bathina technologies india ltd Directors report
BATHINA TECHNOLOGIES (INDIA) LIMITED
ANNUAL REPORT 2003-2004
DIRECTORS REPORT
Dear Members,
We, the Board of Directors of your Company, have pleasure in presenting the
8th Annual Report of the Company together with the Audited Financial
Accounts for the Financial Year ended 31st March, 2004.
Financial Results :
2003-04 2002-03
Particulars Rs. in Rs. in
Lakhs Lakhs
Operating Profit 184.99 262.70
Less: Depreciation 188.71 256.18
Less: Misc. Expenditure written off - 149.03
Profit/Loss before Tax (-) 3.72 6.52
Less: Provision for Taxation - -
Less: Book-profit Tax 0.02 0.27
Less: Deferred Tax Liability - 53.86
Add: Deferred Tax Asset 9.88 -
Add: Prior period adjustment 4.38 2.58
Profit after Tax 10.52 (-) 47.61
Surplus brought forward from Previous
Year 1206.44 1254.05
Balance available for Appropriations 1216.95 1206.44
Share Warrants advance - 45.84
Forfeiture A/C 45.84 -
Balance carried forward to Balance
Sheet 1171.14 1206.44
Performance Review: Your Company has continued its efforts though the
general trend of Software Industry is not encouraging and has earned total
revenue of Rs. 358.01 lakhs and a net profit of Rs. 10.52 lakhs, due to the
addition of deferred tax asset of Rs. 9.88 lakhs.
Product Development: Your Company has continued to make efforts to bridge
the awareness about its flagship product "BATHINA VOICEAUTO", has increased
from major organizations related to different sectors like Banks, Financial
Institutions, R & D Divisions of Multi National Companies, Pharma and
Biotechnology Sectors etc. Various Educational Institutions and
Universities. On the Government front, various Departments of Many State
Governments as well as the Central Government including Revenue, Judiciary,
Police and Irrigation Departments etc., have keenly expressed their desire
in using your product for the purpose of Office Automation. This magnitude
requires fresh inflow of capital.
Your product, Bathing Voice Auto, Version 2.0 is ready for release and in
the final stage of incorporating the features required by the users of
different sectors pertaining to their usage. By incorporating these
features, your product would become not only versatile bulk also unique.
Your product has been rated one among the top products on par with the
international standards expected for the products of this nature,
incorporating features like multiple vocabularies, subject vise
vocabularies, Desktop Navigation etc has evolved your product. A new
approach has also been adopted in the technology thereby the technology
works efficiently in order to provide improved accuracy and robustness to
the product. In addition, unlike previous version of the product, which is
compatible with MS Office: Suite, Version 2.0 can adopt to various office
automation tools and different operating systems.
R&D Policy and Expansion/Diversification: Your Company focuses to be in the
development of Technologies and related Platforms, Products, Applications,
and Technology-Services. Your Company is planning to continue in the base
Voice Automation Technology, Products, and Solutions and is also planning
to expand Research and Development in the areas of integrated solutions as
explained above.
Exports: Your Company has not exported any software or services during the
financial year 2003-04. As explained in the earlier reports, your Company
is doing Research and Development on Voice Automation, being the first of
its kind anywhere in the world, the certification process by the end users
is getting delayed. All the resources of the Company are deployed in the
product leaving little room for undertaking any other work.
Dividend: Since the Company is struggling with cash problem as explained
above; the Directors do not recommend any dividend.
Corporate Governance: The Corporate Governance Regulations under the
listing Agreement; have been implemented from the Financial Year 2002-03.
The report on Corporate Governance as required is attached herein and forms
part of this report.
Directors: Shri V. Rao Bathing, Chairman & Managing Director is not liable
to retire by rotation. Sort. B. Sasi Bimba and Shri N. Srinivasa Rao retire
by rotation and being eligible offer themselves for reappointment.
