To the Members of ABM Knowledgeware Limited
Your Directors are delighted to present the 26th Annual Report of theCompany along with the Audited Financial Statements (Consolidated & Standalone) forthe financial year ended 31st March 2019.
1. FINANCIAL PERFORMANCE OF THE COMPANY (STANDALONE & CONSOLIDATED):
( In Rs. Thousand)
| || |
|Particulars || |
| ||31.03.2019 ||31.03.2018 ||31.03.2019 ||31.03.2018 |
|Gross Income ||684821 ||740217 ||747693 ||762209 |
|Profit Before Interest and Depreciation ||242048 ||210433 ||241509 ||207420 |
|Finance Charges ||2550 ||2934 ||2550 ||2942 |
|Gross Profit ||239498 ||207499 ||238959 ||204478 |
|Provision for Depreciation ||14387 ||15931 ||17258 ||16192 |
|Net Profit Before Tax ||225111 ||191568 ||221701 ||188286 |
|Provision for Tax ||67336 ||47025 ||69163 ||47280 |
|Non-Controlling Interest (on ||- ||- ||4145 ||2801 |
|Net Profit After Tax ||157774 ||144543 ||156683 ||143807 |
|Surplus - Opening Balance ||1350263 ||1235411 ||1349543 ||1235411 |
|Amount Available for Appropriation ||1508038 ||1379954 ||1506812 ||1379218 |
|Other Comprehensive (Income) / Loss (net of tax) ||29 ||402 ||62 ||418 |
|Dividend and Dividend tax paid during the year ||30093 ||30093 ||30093 ||30093 |
|Surplus - closing balance ||1477973 ||1350263 ||1476781 ||1349543 |
2. OPERATIONS OF THE COMPANY:
Operations of the company have been stable and inline with the strategy of doingselective business. Most projects have been progressing well without any notabledisruptions. ABM continues to operate from offices in New Delhi Mumbai Bhopal and officeof the subsidiary in Bangalore. Operational efficiency and cost management have helpedcompany to post higher profits despite of the anticipated drop in sales revenues. All theexisting customers have shown preference to remain associated with ABM. Your company hasmanaged to keep its outstanding payment under control and ensured that resources will notbe inadequate for right opportunities.
Your Directors has recommended a Final Dividend of 25% (i.e. Rs. 1.25/- per EquityShare of Face Value of Rs. 5/- each) for the year ended 31st March 2019. Thedividend recommended if approved by the Members will be paid to Members within theperiod stipulated by the Companies Act 2013. The dividend if approved will result in acash outflow of Rs. 30092710/- including dividend distribution tax.
4. TRANSFER TO RESERVES:
Your Directors do not propose to transfer any amount to the General Reserve out of thecurrent year's profit.
5. TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND:
In terms of the provisions of Investor Education and Protection Fund (AccountingAudit Transfer and Refund) Rules 2016 / Investor Education and Protection Fund(Awareness and Protection of Investors) Rules 2001 Rs. 368213/- of unpaid / unclaimeddividends were transferred during the year to the Investor Education and Protection Fund(IEPF).
6. SHARE CAPITAL:
As on 31st March 2019 the Authorized share capital of your Company was Rs.125000000/- consisting of 25000000 Equity Shares of Rs. 5/- each and paid up equityshare capital was Rs. 102415000/- consisting of 20002200 fully paid up equity sharesand 697800 forfeited equity shares of Rs. 5/- each.
During the year under review the Company has not issued any shares or Bonus shares.The company has not issued shares with differential voting rights. It has neither issuedemployee stock options nor sweat equity shares. The Company has not bought back any of itsequity shares.
7. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP):
In accordance with the provisions of the Section 152 of Companies Act 2013 Mrs.Supriya P. Rane Director retires by rotation at the forthcoming Annual General Meetingand being eligible offer herself for re-appointment. The Board recommends herre-appointment.
