To the Members
The Directors have pleasure in presenting before you the Ninth Annual Report of theCompany together with the Audited Statements of Accounts for the year ended 31stMarch 2017.
(Rs in actuals)
|Particulars ||2016-17 ||2015-16 |
|Gross Income ||93754000 ||89400000 |
|Depreciation ||15814498 ||8513511 |
|Finance Charges ||44032 ||246367 |
|Gross Profit ||16051561 ||19913751 |
|Provision for Depreciation ||0 ||0 |
|Net Profit Before Tax ||16051561 ||19913751 |
|Provision for Tax ||6027081 ||8806515 |
|Net Profit After Tax ||10024480 ||11107236 |
|Balance of Profit brought forward ||10024480 ||11107236 |
|Balance available for appropriation ||10024480 ||11107236 |
|Proposed Dividend on Equity Shares ||0 ||0 |
|Tax on proposed Dividend ||0 ||0 |
|Transfer to General Reserve ||0 ||0 |
|Surplus carried to Balance Sheet ||10024480 ||11107236 |
Gross revenues increased to Rs. 93754000 as against Rs.89400000 in the previousyear. Profit before taxation was Rs. 16051561 against Rs. 19913751 in the previousyear. After providing for taxation the net profit of the Company for the year underreview was placed at Rs 10024480 as against Rs. 11107236 in the previous year.
The Company shifted its corporate office for better operational efficiency to UNITNO.2 4TH FLOOR PINNACLE BUILDING ASCENDAS INTERNATIONAL TECH PARK CHENNAI 600113 from16th February 2017
The Company provides software development services for clients who typically areIndependent software vendors (ISVs) and large enterprises undergoing digitaltransformation in healthcare media and other allied industries. The Company uses thelatest in social mobile cloud and analytics technologies (SMAC) to build software thatis compelling packed with innovative features and designed for rapid evolution to enabledigital transformation.
Your Directors have not recommended any dividend during the financial year 2016-17.
The paid up equity capital as on 31st March 2017 was Rs. 6.41 crore. TheCompany has not issued shares with differential voting rights nor granted stock options orsweat equity during the year under review.
Cash and cash equivalents as at 31st March 2017 was Rs. 23583226. TheCompany continues to focus on judicious management of its working capital receivablesinventories and other working capital parameters were kept under strict check throughcontinuous monitoring.
The Company has not accepted any deposits within the meaning of Section 73 of theCompanies Act 2013 and the Companies (Acceptance of Deposits) Rules 2014 and anyamendments thereto.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The Company has not given any loans or guarantees covered under the provisions ofSection 186 of the Companies Act 2013. The details of the investments made by Company aregiven in the notes to the financial statements.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit function isdefined in the Internal Audit Manual.
To maintain its objectivity and independence the Internal Audit function reports tothe Chairman of the Audit Committee of the Board & to the Chairman & ManagingDirector.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company.
Based on the report of internal audit function process owners undertake correctiveaction in their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented tothe Audit Committee of the Board.
CORPORATE SOCIAL RESPONSIBILITY
The Company has not taken any initiatives under "Corporate SocialResponsibility" as the ceiling limit was not applicable to the Company as per Section135 Companies Act 2013.
CONSERVATION OF ENERGY
a) Company ensures that the operations are conducted in the manner whereby optimumutilization and maximum possible savings of energy is achieved. b) No specific investmenthas been made in reduction in energy consumption. c) As the impact of measures taken forconservation and optimum utilization of energy are not quantitative its impact on costcannot be stated accurately. d) Since the Company does not fall under the list ofindustries which should furnish this information in Form A annexed to the aforesaidRules the question of furnishing the same does not arise.
No outside technology is being used for Development activities. The Company constantlystrives for maintenance and improvement in quality of its products and entire Research& Development activities are directed to achieve the aforesaid goal.
FOREIGN EXCHANGE EARNINGS AND OUT-GO
During the period the Company earned Rs. 9.37 crores and outflow Rs. 0.09 crores.
DIRECTORS AND KEY MANANGERIAL PERSONNEL
The Company has received necessary declaration from each Independent Director of theCompany under Section 149(7) of the Companies Act 2013 that they meet the criteria ofIndependence laid down under Section 149(6) of the Companies Act2013.
Ms. Dharani was appointed as Company Secretary of the Company with effect from 2ndSeptember 2016.
Pursuant to the provisions of the Companies Act 2013 the Board has carried out anevaluation of its own performance the directors individually as well as the evaluation ofthe working of its Audit Appointment & Remuneration Committees. The manner in whichthe evaluation has been carried out has been explained in the Corporate Governance Report.
