Your Board of Directors ("Board") is pleased to present the Twenty firstAnnual Report of your Company IRIS Business Services Limited for the financial yearended 31st March 2021. In line with the requirements of the Companies Act 2013 and therules framed thereunder and SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 this report covers the financial results and other developments during1st April 2020 to 31st March 2021 in respect of IRIS Business Services Limited("IRIS").
|1. SUMMARY OF OPERATIONS / RESULTS || || || ||(Amount in Rs.) |
|Particulars ||Standalone ||Consolidated |
| ||F.Y. 2021 ||F.Y. 2020 ||F.Y. 2021 ||F.Y. 2020 |
|Turnover ||530878129 ||488822751 ||563078643 ||509976517 |
|Other Income ||2781885 ||5596049 ||2869126 ||5761423 |
|Total Expenditure ||505687973 ||478519720 ||544022967 ||510303331 |
|Operating Profit (Loss) ||27972041 ||15899080 ||21924802 ||5434609 |
|Exceptional Items ||- ||- ||- ||- |
|Net Profit (Loss) before tax ||27972041 ||15899080 ||21924802 ||5434609 |
|Tax Expense: || ||- || ||- |
|Current Tax ||- ||- ||- ||- |
|Deferred Tax ||(5834163) ||432287 ||(5834163) ||432287 |
|Tax expense/(income) for earlier years ||550901 ||381913 ||550901 ||381913 |
|Profit (Loss) for the year ||33255303 ||15084880 ||27208065 ||4620409 |
2. PERFORMANCE OF THE COMPANY
In the reporting year that also saw the Covid 19 pandemic sweeping across the globeyour Company was able to grow its revenues contain expenses while improving the cashflows and the liquidity position. In this reporting year your Company has also expandedits footprint in the European market with its enterprise reporting solution notching up anumber of customers in the listed company space.
Highlights of our standalone financial results Revenues:
Our total revenues in the fiscal year ended 31st March 2021 were Rs 53.37 cr anincrease of 7.95% over our total revenues of Rs 49.44 cr in the fiscal year ended 31stMarch 2020.
Our revenues from operation in the fiscal year ended 31st March 2021 were Rs 53.09 cran increase of 8.61% over our total revenues from operations of 48.88 cr in the fiscalyear ended 31st March 2020. Our export revenues increased by 9.96% from Rs 28.00 cr infiscal year ended 31st March 2020 to Rs 30.79 cr in fiscal year ended March 31st2021.Also domestic revenues increased by 6.75% from Rs 20.88 cr in fiscal year ended 2020 toRs 22.29 cr in fiscal year ended 2021. Our revenues from "Collect" segmentdecreased by 22.14% from
H27.91 cr in the fiscal year ended 31st March 2020 to Rs 21.73 cr in fiscal year ended31st March 2021. Revenues from "Create" segment grew by 58.55% from Rs 17.90 crin the fiscal year ended 31st March 2020 to Rs 28.38 cr in the fiscal year ended 31stMarch 2021 primarily due to expansion of IRIS Carbon in the European market apart fromgrowth in the GST compliance business.
Revenues from "Consume" segment decreased by 3.26% from Rs 3.07 cr in thefiscal year ended 31st March 2020 to Rs 2.97 cr in the fiscal year ended 31st March2021.
Our other income primarily comprises interest on bank deposits. Our other income in thefiscal year ended 31st March 2021 were Rs 0.28 cr as compared to Rs 0.56 cr in the fiscalyear ended 31st March 2020.
Employee costs net of capitalized cost in the fiscal year ended 31st March 2021 stoodat Rs 29.13 cr an increase of 10.97% over our employee costs net of capitalized cost ofRs 26.25 cr in the fiscal year ended 31st March 2020. Employee costs relate to salariesand bonus paid to employees.
Finance costs in the fiscal year ended 31st March 2021 were Rs 1.68 cr an increase of9.00% from our finance costs of Rs 1.54 cr in the fiscal year ended 31st March 2020.Finance costs relate to interest and other borrowing costs paid by the Company on thecredit facilities availed from the Banks/ Financial institutions of Rs 1.29 cr and 1.54 crfor the year ended 31st March 2021 and 31st March 2020 respectively. Finance cost forthe year ended 31st March 2021 also includes Loan foreclosure charges of Rs 0.20 cr andLoan processing charges of Rs 0.18 cr for the year ended 31st March 2021 due to whichthere is an increase in the overall finance costs for the year ended 31st March 2021.
Travel related expenses:
Our travel related expenses decreased by 77.46% from Rs 2.84 cr for the fiscal yearended 31st March 2020 to Rs 0.64 cr for the fiscal year ended 31st March 2021.
Our other expenses net of capitalized expenses decreased by 2.66 % from Rs 13.89 cr forthe fiscal year ended 31st March 2020 to Rs 13.52 cr for the fiscal year ended 31stMarch 2021.
Depreciation and Amortization:
Our Depreciation and amortization charge was Rs 6.23 cr and Rs 6.16 cr for the yearended 31st March 2021 and 31st March 2020 respectively representing 11.74% and 12.61% ofrevenues from operations for the year ended 31st March 2021 and 31st March 2020respectively.
There were no exceptional items reported for the fiscal year ended 31st March 2021.
Financial highlights of our consolidated financial results Revenues:
Our total revenues in the fiscal year ended 31st March 2021 were Rs 56.59 cr anincrease of 9.73% over our total revenues of Rs 51.57 cr in the fiscal year ended 31stMarch 2020.
