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TeamLease Services

BSE: 539658|NSE: TEAMLEASE|ISIN: INE985S01024|SECTOR: Miscellaneous
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Download Annual Report PDF Format 2017 | 2016
Directors Report Year End : Mar '18    Mar 17

Dear Shareholders,

The Directors have the pleasure in presenting the Eighteenth (18th) Annual Report of your Company on business and operations along with the audited Standalone and Consolidated Financial Statements and the Auditor’s Report for the year ended March 31, 2018. Consolidated performances of the Company, its subsidiaries and associate companies have been referred to wherever required.

Financial Highlights

Rs. in Lakhs

Particulars

Consolidated

Standalone

2017-18

2016-17

2017-18

2016-17

Revenue from Operations

362,411.54

304,129.41

344,074.08

299,025.35

Other Income

1,563.39

2,166.87

2,438.05

2,337.41

Total Income

363,974.93

306,296.28

346,512.13

301,362.76

Profit before finance cost, depreciation, amortisation and taxes

8,441.62

5,870.77

7,545.42

5,374.37

Depreciation and Amortisation

915.84

610.47

372.34

398.94

Profit before Finance Cost and Taxes

7,525.78

5,260.30

7,173.08

4,975.43

Finance Cost

246.67

109.71

110.22

88.68

Profit before share of profit/(loss) from associates

7,279.11

5,150.59

7,062.86

4,886.75

Share of (loss)/ profit from associates

(25.74)

-

NA

NA

Profit before tax

7,253.37

5,150.59

7,062.86

4,886.75

Income Tax (credit)/expense

(92.22)

(606.45)

(192.84)

(67.60)

Net Profit for the year

7,345.59

5,757.04

7,255.70

4,954.35

Other Comprehensive Income/(Loss) for the year

23.06

45.54

18.90

8.02

Total Comprehensive Income for the year

7,368.65

5,802.58

7,274.60

4,962.37

Earnings Per Equity Share of RS.10 each: -Basic & Diluted (in Rs.)

42.96

33.67

42.44

28.98

Standalone and Consolidated Financial Statements

The Standalone and Consolidated Financial Statements of your Company have been prepared in accordance with Indian Accounting Standards (‘Ind AS’) notified under the Companies (Indian Accounting Standards) Rules, 2015.

Review of Business Operations and Future Prospects

Your Directors wish to present the details of Business Operations done during the year under review:

The Company’s revenue from operations for the year ended March 31, 2018 on a consolidated basis increased to RS.362,411.54 lakhs from RS.304,129.41 lakhs during the previous year. The Company achieved an EBIDTA (including other income) of RS.8,441.62 lakhs during the current year as against the previous year EBIDTA (including other income) of RS.5,870.77 lakhs. The net profit after tax of the Company for the year ended March 31, 2018 was RS.7345.59 lakhs as against the previous year profit after tax of RS.5757.04 lakhs. Net profit for the year was positively impacted by the organic growth and the contribution from recently acquired subsidiaries.

Number of associate employees as on the date of close of financial year of the company was ~181,000 (including the NETAP trainees of~43,000) as against the previous year Associate employees of ~151,000 (including the NETAP trainees of ~23,000). Your Directors express their satisfaction on the overall financial performance and the progress made on different areas by the Company during the year under review.

The Company has the policy on the employment diversity which states the equal opportunity to everyone without any discrimination of gender, region, caste or religion.

Dividend and Reserves

Your Directors would like to use the profits earned for purpose of enhancing business and hence do not propose any dividend for the financial year under review. No amount has been transferred to reserves and the profit for the year has been retained in the surplus forming part of the reserves of the Company.

Transfer of Unclaimed Dividend to Investor Education and Protection Fund

There were no unpaid/unclaimed dividends declared and paid in previous years and hence the provisions of Section 125 of the Companies Act, 2013 do not apply.

Subsidiaries, Joint Ventures and Associate Companies

Your Company has formulated a Policy for determining ‘Material’ Subsidiaries pursuant to the provisions of SEBI Listing Obligation and Disclosure Requirement (LODR) Regulations, 2015. The said Policy is available on the Company’s website https://www.teamleasegroup.com/policy-documents.

