| Financial performance
Key aspects of your Company's standalone financial performance for the
financial year ended 2012-13 are tabulated below:
(Rs. in lac)
Particulars Financial year ended
30-Jun-2013 31-Jun-2012
(12 months) re-casted
(15 months)
Audited Audited
Net sales/Income from operations 37,676.20 79,292.17
Other income 55,104.03 8,972.46
Total income 92,780.23 88,264.63
Total expenditure 1,55,129.94 73,408.74
Gross proft before interest,
depreciation and taxes (62,349.71) 14,855.89
Finance cost 8,289.10 6,644.46
Depreciation and amortisation 10,877.94 16,535.86
Profit before prior period items (81,516.75) (8,324.43)
Prior period items (83.10) (29.76)
Profit before tax (81,433.65) (8,294.67)
Tax expense
Current tax (18.47) 44.01
Deferred tax/ (Reversal) (134.58) (125.66)
Net profit after tax (81,280.60) (8,213.03)
Appropriations:
Balance brought forward 1,33,094.48 1,13,022.86
Transfer to general reserve 20.39 2,536.96
Dividend:
Final (equity) - 2,304.89
Balance carried to Balance Sheet (81,216.31) (8,184.64)
Paid-up equity share capital 1,806.56 1,802.83
Reserves excluding revaluation
reserves 39,205.13 1,33,094.48
Earnings per share (in Rs.) (90.01) (9.08)
Diluted earnings per share (in Rs,) (89.87) (9.07)
Net sales/Income from operations 37,676.20 79,292.17
Review of operations:
Fy2012-13 was way below the expectations of the Company. Due to the
external technology environment and economic slowdown, the Company
witnessed delay in receivables. Te payment cycles of the Company's
customers got stretched. Te Company had to write-of approximately Rs.73
crore towards bad and doubtful debts during the year. As a result, the
Company witnessed working capital crunches and reduced its exposure to
customer selection. It also started aligning with stronger partners to
consolidate its business and ensure revenue growth. This resulted in a
decline in sales and profits of the Company, resulting in working
capital crunches. In a bid to foster growth, Geodesic had availed
short-term and working capital loans from financial institutions.
Geodesic has not been able to fulfill its obligations towards these
loans on their due dates. Te Company was also not able to fulfll its
statutory dues.
During the year, the Company launched new products - Roundtable, BBeep
and Mundu TV, which were made available on iPhone 5, iOS6 and Windows 8
platforms. Channels such as Colors, MTV, History Channel, TV18, CNN
IBN and ETV were added to its suite. New versions of its entertainment
products including Mundu Radio and TV were launched with social
networking features on various platforms including the Nokia Asha
series. New users were added across Mundu TV, Spokn and Mundu Radio.
Spokn launched a new version of the Windows Desktop dialer. It also
launched collect call service that allowed Spokn the subscriber's
contacts from anywhere in the world to make calls to Spokn subscribers
without being charged for the calls. New version of GeoAmida including
a 7" touch screen device was launched. Tis device can be used as
tabletop/mobile point-of-sale terminal. During the year, GeoAmida added
various customers to its basket for various sectors such as
transportation, logistics and the poultry industry. GeoAmida devices,
through CSI Infotech, were deployed for payment collection and gas
distribution for Gujarat Gas Company Limited, one of India's largest
private sector players in the gas T&D business. Several banks including
Bank of India, Saptagiri Grameen Bank, Pallavan Grameen Bank and
Wainganga Grameen Bank have signed contracts with Geodesic for
implementing GeoAmida-based solutions. Te client list of GeoAmida also
includes Airtel, mpay4u (a UK-based company), Wipro, TCS, Fullerton and
PSU banks. GeoAmida devices are also being used by Mumbai Municipality
website's 'Pay and Park' project.
Revision of accounts for the year ended 30th June 2012
Te members of the Company approved the Directors' Report on the affairs
of the Company for the year ended on 30th June 2012, the Balance Sheet
as at 30th June 2012 and the Profit and Loss Account for the year ended
on 30th June 2012, at the Annual General Meeting held on 11th February
2013. Te Company purchases basic modules, integrates it into its
products and then sells the integrated workflow modules to customers.
