixed salary variable paystock options health insurance and unique benefits like Leave Donation Flexi work etc.
Quality Management System (QMS)
1. Quality Policy
"Happiest Minds will consistently strive for customer happiness.We are committed to deliver excellence in our services by continually improving processesand systems aiding in creating value to all our stake holders".
2. QMS Framework
Our strategy for continual quality improvement journey is derived basedon the business needs technology changes customer feedback suggestions and processperformance. Our quality processes are derived from industry best practices as well asfrom our experience and our processes have been assessed by external accredited agencies.Your Company has received accreditation on international quality and process modelsincluding ISO 9001:2015. In addition your Company is certified to Information Securitystandards like ISO 27001:2013 which guides our policies and procedures for protecting ourown and as well customers' software enablers.
3. Engineering Practices
Engineering practices form the crux of successful delivery. Ourengineering practices help your Company deliver high-quality software to its customers andconsistently earn their trust. We measure the satisfaction levels of our customers everyyear and have seen a significant improvement in the scores year on year since inception.We have adopted Agile practices to support our Mission of "Born Digital. BornAgile".
4. Code Quality
Our projects that are adopting Agile methodologies are using JIRA PlanTrack Integrate with other code quality tools and manage the projects to decrease theturnaround of the shippable products to our customers.
5. Rapid Iteration and Experimentation
Fail fast and learn quickly - Agile teams develop solutions throughfast cycles of field testing and learning from mistakes. Products and solutions aredeveloped iteratively using minimum viable products i.e. minimum set of features neededto test and learn.
6. DevOps and automation
Your Company has deployed DevOps practices which includes buildautomation continuous integration code analysis and unit testing along with engineeringpractices such as continuous delivery or automatically deploying to an environment with atest suite to evaluate the software in the environment.
Some of the practices like continuous deployment pushing a new releaseinto production based on passing of all the tests checking code and software quality inthe build pipeline and leverage the build pipeline to get feedback on the health of theirsoftware etc help your Company to decrease the turnaround to the customers and build abetter quality products.
7. Information Transparency
The accessibility accuracy and availability of quality unfiltereddata which is critical for organizational agility is deployed across the organization.Team members can easily share ideas from and results of their work with those who mightbenefit from the information.
8. Continuous Learning
At your Company continuous learning happens on both the individual andorganizational level. At the organizational level structured processes and tools havebeen enabled to share the tribal knowledge. This helps the information learned throughexperimentation and experience is available across the organization.
9. Delivery Methodologies
Our suite of delivery methodologies in the below mentioned areasdemonstrates our thought leadership and execution capabilities viz. Agile methodologiesService delivery lifecycle Application Support and Maintenance life cycle Embeddedsystem software and Waterfall model for Software development.
10. Integrated Project Management System
Our Integrated Project Management system helps the delivery to have anend-to-end view of the project at all levels of the management so as to provide enhanceddelivery value to our customers.
11. Involve to Evolve
We drive the continual improvement programs by actively engaging theteam members across the organization. Focused groups will be formed to make the resourcespart of the continual improvement journey to bring in Agile community of practicetechnical experts from Practice estimation work group and internal audit community.
The continuous measurement of benefits accrued from your Company'sprocess improvement initiatives has brought to light a significant reduction in reworkincrease in productivity adherence to schedules and budget and significant added valueculminating in customer delight.
12. Rewards and Recognitions
The team members/teams are rewarded for their exemplary work towardsprocess improvements and customer delight with awards such as Code excellence awardService Delivery excellence award etc.
13. Customer Connect
Your Company has customer experience framework to understand thebehaviors needs and expectations of individual customers which helps in developing aroadmap for continuous engagement and enriching the customer relationship. As part of thisframework we conduct Customer happiness Survey Customer Pulse bringing Value adds etc
Whenever there is a customer escalation related delivery or staffingthe concerned manager will raise the escalation in Redmine. An action item for the same iscreated and assigned to the respective team member to track monitor the status of theescalation. The closure of the escalation of the communicated back to the customer.
