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Persistent Systems
BSE: 533179|NSE: PERSISTENT|ISIN: INE262H01013|SECTOR: Computers - Software
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« Mar 14
Notes to Accounts Year End : Mar '15
1. Nature of operations
 
 Persistent Systems Limited (the Company) is a public Company
 domiciled in India and incorporated under the provisions of the
 Companies Act, 1956 (the Act). The shares of the Company are listed
 on Bombay Stock Exchange and National Stock Exchange. The Company is a
 global company specializing in software products, services and
 technology innovation. The Company offers complete product life cycle
 services.
 
 2. Basis of preparation
 
 The financial statements of the Company have been prepared in
 accordance with generally accepted accounting principles in India
 (Indian GAAP) to comply in all material respects with the Accounting
 Standards specified under Section 133 of the Companies Act, 2013 read
 with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant
 provisions of the Companies Act, 2013. These financial statements are
 prepared on an accrual basis and under the historical cost convention
 except financial instruments which have been measured at fair value.
 The accounting policies are consistently applied by the Company during
 the year and are consistent with those used in previous year.
 
 3. Gratuity plan:
 
 The Company has a defined benefit gratuity plan. Each employee is
 eligible for gratuity on completion of minimum five years of service at
 15 days basic salary (last drawn basic salary) for each completed year
 of service. The scheme is funded with an insurance Company in the form
 of a qualifying insurance policy.
 
 The following tables summarize the components of net benefit expense
 recognized in the statement of profit and loss and the funded status
 and amounts recognized in the Balance Sheet for the respective plans.
 
 4. Operating leases
 
 The Company has taken equipment and office premises on lease under
 cancellable operating lease arrangements. Further, the Company has also
 taken certain office premises under non-cancellable operating lease
 agreement for a period of 3 - 15 years. The escalations during
 non-cancellable lease period have been accounted for on a straight line
 basis. There are no restrictions imposed by the lease agreements. There
 are no subleases. The Company has an option to renew the lease
 agreements at the end of the lease period.
 
 (iv) Gurantee given on behalf of subsidiary
 
 Persistent Systems Ltd has given a guarantee of USD170,000 to a
 creditor (Sunlife Assurance Company of Canada) on behalf of Persistent
 Systems Inc.
 
 * Includes current portion Rs. 312.40 million and non-current portion Rs.
 Nil (Previous year - current portion Rs. 89.91 million and non-current
 portion Rs. 299.70 million)
 
 ** Includes current portion Rs. 3.62 and non-current portion Rs. Nil
 (Previous year - current portion Rs. 1.94 million and non- current
 portion Rs. 6.47 million)
 
 5. Employees stock option plans (ESOP)
 
 Certain information in this note relating to number of shares, options
 and per share/option price has been disclosed in full and is not
 rounded off as stated in note 43.
 
 d) Effect of the employee share-based payment plans on the statement of
 profit and loss and on its financial position Compensation expense
 arising from equity-settled employee share based payment plans for the
 year ended March 31, 2015 amounted to Rs. 31.71 million (Previous year Rs.
 Nil). The liability for employee stock options outstanding as at March
 31,2015 is Rs. 55.65 million (Previous year Rs. 26.96 million).
 
 6. Contingent liabilities
 
 The Company does not have any contingent liability as on March 31, 2015
 (Previous year Rs. Nil)
 
 i. As on March 31,2015, the pending litigations in respect of direct
 taxes amount to Rs. 115.06 million and in respect of indirect taxes
 amount to Rs. 26.07 million. Based on the advice obtained and judgments
 in favour of the Company at the first appellate authority in the
 earlier years, the company''s management does not expect any outflow in
 respect of these litigations.
 
 7. The Company has incurred an expenditure of Rs. 51.96 million during
 the financial year 2014-15 on Corporate Social Responsibility in
 accordance with section 135(5) of the Companies Act, 2013.
 
 8. Details of dues to micro and small enterprises as defined under
 MSMED Act, 2006
 
 There are no defaults and overdue amounts payable to suppliers, who
 have intimated about their status as Micro and Small Enterprises as per
 the provisions of Micro, Small and Medium Enterprises Development Act,
 2006 (MSMED Act, 2006).
 
