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Notes to Accounts of Aurum Soft Systems Ltd.

Mar 31, 2015

1. BACKGROUND

The Company is engaged in the business of IT Services and Consulting.

The Company was until February 2010, operating in the name of Jaisal Securities Limited. Effective from February 4, 2010, the name of the company was changed to AURUM SOFT SYSTEMS LIMITED. The Shares of the Company are listed on the Bombay stock exchange.

2. Shares held by holding company, its subsidiaries and associates

The company does not have any holding company.

3. Rights, preferences and restrictions attached to equity shares

The company has one class of equity shares having a face value of Rs. 2/- per share. Each shareholder is eligible for one vote for each share held in the company. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

4. Rights, preferences and restrictions attached to preference shares

The company has not issued any preference shares

5. Shares allotted as fully paid up by way of bonus shares (during the 5 years preceding 31st March 2015)

The Company allotted 21,700,000 equity shares of face value Rs. 2/-, as fully paid up bonus shares by utilisation of the Securities premium account on 7th February 2011, pursuant to a shareholder's resolution passed at the Extra ordinary General Meeting held on 19th January 2011.

Business Segment

The Company has only one reportable business segment viz., IT services and Consulting.

Geographical Segment

Entire Revenue from IT services and Consulting business is derived from clients in India and hence the Company does not have any separate reportable geographical segment.

The economic slowdown and the tightening of the immigration laws and hiring procedures have had an adverse effect on the operations of the Company's step down subsidiaries namely Dice Technologies Inc., USA and Dicetek LLC., Dubai. This has adversely impacted the financial position of the step down subsidiaries. In view of this, Dicetek (Sing) Pte Limited, Singapore, has disposed of investment in the shares held by it in Dice Technologies Inc., USA. Accordingly, Dice Technologies Inc., USA has ceased to be a subsidiary of the Company. Dicetek (Sing) Pte Limited, Singapore has also taken steps to dispose of its investment in Dicetek LLC., Dubai

6. RELATED PARTY DISCLOSURE

i. Parties exercising Substantial control

Shripathee Investments Private Limited - Principal Shareholder - Holds 28.31% of the paid up equity share capital of the Company as on March 31, 2015.

ii. Key Managerial personnel

Mr. Srikanth Ramanathan, Managing Director

iii. Subsidiaries

Dicetek (Sing) Pte Limited, Singapore

Dicetek LLC., Dubai

7. Gratuity

The computations are based on the following assumptions:

Discount rate : 8%

Salary Escalation : 10%

* As per the actuarial valuation carried out, no material additional gratuity liability exists when compared to last financial year. Hence no provision for gratuity has been made for the financial year.

8. The Company did not have any outstanding dues to any Micro or Small Enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 at any point during the year that were outstanding for a period of more than 45 days from the date of acceptance.

9. Forward Contracts

The Company does not hedge its risks associated with foreign currency fluctuations relating to its receivables and payables, by entering into foreign currency forward contracts. The Company also does not use forward contracts for speculative purposes.

10. CONTINGENT LIABILITY

The Company has not provided any liability in respect of the following contested claim:

Name of the Statute : Income Tax Act, 1961

Nature of Dues : Income Tax

Amount : Rs. 499,559

Period to which amount relates : 1996-97

Forum where dispute pending : CIT (Appeals)

The Company has paid the said amount of Rs. 499,559 under protest. The Company however is of the opinion that the above demand is not sustainable and expects to succeed in its appeal.

11. The previous year figures have been regrouped / reclassified, wherever necessary to confirm to the current year presentation. Accordingly, amounts and other disclosure for the previous year are included as an integral part of the current year's Financial Statement and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2014

1. BACKGROUND

The Company is engaged in the business of IT Services and Consulting.

The Company was until February 2010, operating in the name of Jaisal Securities Limited. Effective from February 4, 2010, the name of the company was changed to AURUM SOFT SYSTEMS LIMITED. The Shares of the Company are listed on the Bombay and Madras Stock Exchanges.

2. SHARE CAPITAL

Share capital consist of the following:

As at As at Particulars 31st March 2014 31st March 2013 (Rs.) (Rs.)

Authorised

137,000,000 (31st March 2013: 137,000,000) Equity shares of Rs. 2/- each 274,000,000 274,000,000

68,000,000 (31st March 2013: 68,000,000) Non-cumulative optionally 136,000,000 136,000,000

convertible Preference shares of Rs. 2/- each

410,000,000 410,000,000

Issued, Subscribed & Paid-up

65,100,000 Equity shares of Rs.2/- each 130,200,000 130,200,000

(31st March 2013: 65,100,000 Equity share of Rs. 2/- each)

130,200,000 130,200,000

b. Shares held by holding company, its subsidiaries and associates

The company does not have any holding company.

c. Rights, preferences and restrictions attached to equity shares

The company has one class of equity shares having a face value of Rs. 2/- per share. Each shareholder is eligible for one vote for each share held in the company. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

d. Rights, preferences and restrictions attached to preference shares

The company has not issued any preference shares

f. Shares allotted as fully paid up by way of bonus shares (during the 5 years preceding 31st March 2014)

The Company allotted 21,700,000 equity shares of face value Rs. 2/-, as fully paid up bonus shares by utilisation of the Securities premium account on 7th February 2011, pursuant to a shareholder''s resolution passed at the Extra ordinary General Meeting held on 19th January 2011.