A brief profile of Mrs. Supriya P. Rane has been given in the Report on the CorporateGovernance as well as in the Notice of the ensuing Annual General Meeting of the Company.
During the year under review Mr. Sanjay Mehta Independent Director of the Companyresigned from the Board w.e.f 14th August 2018. The Directors place on recordits deep appreciation for the contributions of Mr. Sanjay Mehta Director throughout hisdirectorship and also for significant contributions he has made to the management ofaffairs of the Company and for the valuable advises he made to the Board from time totime.
Further pursuant to provisions of Section 149 of the Companies Act 2013 The Board ofDirectors have appointed Mr. Devendra Parulekar as an Independent Director w.e.f 10thAugust 2018 for a term of 5 (five) consecutive years commencing 10th August2018 up to 9th August 2023.
Section 149(10) of the Companies Act 2013 provides that independent directors shallhold office for a term of up to five consecutive years on the Board of a Company and shallbe eligible for re-appointment on passing a special resolution by the shareholders of theCompany. Accordingly Mr. Sharadchandra Abhyankar was appointed by the Board in theirmeeting held on 18th September 2014 for a period of 5 years and whose termexpires in the ensuing Annual General Meeting. Therefore pursuant to provisions of Section149 of the Companies Act 2013 your Board of Directors are seeking the members approvalfor re-appointment of Mr. Sharadchandra Abhyankar as an Independent Director for a secondterm of 5 (five) consecutive years commencing 17thAugust 2019 up to 16thAugust 2024.
The Independent Directors of your Company have given the certificate of independence toyour Company stating that they meet the criteria of independence as mentioned underSection 149 (6) of the Companies Act 2013.
The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company at www.abmindia.com. The Company has issued a formal letterof appointment to the Independent Director in the manner as provided in the Companies Act2013. The terms and conditions of the appointment have been disclosed on the website ofthe Company.
There has been no change in the Key Managerial Personnel (KMPs) of your Company duringthe year under review.
The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of the CorporateGovernance Report of this Annual Report. Annual Board Evaluation process for Directors hasalso been provided under the Report on Corporate Governance.
During the year five Board Meetings and five Audit Committee Meetings were convened andheld. For the details of the meetings of the Board and its Committees please refer to theReport on Corporate Governance which forms part of this report. The intervening gapbetween the Meetings was within the period prescribed under the Companies Act 2013.
9. PUBLIC DEPOSITS:
During the year under review your Company did not accept any public deposits underChapter V of Companies Act 2013 and no amount on account of principal and interest onpublic deposits was outstanding on the date of the balance sheet. Since the Company hasnot accepted any deposits during the financial year ended March 312019 there has been nononcompliance with the requirements of the Act.
10. SUBSIDIARIES JOINT VENTURES AND ASSOCIATE COMPANIES:
InstaSafe Technologies Private Limited ("InstaSafe") a subsidiary of yourCompany is a leading Cloud based Security-as-a-Service solution provider deliveringcomprehensive and uncompromising protection to mobile and remote workers enabling them tosafely and securely access enterprise apps email and web from anywhere on any network.
Further during the year under review InstaSafe Technologies Private Limited("InstaSafe") a subsidiary of your Company has incorporated a Wholly ownedSubsidiary by name "InstaSafe Inc" in Delaware United State of America on 23rdAugust 2018. Post this incorporation Instasafe Inc became a wholly owned Subsidiary ofInstaSafe Technologies Private Limited and thereby became step-down Wholly ownedSubsidiary Company of your Company.
Pursuant to the provisions of Section 129(3) of the Companies Act 2013 a statementcontaining salient features of financial statements of subsidiary companies in Form AOC 1is attached herewith. The separate audited financial statements in respect of thesubsidiary company shall be kept open for inspection at the Registered Office of theCompany during working hours for a period of 21 days before the date of the Annual GeneralMeeting. Your Company will also make available these documents upon request by any memberof the Company interested in obtaining the same.
As on 31st March 2019 the Company does not have any Joint venture orAssociate Company.
