Tata Elxsi Directors Report, Tata Elxsi Reports by Directors

Tata Elxsi

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Directors Report Year End : Mar '15    « Mar 14
 1. The Directors are pleased to present the Twenty sixth Annual Report
 on the business and operations of the Company along with the Audited
 Statements of Accounts for the financial year ended March 31, 2015.
 2. Result of Operations - Extract
                                                       (Rs. Crores)
                                         Standalone         Consolidated
                               2014-151    2013-14    2014-151   2013-14
 Sales and Service               849.40     772.10      849.40    774.79
 Other income                      4.14      15.68        3.35     12.54
 Total Income                    853.54     787.78      852.75    787.33
 Profit before financial 
 expenses, depreciation and 
 exceptional items               181.52     151.80      180.66    149.00
 Less: Financial expenses             -       1.83           -      1.83
 Depreciation                     25.54      34.99       25.54     34.99
 Profit for the year             155.98     114.99      155.12    112.19
 Less: Provision for Income 
 tax                              53.08      39.88       53.10     39.93
 Profit after tax ~              102.90      75.11      102.02     72.26
 Add: Profit brought forward     146.34     111.36      146.37    114.24
 Balance available for 
 appropriation which has been 
 appropriated as                 249.24     186.47      248.39    186.50
 Depreciation on transition 
 to Schedule-II of the 
 Companies Act, 2013 on           13.30          -       13.30         -
 tangible fixed assets with 
 Nil remaining useful life
 Proposed dividend                34.25      28.02       34.25     28.02
 Dividend tax thereon net of 
 reversal thereof                  6.82       4.11        6.82      4.11
 Transfer to General Reserve      10.00       8.00       10.00      8.00
 Balance of profit carried 
 to Balance Sheet                184.87     146.34      184.02    146.37
 Total appropriations            249.24     186.47      248.39    186.50
 3. Dividend
 Your Directors recommend for your approval, a dividend of 110% (Rs. 11/-
 per share) for the year ended 31st March, 2015, compared to 90% (Rs.9 per
 share) in the previous year.
 This will involve an outgo of Rs. 41.07 crores compared to Rs. 32.13 crores
 in the previous year, including dividend distribution tax.
 4. Reserves
 Your Directors have approved a transfer of Rs. 10 crores to the General
 Reserves for the year ended 31st March, 2015, as against an amount of Rs.
 8 crores in the previous year.
 5. Review of Operations
 The total income during the year under review increased by 8% from
 787.78 crores in the previous year to Rs. 853.54 crores.
 The Profit Before Tax (PBT) increased by 36% from 114.99 crores in the
 previous year to Rs. 155.98 crores.
 The Profit After Tax (PAT) increased by 37% from 75.11 crores in the
 previous year to Rs. 102.90 crores.
 During the year under review, our concerted effort in growing revenues
 from the embedded product design and industrial design services,
 increasing the composition of software sales and support services in
 the Systems Integration business, and balanced control of operational
 costs, resulted in improved top line and bottom line performance.
 7. Directors and Key Managerial Personnel
 In terms of Section 161 of the Companies Act, 2013 Mr. N.G. Subramaniam
 and Dr. G. Katragadda, Non - Executive and Not-Independent Directors,
 who have been appointed as Additional Directors retire at the ensuing
 Annual General Meeting. We have received a Notice under Section 160 (1)
 of the Companies Act, 2013 from a member proposing the candidatures of
 Mr. N.G. Subramaniam and Dr. G. Katragadda to the office of
 Directorship, whose terms of office shall be determined for retirement
 by rotation.
 Mr. S. Ramadorai, the then Chairman, retired from the Board with effect
 from October 06, 2014, on attaining the age of 70 years as per our
 policy. The Board placed on record their appreciation for the exemplary
 leadership and guidance rendered by Mr. Ramadorai during his tenure on
 the Board.
 Mrs. Sudha Madhavan, CFO, resigned from her position w.e.f. September
 19, 2014 to seek other career opportunities.
 The Board on the recommendation of the Audit Committee, appointed Mr.K.
 Ramaseshan as our CFO w.e.f. January 21, 2015.
 During the year under review, Seven (7) Board meetings were held and
 well attended by the Directors. We have circulated the Calendar of
 meetings for the year 2015-16 to the Directors.