Our revenues from operation in the fiscal year ended 31st March 2021 were Rs 56.31 cran increase of 10.41% over our total revenues of Rs 51 cr in the fiscal year ended 31stMarch 2020.
Our export revenues increased by 13.05% from Rs 30.11 cr in fiscal year ended 31stMarch 2020 to 34.04 cr in fiscal year ended 31st March 2021. Also domestic revenuesstrengthened from Rs 20.88 cr in fiscal year ended 31st March 2020 to Rs 22.27 cr infiscal year ended 31st March 2021.
Our revenues from "Collect" segment decreased from Rs 29.30 cr in the fiscalyear ended 31st March 2020 to Rs 23.94 cr in fiscal year ended 31st March 2021.
Revenues from "Create" segment grew from Rs 18.62 cr in the fiscal year ended31st March 2020 to Rs 29.39 cr in the fiscal year ended 31st March 2021 primarily due toexpansion of IRIS Carbon in the European market apart from growth in the GST compliancebusiness.
Revenues from "Consume" segment decreased from Rs 3.07 cr in the fiscal yearended 31st March 2020 to Rs 2.97 cr in the fiscal year ended 31st March 2021.
Our other income primarily comprises of interest on bank deposits. Our other income inthe fiscal year ended 31st March 2021 was Rs 0.29 cr as compared to Rs 0.58 cr in thefiscal year ended 31st March 2020.
Employee costs net of capitalized cost in the fiscal year ended 31st March 2021 stoodat Rs 31.21 cr an increase of 9.97% over our employee costs net of capitalized cost of Rs28.38 cr in the fiscal year ended 31st March 2020. Employee costs relate to salaries andincentive paid to employees.
Finance costs in the fiscal year ended 31st March 2021 were Rs 1.69 cr an increase of9.03% from our finance costs of Rs 1.55 cr in the fiscal year ended 31st March 2020.Finance costs relate to interest and other borrowing costs paid by the Company on thecredit facilities availed from the Banks/ Financial institutions of Rs 1.30 cr and 1.55 crfor the year ended 31st March 2021 and 31st March 2020 respectively. Finance cost forthe year ended 31st March 2021 also includes Loan foreclosure charges of Rs 0.20 cr andLoan processing charges of Rs 0.18 cr for the year ended 31st March 2021 due to whichthere is an increase in the overall finance costs for the year ended 31st March 2021.
Travel related expenses:
Our travel related expenses decreased by 75.68% for the fiscal year ended 31st March2021 from Rs 3.29 cr for 31st March 2020 to Rs 0.80 cr for the fiscal year ended 31stMarch 2021.
Our other expenses net of capitalized expenses increased by 2.2% from Rs 14.94 cr forthe fiscal year ended 31st March 2020 to Rs 15.27 cr for the fiscal year ended 31stMarch 2021.
Depreciation and Amortization:
Our depreciation and amortization charge was Rs 6.24 cr and Rs 6.16 cr for the yearended 31st March 2021 and 31st March 2020 respectively representing and 11.08% and12.09% of revenues from operations for the year ended 31st March 2021 and 31st March2020 respectively.
3. STATE OF COMPANY AFFAIRS
Your Company continues to execute its strategy to be a significant player in theRegtech market with a suite of IP driven software products and solutions built aroundstructured data. Your Company is also one of the global leaders in reporting solutionsbuilt on the XBRL information standard. The Covid19 pandemic adversely affected the marketfor reporting platforms for regulators in the reporting year with many prospectivecustomers slowing down the procurement process. On the other hand your Company has beensuccessful in posting substantial growth in our Create' business for enterprisereporting solutions on the back of good response from European listed companies as wellas demand for eInvoicing solutions in India that helped the GST solution business. TheXBRL based reporting mandate by the Federal Energy Regulatory Commission USA iscommencing in the current financial year and your Company has so far seen an encouragingresponse for its solution from US energy companies. Our presence in the global XBRLcommunity continues to be strong both in terms of participation in working groups and inthe effort to evangelize data standards in newer markets.
4. TRANSFER TO RESERVE
The Company does not propose to transfer any amount to reserves.
5. DIVIDEND AND TRANSFER TO IEPF
The Board of Directors does not recommend any dividend on equity shares.
The Company was not required to transfer any unpaid / unclaimed amount of dividend toIEPF during the financial year ended 31st March 2021.
6. CHANGE IN THE NATURE OF BUSINESS
There are no changes in the nature of business during the financial ended 31st March2021.
7. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING FINANCIAL POSITION OF THE COMPANYOCCURRED BETWEEN END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE ANDTHE DATE OF THE REPORT
There were no material changes and commitment affecting financial position of theCompany between end of the financial year to which these financial statements relate andthe date of the report.
8. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNAL
During the year there were no significant material orders passed by the Regulators /Courts / Tribunals which would impact the going concern status of the Company and itsfuture operations.
9. RISK AND CONCERN
Your Company operates in multiple markets that witness intense competition. Although wehave built an enviable list of marquee clients across our businesses there exists apersistent need to spend both on marketing and enhancement of the product suite in orderto establish presence and build market share.
While data standards and transition to digital reporting are forces that are undeniablyshaping regulatory reporting mandates across the world not all countries and regulatorsare on board. In many markets there is still the tendency with customers to go for suboptimal custom-built solutions that impacts market potential for companies such as ours.
