| a. Basis of Preparation:
The financial statements are prepared under the historical cost
convention under accrual method of accounting and as a going concern,
in accordance with the Generally Accepted Accounting Principles (GAAP)
prevalent in India and the mandatory accounting standards issued by the
Institute of Chartered Accountants of India (ICAI) and according to the
provisions of the Companies Act, 1956.
b. Revenue Recognition:
Revenue is measured at the fair value of the consideration received or
receivable and represents amounts receivable for goods and services
provided in the normal course of business, net of discounts. Revenues
from contracts priced on time and material basis are recognised when
services are rendered and related costs are incurred.
Software services: Where the outcome of a turnkey contract can be
estimated reliably, revenue and costs are recognised by reference to
the stage of completion of the contract activity at the Balance Sheet
date, as measured by the proportion that contract costs incurred for
work performed to date bear to the estimated total contract costs,
except where this would not be representative of the stage of
completion.
c. Fixed Assets:
Fixed assets are stated at historical cost of acquisition and
improvements thereon less accumulated depreciation.
The company had paid an amount of Rs.269.82 lacs to Kashi Infotech
Private Limited to acquire/take over the assets and the same has been
shown under fixed assets. This is due to the fact that during the offer
document for Rights Issue in July 2007 Kashi Infotech delivering
healthcare business was proposed to be acquired. Kashi Infotech is
stabilizing their business in health care with firm orders and the same
would be firmed up in the next financial year.
d. Depreciation:
The company has revised its estimates of providing depreciation on
fixed assets effective 1st April 2014. The carrying amount as on 1st
April 2014 is depreciated over the revised remaining useful life. The
effect relating to the period prior to 1st April 2014 is Rs.14.17 lacs,
which has been shown as 'exceptional item' for the financial year
2014-15 in the statement of profit and loss. Depreciation on fixed
assets have been provided on Straight Line Method at the rates and in
the manner prescribed in Part C of Schedule II of the Companies Act,
2013 and on pro- rata basis of the assets acquired during the year.
Class of asset Previous useful life Revised useful life
(Years) (Years)
Plant & Equipment: 6 4
- Computers & servers 6 10
- Others
Furniture & Fittings 15 5
Office equipments 21 5
e. Investments:
Investments are classified as current or long term in accordance with
Accounting Standard 13 on 'Accounting for Investments'.
* Long term investments are stated at cost to the company. The company
provides for diminution in the value of long term investments other
than those temporary in nature.
The value of investments in Info-Drive Software Inc. USA though
diminished as on the date of balance sheet, management is confident of
augmenting resources against firm orders to mitigate any further
erosion and hence carried at cost.
* Current investments
Info-Drive Software LLC-JV advance - Rs 6,145.95 Lacs In case of
foreign investments
- the cost is the rupee value of the foreign currency on date of
balance sheet.
- the face value of the foreign investments is shown at the face value
reflected in the foreign currency of that country.
f. Employee benefits:
Short term employee benefits are measured at cost. Long term employee
benefits and post employment benefits such as gratuity are reviewed and
provided at each balance sheet date.
g. Taxation :
Income Tax: Provision for Income Tax is made as per the applicable
rules under the Income-tax Act, 1961. Income tax expense represents the
sum of the tax currently payable. The tax currently payable is based on
taxable profit for the year. Taxable profit differs from profit as
reported in the income statement because it excludes items of income or
expense that are taxable or exempt in earlier years and it further
excludes items that are never taxable or exempt. The liability for
current tax is calculated using tax rates that have been enacted or
substantively enacted by the balance sheet date.
Deferred tax: Deferred tax is recognised on differences between the
carrying amounts of assets and liabilities in the financial statements
and the corresponding tax bases used in computation of taxable profit
and are accounted for using the balance sheet liability method.
Deferred tax liabilities are generally recognised for all taxable
temporary differences and deferred tax assets are recognised to the
extent that it is probable that taxable profits will be available
against which deductible temporary differences can be utilised. Such
assets and liabilities are not recognised if the temporary difference
arises from assets and liabilities in a transaction that affects
neither the taxable profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each balance
sheet date and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of
the asset to be recovered.
Deferred Tax resulting from timing difference between book profits and
taxable profits are accounted for to the extent deferred tax
liabilities are expected to crystalise with reasonable certainty.
However in case of deferred tax assets (representing minimum alternate
tax) are recognised, if and only if there is virtual certainty that
there would be adequate future taxable income against which such
deferred tax assets can be realised. Deferred tax is recognised on
adjustments to revenue reserves to the extent the adjustments are
allowable as deductions in determination of taxable income and they
would reverse out in future periods.
h. Secured Loans:
(i) Secured loan Working Capital (Cash Credit facility) from Axis Bank
Ltd against bills receivable and book debts was closed under one time
settlement (OTS). The surplus arises on account of such settlement has
been appropriately dealt in the books of accounts.