The Company has 5 direct and indirect subsidiaries and 2 Associate Companies as on March 31, 2018. The Company does not have Joint Venture with any company. During the year under review, the following subsidiary was acquired:

1. Evolve Technologies & Services Private Limited (Evolve)

The following is the list of Associate Company(ies) wherein investments are made during the year:

1. Cassius Technologies Private Limited

2. School Guru Eduserve Private Limited

The details of major subsidiaries and associates are given below.

11JT Education Private Limited (IIJT) is a wholly owned subsidiary of the Company. During the year under review, the Company had leased out its property and the income for the Company was from the lease rent received on property.

TeamLease Education Foundation (TLEF) is a Section 8 Company (Originally registered under Section 25 of the Companies Act, 1956). TLEF is the sponsor of the TeamLease Skills University (“TLSU”), the country’s first Skills University, established under the provisions of the Gujarat Private Universities Act, 2009.

TLSU, a Public-Private Partnership, with the Governmentof Gujarat, was among the few Universities selected by the United Kingdom Education Research Initiative (UKERI). In terms of the said initiative, the University has received grants that are to be utilized for faculty development.

TLEF is a National Employability Enhancement Mission (NEEM’) Agent as approved by the All India Council for Technical Education (AICTE). NEEM is an employability initiative of the Ministry of Human Resource Development, Government of India. TLEF has operationalized the NEEM initiative as National Employability through Apprenticeship Programme (NETAP) through TLSU.

TLEF, being a wholly owned subsidiary, is provided financial support by your Company till the operations stabilize. The loan advanced to this subsidiary is at arm’s length and will be charged with the appropriate rate of interest. TLEF, has in-turn, advanced monies to TLSU and the same is interest bearing.

TeamLease Digital Private Limited [Formerly known as TeamLease Staffing Services Private Limited] (TDPL) was incorporated under the provisions of Companies Act, 2013 for the purpose of entering into the IT staffing business. TDPL is wholly-owned subsidiary of your Company.

During the year, the Company acquired Evolve Technologies & Services Private Limited (Evolve), IT and telecommunication staffing Company. The Company was acquired as a step-down subsidiary of your Company through TDPL w.e.f. November 01, 2017.

ASAP Info Systems Private Limited (“ASAP”) and Nichepro Technologies Private Limited, wholly owned subsidiaries of TDPL have been merged into TDPL vide approval of NCLT Chennai dated November 30, 2017 and NCLT Mumbai dated November 16, 2017. Subsequent to the merger, the name of TeamLease Staffing Services Private Limited was changed to TeamLease Digital Private Limited w.e.f. March 08, 2018.

Keystone Business Solutions Private Limited (Keystone) is engaged in the business of providing information technology staffing solutions and consulting.

Evolve Technologies & Services Private Limited (Evolve) is wholly-owned subsidiary of Company through TDPL w.e.f. October 31, 2017. Evolve is engaged in the business of staffing (predominantly temporary staffing) to clients in Telecom and IT sector

Cassius Technologies & Services Private Limited (“Freshersworld”) was an Associate Company w.e.f. June 01, 2017 with an investment of 30% stake in Freshersworld. Your Company further acquired additional 21% stake and pursuant to such an investment, Freshersworld becomes subsidiary Company w.e.f. August 01, 2018. The Bangalore headquartered Freshersworld (www.freshersworld.com) is the leading job site for entry level hiring in India with about 4 million unique visits every month. It has a database of 1 crore resumes with over 2 lakh resumes added every month. Freshersworld dominates its competitors in fresher hiring segment with an organic traffic of over 90% and is ranked among the Top 5 hiring portals in India in terms of traffic (per Alexa). It has over 60,000 registered employers/ recruiters witRs.4,000 subscribed customers and conducts 100 virtual recruitment drives every month. Freshersworld is one of the very few online portals with positive margins and operating cashflows.

Schoolguru Eduserve Private Limited is an Associate Company w.e.f. December 01, 2017. Established in 2012, it is India’s premier technology-led specialized academic services organization. The company partners with Indian Universities to help them provide premium online and virtual courses for their students. Schoolguru solicits partnerships only from State / Central universities that are either an Open University (meant to run Distance Education Programs only) or have a significant Distance Education activity. Their managed technology platform provides all the components that a University may need to run their Information and Communication Technology services for their students ranging from the hosting platform, the underlying ERP, admission and fee management, the content, the streaming services, student engagement and communication, student servicing and the expertise to manage the platform. The platform is mobile native and is designed to adopt innovations in machine learning, multi-reality, and analytics to offer personalized and effective learning to millions.

