DIRECTORS' REPORT Dear Shareholders, We are pleased to present Your Company's Twenty Second Report on business and operations, together with the Audited Statement of Accounts, for the year ended March 31, 2015. Overview For the financial year ended March 31, 2015, the Company reported a total income of Rs. 8,288.35 lakhs. Changes in the Capital Structure The Company has allotted 14 Crores Convertible Preferential Warrants to promoter and non promoter category on preferential basis during the period under review. Material changes and Commitments There has been no material changes and commitments affecting the financial position of the company which have occurred between the end of the financial year of the company to which the balance sheet relates and the date of this report. Transfer to Reserves No amount is being transferred to reserves. Dividend In view of requirement of funds for the expansion of Company's business, your directors did not recommend any dividend for the financial year 2014-15. Director and Key Managerial Personnel (KMP) In accordance with the provision of the Companies Act, 2013 and the Article of Association of the Company, Mr. Dalip Kumar, Chairman and Managing Director of the Company, (DIN- 00103292) is proposed to be re-appointed as Managing Director of the Company for a period of Five years from 01.04.2015 to 31.03.2020 on the remuneration and other terms and conditions, as recommended by the Nomination and Remuneration Committee and Board of Directors of the Company. Mr. Rohit Pratap Singh (DIN-03564084), Executive Director of the Company, who retires by rotation in terms of section 152(6) of the Companies Act, 2013 at the ensuing Annual General Meeting and, being eligible, offer himself for re-appointment as Non-executive Director of the Company. The Companies Act, 2013 Rules made thereunder and Listing Agreement with the Stock Exchange (Including Amendment) provide for appointment of Women Director for prescribed Companies. In compliance with these provisions, the Company on the recommendation of Nomination and Remuneration Committee ("NRC"), appointed Ms. Shweta Shatsri as a Women Director on September 24, 2014. Number of Meetings of the Board of Directors The Board met six time during the financial year, the details of which are given in the Corporate Governance Report that form part of this Annual Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013. Board Evaluation The Companies Act, 2013 state that a formal annual evalution need to be made by the Board of its own performance and that of its Committee and individual directors. Clause 49 of Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The evaluation of all the directors and the Board as whole was conducted based on the criteria and framework adopted by the Board. The evaluation process has been explained in the Corporate Governance Report. None of Independent Directors are due for re-appointment. Company's Policy on Directors' Appointment and Remuneration During the year, the Nomination and Remuneration Committee (NRC), a Committee of the Board, was further revised in accordance with requirements of newly enacted Companies Act, 2013 and revised Clause 49 of the listing agreement with stock exchanges. Primary responsibility of the Committee is to identify and nominate suitable candidates for Board membership and as members of senior Management of the company. The Nomination and Remuneration Committee formulate the criteria for determining qualifications, positive attributes and independence of a Director and recommend to the board a policy, relating to the remuneration of Directors, Key Managerial Personnel and other employees of the Company. The policy of the Company for selection of Directors is provided as Annexure C to this Director Report. Declaration By Independent Directors The Company has received declarations from all the independent Director that they meet the criteria of independence as laid down under section 149(6) of the Companies Act, 2013 and clause 49 of the Listing Agreement with the Stock Exchanges. Conservation of energy, research and development, technology absorption, foreign exchange earnings and outgo The particulars as prescribed under section 134(3)(m) of the Companies Act, 2013, read with Rule 8 of the Companies (Accounts) Rules, 2014, are set out in the "Annexure E" to this Board Report. Subsidiaries FCS has four Wholly Owned Subsidiary Companies outside India, viz. FCS Software Solutions America Limited, incorporated in America and F.C.S Software Middle East FZE in UAE, FCS Software Solutions GmbH, in Germany and FCS Software (Shanghai) Co. Ltd. in China to cater to the needs of its clients in America, UAE, Germany and China so that they have better legal security, faster services and comfort in dealing with the Company. FCS has one Wholly Owned Subsidiary Company in India i.e. Insync Business Solutions Limited. The Board of Directors of our Company have reviewed the affairs of all the subsidiary companies. A statement of holding company's interest in subsidiaries as required under Section 129 of the Companies Act, 2013, forms part of this annual report. A Statement containing salient features of the financial statement of subsidiaries is provided in Form No AOC-1 as "Annexure A" to this Board Report. Particulars of Contract or Arrangement with Related Party Details of Contract or Arrangement with Related Party of the Company in the prescribed Form AOC-2, is provided as "Annexure B" to Director's Report. Particulars of Loan, Guarantees or Investments Details of Loan, Guarantees and Investment covered under the provisions of section 186 of Companies Act, 2013 are provided in the notes to the Financial Statement. Particulars of employees During the year ended March 31, 2015, no employee is drawing remuneration in excess of the amount prescribed under section 197(12) of the Companies Act, 2013, read with Rule 5 Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Directors' responsibility statement To the Members, We, the directors of FCS Software Solutions Limited, pursuant to the provisions of section 134(3)(c) of the Companies Act, 2013, confirm the following: 1. that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; 2. that the directors had 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; 3. that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; 4. that the directors had prepared the annual accounts on a going concern basis. 