The COVID-19 pandemic has affected our business to a degree especially on theregulatory platform side with respect to both client acquisition and the pace ofimplementation on existing awards. Even on the Create' segment there has been somepushback on mandates that were supposed to come in 2020. Our current view is that despitethe second wave of the pandemic there should be a revival of market conditions by thesecond half of the current financial year. On the flip side a shift in work and vendorengagement habits towards the virtual environment that we now see in our clients combinedwith our own successful transition to a work from home' mode have brought inefficiencies to the overall process which could further benefit your Company once demandconditions improve.
10. RISK MANAGEMENT
Your company is aware of the risks associated with the business. The company follows amethod for identifying minimizing and mitigating risks which will be periodicallyreviewed.
Some of the risks identified and which will have the attention of the management are:
- Securing critical resources including capital and human resources;
- Ensuring cost competitiveness;
- Building product differentiation and the appropriate value proposition
- Maintaining and enhancing customer service standards.
- Identifying and introducing innovative marketing and branding activities especiallyin the digital media
The Company had not accepted any deposits during the financial year ended 31st March2021 nor there were any unpaid / unclaimed deposits at the financial year ended on 31stMarch 2021. Further as the Company has never accepted deposits there have been nodefaults in repayments thereof nor any non-compliance thereto.
12. SUBSIDIARY ASSOCIATE AND JOINT VENTURE COMPANIES
The Company has the following subsidiaries as on 31st March 2021:
1. IRIS Business Services (Asia) Pte. Ltd. Singapore
2. IRIS Business Services LLC United States of America
3. Atanou S.r.l. Italy
4. IRIS Logix Solutions Private Limited India
The Company has not entered into any Joint Venture and doesn't have any AssociateCompany.
The financial statements pursuant to Section 129(3) of Companies Act 2013 of all theabove subsidiaries forms part of Annual Report. As on the financial year ended March 312021 none of the subsidiaries of the Company were a material subsidiary' within themeaning of Regulation 16(c) of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015.
13. PERFORMANCE AND FINANCIAL HIGHLIGHTS OF SUBSIDIARY COMPANIES AND THEIR CONTRIBUTIONTO OVERALL PERFORMANCE OF THE COMPANY
The consolidated financial statements of the Company forms a part of this AnnualReport. A statement containing salient features of the financial statement of subsidiariespursuant to first proviso to subsection (3) of section 129 read with rule 5 of Companies(Accounts) Rules 2014 in the prescribed Form AOC-1 are enclosed as Annexure - 1 to thisreport.
14. SHARE CAPITAL
During the year there was no change in the authorised share capital of the Companyhowever there was an increase in the issued and paid-up share capital of the Company. Thepaid-up share capital of the Company increased from Rs 188791620 divided into18879162 equity shares of Rs 10/- each to Rs 189231620 divided into 18923162equity shares of Rs 10 each. i. Issue of Equity Shares with Differential Rights: TheCompany has not issued any equity shares with differential rights during the financialyear ended 31st March 2021. ii. Issue of Sweat Equity Shares: The Company has not issuedany Sweat Equity Shares during the financial year ended 31st March 2021. iii. Issue ofEmployee Stock Options: The shareholders of the Company approved IRIS Employee StockOptions Scheme 2017 ("Scheme") at the Extra Ordinary General Meeting held on13th September 2017. The Nomination and Remuneration Committee of the Board inter-aliaadministers and monitors the Employees Stock Option Scheme of the Company in accordancewith the applicable provisions of the SEBI Regulations. Pursuant to shareholders'approval the Nomination and Remuneration Committee of the Board had granted Options toeligible employee(s) under the Scheme. Further the shareholders of the Company grantedtheir approval through Postal Ballot for ratification of the Scheme and for extension ofbenefits of the Scheme for the eligible employees of subsidiary Company(ies) of theCompany. As per the application to BSE Limited the Stock Exchange the Company receivedan in-principal approval of the Stock Exchange dated 9th April 2019 for the IRIS ESOPScheme 2017. The details of Employee Stock Options Scheme as required under Rule 9 ofCompanies (Share Capital and debentures) rules 2014 and those under SEBI (Share BasedEmployee Benefits) Regulations 2014 as amended to the extent applicable are provided inAnnexure 2 attached hereto. The Scheme is in compliance with the SEBI (Share BasedEmployee Benefits) Regulations 2014. Further there were no material change in the Schemeduring the year. The details required under Regulation 14 of the SEBI (Share BasedEmployee Benefits) Regulations 2014 are disclosed on Company's website athttp://www.irisbusiness. com/investors/disclosure. During the year ended 31st March 2020the Board of Directors of the Company approved IRIS Business Services Limited EmployeeStock Option Scheme 2019' ("IRIS ESOS 2019" / "Scheme") covering up to1400000 (Fourteen Lakh) Employee Stock Options to eligible employees of the Company asdetermined in terms of IRIS ESOS 2019 in one or more tranches exercisable in aggregateinto not more than 1400000 (Fourteen Lakh) equity shares of face value of Rs.10/- eachfully paid up. IRIS ESOS 2019 is subject to approval of shareholders of the Company.
The Nomination and Remuneration Committee of the Board of the Company has approved theallotment of 44000 equity shares of face value of Rs 10/- each at issue price of Rs 32per share (including the premium of Rs 22 each) on 30th March 2021 to the applicant(s)who exercised their options under the IRIS Employee Stock Options Scheme 2017.
15. INTERNAL FINANCIAL CONTROL AND THEIR ADEQUACY
The Company has internal financial control and risk mitigation system which isconstantly assessed and strengthened. The Company also conducts internal audit from timeto time. The Audit Committee actively reviews the internal audit report adequacy andeffectiveness of the internal financial control and suggests the improvements for thesame.