A report on the performance and financial position of the subsidiary companies as per the Companies Act, 2013 in the Form AOC-1 is annexed to the Consolidated Financial Statement and hence not repeated here for the sake of brevity.

Management Discussion and Analysis Report

In terms of the provisions of Regulation 34 of the SEBI LODR, Regulations 2015 the Management Discussion and Analysis is set out in this Annual Report.

Corporate Governance

Your Company is committed to maintain the highest standards of corporate governance. We believe sound corporate governance is critical to enhance and retain investor trust. Our disclosures seek to attain the best practices in corporate governance as prevalent globally. We have implemented several best corporate governance practices in the Company to enhance long-term shareholder value and respect minority rights in all our business decisions. Corporate Governance Report for FY 201718 forms part of this Annual Report. The requisite certificate from the Secretarial Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under SEBI LODR Regulations 2015 is annexed to the Corporate Governance Report.

Deposits

Your Company has not accepted any deposit and as such no amount of principal and interest were outstanding as at the Balance Sheet date.

Loans, Guarantees or Investments

Details of loans, guarantees and investments covered under the provisions of Section 186 of the Companies Act, 2013 form part of the notes to the Financial Statements.

Declaration by Independent Directors

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Regulation 25 of SEBI LODR Regulations 2015.

Board Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Regulation 19 of SEBI LODR, Regulations 2015 the Board has carried out the Annual Performance Evaluation of its own performance, the Directors individually as well as the evaluation of the working of its various committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board’s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations, independence, governance, ethics and values, adherence to corporate governance norms, interpersonal relationships, attendance and contribution at meetings etc. A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as participation and contribution by a Director, commitment, including guidance provided to the senior management outside of Board / Committee meetings, effective deployment of knowledge and expertise, effective management of relationship with various stakeholders, independence of behaviour and judgement etc. The Performance Evaluation of the Independent Directors was carried out by the entire Board. The Performance Evaluation of the Chairman and Managing Director was carried out by the Independent Directors. The evaluation process has been explained in the Corporate Governance Report. The Board reviewed the evaluation results as collated by the Nomination and Remuneration Committee.

Committees of the Board and Committees

Currently, the Board has four Committees i.e., Audit Committee, Nomination and Remuneration Committee, Stakeholders’ Relationship Committee and Corporate Social Responsibility Committee. As required under the provisions of Section 177(8) of the Companies Act, 2013, the composition of the Audit Committee is disclosed as under:

Mrs. Latika Pradhan

Chairperson (Independent

Director)

Mr Narayan Ramachandran

Member (Independent

Director)

Mr Raghunathan V

Member (Independent

Director)

A detailed note on the composition of the Board and other Committees is provided in the Corporate Governance Report section of this Annual Report.

Meetings of the Board

The meetings of the Board are scheduled at regular intervals to decide and discuss on business performance, policies, strategies and other matters of significance. The schedules of the meetings are circulated in advance, to ensure proper planning and effective participation in meetings. In certain exigencies, decisions of the Board are also accorded through circulation.

The Board during the financial year 2017-18 met five times. The maximum interval between any two meetings did not exceed 120 days, as prescribed in the Companies Act, 2013. Detailed information regarding the meetings of the Board are included in the report on Corporate Governance, which forms part of the Board’s Report.

Auditors Statutory Auditor

As per the provisions of Section 139 of the Companies Act 2013,M/s. S. R. Batliboi & Associates LLP, Chartered Accountants (ICAI Firm Registration Number 101049W/E300004), Bangalore were appointed as Statutory Auditor of the Company in the Annual General Meeting held on July 07, 2017 subject to ratification at every subsequent Annual General Meeting.

Pursuant to Notification issued by the Ministry of Corporate Affairs on May 7, 2018 amending Section 139 of the Act, the mandatory requirement for ratification of appointment of Statutory Auditor by the Shareholders at every AGM has been omitted. Accordingly, the yearly ratification of appointment of the Statutory Auditor would not be done at every intervening Annual General Meeting as the requirement has been removed in the Companies Act, 2013

The Auditors’ Report on the Financial Statements of the Company for the year ending March 31, 2018 is unmodified i.e. it does not contain any qualification, reservation or adverse remark. The Auditors’ Report is enclosed with the Financial Statements forming part of the Annual Report.

