ERP Soft Systems Ltd Directors Report.

To the Members,

The Directors have pleasure in presenting before you the 24 Boards Report of the Company together with the Audited Statements of Accounts for (both standalone and consolidated) the year ended 31 March, 2018.

1. FINANCIAL SUMMARY/HIGHLIGHTS, OPERATIONS, STATE OF AFFAIRS:

The performance during the period ended 31 March, 2018 has been as under:

(Rs. in lakhs)
Standalone
Particulars 2017-18 2016-2017
Total Income 90.53 88.70
Total Expenditure 72.53 70.66
Profit Before Tax 18.00 18.04
Provision for Tax 5.34 6.72
Profit after Tax 12.67 11.32
Balance Carried to Balance Sheet 12.67 11.32

 

(Rs. in lakhs)
Consolidated
Particulars 2017-18 2016-2017
Total Income 2766.31 3524.60
Total Expenditure 2679.14 3370.26
Profit Before Tax 87.16 154.34
Provision for Tax 19.16 33.98
Profit after Tax 67.99 120.36
Balance Carried to Balance Sheet 67.99 120.36

2. MATERIAL CHANGES AND COMMITMENTS:

There were no material changes and commitments affecting financial position of the company between 31stMarch and the date of Boards Report. (i.e. 14.08.2018)

3. CHANGE IN THE NATURE OF BUSINESS, IF ANY:

During the period under review and the date of Boards Report there was no change in the nature of Business.

4. DIVIDEND:

Keeping the Companys expansion and growth plans in mind, your Directors have decided not to recommend dividend for the year.

5. RESERVES:

The Company has not carried any amount to the reserves.

6. BOARD MEETINGS:

The Board of Directors duly met 5 (Five) times on 29.05.2017, 28.08.2017, 12.12.2017, 19.12.2017 and 13.02.2018.

7. DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

The Company has received declarations from Mr. P.V Srinivasa Rao and Mrs. R. Kamala Mohan, Independent directors of the company to the effect that they are meeting the criteria of independence as provided in Sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 25 of SEBI (Listing Obligations and Disclosure Requirement) Regulations, 2015.

8. DIRECTORS OR KMP APPOINTED OR RESIGNED.

K. Radha Krishna Reddy retires by rotation and being eligible offers himself for re-appointment.

Mrs. P. Shivaleela Reddy has resigned as Company Secretary on 20.04.2018. Apart from this, there is no change in the directors or KMP. As required under regulation 36 (3) of the SEBI (LODR), Regulations, 2015, brief particulars of the Directors seeking appointment/reappointment are given as under:-

Name of the Director K. Radha Krishna Reddy Rajan Kamala Mohan
Date of Birth Qualification 01.07.1936 U.G 30.10.1961 Graduate
Expertise in specific functional areas Management & Administration HR & Administration
Names of listed entities in which the person also holds the directorship and the membership of Committees of the board NIL NIL
No. of Shares held in the Company NIL 34,115
Inter se relationship with any Director NIL NIL

9. FAMILIARISATION PROGRAMMES:

The Company familiarises its Independent Directors on their appointment as such on the Board with the Company, their roles, rights, responsibilities in the Company, nature of the industry in which the Company operates, etc. through familiarisation programme. The Company also conducts orientation programme upon induction of new Directors, as well as other initiatives to update the Directors on a continuing basis. The familiarisation programme for Independent Directors is disclosed on the Companys website www.erpsoft.com

10. COMPOSITION OF AUDIT COMMITTEE:

I. The Audit Committee of the Company is constituted in line with the provisions of Regulation 18 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 read with Section 177 of the Companies Act, 2013.

II. The terms of reference of the Audit Committee include a review of the following:

• Overview of the Companys financial reporting process and disclosure of its financial information to ensure that the financial statements reflect a true and fair position and that sufficient and credible information is disclosed.

• Recommending the appointment and removal of external auditors, fixation of audit fee and also approval for payment for any other services.