11. PERFORMANCE OF SUBSIDIARY COMPANIES:
India's cyber security landscape is going through an interesting phase as businessesare keenly looking at innovative tools to protect themselves from cyber attacks andthreats. While India's cyber security needs are not different from that of the rest of theworld Privacy and personal data protection are the key focus areas. With the draftPersonal Data Protection Bill and the Aadhaar ruling by the Supreme Court recentlylimiting the use of data the focus on data privacy is set to reach a tipping point in2019. Organisations will invest in aligning their infrastructure to the requirements inthe Personal Data Protection Bill (which is likely to become an Act later in 2019) to gainbusiness edge and avoid penalties.
InstaSafe is one of the few innovators from India with high ambitions. Our executioncapability is recognised by making it to the "Deloitte India Fast 50 & APAC Fast500" with a consistent growth in revenue of over 103% consistently over the last 3years. InstaSafe continues to ramp and grew 156% YoY in Revenue while constantly strivingto become capital efficient. InstaSafe has been able to reduce its losses by 21 % YoY.
InstaSafe today finds itself in the middle of the largest disruptions and markettransitions since the invention of the firewall and boom of the cybersecurity industry.According to Gartner "By 2023 60% of enterprises will phase out most of their remoteaccess virtual private networks (VPNs) in favor of ZTNA(Zero Trust Network Access)."As per conservative estimates this itself is a worldwide multi billion market awaiting todisrupt.
In FY18-19 InstaSafe has been recognised with the "Investors Choice Award" atthe Netapp Excellerator partnered with AWS(Amazon) as an Advanced Technology partner.InstaSafe clocked winning partnerships with Hitachi Waverley labs and many more globally.Customer growth has expanded to include the first Fortune 100 customer's adoption ofInstaSafe. New wins included customers from Key Governments internationally to new ageunicorns financial services NBFC's Industry 4.0 forward looking manufacturing behemothsand ITES majors.
Some of the key initiatives during the year were executing international order throughthe USA subsidiary strengthening senior management leadership hires in Sales TechnologyOperations and more.
Recently InstaSafe was included in Gartner's Market Guide for Zero Trust NetworkAccess identifying InstaSafe as a Representative Vendor. As per Gartner "The oldsecurity mindset of inside means trusted' and outside means untrusted' isbroken in the world of digital business which requires anywhere anytime any deviceaccess to services that may not be located inside' an on-premises data center."
In addition Safehats another InstaSafe brand has been covered by Gartners;"Market Guide for Application Crowdtesting Service". It States: By the year2022 more than 50% of enterprises will employ Crowd-testing platform products andservices. Crowd-testing will have a significant advantage over traditional servicedelivery with the increasing demand for speed flexibility support for new technologiesand highly skilled testers. Crowd-testing platforms can be considered as a complementaryalternative to traditional service delivery.
The outlook for FY19-20 is to scale globally and focus on enhancing product adoptionand building InstaSafe brand trusted by international customers. We continue to expectour operating expenses to increase significantly over the next several years particularlythis fiscal as we continue to add experienced & leadership talent particularly inTechnology AI/ML Products Sales and marketing expand our operations andinfrastructure both domestically and internationally.
M/s. Borkar & Muzumdar Chartered Accountants were appointed as Statutory Auditorsof your Company at the Annual General Meeting held on 18th September 2014 fora term of five consecutive years. Since the term of the Statutory Auditors expires in theensuing Annual General Meeting therefore the Board hereby recommends the re-appointmentof Statutory Auditors for a further period of 5 years to hold the office from conclusionof this Annual General Meeting until the Conclusion of thirty first Annual GeneralMeeting which shall be subject to approval by the members.
13. AUDITORS' REPORT:
The Report given by the Auditors on the Financial Statements of the Company is part ofAnnual Report. There has been no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report. Hence it is an unmodified opinion in terms of theapplicable provisions of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015. Notes to Accounts and Auditors remarks in their report areself-explanatory and do not call for any further comments.