The Company is compliant with the following policies/charters:
- Audit Committee Charter
- Nomination and Remuneration Policy
- Vigil Mechanism/Whistle Blower Policy
- Corporate Social Responsibility Policy
- Policy for determination of Materiality of any Event/Information
- Related Party Transaction Policy
- Code of conduct for prevention of insider trading and code of practices andprocedures for fair disclosure of unpublished price sensitive information
- Policy for preservation of documents and Archival Policy All the policies areavailable in the website of the Company www.ofstech.com
The Board of Directors met 07 times during the financial year 2016-17. The dates of theBoard meetings are as follows:
6th April 2016 30th May 2016 2nd September 2016 9th September 2016 11thNovember 2016 20th January 2017 and 16th February 2017.
DIRECTOR'S RESPONSIBILITY STATEMENT
In terms of Section 134 (5) of the Companies Act 2013 the directors would like tostate that: i) In the preparation of the annual accounts the applicable accountingstandards have been followed. ii) The directors have selected such accounting policies andapplied them consistently and made judgments and estimates that were reasonable andprudent so as to give a true and fair view of the state of affairs of the Company at theend of the financial year and of the profit or loss of the Company for the year underreview. iii) The directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the Company and for preventing and detecting fraud and other irregularities.iv) The directors have prepared the annual accounts on a going concern basis. v) Thedirectors had laid down internal financial controls to be followed by the Company and thatsuch internal financial controls are adequate and were operating effectively. vi) Thedirectors had devised proper system to ensure compliance with the provisions of allapplicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transactions made by the Company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the Company at large.
The Company does not have any subsidiary.
CODE OF CONDUCT
The Board of Directors has approved a Code of Conduct which is applicable to theMembers of the Board and all employees in the course of day to day business operations ofthe Company. All the Board Members and the Senior Management personnel have confirmedcompliance with the Code. All Management Staff were given appropriate training in thisregard.
According to the provision of Section 204 of the Companies Act 2013 read with Rule 9of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany engaged the services of Mr. S Hari Krishnan CP No: 13740 Company Secretary inPractice Chennai to conduct the Secretarial Audit of the Company for the Financial Year2015-16.
The Secretarial Audit Report submitted by the Company Secretary in Practice is enclosedas a part of this Annual report in Annexure-A which is self-explanatory.
M/s. Elangovan and Co Chartered Accountants having Firm Reg.No:006990S Chennai beand hereby appointed as Statutory Auditor of the Company to fill the casual vacancycreated by death of Mr. V. Krishnamoorthy Chartered Accountant Chennai.
OBSERVATIONS IN AUDITORS' REPORT
The Auditors' report does not contain any qualification reservation or adverseremarks.
The Central Government has not prescribed maintenance of cost records for the existingbusiness activities of the Company.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT-9 is annexedherewith as Annexure-B
PARTICULARS OF EMPLOYEES
The Company has not employed any person during the year
- whose remuneration was not less than Rs. 6000000/- for the whole year or - not lessthan Rs. 500000/- per month if employed for part of the year.
- if employed throughout the financial year or part thereof was in receipt ofremuneration in that year which in the aggregate or as the case may be at a rate whichin the aggregate is in excess of that drawn by the managing director or whole-timedirector or manager and holds by himself or along with his spouse and dependent childrennot less than two percent of the equity shares of the Company.
The information required pursuant to Section 197 read with rule 5 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will be provided upon request. In terms of Section 136 of the Act thereports and accounts are being sent to the members and others entitled thereto excludingthe information on employees' particulars which is available for inspection by the membersat the Registered office of the Company during business hours on working days of theCompany up to the date of ensuing Annual General Meeting. If any member is interested ininspecting the same such member may write to the Company secretary in advance.
CORPORATE GOVERNANCE AND SHAREHOLDERS INFORMATION
The Company has taken adequate steps to adhere to all the stipulations laid down underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015. A report on Corporate Governance included as a part of this AnnualReport is given in Annexure-E. Certificate from the Statutory Auditors of the Companyconfirming the compliance with the conditions of Corporate Governance as stipulated underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 is attached to this Annual Report.
PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORKPLACE POLICY
The Company's policy on Prevention of Sexual Harassment of Women provides for theprotection and prevention against sexual harassment of women employees at the workplaceand redressal of such complaints. There were no complaints received or pending forredressal during the FY 16-17.
The Directors take this opportunity to place on record their gratitude for the supportextended to the Company by the clients banks employees investors and otherstakeholders.
| ||On behalf of the Board |
|Place: Chennai ||For OFS Technologies Limited |
|Date: 30th May 2017 || |
| ||Jesudas Premkumar |
| ||Managing Director |
| ||DIN: 07008031 |