• Discussion with external auditors before the audit commences, of the nature and scope of audit as well as post-audit discussion to ascertain any area of concern.

• Reviewing the financial statements and draft audit report including quarterly / half yearly financial information.

• Reviewing with management the annual financial statements before submission to the Board, focusing on:

1. Any changes in accounting policies and practices;

2. Qualification in draft audit report;

3. Significant adjustments arising out of audit;

4. The going concern concept;

5. Compliance with accounting standards;

6. Compliance with stock exchange and legal requirements concerning financial statements and

7. Any related party transactions

• Reviewing the companys financial and risk managements policies.

• Disclosure of contingent liabilities.

• Reviewing with management, external and internal auditors, the adequacy of internal control systems.

• Reviewing the adequacy of internal audit function, including the audit character, the structure of the internal audit department, approval of the audit plan and its execution, staffing and seniority of the official heading the department, reporting structure, coverage and frequency of internal audit.

• Discussion with internal auditors of any significant findings and follow-up thereon.

• Reviewing the findings of any internal investigations by the internal auditors into the matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the Board.

• Looking into the reasons for substantial defaults in payments to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors.

• Reviewing compliances as regards the Companys Whistle Blower Policy.

III. The previous Annual General Meeting of the Company was held on

28.09.2017 and Chairman of the Audit Committee, attended previous AGM.

IV. The composition of the Audit Committee and the attendance of each member of the Audit Committee are given below:

The Company has complied with all the requirements of provisions of SEBI (LODR) Regulations 2015 relating to the composition of the Audit Committee.

During the financial year 2017-18, (4) four meetings of the Audit Committee were held on the 29.05.2017, 28.08.2017, 12.12.2017, 10.02.2018.

The details of the composition of the Committee and attendance of the members at the meetings are given below:

Name Designation Category No. of meetings held No. of meeting attended
*Mr. P.V. Srinivasa Rao Chairman NED(I) 4 4
Mrs. R. Kamala Mohan Member NED(I) 4 4
Mr. K. Radha Krishna Reddy Member ED 4 4
#Mr. Babulu Gangisetty Chairman NED(I) - -

NED (I) : Non Executive Independent Director ED : Executive Director *Resigned w.e.f 14.08.2018 #Appointed w.e.f 14.08.2018

V. NOMINATION & REMUNERATION COMMITTEE

Terms of reference:

The main term of reference of the Committee is to approve the fixation/revision of remuneration of the Managing Director/Whole Time Director of the Company and while approving:

• To take into account the financial position of the Company, trend in the industry, appointees qualification, experience, past performance, past remuneration etc.

• To bring out objectivity in determining the remuneration package while striking a balance between the interest of the Company and the Shareholders.

Remuneration Policy:

The objectives of the remuneration policy are to motivate Directors to excel in their performance, recognize their contribution and retain talent in the organization and reward merit.

The remuneration levels are governed by industry pattern, qualifications and experience of the Directors, responsibilities shouldered, individual performance etc.

The details of remuneration paid to the Executive and Non-Executive Directors for the financial year 2017-18 are given below:

D. Sarojanamma and D. Kowsalyamma have drawn a remuneration of Rs. 6,00,000/- and Rs. 6,00,000/- for the year ended 31.03.2018 respectively.

None of the Directors is drawing any Commission, Perquisites, Retirement benefits etc.,

During the year, the committee met on 13.02.2018.

The details of composition of the Committee are given below:

Name Designation Category No. of meetings held No. of meeting attended
Mrs. R. Kamala Mohan Chairman NED(I) 1 1
*Mr. P.V. Srinivasa Rao Member NED(I) 1 1
Mrs. D. Kowsalyamma Member ED 1 1
#Mr. Babulu Gangisetty Chairman NED(I) - -

NED (I) : Non Executive Independent Director

ED : Executive Director

*Resigned w.e.f 14.08.2018

#Appointed w.e.f 14.08.2018