Major technical deficiencies and bugs were reported in the integrated
modules sold by the Company and these technical issues resulted in
operational failures at the client's end. Te Company had various
discussions with its debtors to salvage the situation and one of the
options was to agree for a full sales return. To stand by its
customers, the Company decided to go in for the aforementioned option.
This resulted in heavy losses but allowed the Company to retain its
credibility and be able to prosper again in the future. At that point
of time, one option for the Company to minimize its losses was to
negotiate with creditors to accept their module licenses back. Te
Company successfully persuaded creditors to do so. These entries
pertained to Fy 2011-12 and so the Company had to reopen the accounts
for the year ended 30th June 2012 and revise them to give effect to the
sales and purchase return entries. Te revised Audited Annual Accounts
would also be for the period of 15 months from April 2011 till June
2012. Te revised accounts with the Auditor's Report and the Directors'
Report thereon are enclosed. Te Company seeks adoption of the Revised
Annual Accounts for Fy ended 30th June 2012 by the members.
Dividend
In view of losses incurred by the Company during the previous fscal,
the Company will not be declaring dividend for Fy 2012-13.
However, the Company is still committed to declare and pay dividend for
Fy 2011-12 on obtaining the requisite approvals from the
banks/bondholders.
Transfer to Investor Education and Protection Fund (IEPF)
According to Section 205C of the Companies Act, 1956, the outstanding
amount of the dividend paid to the shareholders should be retained in
the unpaid dividend account of the Company for seven years. At the end
of seven years, the balance amount should be transferred to the
Investor Education and Protection Fund (IEPF) established and
maintained by the Government of India.
Following unpaid and unclaimed dividends were duly transferred to the
Investor Education and Protection Fund during the reporting period:
Unpaid and unclaimed dividend Amount transferred to IEPF (in Rs.)
Final dividend For Fy 2004-05 5,927.00
Interim dividend For Fy 2005-06 37,873.80
Te Geodesic world
Geodesic is a global corporation making its presence felt across the
globe. Geodesic has three Indian subsidiaries, two foreign
subsidiaries, eight foreign step-down subsidiaries and an Indian
associate company. Te corporate structure of the Company is explained
below:
Section 212
Te Ministry of Corporate Affairs, Government of India, vide its General
Circular No. 2/2011 dated 8th February, 2011 has granted general
exemption to attach various documents in respect of subsidiary
companies, as set out in Sub-section (8) of Section 212 of the
Companies Act, 1956. Accordingly, the balance sheets, proft and loss
accounts and other documents of the subsidiary companies are not being
attached with the Balance Sheet of the Company.
However, on request in writing, the Company will make available the
annual accounts of the subsidiary companies and the related detailed
information to any member of the Company and its subsidiaries who may
be interested in obtaining the same. Te Consolidated Financial
Statements presented by the Company include financial results of its
subsidiary companies. A statement as required under the section
disclosing the details of the subsidiaries is attached herewith.
Company finance
Equity share capital
Te paid-up equity share capital of the Company is Rs. 1, 806.56 lac
divided into 90,327,847 Equity Shares of Rs. 2 each as on 30th June 2012.
During the year, the Company allotted 1,86,498 Equity Shares to the
employees upon exercise of stock options.
Buyback of Equity Shares
Te Board of Directors of your Company, in its meeting held on 27th
November, 2012 recommended buyback of up to 25% of the outstanding
Equity Shares of the Company at a maximum buyback price of B 75 per
share. Te same would require the approval of the Shareholders through
Postal Ballot. Te Company intends to proceed with the buyback process
post fulfilling its financial dues.
FCCB issue
Te Company has issued US$125 million worth of unsubordinated, unsecured
foreign currency zero coupon convertible bonds due 2013 (the 'Bonds').
Te bonds are listed on the official list of the Singapore Exchange
Securities Trading Ltd (SGx-ST) (the Singapore Stock Exchange).
Geodesic has repurchased US$11.5 million face value of FCCBs, listed on
the Singapore Stock Exchange, in accordance with the A.P. (DIR Series)
Circular No. 39 dated 8thDecember, 2008 (the 'Circular') issued by the
Reserve Bank of India. As on date of this report, Bonds with the
nominal value of US$113.5 million are outstanding.