5. that the Board of Director had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively. 6. That the Board of Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Ensuring Compliance of laws The company has devised and set in place proper systems to ensure compliance of all laws applicable to the company. Transfer to Investor Education and Protection fund Pursuant to Sections 125 and other applicable provisions, if any, of the Companies Act, 2013, all unclaimed/ unpaid dividend, application money, remaining unclaimed/unpaid for a period of seven years from the date they became due for payment, in relation to the Company, have been transferred to the Investor Education and Protection Fund (IEPF) established by the Central Government. No claim shall lie against the IEPF or the Company for the amounts so transferred nor shall any payment be made in respect of such claim. Board Committee The Company has the following committee of the Board: 1. Audit Committee 2. Nomination and Remuneration Committee 3. Stakeholders Relationship Committee 4. Corporate Social Responsibility Committee Composition of audit committee Details of Audit Committee of Board of Directors of the Company forms part of the Annual Report and is given separately in Report of Corporate Governance. Management Discussion and Analysis A Management Discussion and Analysis Report has been attached and forms part of the Annual Report. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future During the year, no significant and material orders were passed by the regulators or courts or tribunals impacting the going concern status and Company's operation in future. Vigil Mechanism/Whistle Blower Policy The Company has established a whistle-blower policy and also established a mechanism for Directors and employees to report their concerns. The detail of the same is explained in the Corporate Governance Report. Corporate Governance FCS is endeavouring to implement every norm, which is promulgated by legislation, or any of the statutory bodies. In line with that, a report on Corporate Governance, along with a certificate from the Statutory Auditors, has been included in the Annual Report, detailing the compliances of corporate governance norms as enumerated in Clause 49 of the Listing Agreements with the Stock Exchanges. Public Deposits The Company has not accepted any public deposits during the year under Section 73 of the Companies Act, 2013, read with Companies (Acceptance of Deposits) Rules, 2014, and as such, no amount on account of principal or interest was outstanding as on the date of Balance Sheet. Corporate Social Responsibity (CSR) Your Company's approach is to spend on activities for the welfare of society under CSR, CSR is a mean to balance economic, social and environmental objectives, it is a responsible way of doing business. In terms of provisions of section 135 of the Companies Act, 2013 & Rule 9 of Companies (Corporate Social Responsibility) Rule, 2014 and other clarification issued by Ministry of Corporate Affairs, however the Company does not qualified the norms specified as required under section 135 of Companies Act, 2013 to contribute towards CSR. Secretarial Auditor As per the Companies Act 2013, Secretarial Audit by a practising Company Secretary has become mandatory for prescribed Companies, and they are required to annex the Secretarial Audit report with their Board Report in the Annual Report. Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board appointed, Manju Pathak Khulbe, Practising Company Secretaries to undertake the Secretarial Audit of the Company. Secretarial Audit Report in the prescribed Form MR 3 is provided as "Annexure D" to this Directors' Report. The Secretarial Auditors' Report does not contain any qualification, reservation or adverse remark. Consolidated Financial Statements The Consolidated Financial Statements of the Company prepared in accordance with applicable Accounting Standards forms a part of this Annual Report. Auditors The statutory auditors M/s. SPMG & Company, Chartered Accountants, Delhi, retire at the ensuing Annual General Meeting, and being eligible, offers himself for reappointment. Your directors recommend their reappointment as auditors. Extract of Annual Return Extract of Annual Return of the Company in the prescribed Form MGT-9, is provided as "Annexure F" to Directors' Report. Listing Fees The Company Confirms that it has paid the annual listing fees for the year 2015-16 to both Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Acknowledgements The Directors thank the Company's employees, customers, vendors, investors, service providers, bankers for their continued support. The Directors also convey a special thanks to the Government of India, particularly Ministry of Communication and Information Technology, the Customs and Excise departments, the Income Tax department, Ministry of Corporate Affairs, Office of Registrar of Companies, New Delhi, Board of approval and Development Commissioner of Special Economic Zones, particularly of Noida and Chandigarh for their co-operation. For and on behalf of the Board of Directors For FCS Software Solutions Limited Sd/- Dalip Kumar Chairman & Managing Director Place : Noida Date : August 28, 2015 |