14. SECRETARIAL AUDIT REPORT:
Pursuant to the provisions of the Section 204 of the Companies Act 2013 The Board hasappointed Mr. Upendra Shukla Practicing Company Secretary as Secretarial Auditor toundertake the Secretarial Audit of the Company for the year ended on 31stMarch 2019. The Secretarial Audit Report issued by Mr. Upendra Shukla in Form No. MR-3forms part of this Annual Report and is an Annexure to the Annual Report. The SecretarialAudit Report does not contain any qualification reservation or adverse remark.
15. COMPLIANCE WITH SECRETARIAL STANDARDS:
The Company has complied with Secretarial Standards issued by the Institute of CompanySecretaries of India on Board Meetings and General Meetings.
16. INTERNAL AUDIT AND INTERNAL CONTROL SYSTEMS:
The Company has laid down certain guidelines and processes which enables implementationof appropriate internal financial controls across the organisation. Such internalfinancial controls encompass policies and procedures adopted by the Company for ensuringorderly and efficient conduct of business including adherence to its policiessafeguarding of its assets prevention and detection of frauds and errors the accuracyand completeness of accounting records and the timely preparation of reliable financialinformation.
The Audit Committee reviews the reports submitted by the Internal Auditors in each ofits meeting. The Management duly considers and takes appropriate action on recommendationsmade by the Statutory Auditors Internal Auditors and Audit Committee of the Board ofDirectors.
The Company has appointed M/S. S.P Sule & Associates Chartered Accountants asInternal Auditor of the Company for the financial year 2018-2019.
17. CORPORATE GOVERNANCE:
Corporate Governance is a continuous process at ABM. It is about commitment to valuesand ethical business conduct. Systems policies and frameworks are regularly upgraded toeffectively meet the challenges of rapid growth in a dynamic external businessenvironment. Your Company is committed to sound corporate practices based on conscienceopenness fairness professionalism and accountability paving the way in buildingconfidence among all its stakeholders for achieving sustainable long term growth andprofitability. Your Company has complied with the governance requirements provided underthe Companies Act 2013 and listing regulations.
A separate Report on Corporate Governance together with Auditor's Certificateconfirming compliance with the conditions of Corporate Governance as stipulated underSecurities and Exchange Board of India (Listing Obligations and Disclosure Requirements)Regulations 2015 is annexed to this Report.
18. MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
A. Industry Structure and Development:
Industry structure has more or less remained unchanged. It is dominated by somenational level IT companies which includes ABM as well as some reputed large IT companiesand some strong regional players. Continuation of the key policies will help inprogressing of projects under Digital India vision due to stable govt at the center. Therecent budget has emphasized need to encourage the start-ups ecosystem and eased fundingto start-ups. This will fuel innovation and adoption of IT in general.
Urban administration sector is primary focus of ABM. Smart Cities initiative has seenentry of large System Integrators (whose core strength is not IT) entering into the ITspace. This development is offering more opportunities to niche IT companies to partnerwith them.
Cybersecurity space which is also a focus of ABM is expected to grow rapidly due toseveral instances of security breaches in vital establishments and favorable policy levelchanges in govt . The high priority assigned by govt to treat cyberthreats on par with anycross border threat underlines the potential of cybersecurity business.
Digital technologies continue to dominate the focus of IT companies in domestic as wellas govt sectors. The domestic market dominated by govt. sector continues to face the ageold challenges of cost and time overruns payment delays tenders with difficult terms andconditions etc. There is a lot of attention continues to be given to t use of IT in govt.operations. However there is a need for institutionalized mechanism whereby the importantaspects like proper budgeting tendering based on fair terms vendor finalization usingblend of quality and cost parameters time bound implementation and sustenance etc areachieved to attract more IT companies to govt. segment which will help in expandingmarket.
B. Existing Opportunities and Outlook:
ABM will continue to focus on opportunities in the space of Urban administration andCybersecurity.