16. DECLARATIONS GIVEN BY DIRECTORS
The Company has received necessary declarations and disclosures from the IndependentDirectors under Section 149(7) and Section 184(1) of the Companies Act 2013 stating thatthey meet the criteria of independence as laid down in Section 149(6) of the CompaniesAct 2013 and under the applicable provisions of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 and disclosing their interest in form MBP-1.All the Directors have certified that the disqualifications mentioned under sections 164167 and 169 of the Companies Act 2013 do not apply to them. The Independent Directorshave complied with the Code for Independent Directors prescribed in Schedule IV to theAct.
The Board of the Company has taken the disclosures on record after verifying the dueveracity of the same. In the opinion of the Board all the Independent Directors possessthe integrity expertise and experience including the proficiency required to beIndependent Directors of the Company fulfil the conditions of independence as specifiedin the Act and the SEBI Listing Regulations and are independent of the management and havealso complied with the Code for Independent Directors as prescribed in Schedule IV of theAct. All the Independent Directors of the Company are also registered with the databank ofIndependent Directors as required under the provisions of the Companies Act 2013.
The Directors and the senior management personnel have affirmed compliance with theCode of Conduct for Directors and Senior Management Personnel.
17. DIRECTORS AND KEY MANAGERIAL PERSONNEL AND COMPOSITION OF BOARD
During the financial year ended 31st March 2021 Mr Haseeb A Drabu (DIN: 00489888) wasappointed as an Independent Director of the Company on 13th November 2020. Other than MrDrabu's appointment as an Independent Director there was no other change in thecomposition of the Board for the financial year ended 31st March 2021. There was nochange in the composition of any Committee of Board during the financial year ended 31stMarch 2021. Further there was no change in the Key Managerial Personnel during thefinancial year ended 31st March 2021. In accordance with the provisions of Section 152 ofthe Companies Act 2013 and the Company's Articles of Association Ms Deepta Rangarajan(DIN: 00404072) Whole Time Director retires by rotation at the forthcoming twenty-firstAnnual General Meeting and being eligible has offered herself for re-appointment.
Mr Swaminathan Subramaniam (DIN: 01185930) Ms Deepta Rangarajan (DIN: 00404072) andMr Balachandran Krishnan (DIN: 00080055) were re-appointed by the Board of Directors ofthe Company as Whole Time Director(s) of the Company for a period of three years effectivefrom 1st May 2021 on the recommendation of the Nomination and Remuneration Committee atits meeting held on 1st March 2021 which was duly approved by the shareholders of theCompany through postal ballot on 3rd April 2021.
The composition of Board of Directors of the Company as on 31st March 2021 is asfollows:
The composition of Board of Directors of the Company as on 31st March 2021 is asfollows:
|Sr. Name of Director ||DIN ||Category ||Period of Appointment |
|1. Mr Swaminathan Subramaniam ||01185930 ||Promoter Whole Time Director & CEO ||Period of 3 (three) years with effect from 1st May 2021 |
|2. Mr Balachandran Krishnan ||00080055 ||Promoter Whole Time Director & CFO ||Period of 3 (three) years with effect from 1st May 2021 |
|3. Ms Deepta Rangarajan ||00404072 ||Promoter Whole Time Director ||Period of 3 (three) years with effect from 1st May 2021 |
|4. Mr Vinod Balmukand Agarwala ||01725158 ||Independent Director ||Five years commencing from 27th November 2017 upto 26th November 2022 |
|5. Mr Ashok Venkatramani ||02839145 ||Independent Director ||Five years commencing from 9th October 2017 upto 8th October 2022 |
|6. Mr Bhaswar Mukherjee ||01654539 ||Independent Director ||Five years commencing from 9th October 2017 upto 8th October 2022 |
|7. Mr Haseeb A. Drabu ||00489888 ||Independent Director (Additional) ||Appointed for a tenure of five years from November 13 2020 subject to approval of the shareholders of the Company at the ensuing Annual General Meeting. |
Following are the Key Managerial Personnel of the Company as on 31st March 2021:
|Name ||Designation |
|Mr Swaminathan Subramaniam ||Whole Time Director & CEO |
|Mr Balachandran Krishnan ||Whole Time Director & CFO |
|Ms Deepta Rangarajan ||Whole Time Director |
|Mr Jay Mistry ||Company Secretary & Compliance Officer |
18. BOARD MEETING(S)
The Board met eight (8) times during the financial year ended 31st March 2021. Themeetings were held on 29th June 2020 14th August 2020 15th September 2020 13thNovember 2020 24th December 2020 14th January 2021 1st March 2021 and 30th March2021. The maximum interval between any two meetings did not exceed 120 days as prescribedin the Companies Act 2013.
Attendance of Director(s) at meeting(s) during the financial year 2020-21:
|Sr. Name of Director ||Board meeting(s) attended |
|1. Mr Vinod B. Agarwala (Chairman) ||7 |
|2. Mr Bhaswar Mukherjee ||8 |
|3. Mr Ashok Venkatramani ||7 |
|4. Mr Swaminathan Subramaniam ||6 |
|5. Mr Balachandran Krishnan ||7 |
|6. Ms Deepta Rangarajan ||8 |
|7. Mr Haseeb A. Drabu ||5 |
19. COMMITTEES OF THE BOARD
I. AUDIT COMMITTEE
The Company has constituted an Audit Committee in accordance with Section 177 of theCompanies Act 2013. The terms of reference of the Committee are as follows: (i) Oversightof the Company's financial reporting process and the disclosure of its financialinformation to ensure that the financial statement is correct sufficient and credible.