 9. Loans and advances in the nature of loans given to subsidiaries and
 associates and firms / companies in which directors are interested
 
 a) Advance to Persistent Systems, Inc.
 
 - Balance as at March 31, 2015Rs.7.77 million (Previous year: Rs. 7.62
 million).
 
 - Maximum amount outstanding during the yearRs. 16.50 million (Previous
 year: Rs. 14.39 million).
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 b) Advance to Persistent Systems Pte. Ltd.
 
 - Balance as at March 31, 2015 Rs. Nil (Previous year: Rs. 0.18 million)
 
 - Maximum amount outstanding during the yearRs. 0.57 million (Previous
 year: Rs. 0.76 million)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 c) Advance to Persistent Telecom Solutions Inc.
 
 - Balance as at March 31, 2015Rs.0.43 million (Previous year: Rs. 0.02
 million)
 
 - Maximum amount outstanding during the yearRs. 0.43 million (Previous
 year: Rs. 2.06 million)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 d) Advance to Persistent Systems Malaysia Sdn. Bhd.
 
 - Balance as at March 31, 2015 Rs. Nil (Previous year: Rs. 19.28 million)
 
 - Maximum amount outstanding during the yearRs. 20.14 million (Previous
 year: Rs. 44.66 million)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 e) Loan to Persistent Systems, Inc.
 
 - Balance as at March 31, 2015Rs.312.40 million (Previous year: Rs.
 389.61 million)
 
 - MaximumamountoutstandingduringtheyearRs. 389.61 million (Previous
 year: Rs. 389.61 million)
 
 - Principle and interest is payable at the end of 3 years @ LIBOR  
 3.5% p.a. This amount is utilized for meeting business requirements.
 
 f) Advance to Persistent Systems France SAS
 
 - Balance as at March 31, 2015Rs.0.04 million (Previous year: Rs. Nil)
 
 - Maximum amount outstanding during the yearRs. 0.67 million (Previous
 year: Rs. Nil)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 g) Advance to CloudSquads Inc.
 
 - BalanceasatMarch31,2015Rs.0.01 million (Previous year: Rs. Nil)
 
 - Maximum amount outstanding during the yearRs. 0.03 million (Previous
 year: Rs. Nil)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 h) Loan to Klisma e-Services Private Limited
 
 - Balance as at March 31, 2015Rs.27.43 million (Previous year: Rs. 27.43
 million)
 
 - Maximum amount outstanding during the year Rs. 27.43 million
 (Previous year: Rs. 27.43 million)
 
 - Principle is payable at the end of twelve months and interest is
 payable quarterly @ 12 % p.a. This amount is utilized for meeting
 business requirements.
 
 i) Advance to Klisma e-Services Private Limited
 
 - Balance as at March 31, 2015Rs.0.75 million (Previous year: Rs. 0.75
 million)
 
 - Maximum amount outstanding during the yearRs. 0.75 million (Previous
 year: Rs. 0.75 million)
 
 - There is no repayment schedule in respect of this advance. It is
 repayable on demand. This amount is utilized for meeting business
 requirements.
 
 10. The Company had adjusted the difference between the cost incurred
 by the Trust for the purpose of purchase of shares and the exercise
 price of those shares which have been exercised by the employees during
 the earlier periods/years to General Reserve, in accordance with
 Guidance Note on accounting for Employee share based payment, issued by
 the Institute of Chartered Accountants of India. As per the provisions
 of the Trust Deed, the Trust is constituted as an irrevocable trust and
 in no event the funds of the Trust shall revert to the Company. The
 Company has obtained a legal opinion which states that the Company has
 no right to the assets of the Trust. Hence in view of the legal opinion
 the Company had reversed the amount of Rs. 92.85 million in the previous
 year which was initially transferred to General Reserve.
 
 11. The financial statements are presented in Rs. million and decimal
 thereof except for per share information or as otherwise stated.
 
 12. Previous year''s figures have been regrouped where necessary to
 conform to current year''s classification.
Source : Dion Global Solutions Limited
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