Audit Committee: The Audit Committee has been restructured consisting of
the following Directors with effect from 31.07.2004:
1. Shri N. Srinivasa Rao, Committee Chairman
2. Smt. B. Sasi Bimba, Member of the Committee
3. Smi. R. Laxmi Kantham, Member of the Committee
Investors Grievances Committee: The Investors Grievances Committee has
been restructured consisting of the following Directors with effect from
31.07.2004 :
1. Shri N. Srinivasa Rao, Committee Chairman
2. Smt. B. Sasi Bimba, Member of the Committee
3. Smt. R. Laxmi Kantham, Member of the Committee
Auditors: M/s JBRK & Co., Chartered Accountants. Auditors of the Company
retire at the conclusion of the ensuing Annual General Meeting. They have
signified their willingness to accept re-appointment and have also
confirmed their eligibility under Section 224 (1B) of the Companies Act,
1956.
Directors Responsibility Statement as required under Section 217 (2AA) of
the Companies Act, 1956, In pursuance et the provisions of Section 217
(2AA) of the Companies Act, 1956, it is hereby confirmed
(i) that in preparing the Annual Accounts, all applicable Accounting
Standards have been followed ;
(ii) that the Accounting Policies adopted are consistently followed and the
judgments and estimates made 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 the Profit & Loss Account of the Company for the
financial year under review;
(iii) that the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the assets of the
Company and for preventing/detecting fraud and other irregularities and
(iv) that the Annual accounts have been prepared on a going concern
basis.
Future Outlook: Your Company confidently expects good revenues from product
sales as well as services in the coming years. Your Company has been able
to penetrate into difficult market of the Voice Automation and made a mark
for itself as a Number One Company in the World for providing Voice
Automation Solutions. The Govt. of Andhra Pradesh has initiated a pilot
project for testing the product in one of its Department and trials have
proved successful after certain customization. The Company expects good
orders from the Government of AP and other State Governments also.
The Company has been focusing on the product that has left it cash starved.
In view of the same, it has become increasingly difficult to sustain the
operations. However, with the promised Government support, the Company
could come out with quantum leap in sales and profits.
In addition to the Information Technology, Mr. Bathina has taken-up on his
own, research in Biotechnology area in a very small scale. The part-time
work on this research for the past one and a half-years work has shown
some positive results. Mr. Bathina has been talking to some top-ranking
bio-technology scientists and organizations abroad to mutually share
technologies and make it commercial. So far, a very good positive responses
from these international organizations is quite were couraging. If this
biotech research give some commercial success, Mr. Bathina wishes to ad
Biotechnology to your companys present Information Technology line of
business.
Bio-Informatics, an area that is a combination of Information Technology
and Biotechnology is also very promising.
Both contract works and Independent research are possible in the
Biotechnology and Bio-Informatics areas.
Employees Relations: The Directors place on record, their appreciation of
the contributions made be the employees at all levels for their dedication,
support and hard work. The Employer-Employee relations an strained to some
extent as the company was not in position to pay their salaries on regular
basis.
Fixed Deposits: The Company did not accept an deposits pursuant to Section
58A of the Company Act, 1956.
Particulars of Employees: There are no employee covered under Section 217
(2A) of the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules, 1975 and forming part of the Directors Report for the
financial year ended 31st March 2003.
Conservation of Energy, Research and Development, Technology Absorption &
Foreign Exchange Earnings and Outgo: The particulars as prescribe under
Section 217 (1) (e) of the Companies Act, 1956, read with the Companies
(Disclosure of Particulars the Report of Board of Directors) Rules, 1988
are set out in the annexure included in this Report.
Observations by the Auditors: All the qualification remarks made by the
auditors have been addresse in Schedule 9 - "Notes forming part of
accounts," attached to the balance sheet
Acknowledgements: Your Directors place on record their appreciation of the
continued assistance and co operation extended to the Company by the
Bankers Government & Semi-Government Departments, an Shareholders.
for and on behalf of the Board of Directors
V. RAO BATHINA
Chairman and Managing Director
Place : Hyderabad
Date : 4 August 2004
ANNEXURE TO THE DIRECTORS REPORT
ANNEXURE - A
Particulars pursuant to the Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988:
(A) Details of Conservation of Energy: Even though energy conservation is
not applicable to our business, as a national concern, your Company kept
energy conservation as an objective. Your Companys operations require
electricity for conditioned environment, for running the computers and for
lighting purpose and none of these are energy intensive. The consumption
has been low due to the reason, majority of the development work has been
completed and the manpower requirement has come dome down substantially.