 The Independent Directors have submitted their declaration that they
 fulfill the requirements as stipulated in Section 149 (6) of the
 Companies Act, 2013. Pursuant to Clause VII (1) of Schedule IV of the
 Companies Act, 2013. The Independent Directors had a separate meeting
 on 25th March,2015.
 8. Directors'' Responsibility Statement
 Based on the framework of internal financial controls and compliance
 systems established and maintained by the Company, work performed by
 the internal, statutory and secretarial auditors and the reviews
 performed by Management and the relevant Board Committees, including
 the Audit Committee, the Board is of the opinion that the Company''s
 internal financial controls were adequate and effective during the
 financial year 2014-15.
 Accordingly, pursuant to Section 134(5) of the Companies Act, 2013, the
 Board of Directors, to the best of their knowledge and ability, confirm
 (a) in the preparation of the annual accounts the applicable accounting
 standards had been followed along with proper explanations relating to
 material departures;
 (b) the directors had selected such accounting policies and applied
 them consistently and made judgements and estimates that are reasonable
 and prudent so as to give a true and fair view of our state of affairs
 at the end of the financial year and of our profit and loss for that
 (c) the Directors had taken proper and sufficient care, for the
 maintenance of adequate accounting records, in accordance with the
 provisions of Companies Act 2013, for safeguarding our assets and for
 preventing and detecting fraud and other irregularities;
 (d) the Directors have prepared the annual accounts on a going concern
 (e) the directors had laid down internal financial controls to be
 followed by us and that such internal Controls are adequate and were
 operating effectively.
 (f) the Directors have devised proper systems to ensure compliance with
 provisions of all applicable laws and that such systems were adequate
 and operating effectively.
 10. Particulars on Remuneration
 The information required under Section 197(12) of the Companies Act
 2013 Read with Rule 5(2) and 5(3) of the Companies (Appointment &
 Remuneration of Managerial Personnel) Rules, 2014 forms part of the
 Directors'' Report and have not been attached. However, in terms of
 first proviso to Section 136(1) the particulars as referred above are
 available for inspection at our Registered office during business hours
 on working days, up to the date of the ensuing Annual General Meeting.
 Any shareholder interested in obtaining a copy of the same may write to
 the Company Secretary.
 Particulars pursuant to Section 197(12) of the Companies Act 2013 Read
 with Rule 5(1) of the Companies (Appointment & Remuneration of
 Managerial Personnel) Rules, 2014 are provided in Annexure-A.
 Our Board has adopted a Remuneration Policy as also the Charter for the
 Nomination & Remuneration Committee (NRC). The Policy covers the Policy
 on remuneration to our Managing Director, Key Managerial Personnel and
 other officers. The Charter lays down the Rights, Roles and
 Responsibilities of the NRC. A Policy on Board diversity has also been
 adopted by the Board. A comprehensive Governance Guidelines for Board
 effectiveness has also been adopted by the Board on the recommendation
 of NRC. The Guidelines lay down the following:
 - Composition and Role of the Board (Role of the Chairman, Directors,
 size of the Board, Managing Director, Executive Director, Non-Executive
 Directors, Independent Directors, their term, tenure and Directorship).
 - Board appointment, Industrial Development.
 - Directors remuneration (Guided by Remuneration policy).
 - Subsidiary oversight.
 - Code of Conduct (Managing Director, Executive Director,
 Non-Executive Directors, Independent Directors).
 - Board effectiveness review.
 - Mandate of the Board Committee.
 11. Conservation of Energy, Technology Absorption, Foreign Exchange
 Earnings and Outgo
 The particulars pursuant to section 134 (m) of the Companies Act, 2013
 is attached with this report as Annexure-B.
 12. Risk Management Policy
 We have adopted a Risk Management Policy to identify and categorize
 various risks, implement measures to minimize impact of these risks
 where it is deemed necessary and possible, and a process to monitor
 them on a regular basis.  More details are given under Section-6 of
 Corporate Governance Report.
 13. Corporate Social Responsibility
 We have constituted a CSR committee for the purposes of recomending and
 monitoring the CSR initiatives of the Company.
 The Board on the recommendation of CSR Committee adopted a CSR Policy.
 The same is available on Company''s website at
 ( The CSR
 objectives are designed to serve societal, local and national goals in
 the locations that we operate in, create a significant and sustained
 impact on local communities and provide opportunities for our employees
 to contribute to these efforts through volunteering.