(ii) Recommending to the Board the appointment reappointment and if required thereplacement or removal of the statutory auditor and the fixation of audit fees.
(iii) Approval of payment to statutory auditors for any other services rendered by thestatutory auditors.
(iv) Reviewing with the management the annual financial statements before submissionto the board for approval with particular reference to: a) Matters required to beincluded in the Director's Responsibility Statement to be included in the Board's reportin terms of clause (c) of sub-section 3 of section 134 of the Companies Act 2013; b)Changes if any in accounting policies and practices and reasons for the same; c) Majoraccounting entries involving estimates based on the exercise of judgment by management; d)Significant adjustments made in the financial statements arising out of audit findings; e)Compliance with listing and other legal requirements relating to financial statements; f )Disclosure of any related party transactions; g) Qualifications in the draft audit report.
(v) Reviewing with the management the half yearly financial statements beforesubmission to the board for approval. (vi) Reviewing with the management the statementof uses / application of funds raised through an issue (public issue right issuepreferential issue etc.) the statement of funds utilized for purposes other than thosestated in the offer document/ Draft Prospectus/ Prospectus /notice and the reportsubmitted by the monitoring agency monitoring the utilization of proceeds of a public orrights issue and making appropriate recommendations to the Board to take up steps in thismatter. (vii) Review and monitor the auditor's independence performance and effectivenessof audit process.
(viii) Approval or any subsequent modification of transactions of the company withrelated parties; (ix) Scrutiny of inter-corporate loans and investments; (x) Valuation ofundertakings or assets of the company wherever it is necessary; (xi) Evaluation ofinternal financial controls and risk management systems; (xii) Reviewing with themanagement performance of statutory and internal auditors adequacy of the internalcontrol systems. (xiii) Reviewing the adequacy of internal audit function if anyincluding the structure of the internal audit department staffing and seniority of theofficial heading the department reporting structure coverage and frequency of internalaudit. (xiv) Discussion with internal auditors any significant findings and follow upthere on.
(xv) Reviewing the findings of any internal investigations by the internal auditorsinto matters where there is suspected fraud or irregularity or a failure of internalcontrol systems of a material nature and reporting the matter to the board.
(xvi) Discussion with statutory auditors before the audit commences about the natureand scope of audit as well as post-audit discussion to ascertain any area of concern.
(xvii) To look into the reasons for substantial defaults in the payment to thedepositors debenture holders shareholders (in case of non-payment of declared dividends)and creditors.
(xviii)To oversee and review the functioning of the vigil mechanism which shall providefor adequate safeguards against victimization of employees and directors who avail of thevigil mechanism and also provide for direct access to the Chairperson of the AuditCommittee in appropriate and exceptional cases.
(xix) Call for comments of the auditors about internal control systems scope of auditincluding the observations of the auditor and review of the financial statements beforesubmission to the Board.
(xx) Approval of appointment of CFO (i.e. the whole-time Finance Director or any otherperson heading the finance function or discharging that function) after assessing thequalifications experience & background etc. of the candidate.
(xxi) To investigate any other matters referred to by the Board of Directors; (xxii)Carrying out any other function as is mentioned in the terms of reference of the AuditCommittee.
(xxiii) Reviewing the utilization of loans and/ or advances from/ investment by theholding company in the subsidiary exceeding rupees 100 cr or 10% of the asset size of thesubsidiary whichever is lower including existing loans / advances / investments existingas on the date of coming into force of this provision.
(xxiv) To review compliance with the provisions of regulations 9A and other applicableprovisions of Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015 at least once in a financial year and shall verify that the systems forinternal control are adequate and are operating effectively. The Audit Committee shallmandatorily review the following information: a) Management discussion and analysis offinancial information and results of operations; b) Statement of significant related partytransactions (as defined by the Audit Committee) submitted by the management; c)Management letters / letters of internal control weaknesses issued by the statutoryauditors; Internal audit reports relating to internal control weaknesses; and d) Theappointment removal and terms of remuneration of the chief internal auditor shall besubject to review by the Audit Committee.
The Audit Committee met four (4) times during the financial year ended 31st March 2021on 29th June 2020 14th August 2020 13th November 2020 and 1st March 2021.
The composition of the Audit Committee as on 31st March 2021 is as follows:
|Name of the Committee Member ||Category ||No. of meetings attended |
|Mr Bhaswar Mukherjee (Chairman) ||Independent Director ||4 |
|Mr Vinod Agarwala ||Independent Director ||4 |
|Mr Ashok Venkatramani ||Independent Director ||4 |
|Mr Balachandran Krishnan ||Whole time Director & CFO ||4 |
The recommendations made by the Audit Committee to the Board from time to time duringthe year under review have been accepted by the Board.
II. NOMINATION AND REMUNERATION POLICY & COMMITTEE
The Nomination and Remuneration Committee ("NRC") had formulated a policy forthe Nomination and Remuneration of the Directors Key Managerial Personnel("KMP") and Senior Management.
The terms of reference of the NRC are as follows:
1. Formulation of the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board a policy relating to the level andcomposition of remuneration of the directors key managerial personnel and otheremployees;
2. Formulation of criteria for evaluation of independent directors and the Board;
3. Shall specify the manner for effective evaluation of performance of Board itscommittees and individual Directors to be carried out either by the Board by theNomination and Remuneration
Committee or by an independent external agency and review its implementation andcompliance.