Secretarial Auditors

Section 204 of the Companies Act, 2013, inter-alia, requires every listed company to annex with its Board’s Report, a Secretarial Audit Report given by a Company Secretary in practice, in the prescribed form. The Board of Directors appointed M Siroya & Company, Practicing Company Secretaries, as Secretarial Auditor to conduct the Secretarial Audit of the Company for financial year 2017-18 and their report is annexed to this Board Report as Annexure-I. The Board has also appointed M Siroya & Company as Secretarial Auditor to conduct the Secretarial Audit of the Company for Financial Year 2018-19.

Explanation or Comments on Qualifications, Reservations or Adverse Remarks or Disclaimers made by the Auditors and the Practicing Company Secretary in their Reports

In connection with the Statutory Audit of the financial statements for the year under review, there was no qualification, reservation or adverse remark in the report by the Statutory Auditor, save and except disclaimer made by them in discharge of their professional obligation.

No frauds are reported by the Statutory Auditor under sub section (12) of Section 143 of the Companies Act, 2013.

Material changes and commitment if any affecting the financial position of the Company occurred between the end of the financial year to which this Financial Statements relate and the date of the Report.

No material changes and commitments have occurred after the closure of the financial year 2017-18 till the date of this Report, which would affect the financial position of your Company.

Extension of 18th Annual General Meeting

Your Company had made an application to the Registrar of Companies, Mumbai for the extension of due date for holding the 18th Annual General meeting of the Company for the financial year ended March 31, 2018 on August 21, 2018 and the Registrar of Companies, Mumbai vide the Order dated September 11, 2018 granted the approval for extension of holding the Annual General Meeting of the Company by two months from due date. Therefore the Annual General Meeting of the Company for the financial year ended March 31, 2018 was scheduled to be held on or before November 30, 2018.

Your Company has further made an application to the Registrar of Companies, Mumbai on October 25, 2018 for extension of additional 1 month for holding AGM. which is expected shortly as on date of signing this Report.

Shifting of Registered Office of the Company

The members of the Company have approved the shifting of the Registered Office of the Company from the State of Maharashtra to the State of Karnataka i.e., from “Office No. 6, 3rd Floor, C Wing, Laxmi Towers, Bandra Kurla Complex, Bandra (E), Mumbai, Maharashtra - 400051” to “6th Floor, BMTC Commercial Complex, 80 Ft Road, Koramangala, Bangalore - 560095”. The Company has received order from Regional Director, Western Region on October 25, 2018 and filed the same respective authority as on October 27, 2018. The Company is yet to file Form INC-22 as on date of signing this Report subject to approval of Form INC-28 as on date.

Acquisition of additional 21% stake in Cassius Technologies Private Limited

Your Company has made an additional investment of 21% stake in Cassius Technologies Private Limited and pursuant to such an investment; Cassius becomes subsidiary Company w.e.f. August 01, 2018. The Company as on date of report holds 51% equity stake in Cassius.

Agreement to acquire stake in Avantis Regtech Private Limited

Your Company has signed a definitive agreement under which the Company will invest RS.700 lakhs in Avantis Regtech Private Limited (“Avantis”). Avantis has deep expertise in Governance, Risk and Compliance Automation and has helped hundreds of organisations migrate from manual and people dependent processes to automated, framework based solutions. It has credibility across large enterprises and SMEs with implementations across 29 states and 7 union territories in India with quick and easy on-boarding and a Mobile App based compliance tracking and management. Avantis’s SAAS (Software as a Service) Platform covers over 1200 Acts and over 55,000 compliances in India. Avantis’s strong compliance assessment and research capabilities leverage cutting edge technologies such as Artificial Intelligence (AI), Machine Learning (ML) and Optical Character Recognition (OCR).

Amalgamation of Wholly Owned Subsidiary Companies and Name Change

ASAP Info Systems Private Limited (“ASAP”) and Nichepro Technologies Private Limited (“Nichepro”) merged with TeamLease Digital Private Limited (formerly TeamLease Staffing Services Private Limited) (“TDPL”) vide approval of NCLT Chennai dated November 30, 2017 and NCLT Mumbai dated November 16, 2017. Subsequent to merger, name of TeamLease Staffing Services Private Limited was changed to TeamLease Digital Private Limited w.e.f. March 08, 2018.