(ii) Secured Loan includes outstanding dues to Indian Overseas Bank
against undertakings.
i) Inventories and WIP (Projects): Rs. 85.92 Lacs (Rs.85.15 Lacs)
j) Preliminary and Issue Expenses: Expenses incurred in connection with
issue of FCCB of Rs 70.25 Lacs have been amortised over a period of 5
years. Accordingly during the year an amount of Rs.14.05 lacs was
written off (Previous year - Nil)
k) Segment reporting:
The company operates only in one segment viz. Information Technology.
l) Related Party Disclosures:
List of related parties where control exists and other related parties
with whom the company had transactions and their relationship is as
below.
Sl.No. Name of the related party Nature of relationship
1. Info-Drive Software Inc. USA
2. Info-Drive Software LLC, Dubai
3. Infodrive Enterprises Pte Ltd.,
Singapore
4. Info-Drive Systems Sdn Bhd, Subsidiary Companies
Malaysia
5. Info-Drive Software Limited,
Canada
6. Infodrive Mauritius Limited,
Mauritius
Sl.No. Name of the related party Nature of relationship
Fellow Subsidiary Company
7. Technoprism LLC, USA (Subsidiary of Info-Drive
Software Inc, USA)
8. Info Drive Technologies Associate Company
Co., Ltd, Thailand (Associate company of
Infodrive Enterprises Pte
Ltd., Singapore)
9. ANL Madhavann
Key Management personnel
10. Ajay K Mehtha
11. A.S.Giridhar
m) Foreign Currency Translation Reserve:
Exchange differences on account of fluctuations in foreign currency
rates are treated as under:
i) Exchange difference gain/ (loss) recognised in the Statement of
Profit and Loss relating to exports/services during the year.
ii) Exchange difference gain/ (loss) recognised in the Balance Sheet
relating to investments as Foreign Currency Translation Reserve.
iii) As per the Accounting Standard (Integral foreign operations)
issued by the Institute of Chartered Accountants of India the impact of
exchange difference gain or loss has not been considered in respect of
branch operations in Singapore.
n) Contingent Liabilities:
1. SBLC (stand by letter of credit) renewed in favour of Indian
Overseas Bank, Singapore has been pre-maturely invoked. However
corporate guarantee (CG) issued would be nullified after settlement of
all dues by the subsidiary company in Singapore.
2. The appeal filed by the company with the Commissioner of
Income-tax, Appeals III in respect of the disallowance of claim under
section 35D (issue expenses) of Rs.4,50,296/- for the assessment year
2004-2005 has not been disposed off as yet; However, there is no demand
of tax.
3. The company has preferred an appeal before the Income Tax Appellate
Tribunal (ITAT) for the demands raised on account of TDS on
international transactions by CIT (A) for AY 2010-11 Rs.33,44,226 and
for AY 2011-12 of Rs.1,65,15,087 respectively. No provision
has been made for this contingency on demands as the company is
confident of winning the appeal.
4. The company has filed appeal with the Commissioner of Income-tax,
Appeals (II) in respect of the assessment year 2010-11 for Rs.
3,18,73,620/- which arose on account of denial of deduction u/s.10B and
u/s 115JB for section 80HHC of the Income Tax Act 1961 . In view of
confident of winning the appeal no provision has been made in the books
of account.
5. The company has filed appeal with the Commissioner of Income-tax,
Appeals (II) in respect of the assessment year 2009-10 for Rs.
3,18,78,250/- which arose on account of denial of deduction u/s.10B and
u/s 115JB for section 80HHC of the Income Tax Act 1961 . In view of
confident of winning the appeal no provision has been made in the books
of account.
o) Due to SSI's:
As at 31st March 2015 the company has no outstanding dues to Micro
Enterprises, Small Enterprises and Small Scale Industrial Undertakings.
a. Foreign Currency Transactions:
Monetary current assets and current liabilities relating to foreign
currency transactions remaining unsettled at the end of the year are
translated at the exchange rates prevailing at the date of balance
sheet.
Rs. lacs
2015 2014
Earnings in Foreign Currency Nil 34.06
Expenditure in Foreign Currency Nil 2.62
Investment in Foreign Currency Nil Nil
b. Unclaimed Dividend
For the earlier three financial years the total unclaimed dividends
amounted to Rs.7,61,713/-comprising of Rs.277,734/- (2007-2008), Rs
236,194/- (2008-2009) and Rs.2,47,785/- (2009-2010) respectively.
c. Confirmations from Trade Receivables , Payables, Loans and Advances
Confirmation of balances from Trade Receivables, Payables and loans and
advances are yet to be received in some cases though the company has
sent letters for confirmation by them. The balances adopted are as
appearing in the books of accounts of the Company.
d. Advance received for services:
The company had received an advance of Rs.4,00,12,568/- to provide
services to a company called M/s. Persian Dam Keshte Aria located in
Tehran, Iran. However, while remitting the advance by the remitter the
swift message for the advance was wrongly mentioned as 'Feed Corn
Purchase'. RBI approval was accorded in the month of June 2014 for
refund of advance remittance received from the above said company in
Iran and the company is taking steps to remit the amount as early as
possible.
|