(B) Technology Absorption :
(a) Research and Development (R & D) :
1. Specific areas in which R&D work has been done by the Company and the
benefits derived from R&D: Your Company being a technology focusing
Company, in its continued endeavor has focused on natural man-machine
interaction and continued its Research and development in the area of
Natural Interface. Speech being the most natural interlace, your Company
focused on and pioneered Voice Automation Technology, which is a
combination of Speech Recognition and Natural Language Understanding.
2. Future Plan of Action: As explained earlier, your Company proposes to
continue to research on knowledge based Voice Automation Technology and
Integrated Solutions for Both Domestic and International Markets.
3. Expenditure on R&D: During the year
Capital NIL
Recurring 15885734
Total R&D expenditure as
a percentage of total revenue 44.37%
(b) Technology absorption, adaptation and innovation: Your Company has
brought out excellent innovations in Voice Automation, Technologies and
recognized as Number One Voice Automation Solutions Provider. It is your
Companys endeavor to continue research to bring out solutions that are
very useful for various professionals and non-professionals in both
Domestic and International Markets.
(c) Foreign Exchange Earnings and Outgo :
1. Initiatives taken to increase exports, development of new export markets
for products and services and export plans: Your Company has been exporting
its products and planning on continuing with the product exports. We are
emphasizing on setting up international marketing network to improve the
exports.
2. Foreign Exchange Earned: NIL
3. Foreign Exchange Outgo: NIL
ANNEXURE-B
Management Discussion & Analysis :
Industry structure and developments: The Indian software industry has
started to look up after a gap of three years with bast in Business Process
Outsourcing (BPD) becoming the buzzword of the Industry. Indian Software
Industry offers cheap skilled workforce with talent pool of software
programmers to suit the price sensitive Multinationals. These factors have
earned the Indian software industry a good reputation which has thrown open
the gates for tot of large Multinationals putting up their own BPO units in
India.
Opportunities and Threats: The Company is a new generation technology
solution provider with diverse capabilities in the areas of product
engineering, product automation, technology consulting, database
management, arid customized solutions. These niche areas have dried up for
the Indian Companies with the advent of BPOs being set up the prospective
buyers from USA and Europe. Company could not gear up to face the changing
Industry scenario and had to completely dose down the operations in
software development area.
Outlook: During last years, the industry in general slowed down and we
expect the industry to continue to be sluggish until the end of the year.
The Company is considering entering into some other field of business
including product marketing. In case the Government departments support the
Voice Auto product, the Company will gain immensely with high revenues.
Risks and concerns: The slowdown in the industry is a cause for concern. To
reduce the impact of the slowdown, your company tried to enter into new
areas of technology but cool not, garner any contract to keep sailing and
consequently had to close down the operations. With plans to diversify into
other businesses, the risks associated with the trade will be borne in mind
before leaping into such business.
Internal control systems and their adequacy :
(a) The internal control systems are aimed at promoting operational
efficiencies. Since the operations have been closed, the new guidelines for
control will be implemented according to the Industry specific requirement
of appropriate time.
(b) The internal audit is conducted as per the*requirement of the Company
and the report is submitted to the Audit committee and to the Management.
it reviews the policies and procedures followed.
(c) The Audit committee with three directors meets regularly to
investigates any matter relating to the internal control system and reviews
the internal Audit. The committee reviews the quarterly and half-yearly
financials before they are submitted to the Board of Directors.
Financial Condition :
Share Capital: During the year under review Company has not allotted any
snares, pending implementation of scheme of amalgamation of B-MIS with the
company.
Secured Loans: There is no outstanding secured Loans as on 31st March 2004.
Fixed Assets: Fixed Assets (gross block) have depreciated from Rs. 430.94
lakhs to Rs. 242.22 lakhs during the financial year.
Current Assets: The Net current assets of the Company stood at Rs. 2780.59
lakhs as on 31st March 2004.
Human Resources: The Company could not sustain the heavy costs of retaining
the employees and with no new projects in hand, the entire workforce of the
Company left the organisation and the Company is left with only two
employees.
for and on behalf of the Board of Directors
V. RAO BATHINA
Chairman and Managing Director
Place : Hyderabad
Date : 4 August 2004