Acquisition of Companies / Investment in Associates

During the year under review, your Company has acquired 100% stake in Evolve Technologies & Services Private Limited (“Evolve”), an IT and telecommunication staffing Company through its wholly owned subsidiary, TeamLease Digital Private Limited. The control got transferred on November 01, 2017.

The Company also made investments in two Associate Companies with direct investment of 30% in Cassius Technologies Private Limited for RS.600 lakhs and 22.19% equity stake in Schoolguru Eduserve Private Limited for RS.750 lakhs. The Company also subscribed to the Compulsory Convertable Preferance Shares (CCPS) of School Guru to an extent of RS.1350 lakhs.

As on the date of reporting, the business integration of the acquired companies with the holding Company has been completed and all the financial data of these companies have been considered in the audited Consolidated Financial Statements of the Company for the year ended March 31, 2018.

Utilisation of IPO Proceeds

The proceeds of the IPO were to be utilised for funding existing and incremental working capital requirements, acquisitions and other strategic initiatives, up-gradation of the existing IT infrastructure and general corporate purposes as outlined in the prospectus. The Board of Directors in their meeting held on August 08, 2017 approved to seek the shareholder’s approval through Postal Ballot for the variation/deviation in the utilisation of the un-utilised portion of the IPO proceeds. The resolution was passed by the shareholders with requisite majority on September 18, 2017.

The entire proceeds have been utilised as at the end of the year. The summary of utilisation of net IPO proceeds as on March 31, 2018 are as follows:

Sl. No.

Particulars

Projected Utilisation of funds as per prospectus

Alteration in the objects of the IPO for which the amount was raised

Utilisation of funds up to March 31, 2018

Un-utilised amount as at March 31, 2018

A

Funding existing and incremental working capital requirements

800.00

(180.00)

620.00

B

Acquisitions and other strategic initiatives

250.00

490.92

740.92

C

Upgradation of the existing IT infrastructure

150.00

(133.52)

164.71

-

D

General corporate purposes

184.10

(177.40)

67.00

-

Total

1,384.10

-

1,384.10

-

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The Company being in the service industry does not have any power generation units and did not produce/generate any renewable or conventional power. However, Company has taken all steps to conserve Energy in the work places by using energy saving lamps at all work stations and educating the employees to conserve energy.

The Company being in Service Sector has adopted all new technology in terms of software and hardware for the better working and efficient reporting. The Company has an in house Information Technology team which constantly works on the adoption and implementation of new technology into the businesses of the Company.

During the year under review the Company on standalone basis has incurred RS.123.35 Lakhs towards expenditure in foreign currencies and earned RS.180.39 Lakhs towards export of services. Total foreign exchange outflow during the year was RS.107.66 Lakhs.

Research and Development

The Company has not undertaken any Research and Development activity in any specific area during the year under review, and hence no cost has been incurred towards same.

Vigil mechanism / Whistle Blower Mechanism

The Company has adopted a Whistle Blower Policy and has established the necessary Vigil Mechanism as defined under Regulation 22 of SEBI (LODR) Regulations, 2015 read with Section 177(10) of the Companies Act, 2013 for Directors, employees and all stakeholders of the Company to report genuine concerns, to provide for adequate safeguards against victimization of persons who use such mechanism and make provision for direct access to the Chairperson of the Audit Committee. No person has been denied access to the Chairperson of the Audit Committee. The said Policy has been also put up on the website of the Company at the following link https://www.teamleasegroup.com/policy-documents

Statement concerning development and implementation of Risk Management Policy of the Company

The Board of the Company has formed a Risk Management committee to frame, implement and monitor the Risk Management plan for the Company. The committee is Responsible for reviewing the risk management plan and Ensuring its effectiveness. Major risks identified by the Businesses and functions are systematically addressed through mitigating actions on a continuous basis.

The Company does not fall under the ambit of top 100 listed entities, determined on the basis of market capitalisation as at the end of the immediately preceding financial year. Hence, compliance under Regulation 21 of SEBI LODR Regulations, 2015 is not applicable.

Insider Trading Regulations

Based on the requirements under SEBI (Prohibition of Insider Trading) Regulations, 1992, as amended from time to time, the code of conduct for prohibition of insider trading, as approved by the Board is in force by the Company. The Company also adopts the concept of Trading Window Closure, to prevent its Directors, Officers, designated employees, their relatives and other employees from trading in the securities of the Company at the time when there is unpublished price sensitive information. Mr. Mruthunjaya Murthy Company Secretary was the Compliance Officer under the Code during the year Mr. Mruthunjaya Murthy has resigned from the office of Compliance Officer w.e.f. May 31, 2018.