Internal Control System
Your Company has deployed adequate Internal Control Systems in place toensure a smooth functioning of its business. The processes and the systems are reviewedconstantly and changed to address the changing regulatory and business environment. TheControl Systems provide a reasonable assurance of recording the transactions of itsoperations in all material aspects and of providing protection against misuse or loss ofCompany's assets. The ERP system which the Company had implemented has helped in furtherstrengthening the internal control systems that are in place.
The existing internal control systems and their adequacy are frequentlyreviewed and improved upon to meet the changing business environment. The statutoryauditors as well as the internal auditors periodically review the internal controlsystems policies and procedures for their adequacy effectiveness and continuousoperation for addressing risk management and mitigation strategies.
Conservation of Energy Research and Development Foreign ExchangeEarnings and Outgo
Your Company has made the necessary disclosures in Annexure V to thisReport in terms of Section 134(3) of the Companies Act 2013 (earlier Section 217(1)(e) ofthe Companies Act 1956) read with the Companies (Disclosure of Particulars in the Reportof the Board of Directors) Rules 1988.
As per the proviso to Rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the statement containing the names andother details of employees drawing more than ' 10.2 million per financial year or ' 0.85million per month as the case may be are set out in the Annexure VI to the Board'sReport. Further as per the proviso to Rule 5(3) of the said Rules the particulars ofemployees posted and working outside India not being directors or their relatives neednot be included in the statement but such particulars shall be furnished to the Registrarof Companies. Accordingly the statement included in this Report does not contain theparticulars of employees who are posted and working outside India. If any Member isinterested in obtaining a copy thereof such Member may write to the Company in thisregard.
Directors' Responsibility Statement
Pursuant to the requirement under Section 134 (5) of the Companies Act2013 with respect to Directors Responsibility Statement it is hereby confirmed that:
(i) In the preparation of the Annual Accounts the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures if any;
(ii) Accounting policies have been selected and applied themconsistently and made judgments and estimates made are reasonable and prudent to give atrue and fair view of the state of affairs of the Company at the end of the financial year2020-21 and of the profit or loss of the Company for that financial year;
(iii) Proper and sufficient care have been taken for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) The Annual Accounts have been prepared on a going concern basis.
(v) Proper systems have been devised to ensure compliance with theprovisions of all applicable laws and that such systems were adequate and operatingefficiently.
Your Directors' have laid down internal financial controls to befollowed by the Company and that such internal financial controls are adequate and wereoperating effectively.
During the year under review your Company has duly complied withSecretarial Standard 1 dealing with Meetings of the Board of Directors & SecretarialStandard 2 dealing with General Meetings as issued by the Institute of CompanySecretaries of India.
The provisions of Companies (Cost Records and Audit) Rules 2014 arenot applicable to your Company.
Disclosure under the Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013
Your Company is committed to promote a safe and professional workenvironment that fosters teamwork diversity and trust across. Your Company has a genderneutral Anti-Sexual Harassment Policy at workplace which is also in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal) Act 2013 and the applicable rules. Internal Committee has been set up toredress complaints received regarding sexual harassment. We have also appointed a lawyeras an external Internal Committee member who specializes in Prevention of SexualHarassment ("POSH") and Protection of Children against Sexual Offences Acts.
All employees regardless of position or contractual status i.e.permanent short-term contract visitors and casual employees are covered under thisPolicy. The POSH awareness program is mandated to all Happiest Minds. During lockdown asmost of our employees were working remotely we had sent communications on theapplicability of the POSH during remote working times along with do's and don'ts underPOSH.
During the year under review there were no complaint with allegationof sexual harassment was filed with Internal Committee.
Events Subsequent to the date of Financial Statements
As on the date of this Report your Directors are not aware of anycircumstances not otherwise dealt with in this Report or in the financial statements ofyour Company which would render any amount stated in the Accounts of the Companymisleading.
In the opinion of the Directors no item transaction or event of amaterial and unusual nature has arisen in the interval between the end of the financialyear and the date of this report which would affect substantially the results or theoperations of your Company for the financial year in respect of which this report is made.
Your Directors have pleasure in recording their appreciation for allthe guidance and co-operation received from all its customers Members investorsvendors partners bankers government authorities and other stakeholders for theirconsistent support to your Company in its operations. Your Directors take this opportunityto place on record their sincere appreciation of the dedication contribution andcommitment of all Happiest Minds in Company's growth and successful IPO.