 The Annual Report on the CSR initiatives undertaken by the Company as
 per the Companies (Corporate Social Responsibilities Policy) Rules,
 2014 is annexed as Annexure-C. The details of the CSR Committee and its
 composition is given in section-7 of the Corporate Governance Report.
 14. Subsidiary Company, Statement under Section 129 of the Companies
 Act, 2013 and Consolidated Financial Statements
 Our wholly owned subsidiary, Tata Elxsi (Singapore) Pte. Ltd. did not
 accrue any revenue during the year under review.  There has been an
 expenditure of Rs. 0.06 crores during the year under review. Our Board of
 Directors have given their consent to the closure of Subsidiary and the
 same is under process. The details of subsidiary as required under the
 provisions of the Companies Act, 2013 are given in page No. 93 Members
 interested in obtaining a copy of the Audited annual accounts of the
 subsidiary company may write to the Company Secretary.
 15. Corporate Governance
 Pursuant to Clause 49 of the Listing Agreement, the Corporate
 Governance Report, the Management Discussion & Analysis Statement, and
 the Auditors'' Certificate regarding Compliance of Conditions of
 Corporate Governance are part of this Annual Report.
 16. Secretarial Audit
 Pursuant to the provisions of Section 204 of the Companies Act, 2013
 and The Companies (Appointment and Remuneration of Managerial
 Personnel) Rules, 2014, Ms. Jayashree Parthasarthy, a Company Secretary
 in Practice, was appointed to undertake the Secretarial Audit. The
 Report of the Secretarial Audit for the year ended 31st March, 2015 is
 attached to the Directors'' Report at page No. 27.
 17. Prevention of Sexual Harassment
 We have zero tolerance for sexual harassment at workplace and have
 adopted a Policy on prevention, prohibition and redressal of sexual
 harassment at workplace in line with the provisions of the Sexual
 Harassment of Women at Workplace (Prevention, Prohibition and
 Redressal) Act, 2013 and the Rules thereunder for prevention and
 Redressal of complaints of sexual harassment at workplace.
 During the year FY15, we received one (1) complaint related to sexual
 harassment; the same has been disposed of and appropriate action taken.
 There are no pending complaints for FY15.
 18. Vigil Mechanism
 Our company has established a Vigil Mechanism for its employees and
 Directors, enabling them to report any concerns of unethical behaviour,
 suspected fraud or violation of the Company''s ''Code of Conduct''.
 To this effect the Board has adopted a ''Whistle Blower Policy'' (WBP),
 which is overseen by the Audit Committee. The policy provides
 safeguards against victimization of the Whistle Blower. Employees and
 other stakeholders have direct access to the Chairperson of the Audit
 Committee for lodging concerns if any, for review.
 The said policy has been posted on our intranet where all the employees
 have access. Our Company conducts ''Policies Awarness Campaign''
 regularly for its employees at its various centres, and the WBP also
 features in the campaign amongst others.
 19. Others
 There are no loans, guarantees and investments made by us u/s 186 of
 the Companies Act, 2013 during the year under review.
 The extract of Annual Return in MGT-9 is attached and forms part of the
 We have neither accepted nor renewed any deposit during the year under
 The Unclaimed Dividend in respect to the financial year 2007-08 is due
 for remittance to Investors'' Education & Protection Fund (IEPF) on 27th
 August, 2015 in terms of Section 125 of the Companies Act, 2013.
 There are no material changes and commitments affecting our financial
 position between the end of the financial year to which this financial
 statement relate and the date of this report.
 20. Auditors
 Delloitte Haskins & Sells (DHS), Chartered Accountants, the Statutory
 Auditors, who have been appointed for a period of 3 years and whose
 reappointment is to be ratified at the ensuing Annual General Meeitng,
 have confirmed that their certificate dated April 21, 2014 issued
 pursuant to the provisions of Section 139(1) of the Companies Act, 2013
 holds good for the period of re-appointment.
 21. Acknowledgements
 Your Directors wish to thank employees, customers, partners, suppliers,
 and above all, our shareholders and investors for their continued
 support and co-operation.
                       On behalf of the Board of Directors
                             N.G. Subramaniam
 Bengaluru, 28th April, 2015
Source : Dion Global Solutions Limited
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