Legal battle
During the year, due to the Company's cash fow coupled with subsidiary
restructuring and foreign exchange losses, it was not able to fulfill
its financial obligations towards bank dues, redemption of FCCBs and
dues towards creditors. As a result, various banks, creditors and the
bondholders fled cases against the Company in the court of law. As on
the date of this Annual Report, following cases have been fled against
the Company:
Name of the party Court
Standard Chartered Bank Bombay High Court
Barclays Bank Bombay High Court and Debt Recovery Tribunal
ICICI Bank Bombay High Court and Debt Recovery Tribunal
HDFC Bank Metropolitan Magistrate Court and Debt
Recovery Tribunal
Citi bank High Court Bombay and London
Axis Bank Metropolitan Magistrate Court
Times Internet Limited Bombay High Court
Simmtronics
Semiconductors Ltd Bombay High Court
Te Bombay High Court has passed the order in case of Times Internet
Limited. Te bondholders, through the trustees of the bonds, Citibank N.
A., London, has fled cases against the Company in Bombay High Court and
London High Court. Te London High Court has passed a summary judgment.
Te Bombay High Court has passed an order on 7th April, 2014. Te Company
is evaluating the order in consultation with its legal team and
discussing on further steps to be taken in this regard. Te Company is
contesting the claims of the rest of the cases in consultation with
legal experts.
Employee stock options
Te Geodesic employee stock options plan 2002 expired during the year.
Te Board of Directors, through circular resolution passed on
17-Oct-2012 allotted 1,86,498 Equity Shares to the employees upon
exercise of options already granted to them.
Geodesic employees stock options plan 2002
As on 30th June 2013, a total of 2,307,886 options are outstanding to
be exercised under the ESOP plan.
Neither any employee has been granted options equal to or exceeding 1%
of the issued capital (excluding outstanding warrants and conversions)
of the Company at the time of grant, nor has any employee been granted
options amounting to 5% or more of the total Options granted during the
year.
Disclosure required under SEBI (Employee Stock Option Scheme and
Employee Stock Purchase Scheme), Guidelines, 1999 as to the status of
options as on 30th June 2013:
a) As on 1st July 2012, options
granted and not exercised (in force) 3,050,618
options convertible into Rs. 2 each
(options granted but not exercised)
b) Options granted during the year Nil
c) Pricing formula Market price as per SEBI
guidelines as on the date
of the grant
d) Options vested: Nil
e) Options exercised 1,86,498
f) Total number of Equity Shares
arising as a result of exercise of
options 1,86,498
g) Options lapsed 556,254
h) Variations of terms of options Nil
i) Money realised by exercise of
options Nil
j) Total number of options in force
as on 30th June 2013 2,307,886 options convertible
into Rs.2 each (options
granted but not exercised)
k) Employee-wise details of options
granted to :
(1) Senior managerial personnel Nil
(2) Any other employee who receives
a grant in any one year of options Nil
amounting to 5% or more of option
granted during that year
(3) Identified employees who were
granted options, during any one year,
equal Nil
to or exceeding 1% of the issued
capital (excluding outstanding
warrants and conversions) of your
Company at the time of grant
l) Diluted EPS pursuant to issue of
shares on exercise of options
calculated in (89.83)
accordance with Accounting
Standard (AS) 20
Details of exercise price for stock options outstanding at the end of
the year are:
Year end Range of
exercise price Number of
options Weighted
average Weighted
average
(Rs.) outstanding remaining
contractu
al life exercise
price (Rs.)
(in months)
30th June,
2013 Rs. 26.81 -
Rs. 210.05 23,07,886 61.74 146.75
30th June,
2012 Rs. 26.81 -
Rs. 210.05 30,50,618 69.45 140.17
Listing of equity
Geodesic's equity scrip is listed on the NSE (National Stock Exchange
of India Limited) and BSE (Te Bombay Stock Exchange Limited, Mumbai)
scrip code being GEODESIC in NSE and 503699 in BSE. Te entire paid-up
equity capital is listed on both the Stock Exchanges.
Fixed deposits
Geodesic has not accepted any fixed deposits from the public during the
year under review.