Ms. Alaka Chanda has been appointed as Compliance Officer of the Company by the Board of the Company w.e.f. October 30, 2018.

Policies on Appointment of Directors and Remuneration of Directors, Key Managerial Personnel and Employees

In accordance with the provisions of Section 134(3) (e) of the Companies Act, 2013 (“the Act”) read with Section 178(2) of the Act and Regulation 17 of the SEBI (LODR) Regulations, 2015, your Company has adopted a Policy on Appointment of Directors and Senior Management and succession planning for orderly succession to the Board and the Senior Management, which inter alia, includes the criteria for determining qualifications, positive attributes and independence of Directors.

The Company’s current policy is to have an appropriate mix of Executive and Independent Directors to maintain the independence of the Board and separate its functions of governance and management. As on March 31, 2018 the Board consists of 5 Directors, majority of them being Independent Directors. Besides the Chairman and Managing Director who are the Promoters, the Board comprises of 3 Independent Directors. The Board periodically evaluates the need for change in its composition and size. The Policy of the Company on Director’s Appointment and Remuneration, including criteria for determining qualifications, positive attributes, independence of a Director and other matters as required under sub-section (3) of Section 178 of the Companies Act, 2013 are formulated by the Nomination and Remuneration Committee.

Your Company has also adopted the Policy on appointment of directors and senior management and Policy on Remuneration of Directors, Key Managerial Personnel and Employees of the Company in accordance with the provisions of sub-section (4) of section 178, and the same are available on website under link: https://www.teamleasegroup.com/compliance-documents

Details of Policy Developed and Implemented by the Company on its Corporate Social Responsibility Initiatives

The Companies Act, 2013 has mandated, under the provisions of Section 135 of the Companies Act, and Schedule VII of the Act, to form a Corporate Social Responsibility (CSR) Committee for certain classes of Private Limited Companies and unlisted Public Limited Companies and has made it compulsory for all the listed Companies. In this regard your Directors in their Meeting held on July 09, 2015 have duly constituted the Committee, TeamLease Corporate Social Responsibility Committee. The committee now comprises Mr. V Raghunathan (Chairman and Independent Director), Mr. Manish Mahendra Sabharwal (Member) and Mr. Ashok Reddy (Member). During the year under review, the Committee met on August 08, 2017 and January 30, 2018. The Board of Directors in their meeting held on January 30, 2018 unanimously decided not to incur any expenditure on Corporate Social Responsibility activity for the year under review. Your board members wish to state here that the Company’s core objective is to provide Education, Employment and Employability through skill development and training which is a mainstream to eradicate poverty promotion of education, employment enhancing vocational skills, all of which are covered under the Act/Schedule as CSR activities. The Board discussed the matter in detail and has consented not to spend any amount towards CSR activity for financial year 2017-18 considering the ongoing business objects of the Company. However the Board advised the Company and CSR Committee to review any activity/ies that drives the modalities for Corporate Social Responsibility other than the core activities of the Company mentioned above and should it fit within any of the other activity listed in the Schedule VII the same can be considered for the financial year 2018-19.

The statutory disclosures with respect to CSR activities forms part of this Annual Report and is annexed herewith as Annexure-II.

Business Responsibility Report

The Business Responsibility Report (“BRR”) of your Company for the year 2017-18 forms part of this Annual Report as required under Regulation 34(2) (f) of the SEBI LODR Regulations 2015

Particulars of Contracts or Arrangements made with Related Parties

All transactions entered into with Related Parties as defined under Companies Act, 2013 during the year were in the ordinary course of business and on an arm’s length basis. The Company has formulated a Policy on “Materiality of Rela ted Pa rty Tra nsa ctions” a nd the process of dealing with such transactions, which are in line with the provisions of the Companies Act, 2013 and SEBI LODR Regulations 2015. The same is also available on the web-link: https://www. teamleasegroup.com/policy-documents

Prior omnibus approval from the Audit and Risk Committee are obtained for transactions which are repetitive and also normal in nature. Further, disclosures on related party contracts and arrangements are made to the Audit Committee and the Board on a quarterly basis. During the year under review, there were no material related party transactions under Regulation 23 (4) of SEBI LODR Regulations 2015 entered into by the Company which necessitates approval of shareholders. Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC - 2, is appended herewith as Annexure-III to the Board’s Report.