4. To ensure that the relationship of remuneration to performance is clear and meetsappropriate performance benchmarks;
5. Devising a policy on Board diversity; and
6. Identifying persons who are qualified to become directors and who may be appointedin senior management in accordance with the criteria laid down and recommend to the Boardtheir appointment and removal.
7. Whether to extend or continue the term of appointment of the Independent Directoron the basis of the report of performance evaluation of independent directors.
8. Recommend to the board all remuneration in whatever form payable to seniormanagement.
9. Grant of options and allotment of shares under and in accordance with terms ofEmployee Stock Scheme(s) of the
The Company had adopted a Nomination and Remuneration policy (Policy) in accordancewith Section 178 of the Companies Act 2013 and the applicable provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015. The Policy was amended by theBoard at its meeting held on 23rd February 2019 to align with the changes prescribedunder SEBI (Listing Obligations and Disclosure Requirements) (Amendment) Regulations2018. The Policy is attached as Annexure 3' to this report and is alsoavailable on the website of the company viz. www.irisbusiness.com.
TheNRCmetfour(4)timesduringthefinancialyearended31stMarch 2021. The meeting was heldon 29th June 2020 13th November 2020 1st March 2021 and 30th March 2021. TheConstitution and terms of reference of the committee are in compliance with therequirements of section 178 of the Companies Act 2013 and the provisions of SEBI (ListingObligations and Disclosure Requirements) Regulations 2015.
The composition of the NRC as on 31st March 2021 is as follows:
|Name of the Committee Member ||Category ||No. of meeting(s) attended |
|Mr Ashok Venkatramani (Chairman) ||Independent Director ||4 |
|Mr Vinod Agarwala ||Independent Director ||4 |
|Mr Bhaswar Mukherjee ||Independent Director ||4 |
III. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE (CSR COMMITTEE)
The Company has constituted a CSR Committee in accordance with Section 135 of theCompanies Act 2013. No meeting of the Committee was held during the financial year ended31st March 2021. The Composition of the Committee as on 31st March 2021 is as follows:
|Sr. Name of the Member ||Category |
|1 Mr Ashok Venkatramani (Chairman) ||Independent Director |
|2 Ms Deepta Rangarajan ||Whole Time Director |
|3 Mr Swaminathan Subramaniam ||Whole Time Director & CEO |
IV. STAKEHOLDERS RELATIONSHIP COMMITTEE
The Company has constituted a Stakeholder's Relationship Committee in accordance withSection 178 of the Companies Act 2013 and the SEBI (Listing Obligation and DisclosureRequirements) Regulation 2015 specifically for the purposes of looking after the matterof handling and resolving shareholders / investors grievances. The Committee met three (3)times during the financial year ended 31st March 2021. The meetings were held on 29thJune 2020 13th November 2020 and 1st March 2021.
The terms of reference of the Committee are as follows: a. To look into various aspectsof interest of shareholders debenture holders and other security holders. b. Efficienttransfer of shares; including review of cases for refusal of transfer / transmission ofshares and debentures; c. Reviewing on a periodic basis the approval/refusal of transferor transmission of shares debentures or any other securities; d. Issue of duplicatecertificates and new certificates on split/ consolidation/renewal; e. Allotment andlisting of shares; f. Reference to statutory and regulatory authorities regarding investorgrievances; and g. To otherwise ensure proper and timely attendance and redressal ofinvestor queries and grievances; h. Resolving the grievances of the security holders ofthe listed entity including complaints related to transfer/transmission of sharesnon-receipt of annual report non-receipt of declared dividends issue of new/duplicatecertificates general meetings etc. i. Review of measures taken for effective exercise ofvoting rights by shareholders. j. Review of adherence to the service standards adopted bythe listed entity in respect of various services being rendered by the Registrar &Share Transfer Agent.
k. Review of the various measures and initiatives taken by the listed entity forreducing the quantum of unclaimed dividends and ensuring timely receipt of dividendwarrants/annual reports/statutory notices by the shareholders of the company. l. Any otherpower specifically assigned by the Board of Directors of the Company
The Composition of the Committee as on 31st March 2021 is as follows:
|Sr. Name of the Member ||Category ||No. of meetings attended |
|1 Mr Bhaswar Mukherjee (Chairman) ||Independent Director ||3 |
|2 Ms Deepta Rangarajan ||Whole Time Director ||3 |
|3 Mr Balachandran Krishnan ||Whole Time Director & CFO ||3 |
20. COMPLIANCE WITH SECRETARIAL STANDARD
During the period from 1st April 2020 to 31st March 2021 the Company complied withthe Secretarial Standard 1 and Secretarial Standard 2 issued by theInstitute of Company Secretaries of India.
21. CORPORATE SOCIAL RESPONSIBILITY ("CSR")
The Company has a CSR Committee and an approved CSR Policy in accordance with Section135 of the Companies Act 2013 read with rules made thereunder.
The Company is exempt from mandatory CSR expenditure as per Rule 3(2) CSR Rules 2014due to not falling in criteria of CSR applicability as mentioned in Section 135 of theCompanies Act 2013.
The company has on a voluntary basis provided disclosure in Annexure 4 to thisreport in the prescribed format under Section 135 of the Companies Act 2013 which isattached to this report. Further the composition of the Committee is covered underCommittee of the Board' part of the Directors' Report.
The CSR policy of the Company is available on the website of the Companywww.irisbusiness.com.