Directors
During the year, three Non-Executive Directors - Mr. Nitin Potdar, Mrs.
Radhika Pereira and Mr. Vinod Sethi resigned on 4th December 2012, 11th
February 2013 and 16th May 2013, respectively, due to preoccupation. Te
Board of Directors of the Company places on record its sincere
appreciation for the remarkable efforts and support provided by the
Directors.
Currently, the Company has three Executive Directors viz., Mr. Pankaj
Kumar - Chairman, Mr. Kiran Kulkarni - Managing Director and Mr.
Prashant Mulekar, Executive Director. Te Directors of the Company are
in the process of appointing Non-Executive and Independent Directors to
ensure compliance with the provisions of the Companies Act, 2013, and
subsequently the Listing Agreement.
Mr. Prashant Mulekar retires by rotation at the ensuing Annual General
Meeting and being eligible offers himself for reappointment in terms of
the provisions of the Articles of Association of the Company.
Resolution for his reappointment will be placed for approval at the
ensuing Annual General Meeting. Te brief resume/details relating to
Mr. Prashant Mulekar is furnished in the Notes to the Notice of the
ensuing Annual General Meeting.
Human resource
We are committed towards making Geodesic a 'great place to work'
through the pursuit of driving 'employee engagement' across multiple
platforms, events and extensive employee communication initiatives
involving not just the employees but also their families. Tis is aimed
at increasing the happiness quotient of our employees, enhance
retention and boost the engagement score, thereby leading to
qualitative and quantitative augmentation in terms of our products and
services and thus creating satisfied customers.
Our continuous efforts have been mediated towards re-engineering our
organisation in terms of workflow and processes and enhancing
automation, consequently enabling us to evolve into an efficient,
productive and agile corporate entity.
Te Company regards human resources as a priceless asset. Te Company
encourages a performance-driven culture and enables the employees with
focused training at regular intervals. Further, the training needs of
the staff are periodically assessed and training programmes are
conducted using internal resources.
We are relentlessly driving capability, leadership and culture building
and acquiring, developing and retaining quality talent. Our leadership
development process is aligned with the core organisational values,
which involves identifying high potential talent periodically and
initiating necessary timely interventions to help them take on larger
responsibilities and roles.
Our global employee base includes people from diverse educational,
socio- cultural, religious backgrounds and nationalities. Our emphasis
this year and going forward has been on creating and nurturing value.
It is this dynamism that has enabled us to reach where we are. Te real
strength of Geodesic lies in its ability to innovate, add vigor and
diversify.
Geodesic culture
As Geodesicians, we take the initiative and go forward with a clear
focus on a predetermined set of values. We believe in integrity,
transparency, collaboration, speed and agility, customer focus,
entrepreneurship and respect and dignity.
A perfect blend of raw talent and experienced professionals from
diverse academic backgrounds: engineering, commerce, arts, mass
communication, media and animation, make Geodesic a dynamic entity.
Our departmental activities supporting our objectives this year
included:
Review and development of both new and current human resource-related
processes, policies and procedures Performance management initiatives
through implementation of coding test and reading comprehension test to
evaluate employee skill sets
- Recruitment and retention of resources
- Training drills for our sales team to make them well-versed with
industry trends
- Our CSR activities included participation in the Standard Chartered
Mumbai Marathon's Corporate Challenge to raise funds for charity where
we supported Project Crayons. Our employees also visit old age homes
and meet underprivileged children with a hope of bringing a smile in
their lives.
Technology innovation and creativity have always been the foundation of
our growth and success. Individual as well as corporate performance is
strictly measured against the parameters of business strategy, market
results, stakeholder value and thought leadership.
Knowledge Management
Knowledge Management (KM) at Geodesic allows employees to tie together
the collective experiences and knowledge towards better product
delivery, individual and organisational excellence through the event
'Geodesic Minds'.
Our culture resonates with our goals to create an open and transparent
organisation in which knowledge is created and shared in a supportive
environment where creativity and innovation are valued. Geodesic Minds
are encouraged to bring forward any idea for improvement or innovation.