Indian Government is planning large amount of investment in next few years oninfrastructure development. ABM would tap opportunities to provide IT solutions forConstruction Management and BIM.
However ABM will continue following a cautious approach of doing selective bidding bygiving higher priority to ability of the company to execute the project "successfullyand profitably". This can impact revenue growth in 2019-20 also.
This space has dearth of competent players who have proven track record of implementinglarge e governance project successfully at pan India level. This gives unique advantage toyour company for growth and profitability.
As we have been outlining in most of the annual reports the company faces various risksand threats associated with e government business. It includes possible payment delaysTime and Cost overruns Disruptions in the project when head of the organization ischanged challenges in attracting good talent to work in less developed states and ininterior regions of India etc. Inexperienced competition remains a threat and results intoloss of some of the opportunities due to unrealistic prices quoted by such companies.
D. Business Strategies and Planning:
The business strategy will continue to achieve growth in selective segments. Hence thebusiness strategy will be dominated by avoidance of mistakes made by fellow travelers inthis market segment on one hand and careful exploitation of the immense opportunityoffered by this segment on the other hand.
During 2019-20 ABM would focus on building order book significantly. The businessacquisition will have high focus in areas such as Smart Cities Cybersecurity and newareas like Construction Management and BIM. Effort will be made to make foray into DigitalTechnologies during this year.
There has not been expected progress in developing business in Smart Water Management.The strategy will be revisited to decide the next course of action.
The strategy of working closely with existing prestigious customers and retaining themwill continue with due consideration to the increased competition is some of the keyaccounts of your company.
E. Human Resource Management:
Aim of Human Resource Management
1. It aims to ensure that ABM obtains and retains the skilled committed andwell-motivated workforce to enhance the business growth.
2. It aims to support programmes for improving organizational effectiveness by focusingon knowledge management talent management hereby creating "a great place towork".
3. Enhance and develop the inherent capabilities of people their contributionspotential and employability by providing learning and continuous developmentopportunities.
4. Fulfill business demand deliver consistently high utilization rates and keepmanpower costs within the desired range as per Business plan.
5. Deploy meaningful practices to enhance the engagement capability andcompetitiveness of our workforce.
|S. No. ||Year ||Current Headcount |
|1 ||April 2017 - March 2018 ||434 |
|2 ||April 2018 - March 2019 ||441 |
ii) HR Events
Quarterly mentorship & feedback program.
"Saturday Funday" challenge was endorsed to hunt the hidden talentwithin the team.
Successfully executed "Yoga at work" activity for ABM Mumbaiemployees.
Arranged Zumba and Yoga as a fun fitness activity for all the women on Women'sday celebration
Initiated strategic level training programmes in order to up-skill our seniorlevel employees with the latest technology in the market.
Career Enhancement opportunities
Recognized employees' performance with an appreciation letter to family.
Hired talented Professional Graduates from the reputed universities andInstitutes.
iv) Motivational and Focus Areas
The Company continues to invest in the form of training for enhancing its HumanCapital by providing opportunities to its employees to develop their skills andcompetencies relevant to the business requirements.
It always believes to enhance motivation job engagement and commitment byintroducing policies and process which ensures that people are valued for what they doand achieve and for the levels of skill and competency they reach.
We follow Equal Opportunities & Non Discrimination Policy and do notdiscriminate on basis of race color gender caste or religion.
The Company's relentless pursuit to connect with employees on a regular basiscommunicate in an open and transparent manner provide opportunities to learn and growwithin the organization are yielding desired results as is evident from the high retentionrate and the motivation and engagement levels of the employees.
