DIRECTORS' REPORT To The Members, Your Directors have pleasure in presenting the 21st Annual Report together with the Audited Accounts for the Financial Year ended 31st March 2015 Dividend Due to inadequacy of profits and in order to conserve resources, your Directors have not recommended any dividend for the year under review. Transfer of Unclaimed Dividend To Investor Eduction And Protection Fund The provisions of Section 125(2) of the Companies Act, 2013 do not apply as there was no dividend declared and paid last year. Review of business operations and future prospects: The Company has achieved a turnover of Rs. 1,968.12 Lakhs and Net Profit of Rs. 214.22 Lakhs as against Rs. 1,246.76 Lakhs and Rs. 82.07 Lakhs in the previous year respectively. Details of Policy Developed and Implemented by the Company on its Corporate Social Responsibility initiatives The said provisions are not applicable for your Company. However, your Company is actively involved in taking up Programs to financially support the educational requirements of the needy children. Future Outlook Your Board of Directors has taken various initiatives to overcome the competition by adopting various strategies that helped your Company to bag various orders. This will pave a way for better visibility and higher revenues and profitability for the Company in coming financial years. Further, The Company is also taking measures to keep the operating costs low wherever possible. Capital Expenditure During the year under review the company has made Capital Expenditure of Rs. 46,62,231 /-. Deposits The Company has not accepted any deposits and as such, no amount of principal or interest was outstanding as on the date of the Balance Sheet for the year ended on 31 st March 2015. ISO 9001 -2008 Certification Your Company continues to hold ISO 9001-2008 Certification by complying with all the requirements of Certification from time to time. ISO 27001 -2013 Certification This year your Company obtained ISO 27001-2013 Certification for Software Development, IT BPO Services, Data Management Services and Infrastructure Management by complying with all the requirements of Certification. ISO 20000-1:2011 Certification This year your Company obtained ISO 20000-1:2011 for Software Development, IT BPO Services, Data Management Services and Infrastructure Management Certification by complying with all the requirements of Certification. BOARD OF DIRECTORS & KEY MANAGERIAL PERSONNEL None of the directors of the company are disqualified under the provisions of the Act or under the Listing Agreement with the Stock Exchanges. APPOINTMENTS Mr. Ravi Vishnu was re-appointed as the Managing Director w.e.f 15-01-2015 for a period of 5 years subject to the approval of members. His appointment as the Managing Director by the members is proposed at the ensuing AGM. Smt. Ravi Kasturi and Mr.P. Venkata Rao were appointed as the Additional Directors w.e.f 104-2015 and 12-08-2015 respectively. Their appointment as Directors by the members is proposed at the ensuing AGM. Pursuant to the articles of association of the company and the provisions of Section 152 of the Companies Act, 2013, Mr. Radhakrishna Murthy retires by rotation at the ensuing AGM and offers himself for re-appointment. Pursuant to the provisions of Clause 49 of the Listing Agreement, brief particulars of the directors who are proposed to be appointed/re-appointed are provided as an annexure to the notice convening the AGM. Mr. K. Rahupathi Rao was designated as the Chief Financial Officer (CFO) of the Company during the year. Except as stated above, there is no change in the key managerial personnel during the year. Policy on Directors' Appointment and Remuneration and other details The Company's policy on directors' appointment and remuneration and other matters provided in section 178(3) of the Act have been disclosed in the corporate governance report, which forms part of the directors' report. Number of Board meetings during the year During the year, five meetings of the board were held, the details of which form part of the report on corporate governance. Board evaluation and assessment The company believes that formal evaluation of the board and of the individual directors, on an annual basis, is a potentially effective way to respond to the demand for greater board accountability and effectiveness. For the company, evaluations provide an ongoing means for directors to assess their individual and collective performance and effectiveness. In addition to greater board accountability, evaluation of board members helps in: • More effective board processes • Better collaboration and communication • Greater clarity with regard to members' roles and responsibilities and • Improved Board relations By focusing on the board as a team and on its overall performance, the company ensures that communication and overall level of participation and engagement also improves. In this background, the board undertook a formal board assessment and evaluation process during 2014-15. The Nomination & Remuneration Committee has overall stewardship for the process. The evaluation process covers the following aspects: • Peer and self-evaluation of Directors • Evaluation of the performance and effectiveness of the board • Evaluation of the performance and effectiveness of Board Committees • Feedback from the Non-Executive Directors to the Chairman, and • Feedback on management support to the Board The evaluation process elicits responses from the directors in a judicious manner - ranging from composition and induction of the board to effectiveness and governance. It also seeks feedback on board and committee charters, strategy, risk management and quality of discussion and deliberations at the board. The same is discussed and acted upon accordingly at the board. AUDITORS Pursuant to the provisions of section 139 of the Act and the rules framed thereunder, M/s. Rambabu & Co.; Chartered Accoutants, were appointed as statutory auditors of the company from the conclusion of the 20th AGM of the company held on 30th September 2014 till the conclusion of the 25th AGM to be held in the year 2019, subject to ratification of their appointment at every AGM. Their appointment from the conclusion of this Annual General Meeting till