Particulars of employees
Te Ministry of Corporate Affairs has vide notification dated 31st March
2011 enhanced the limits for the purpose of disclosure of particulars
of employees in Directors report as requisite under Section 217 (2A)
read with Companies (Particulars of Employees) Rules, 1975, from the
existing limit of Rs. 24 lac per year or Rs.2 lac per month to Rs.60 lac per
year or Rs.5 lac per month.
None of the employees of the Company were in receipt of remuneration
during the financial year 2012-13 in excess of the limits prescribed.
Corporate Governance
Te Report on Corporate Governance and the Certificate from the Auditors
of the Company as stipulated under Clause 49 of the Listing Agreement
forms part of this Annual Report.
Dematerialisation of shares
Dematerialisation is the process of converting physical shares (share
certificates) into an electronic form. Shares once converted into
dematerialised form are held in a Demat account. As per SEBI directive,
the equity shares are to be traded in demat mode compulsorily by all
investors w.e.f. 26th June, 2000.
Te Company has entered into an agreement with National Securities
Depository Limited (NSDL) and Central Depository Services (India)
Limited (CDSL) for the dematerialisation of its shares. Te Company's
shares are eligible for dematerialisation in both NSDL Depository
System and CDSL Depository System.
Te ISIN of the scrip is INE371D01029. As on 30th June 2013, 99.75% of
the total equity capital of the Company was held in dematerialised
form.
Conservation of energy, technology absorption, foreign exchange
earnings and outgo U/S 217(e) of the Companies Act, 1956.
a) Conservation of energy
Being a software company, the Company's operations and administration
require electrical energy for power supply to computer systems, in air
conditioning, and lighting, which are not energy- intensive. During the
current financial year, the Company has undertaken significant measures
to reduce energy consumption by using energy-efficient machines and
equipment. Te Company also undertakes evaluation of latest technology
and invests in making its infrastructure more energy efficient. Form A
is not applicable for the software industry.
b) Technology absorption:
Not applicable
c) Foreign exchange earnings and outgo
We have started operations in SEEPZ, Andheri (East), Mumbai from the
end of September, 2008, which is an SEZ (Special Economic Zone) unit
that entitles your Company to enjoy 100% tax holiday for exports under
Section 10A of the Income Tax Act, 1961, until September 2013 and 50%
thereafter till March 2019. Te export performance of your Company
scaled well. Te information on foreign exchange earnings and outgo is
contained in Schedule to Accounts.
Auditors
Te Auditors M/s. Borkar & Muzumdar, Chartered Accountants (Registration
No. 101569w) retire at the conclusion of the ensuing Annual General
Meeting and have confirmed eligibility for their re-appointment. As per
the provisions of the Companies Act, 2013, Te Board recommends their
reappointment as Statutory Auditors of the Company for a period of 5
years from the conclusion of this Annual General Meeting till the
conclusion of 18th Annual General Meeting of the Company at a
remuneration mutually agreed upon. Te report of Auditors and notes
forming part of the Accounts are attached along with the Annual Report.
Te Statutory Auditors have made the below qualifications in their
Report.
Te Statutory Auditors have made the below qualifications in their
Report:
a) We are unable to verify the correctness of the write off of
B36,972.96 lac in respect of software licenses sold to the customers,
as stated in Note no.1 to the consolidated financial statements of the
Company for the Period. (June 2012 qualification)
b) Te Company has shown receipts from the debtors (Geodesic Technology
Solutions Limited, wholly owned subsidiary) of Rs. 40,544.83 lac and
payments to the various creditors of Rs. 40,472.55 lac. It was informed
to us by the management that the cheques were not processed and
therefore were not realised till December 3rd 2012. All these cheques
have become stale the same have been subsequently reversed.
Consequently the debtors and creditors are understated by Rs. 40,544.83
and Rs. 40,472.55 respectively and the bank is overstated by Rs. 16.72
lac. These debtors and creditors have been reversed till June 2013.
(June 2012 qualification)
c) We are unable to verify the correctness of the write off of
Rs. 21,300.03 lac (USD 3,88,12,000) reversed in respect of software
licenses sold to the customer's as stated in Note no. 1 to the
consolidated financial statements of the Company for the year. (June
2013 qualification)
d) We are unable to verify the correctness of the write back of Rs.