Extracts of Annual Return

The extracts of Annual Return pursuant to the provisions of Section 92 read with Rule 12 of the Companies (Management and Administration) Rules, 2014 (Form MGT-9) is furnished in Annexure-IV and is attached to this Report.

Directors’ Responsibility Statement

Based on the framework of internal financial controls established and maintained by the Company, work performed by the internal, statutory and secretarial auditors and external agencies, the reviews performed by Management and the relevant Board Committees, the Board, with the concurrence of the Audit Committee, is of the opinion that the Company’s internal financial controls were adequate and effective as on March 31, 2018.

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) that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) that we have selected such accounting policies and 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 and of the profit and loss of the Company for that period;

c) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,

2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the annual accounts have been prepared on a going concern basis;

e) that proper systems to ensure compliance with the provisions of all applicable laws were in place and that such systems were adequate and operating effectively;and

f) that proper internal financial controls were laid down and that such internal financial controls are adequate and were operating effectively.

Secretarial Standards

The Company complies with all applicable secretarial standards.

Details of Directors or Key Managerial Personnel who were appointed or have resigned during the year

In accordance with the provisions of Section 152 of the Companies Act, 2013 and in terms of the Articles of Association of the Company, Mr. Ashok Kumar Nedurumalli aka Ashok Reddy (DIN:00151814), Managing Director of the Company retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment. The details of Mr. Ashok Reddy are provided in the Notice of the Annual General Meeting.

During the year, below mentioned Director and Key Managerial Personnel have tendered their resignation:

Name

Designation

Effective date

Mr. Gopal Jain

Non-Executive

August 08, 2017

Director

Mr. C

Company Secretary

May 31, 2018

Mruthunjaya

& Compliance

Murthy

Officer

Ms. Alaka Chanda is appointed as Company Secretary and Compliance Officer w.e.f. October 30, 2018.

Receipt of any commission by MD / WTD from Company or from its holding or subsidiary Company

The Company has not paid any commission to any of its Directors. Further, none of the subsidiaries of the Company has paid any commission/remuneration to any of the Directors of the Company.

Internal Financial Control

The Company has laid down certain guidelines, processes and structures, which enable implementation of appropriate internal financial controls across the organisation. Such internal financial controls encompasses policies and procedures adopted by the Company for ensuring the orderly and efficient conduct of business, including adherence to its policies, safeguarding of its assets, prevention and detection of frauds and errors, the accuracy and completeness of accounting records and the timely preparation of reliable financial information. These include control processes both on manual and IT applications wherein the transactions are approved and recorded. Appropriate review and control mechanisms are built in place to ensure that such control systems are adequate and are operating effectively. Because of the inherent limitations of internal financial controls, including the possibility of collusion or improper management override of controls, material misstatements in financial reporting due to error or fraud may occur and not be detected. Also, evaluations of the internal financial controls are subject to the risk that the internal financial control may become inadequate because of changes in conditions, or that the compliance with the policies or procedures may deteriorate. The Company has, in all material respects, an adequate internal financial controls system and such internal financial controls were operating effectively based on the internal control criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Control over Financial Reporting issued by the Institute of Chartered Accountants of India.

Details in respect of adequacy of Internal Financial Controls with reference to the Financial Statements

Your Company has in place adequate financial controls with reference to financial statements. During the year under review, such controls were reviewed and it did not observe any reportable material weakness in the design or operation of financial controls.

Details of Significant and Material orders passed by the Regulators or Courts or Tribunals Impacting the Going concern status and Company’s operations in future

During the year under review, there were no significant and material orders passed by the Regulators or Courts or Tribunals impacting the going concern status and Company’s operations in future.

Shares

a. Buy Back of Securities

The Company has not bought back any of its securities during the year under review.

b. Sweat Equity

The Company has not issued any Sweat Equity Shares during the year under review

c. Employee Stock Option Plan (ESOP)

Nomination and Remuneration Committee of the Board, inter alia administers and monitors the Company’s Employees’ Stock Option Plan (ESOP Plan) in accordance with SEBI (Share Based Employee Benefits) Regulations, 2014 (SBEB Regulations). The Plan is implemented through TeamLease ESOP Trust (ESOP Trust). During the year ended March 31, 2018, a total of 36,221 Equity Shares of RS.10/- each were transferred from the ESOP Trust to the eligible employees under the Company’s prevailing ESOP plan.