22. RELATED PARTY TRANSACTIONS
The transactions entered into by the Company with related parties are on arm's lengthbasis and in the ordinary course of business. The details of the transactions as persection 188 of the Companies Act 2013 and rules framed thereunder are enclosed asAnnexure - 5 in Form AOC-2 as required under Rule 8(2) of Companies (Accounts) Rules2014.
23. PARTICULARS OF REMUNERATION OF DIRECTORS KMP AND EMPLOYEES AND DISCLOSURES INBOARD'S REPORT
The disclosure on remuneration of Directors Key Managerial Personnel and employees asrequired under the Companies Act 2013 and Rules made thereunder is provided in Annexure 6 to this Report.
The information required under Rule 5 (2) of The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 is provided in the Annexure 6forming part of this Report. In terms of first proviso to Section 136 of the Act theReport and Accounts are being sent to the members excluding the certain informationcovered under aforesaid Annexure. Any member interested in obtaining the same may write tothe Company Secretary at the Registered Office of the Company. None of the employeeslisted in the said Annexure 6 is related to any Director of the Company.
24. ANNUAL EVALUATION OF DIRECTORS COMMITTEE AND BOARD
The Nomination and Remuneration Committee of the Board has formulated a performanceevaluation framework under which the Committee has identified criteria upon which everyDirector every Committee and the Board as a whole shall be evaluated.
The Board of Directors has carried out an annual evaluation of its own performanceBoard Committees and individual Directors pursuant to the provisions of the CompaniesAct 2013 and the SEBI (Listing Regulations and Disclosure Requirements) Regulations2015.
The performance of the Board was evaluated by the entire Board after seeking inputsfrom all the Directors on the basis of criteria such as the Board composition andstructure effectiveness of Board processes information and functioning etc. Theperformance of the Committees was evaluated after seeking inputs from the Committeemembers on the basis of criteria such as the composition of Committees effectiveness ofCommittee meetings etc. The above criteria are based on the Guidance Note on BoardEvaluation issued by the Securities and Exchange Board of India on 5th January 2017. Aseparate meeting of Independent Directors as required under Companies Act 2013 was heldon 30th March 2021 to evaluate the performance of the Non-Independent Directors and Boardas a whole.
The Board and the NRC reviewed the performance of individual directors on the basis ofcriteria such as the contribution of the individual director to the Board and Committeemeetings like preparedness on the issues to be discussed meaningful and constructivecontribution and inputs in meetings etc. In the Board meeting the performance of theBoard its Committees and individual Directors was also discussed. Performance evaluationof Independent Directors was done by the entire Board excluding the Independent Directorbeing evaluated.
Outcome of evaluation process: Based on inputs received from the members it emergedthat the Board has a good mix of competency experience qualifications and diversity.Each Board member contributed in his/her own manner to the collective wisdom of the Boardkeeping in mind his/her own background and experience. There was active participation andadequate time was given for discussing strategy. Overall the Board was functioning verywell in a cohesive and interactive manner.
25. ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo stipulated under Section 134(3)(m) of the Companies Act 2013 read withRule 8 of the Companies (Accounts) Rules 2014 is enclosed as Annexure - 7 to this report.
26. STATUTORY AUDITORS
M/s. Khimji Kunverji & Co LLP Chartered Accountants (ICAI Firm Registration No.105146W/W100621) were appointed as the Auditors of the Company by the shareholders of theCompany at the Twentieth Annual General Meeting ("AGM") of the Company held on14th August 2020 to hold office till the conclusion of the Twenty-fifth AGM. The Auditorsshall be eligible for re-appointment for maximum permissible tenure as the Auditors ofyour Company.
27. SECRETARIAL AUDITOR
In terms of Section 204 of the Companies Act 2013 and Rules made there under M/s.Parikh & Associates Practicing Company Secretary Mumbai were appointed as aSecretarial Auditors of the Company to conduct the Secretarial Audit of the Company forFinancial Year 2020-21. The Secretarial Audit Report does not contain any qualificationsreservations or adverse remarks or disclaimers. The report of the Secretarial Auditor isenclosed as Annexure - 8. The Secretarial Audit is not applicable to any of the subsidiaryof the Company since none of the subsidiary of the Company is a material subsidiary as onthe financial year ended 31st March 2021 within the meaning of Regulation 16(c) of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015.
The provisions of the circular no. CIR/CFD/CMD1/27/2019 dated 8th February 2019 issuedby Securities and Exchange Board of India with respect to the Annual SecretarialCompliance Report is not applicable to the Company as the Company is listed on the SMEPlatform of BSE Limited the Stock Exchange.
28. INTERNAL AUDITOR
In terms of Section 138 of the Companies Act 2013 and Rules made there under M/s.M.P. Chitale & Co. Chartered Accountants Mumbai were the Internal Auditor of theCompany as on 31st March 2021. During the year the Company continued to implement itssuggestions and recommendations to improve the control environment. Their scope of workincluded review of processes for safeguarding the assets of the Company review ofoperational efficiency effectiveness of systems and processes and assessing the internalcontrol strengths in all areas.
29. STATUTORY AUDITORS' REPORT
The Auditors' Report on the Financial Statements (Standalone and Consolidated) of theCompany for the year under review "with an unmodified opinion" as given by theStatutory Auditors is disclosed in the Financial Statements forming part of this AnnualReport. The Auditors' Report is clean and there are no qualifications in their Report.Also no frauds in terms of the provisions of Section 143(12) of the Act have beenreported by the Statutory Auditors in their report for the year under review.