F. Discussion on financial performance with respect to the operational performance(Standalone & Consolidated):
| || || || |
( In Rs. Thousand)
| || |
|Particulars || |
| ||31.03.2019 ||31.03.2018 ||31.03.2019 ||31.03.2018 |
|Gross Income ||684821 ||740217 ||747693 ||762209 |
|Total Expenditure ||352950 ||422239 ||412745 ||444102 |
|Gross profit before depreciation and Taxation ||239498 ||207499 ||238959 ||204478 |
There is significant impact of various factors on performance of your company. Theseare discussed in detail in the Management Discussion and Analysis. However your companyhas managed to improve profitability despite of the planned tapering of revenue.
G. Key Financial Ratios:
In accordance with the SEBI (Listing Obligations and Disclosure Requirements 2018)Amendment Regulations 2018 the Company is required to give details of significant changes( changes of 25% or more as compared to the immediately previous financial year ) in keyfinancial ratios. There are no significant changes in the key financial ratios that areidentified by the Company below are the details (Standalone):
|Particulars ||Unit ||March 2019 ||March 2018 |
|Debtors Turnover Ratio ||Times ||1.79 ||2.12 |
|Current Ratio ||Times ||21.52 ||26.10 |
|Debt Equity Ratio ||Times ||0.00 ||0.00 |
|Net profit Margin ||% ||24.54 ||20.18 |
|Return on Net worth ||% ||9.98 ||9.95 |
19. RISK MANAGEMENT:
The Company has developed and adopted a Risk Management Policy that ensures theappropriate management of risks in line with its internal systems and culture. The Companyperceives risk management as a means of value optimization. The Company also recognizesthe importance of internal controls and risk management in sustaining the businesscontinuity and endeavors to make risk management and control as essential components ofbusiness environment which is exposed to different modalities of risks arising from bothinternal and external sources. Risks are assessed department-wise such as financial risksinformation technology related risks legal risks accounting fraud etc. It furtherassists the Board in fulfilling its corporate governance oversight responsibilities withregard to the identification evaluation and mitigation of operational strategic andexternal environment risks.
The details of the Committee and its terms of reference are set out in the CorporateGovernance report forming part of this report.
The following elements of risks which in the opinion of the Board can impact theperformance of the company.
1. Industry: Industry risks are competition newer business models like PPP anddisruptive technologies like Artificial Intelligence Machine Learning Virtual Reality(VR) and Augmented Reality (AR) Automation slower decision making due to impending stateelections in a few states in coming year.
2. Supply side risk for talent acquisition: With growing customer base and missioncritical projects unavailability of right skilled resources at right time in rightquantity can pose a risk. The company constantly trains and re-trains existing resourcesfor different skills and technologies. Suitable HR practices are adopted to minimise theattrition rate. Lateral hiring is done to bring in fresh leaders.
3. Operational efficiency: The operational risk is mainly associated with clientacquisition execution of projects information security and continuity of customer'sbusiness operations. The company has project level monitoring where such risks areidentified and escalated to board for suitable corrective measures on time.
4. Reputation: The Company's projects are in Government sector which are necessarilyfunded by public finance. This may expose the company to the risk of motivated publicscrutiny from elements which are adversely affected by success of project leading totransparency as well as some times by competition. The company strictly follows the Govt.processes of procurement and executes the projects with highest possible standards ofethics and best industry processes. Employees are made well aware of the company policyand ensure the proper code of conduct is followed across projects uniformly. Company haspublished its own code of conduct for benefit of employees. This has been helping companyso far to win over the confidence of customers even in the situations of motivated publicscrutiny which is aimed at hurting reputation of the Company.
20. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTSRELATE AND THE DATE OF THE REPORT:
There are no planned material changes or commitments made by company that will affectthe financial position of the company during the above mentioned period except the balanceinvestment commitment of approximately Rs. 4 crores in the subsidiary. The liquid cashavailable with the company may also be utilized if the plans for acquisition fructifyfaster than envisaged.