As at March 31, 2018, the ESOP Trust held 72,715 Equity Shares of the Company. During the year ended March 31, 2018, there has been no material change in the Company’s existing plan and the plan is in compliance with SBEB Regulations. Note 32 of Standalone financials statements to be referred for information as required under SBEB Regulations read with SEBI Circular CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015. In addition to the above, options granted to Senior Management Personnel are as mentioned below:

Employee wise details (name of employee, designation, number of options granted during the year, exercise price) of options granted to -

(a) senior managerial personnel; : NIL

(b) any other employee who receives a grant in any one year of option amounting to 5% or more of option granted during that year; and : NIL

(c) identified employees who were granted option, during any one year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant. : NIL

Company has received a certificate from the Statutory Auditor that the scheme has been implemented in accordance with SEBI Share Based Employee Benefits (SBEB) Regulations and the resolutions passed by the shareholders. The certificate would be placed at the Annual General Meeting for inspection by the Members.

Particulars of Employees

The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided in the Annexure-V forming part of this Report.

As required pursuant to Rule 5(2) and Rule 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the particulars of the top 10 employees in terms of remuneration drawn are given in Annexure-VI is attached herewith. There were two employees during the financial year drawing remuneration of RS.1.02 crore per annum or more whose details are forming part of Annexure-VI. There were no employees who were employed for a part of the financial year and have drawn a remuneration of more than RS.8.5 lakhs per month.

Disclosure under Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013

At TeamLease Services Limited, all employees are of equal value. There is no discrimination between individuals at any point on the basis of race, colour, gender, religion, political opinion, national extraction, social origin, sexual orientation or age. All employees (permanent, contractual, temporary and trainees) are covered under this policy. The Company has complied with the provisions relating to the constitution of Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The following is a summary of sexual harassment complaints received and disposed off during the year:

- No. of complaints received: 3

- No. of complaints disposed off: 3

Maintenance of Cost Records

The Company is not required to maintain cost records as specified by the Central Government under sub-section (1) of Section 148 of the Companies Act 2013.

CEO and CFO Certification

As required by SEBI (LODR) Regulation, 2015, the CEO and CFO have given appropriate certifications to the Board of Directors.

General

During the year under review, no revision was made in the Financial Statement of the Company except for compliance with the Ind-AS applicable for the Company w.e.f. April 01, 2017. Kindly refer the Notes to Accounts to the Financial Statements for additional details.

No penalties/strictures were imposed on the Company by Stock Exchanges or SEBI or any statutory authority on any matter related to capital market since the listing of the Company’s Equity Shares.

Human Resources

The Company has all required policies under the required laws for the time being in force and as required under the Companies Act, 2013 and SEBI LODR Regulations, 2015 the policies pertaining the code of conduct for employees, senior management team and directors, policy on succession plan and harassment free policy as required under the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, Policy on insider trading as required under SEBI Prohibition of Insider Trading Regulations, 1992 and subsequent amendments made thereon, whistle blower policy has been uploaded in the website of the Company https://www.teamleasegroup.com/policy-documents.

Statutory Disclosures

None of the Directors of your Company are disqualified as per the provisions of Section 164(2) of the Companies Act, 2013. Your Directors have made necessary disclosures, as required under various provisions of the Companies Act, 2013 and SEBI LODR Regulations 2015.

Change in nature of business

There has been no change in the nature of business of the Company. Your Company continues to one-stop provider of human resources services to various industries and diverse functional roles, offering staffing, payroll processing, recruitment, compliance and training services. Your Company set in motion the larger company mission of Putting India to Work’ by focusing on its vision of 3 E’s - Employment, Employability and Education

Acknowledgements

We thank our customers, vendors, investors, bankers and the Ministry of Labour for their continued support during the year

We place on record our appreciation of the contribution made by our employees at all levels. Our consistent growth was made possible by their hard work, solidarity, co-operation and support.

For and on Behalf of Board of Directors

Ashok Reddy Latika Pradhan

Managing Director Director

DIN: 00151814 DIN:07118801

Place: Bangalore

Date: October 30, 2018

Source : Dion Global Solutions Limited
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