43,700.54 lac, reversed in respect of software licenses returned to the
suppliers, as stated in Note no. 1 to the consolidated financial
statements of the Company for the year. Consequently the loss for the
year has been understated to that extent. (June 2013 qualification)
In April 2011, the Company developed a new version of one of their
product with additional features to keep up with the latest changes in
technology. However, the revised version developed certain problems
with all the customers.
Te Company had put lot of efforts to solve the problems and to provide
improved services to the customers, in spite of all its efforts the
Company was unable to offer a permanent solution to the problems faced
by the customers. Finally, in July 2013, the Company agreed to reverse
all sales made to the customers of the said product from April 2011 to
avoid further legal action from the customers
Tis has given a very big set back to the Company so far as the
recoveries are concerned. Due to this action the Company had started
negotiations with the parties from whom these input licenses were
purchased. During this negotiation the Company has taken help of the
clause mentioned in the agreement entered in to by the Company with the
vendors. Ultimately the vendors have agreed for write off of the amount
receivable them. Te Company had prepared the Deed of Settlement based
on the above mentioned clause and got it notarised. These deeds are kept
on the record by the Company to avoid any future litigation, which may
arise.
e) During the year Company has not made the provision for Bad and
Doubtful debts, as stated in Note no. 2 to the consolidated financial
statements of the Company for the year, as per the accounting policy
the amount shown as Trade Receivable amounting to USD 38,812,000. Te
loss for the year has consequently been understated to that extent.
No provision has been made for the amount, shown as trade receivables
which is due for over two years from the Company's wholly-owned
subsidiary GTSL in respect of supplies made to them by the Company,
which GTSL in turn had supplied to its end customers, since the Company
is in the process factorisation of the said dues.
f) In the absence of confirmations from any of the third parties
(including Company's foreign subsidiary) in respect of correctness of
amount due from/to the Company, including debtors, creditors, trade
advances, other liabilities among others. We are unable state
correctness thereof.
Te Company is in the process of obtaining and providing the required
documents and confirmations to the Statutory Auditors
g) During the year, the Company defaulted in repayment of loans/ dues
to the financial institutions to the tune of Rs. 8,005.29 lac. Some of
the financial institutions have fled winding up petitions against the
Company. Te litigation is still pending and we are informed in a few
cases the Company has made a counter claim against the same. However,
the ultimate impact is presently unascertainable as stated in note no.
4 to the consolidated financial statements of the Company for the year.
Te financial charges include amounts aggregating to Rs. 3,528.16 lac
demanded by Barclays Bank and Standard Chartered Bank towards interest
and loss on hedging contracts on a conservative basis although the same
are disputed by the Company. However, the Company has made
counterclaims against both the above Banks for excess charges/ profit on
hedging contracts aggregating to Rs. 9,300 lac. Te Company has also
disputed amounts claimed by ICICI and HDFC Bank against the hedging
contracts. Te Company is in process of filling a counter claim against
the aforementioned banks also.
h) Te Company has raised funds through FCCBs during the year 2008; the
same were due for repayment in the month of January, 2013. Till date of
the Balance Sheet, the Company has not been able to discharge this
liability. Te foreign currency convertible bond (FCCB) holders have,
through their Trustees, fled a winding up petition against the Company
for defaulting on the dues. Bombay High Court has in a decision given
on 7th April, 2014 asked the Company to deposit the amount of B972
crore before 28th April, 2014 in a Citibank branch at London or
Singapore. However, we are unable to ascertain financial impact thereof
in view of the Company's inability to give relevant information in this
regard.
Te Company has made provision for interest on the said bonds at 9%
amounting to Rs. 2,890.11 lac in accordance with the agreement with
bondholders from the date of maturity till the Balance Sheet date and
also for the interest payable during the life of the said bonds.
i) No provision has been made for depletion in the value of Company's
investment to the extent of Rs. 6,161.32 lac in Geodesic Technology
Solutions Ltd GTSL, due to losses incurred during the year as stated in
Note no. 6 to the consolidated financial statements of the Company for
the year.