21. CODE OF CONDUCT:
The Company has adopted the Code of Conduct and ethics for all Board Members and SeniorManagement and this is strictly adhered to. A copy of the Code of Conduct is available onthe website of the Company www.abmindia.com. In addition members of the Board and SeniorManagement also submit on an annual basis the details of individuals to whom they arerelated and entities in which they hold interest and such disclosures are placed beforethe Board. The members of the Board inform the Company of any change in theirdirectorship(s) chairmanship(s) / membership(s) of the Committees in accordance with therequirements of the Companies Act 2013 and Listing Regulations.
The members of the Board and Senior Management have affirmed their compliance with thecode and a declaration signed by the Managing Director is annexed to this report.
22. AUDIT COMMITTEE COMPOSITION:
The Composition of the Audit Committee is as per Section 177 of the Companies Act 2013and the Listing Regulations and is as described in the Corporate Governance Report whichforms part of this report. The Constitution meetings attendance and other details of theAudit Committee are given in the Corporate Governance Report which is part of the Report.During the year all the recommendations of the Audit Committee were accepted by the Board.
23. VIGIL MECHANISM:
Pursuant to the provisions of Section 177(9) of the Act and rules made thereunder theBoard of Directors had approved the Policy on Vigil Mechanism / Whistle Blower Policy toprovide a mechanism for the Directors and employees to report their grievances genuineconcerns about unethical behaviour actual or suspected fraud and violation of theCompany's Code of Conduct. This Policy inter-alia provides a direct access to the Chairmanof the Audit Committee.
Brief details about the policy are provided in the Corporate Governance Report attachedto this Report. The Whistle Blower Policy is available on the website of the Company.
24. PREVENTION OF INSIDERTRADING:
As per SEBI (Prohibition of Insider Trading) Regulation 2015 the Company has in placea Code of Conduct to Regulate Monitor and Report Trading by Insiders the disclosurerequirements and procedure thereto. The Company endeavours to preserve the confidentialityof Unpublished Price Sensitive Information and to prevent misuse of such information. Withrespect to this the Company has also developed a Code for Procedure for Inquiry in caseof Leak of Unpublished Price Sensitive Information. This code is prepared in accordancewith Regulation 9(1) and Schedule B of the SEBI (Prohibition of Insider Trading)Regulation 2015 as amended by SEBI (Prohibition of Insider Trading) (Amendment)Regulation 2018 effective from 1st April 2019. The Company regularly remindsthe Employees about their obligation under the policies and also informs about preventionof insider trading into the securities of the Company.
The Company Secretary is responsible for implementation of the Code. All Board ofDirectors and the designated employees have confirmed compliance with the Code.
25. RELATED PARTY TRANSACTIONS:
In line with requirement of the Companies Act 2013 and amendment to the ListingRegulations your Company has formulated a revised Policy on Related Party Transactionswhich is also available at Company's website www.abmindia.com. The Policy intends toensure that proper reporting approval and disclosure processes are in place for alltransactions between the Company and Related Parties.
All related party transactions are placed before the Audit Committee for approval.Prior omnibus approval of the Audit Committee is obtained on an annual basis which isreviewed and updated on quarterly basis.
All Related Party Transactions entered during the year were in Ordinary Course of theBusiness and on Arm's Length basis. No Material Related Party Transactions i.e.transactions exceeding ten percent of the annual consolidated turnover as per the lastaudited financial statements were entered during the year by your Company. Accordinglythe disclosure of Related Party Transactions as required under Section 134(3) (h) of theCompanies Act 2013 in Form AOC 2 is not applicable.
26. EXTRACT OF ANNUAL RETURN:
As required pursuant to section 92(3) of the Companies Act 2013 and rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of annual return in MGT9 is appended as an Annexure to this Annual Report.
27. CORPORATE SOCIAL RESPONSIBILITY:
The brief outline of the Corporate Social Responsibility (CSR) Policy of the Companyand the initiatives undertaken by the Company on CSR activities during the year are setout in Annexure of this report in the format prescribed in the Companies (Corporate SocialResponsibility Policy) Rules 2014. In compliance with requirements of Section 135 of theCompanies Act 2013 the Company has laid down a CSR Policy which is published on itswebsite www.abmindia.com.
28. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
There were no loans or guarantees given by the Company under Section 186 of theCompanies Act 2013 during the year under review. The Particulars of investments have beendisclosed in the Financial Statements.
29. PREVENTION OF SEXUAL HARASSMENT (POSH) AT WORKPLACE:
The Company has adopted a Policy for prevention of Sexual Harassment in line with therequirements of the Sexual Harassment of Women at Workplace (Prevention Prohibition &Redressal) Act 2013 and rules thereunder. The Company has also formed an "InternalComplaints Committee" for prevention and redressal of sexual harassment at workplace.The Company has appointed external independent person who worked in this area and has therequisite experience in handling such matters as member of Internal Complaints Committee.The Company has ensured a wide dissemination of the Policy and have conducted variousawareness programmes in the organization. The Company has not received any complaint ofsexual harassment during the financial year 2018-2019.
30. PARTICULARS OF EMPLOYEES:
Disclosures with respect to the remuneration of Directors and employees as requiredunder Section 197 of Companies Act 2013 and Rule 5 (1) Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 have been appended as Annexure to thisReport. The statement containing names of top ten employees in terms of remuneration drawnand the particulars of employees as required under Section 197(12) of the Act read withRule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 is provided in a separate annexure forming part of this report. Further thereport and the accounts are being sent to the members excluding the aforesaid annexure. Interms of Section 136 of the Act the said annexure is open for inspection at theRegistered Office of the Company. Any shareholder interested in obtaining a copy of thesame may write to the Company Secretary.
31. CONSERVATION OF ENERGY:
Your Company consumes energy mainly for the operation of its software development thusthe consumption of electricity is negligible. In order to conserve the electricity theair conditioners are kept at a moderate temperature and all the electrical equipments aretu rned off whenever they are not required by the office staff.
32. TECHNOLOGY ABSORPTION ADOPTION & INNOVATION AND RESEARCH AND DEVELOPMENT:
Your Company has continued its focus on 'Productisation of Services' by innovativebusiness models. Company is putting in efforts to adopt the latest technologies to addressthe demand for "Digital Business". The flagship products of the company haveprogressed well with respect to upgradation to the latest technology for reducing thetotal cost of ownership for customers and becoming more competitive in market.
33. FOREIGN EXCHANGE EARNINGS AND OUTGO:
Your company did not have any Foreign Exchange earnings or outgo in last year.
34. LISTING FEES:
Your Company's shares are listed in The Bombay Stock Exchange Limited Mumbai and theAnnual Listing fees for the year under review have been paid.
35. DIRECTORS' RESPONSIBILITY STATEMENT:
The Directors hereby confirm that:
a) in the preparation of the annual accounts the applicable accounting standards havebeen followed and that no material departures have been made from the same;
b) they have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the Profitor Loss of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) they have prepared the Annual Accounts on a going concern basis;
e) they have laid down internal financial controls for the Company and such internalfinancial controls are adequate and operating effectively; and
f) they have devised proper system to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.
The Board express their deep sense of gratitude to all Shareholders BusinessAssociates Clients Vendors Banks Financial Institutions Central and State GovernmentOrganizations Regulatory Authorities for their continued cooperation and support whichwas a great help to us in managing our continued growth. We acknowledge theircontributions and commit ourselves to continue and strengthen this fruitful alliance inall times to come.
Your Directors very warmly thank all of our employees for their perseverance loyaltyand unflinching efforts by their hard work dedication and commitment. We applaud them fortheir superior level of competence enthusiasm and unstinting efforts which have enabledthe Company to remain an innovative leader in Software & Services segment of Indian ITIndustry.
| ||For and on behalf of the Board |
|Date : 24th May 2019 ||Prakash B. Rane ||Sharadchandra D. Abhyankar |
|Place: Mumbai ||Managing Director ||Director |
| ||(DIN: 00152393) ||(DIN:00108866) |