the conclusion of next Annual General Meeting to be ratified at the ensuing annual general meeting. The Company has received confirmation regarding their consent and eligibility that their appointment, if ratified, would be within the prescribed limits under Sections 139 and 141 of the Companies Act, 2013 read with the Companies (Audit and Auditors) Rules, 2014 and that they are not disqualified. The Notes on financial statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark. AUDITORS' REPORT AND SECRETARIAL AUDITORS' REPORT The auditors' report and secretarial auditors' report do not contain any qualifications, reservations or adverse remarks. Report of the secretarial auditor is annexed to the Directors Report. CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Information relating to conservation of energy, technology absorption, foreign exchange earnings and outgo forming part of Directors' report. Conservation of Energy The operations of your Company are not Energy intensive. The Company makes every effort to conserve energy as far as possible in its facilities. The Company continuously evaluates new technologies and techniques to make infrastructure more energy efficient. Technology Absorption Your Company did not invest in any R&D activity during the year under consideration. However, the up gradation of the technology in vogue is being given highest priority to give a better service to the clientele. MANAGEMENT DISCUSSION & ANALYSIS REPORT Pursuant to the provisions of Clause 49 of the Listing Agreement, a report on Management Discussion & Analysis is enclosed to the Annual Report. DIRECTORS'RESPONSIBILITY STATEMENT Pursuant to Section 134(5) of the Companies Act, 2013, the Board of Directors, to the best of their knowledge and ability, confirm that: i. In the preparation of the annual accounts, the applicable accounting standards have been followed and there are no material departures; ii. They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the company for that period; iii. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; iv. They have prepared the annual accounts on a going concern basis; v. They have laid down internal financial controls to be followed by the company and such internal financial controls are adequate and operating effectively; vi. They have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS The particulars of loans, guarantees and investments have been disclosed in the financial statements RELATED PARTY TRANSACTIONS The Company had not entered into any arrangement / transaction with related parties which could be considered material in nature and accordingly the disclosure of Related Party Transactions in Form AOC 2 is not applicable,. However, Suitable disclosures have been made in notes to the financial statements, In compliance of Clause 49 of the Listing Agreement the Company has formulated a EXTRACT OF ANNUAL RETURN (MGT9) The extract of the annual return in Form MGT 9 as required under the provisions of section 92 of the Act is annexed to the Directors Report. PARTICULARS OF EMPLOYEES The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below: a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year: RISK MANAGEMENT The Board of Directors has formed a risk management committee to identify, evaluate, mitigate and monitor the risk management in the company. The committee is responsible for reviewing the risk management plan and ensuring its effectiveness. The audit committee also oversees in the area of financial risks and controls. A comprehensive enterprise risk management mechanism has been put in place and the same is regularly reviewed. A more detailed analysis of the risk management in the company is published in the management discussion and analysis report published elsewhere in the annual report. CORPORATE GOVERNANCE The Company will continue to uphold the true spirit of Corporate Governance and implement the best governance practices. A report on Corporate Governance pursuant to the provisions of Clause 49 of the Listing Agreement forms part of the Annual Report. Full details of the various Board Committees are also provided therein. As required under Clause 49 of the Listing Agreement, the Auditors' Certificate regarding compliance of conditions of corporate governance is annexed to the Directors Report. DISCLOSURE REQUIREMENTS Details of the familiarization programme of the independent directors are available on the website of the Company www.cosyn.in Policy for determining material subsidiaries of the Company is available on the website of the Company www.cosyn.in Policy on dealing with related party transactions is available on the website of the Company www.cosyn.in The Company has formulated and published a Whistle Blower Policy to provide Vigil Mechanism for employees including Directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the section 177(9) of the Act and the revised Clause 49 of the Listing Agreements with stock exchanges. The company has in place an Anti-Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All associates of the company are covered under this policy. There were no complaints received under the policy during 2014-15. Managing Director / CEO's DECLARATION Pursuant to the provisions of clause 49 (II)(E) of the Listing Agreement, a declaration by the Managing Director of the company declaring that all the members of the board and the senior management personnel of the company have affirmed compliance with the Code of Conduct of the company is annexed to the Directors Report. The Managing Director / CFO certification to the board pursuant to clause 49(V) of the listing agreement is annexed to the Directors Report. ACKNOWLEDGMENTS Your Directors extend their gratitude to the valuable customers, investors, Bankers, Central and State Government officers, agencies and the confidence, which they have reposed in the Management. We place on record our appreciation of the contribution made by employees at all levels. Our consistent performance was made possible by their hard work, solidarity co-operation and support. For and on behalf of the Board of Directors -Sd-Ravi Vishnu Managing Director (DIN-01144902) -Sd- A.BHOPAL REDDY Whole-Time Director (DIN-01119839) Place: HYDERABAD Date : August 12, 2015 |