30. EXPLANATION OR COMMENTS ON QUALIFICATIONS RESERVATIONS OR ADVERSEREMARKSORDISCLAIMERSMADEBYTHEAUDITORS AND THE PRACTICING COMPANY SECRETARY IN THEIRREPORTS
There are no qualifications reservations or adverse remarks made by the Auditors(Statutory Auditors and Secretarial Auditors) in their report.
31. ANNUAL RETURN
The Annual Return of the Company as on March 31 2021 is available on the Company'swebsite and can be accessed at https://www.irisbusiness.com/sites/default/files/Annual_Return_2020-21.pdf
The details forming part of the extract of the Annual Return in Form MGT - 9 areenclosed as Annexure - 9 to this report.
32. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
The Company has not granted any loans to any persons or body corporate. The details ofguarantees given and investments made as covered under the provisions of Section 186 ofthe Companies Act 2013 forms part of notes to the Standalone Financial Statements of theCompany.
33. DIRECTORS' RESPONSIBILITY STATEMENT
To the best of their knowledge and information and based on the information andexplanations provided to them by the Company your Directors make the following statementin terms of Section 134(3)(c) of the Companies Act 2013 ("the Act"): a. That inthe preparation of the annual accounts the applicable accounting standards had beenfollowed along with proper explanation relating to material departures; b. That thedirectors had 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 at the end of the financial year and of the profitand loss of the company for that period; c. That the directors had taken proper andsufficient care for the maintenance of adequate accounting records in accordance with theprovisions of this Act for safeguarding the assets of the company and for preventing anddetecting fraud and other irregularities; d. That the directors had prepared the annualaccounts on a going concern basis. e. That the directors had devised proper systems toensure compliance with the provisions of all applicable laws and that such systems wereadequate and operating effectively. f. That the Directors had laid down internal financialcontrols to be followed by the Company and that such internal financial controls wereadequate and were operating effectively.
34. HUMAN RESOURCES / INDUSTRIAL RELATIONS INCLUDING NUMBER OF PEOPLE EMPLOYED
Your Company provides regular training to employees to improve skills. Your company hasput in place a performance appraisal system that covers all employees. Your Company had357 permanent employees as on 31st March 2021 while the count was 341 as on 31st March2020.
35. CORPORATE GOVERNANCE
The Company being listed on the SME Platform of BSE Limited is exempted from theprovisions of corporate governance as per Regulation 15 of Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015. Thereforeno corporate governance report is annexed to this report. However your Company hascomplied with the relevant provisions of the Companies Act 2013 and rules thereunder withregards to formation of committees.
36. COMMITTEE AND POLICY UNDER SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company has constituted Internal Complaints Committee under and as per the SexualHarassment of Women at Workplace (Prevention Prohibition and Redressal) Act 2013. Duringthe year under review Company has not received any complaint under the Policy forPrevention of Sexual Harassment of the Company.
37. WHISTLE BLOWER POLICY / VIGIL MECHANISM
Your Company has Whistle Blower Policy /Vigil Mechanism Policy ("Policy") forthe Company to report to the management instances of unethical behaviour actual orsuspected fraud or violation of the Company's code of conduct. Functioning of the Policyis reviewed by the Audit Committee / Board on periodical basis. During the financial yearended 31st March 2021 the Company has not received any complaint under the WhistleBlower Policy of the Company.
38. CODE OF CONDUCT
The Board of Director has approved a Code of Conduct which is applicable to the membersof the Board of Directors and Senior Management Personnel. It is confirmed that allDirectors and Senior Management Personnel have affirmed their adherence to the provisionsof the Code of Conduct during the financial year 2020-21. The declaration to this effectis enclosed to this report as Annexure 10'.
39. MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of provisions of Regulation 34(2)(e) of SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a Management Discussion & Analysis Reporthas been separately furnished in the Annual Report.
40. POLICIES AND DISCLOSURE REQUIREMENTS
In terms of provisions of the Act and provisions of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 the Company has adopted the followingPolicies. The policies are available on Company's website http://www.irisbusiness.com/ investors/policies
Policy on Related Party Transactions
Nomination and Remuneration Policy
Corporate Social Responsibility Policy
Code of Conduct for Director & Senior Management Personnel
Material Subsidiary Policy
Policy for Determination of Materiality of Events
Policy for Preservation of Documents
Terms and Condition of Independent Director
Vigil Mechanism Policy
Code of Conduct to Regulate Monitor and Report Trading by insiders and Code ofPractices and Procedures for Fair Disclosure of Unpublished Price Sensitive Information
Policy for Procedure of Inquiry in Case of Leak of Unpublished Price SensitiveInformation ("UPSI") The Company's Policy on Directors' appointmentremuneration and other matters provided in Section 178(3) of the Companies Act 2013 formspart of Nomination and Remuneration Policy.
Your Board takes this opportunity to thank all its employees for their dedicatedservice and firm commitment to the goals of the Company. Your Board also wishes to placeon record its sincere appreciation for the wholehearted support received from membersclients bankers and all other business associates. We look forward to continued supportof all these partners in progress.
| ||For and on behalf of Board of Directors of IRIS Business Services Limited || |
|Swaminathan Subramaniam ||Deepta Rangarajan ||Balachandran Krishnan |
|Whole Time Director & CEO ||Whole Time Director ||Whole Time Director & CFO |
|DIN: 01185930 ||DIN: 00404072 ||DIN: 00080055 |
|Place: Navi Mumbai || || |
|Date : 22nd May 2021 || || |