During the year the Company's foreign subsidiaries GTSL and GHL
incurred losses. This resulted in depletion of the Company's resources
in terms of investment in the said subsidiaries. However considering
the potential of both the subsidiaries the management does not consider
it necessary to provide for any depletion in the value of its
investments in the said subsidiaries.
j) During the year all the independent directors have resigned from the
post of directorship. As on the date of financials the Company has not
complied with the conditions as mentioned in Clause 49. Non- compliance
with the provisions of corporate governance in Clause 49 could invite
penalties such as fine, suspension of trading and delisting from the
stock exchange.
Te Company is in the process of identifying and appointing Independent
Directors. However, with the obligations cast on such Directors under
the Companies Bill, the eligibility criteria being narrowed and Section
149 of the Companies Act, 2013 being notified shortly, individuals shy
away from accepting such positions. Thus it has become an uphill task to
identify an independent Director who complies with Section 149 of the
Companies Act, 2013.
k) In the absence of any confirmations in that regard we were unable to
verify the correctness of Company's Bank Balances including Deposits at
their subsidiaries Geodesic Technology Solutions Ltd (GTSL) and
Geodesic Holdings Ltd (GHL), amounting to Rs. 3.62 lac & Rs. 207.80 lac
respectively nor are we able to verify whether these are free of any
encumbrances.
l) In the absence of any confirmations in that regard we were unable to
verify the correctness of Company's Bank Balances including Deposits at
their foreign subsidiaries Geodesic Technology Solutions Ltd (GTSL) and
GHL amounting to Rs.46,069.50 lac & Rs.67,713.18 lac respectively nor are
we able to verify whether these are free of any encumbrances as such we
are unable to ascertain the recoverability thereof. (June 2012
qualification)
Te Company had submitted the bank statements to the Auditors for the
purpose. However, the Auditors require the statements to be sent
directly to them from the respective banks of the subsidiaries. Te
Company has already made an application in this regards to the
respective banks to forward the statements to the Auditors.
m) In the case of the Hong Kong Subsidiary certain changes were effected
in the accounts for the financial year ended 31st March, 2011 to give
effect to changes made in the final audited accounts for the financial
year ended 31st March, 2010 after the figures were taken in the original
accounts for the period ended 30th June, 2012. Consequently the
previous year figures in this Recast Consolidated Financial Statements
of the Company show difference as compared to the original accounts
adopted by the AGM on 11th February 2013, as under:
i) Net Profit higher by Rs. 1,752.45 lac
ii) Other Income higher by Rs. 70.32 lac
iii) Administrative and Operating Expenses lower by Rs. 1,682.13 lac
Due to occurrence of certain events post adoption of accounts in the
AGM held on 11th February, 2013, the Company's subsidiary in Hong Kong
was required to effect certain changes in the accounts for the financial
year ended 31st March, 2011 to give effect to changes made in the final
audited accounts for the financial year ended 31st March, 2010.
n) An amount of Rs. 17,332.70 lac. (USD 29,033,000) shown in the audited
accounts of Mauritius subsidiary Geodesic Holding Ltd (GHL)under Loans
and Advances (as due from Audrain Commercial Corporation). However, in
the absence of any confirmation in that respect we are unable to state
recoverability thereof.
Te loan has been given in due course of business.
Directors responsibility statement
Pursuant to Section 217(2AA) of the Companies Act, 1956, your Directors
confirm that:
- In the preparation of the annual accounts, the applicable accounting
standards have been followed and that there have been no material
departures;
- They have, in selection of the accounting policies, consulted the
Statutory Auditors and have 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 ended 30th June 2013 and of the profit of the Company
for that year;
- They have taken proper and sufficient care to the best of their
knowledge and ability 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 and
detecting fraud and other irregularities;
- They have prepared the annual accounts on a 'going concern' basis.
Acknowledgement
We wish to thank all shareholders and business partners, bankers,
financial institutions, regulatory bodies and other business
constituents for their continued support and valuable cooperation.
We wish to place on record their appreciation for the efforts and
contributions of the Company's executives, offers, consultants and
staff, for ensuring that the Company continues to grow and excel.
We also express their gratitude to investors for the faith that they
continue to repose in the Company.
On behalf of the Board of Directors
Place: Mumbai Pankaj Kumar Kiran Kulkarni
Date: 17th April, 2014 Chairman Managing Director
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