3. SEGMENT REPORTING

Business Segment

The Company has only one reportable business segment viz., IT services and Consulting.

Geographical Segment

Significant Revenue from IT services and Consulting business is derived from clients in India and hence the Company does not have any separate reportable geographical segment.

4. RELATED PARTY DISCLOSURE

i. Parties exercising Substantial control

Shripathee Investments Private Limited - Principal Shareholder - Holds 28.46% of the paid up equity share capital of the Company as on March 31, 2014.

ii. Key Managerial personnel

Mr. Srikanth Ramanathan, Managing Director

iii. Subsidiaries

Dicetek (Sing) Pte Limited, Singapore

Dicetek LLC., Dubai

Dice Technologies Inc., USA

The computations are based on the following assumptions:

Discount rate : 8%

Salary Escalation : 10%

* As per the actuarial valuation carried out, no material additional gratuity liability exists when compared to last financial year. Hence no provision for gratuity has been made for the financial year.

29. The Company did not have any outstanding dues to any Micro or Small Enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 at any point during the year that were outstanding for a period of more than 45 days from the date of acceptance.

5. FORWARD CONTRACTS

The Company does not hedge its risks associated with foreign currency fluctuations relating to its receivables and payables, by entering into foreign currency forward contracts. The Company also does not use forward contracts for speculative purposes.

6. CONTINGENT LIABILITY

The Company has not provided any liability in respect of the following contested claim:

Name of the Statute : Income Tax Act, 1961

Nature of Dues : Income Tax

Amount : Rs. 499,559

Period to which amount relates : 1996-97

Forum where dispute pending : CIT (Appeals)

The Company has paid the said amount of Rs. 499,559 under protest. The Company however is of the opinion that the above demand is not sustainable and expects to succeed in its appeal.

7. Provision for diminution in value of investment

The economic slowdown and the tightening of the immigration laws and hiring procedures have had an adverse effect on the operations of the Company''s step down subsidiaries namely Dice Technologies Inc., USA and Dicetek LLC., Dubai. This has adversely impacted the financial position of the step down subsidiaries. In view of this, Dicetek (Sing) Pte Limited, Singapore has provided for impairment loss in respect of the investment in the subsidiaries in its books of accounts.

Accordingly, the management is of the opinion that the diminution in value of the investment is permanent and the same is reiterated by the impairment loss provided by our wholly owned subsidiary. In order to reflect a true and fair view of the state of affairs, the Company has provided for diminution in value of investment in wholly owned subsidiary for Rs. 5 crores.

8. Bad Debts

During the Financial Year 2013-14, the Company has written-off loans to the tune of Rs. 3,561,232 (net of reversal of provision), which were extended when the Company was a Non-banking Finance Company, as the same was found not realisable. The provision created in the books in respect of the loans which have been fully written-off has been reversed during Financial Year 2013-14.

9. The previous year figures have been regrouped / reclassified, wherever necessary to confirm to the current year presentation. Accordingly, amounts and other disclosure for the previous year are included as an integral part of the current year''s Financial Statement and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2013

1. BACKGROUND

The Company is engaged in the business of IT Services and Consulting.

The Company was until February 2010, operating in the name of Jaisal Securities Limited. Eff ective from February 4, 2010, the name of the company was changed to AURUM SOFT SYSTEMS LIMITED. The Shares of the Company are listed on the Bombay and Madras Stock Exchanges.

2. SEGMENT REPORTING

Business Segment

The Company has only one reportable business segment viz., IT services and Consulting.

Geographical Segment

Significant Revenue from IT services and Consulting business is derived from clients in India and hence the Company does not have any separate reportable geographical segment.

3. CHANGE OF NAME OF THE COMPANY

The Company has changed its name to AURUM SOFT SYSTEMS LIMITED w.e.f. February 4, 2010, so as to refl ect the change in the line of business. In accordance with Clause 32 and 41 of the listing agreement, the net sales or income, expenditure and net profi t or loss after tax fi gures pertaining to the said new line of business are given below:

4. RELATED PARTY DISCLOSURE

i. Parties exercising Substantial control

Shripathee Investments Private Limited - Principal Shareholder - Holds 28.46% of the paid up equity share capital of the Company as on March 31, 2013.

ii. Key Managerial personnel

Mr. Srikanth Ramanathan, Managing Director

iii. Subsidiaries

Dicetek (Sing) Pte Limited, Singapore

Dicetek LLC, Dubai

Dice Technologies Inc., USA

5. The Company did not have any outstanding dues to any Micro or Small Enterprises as defi ned under Micro, Small and Medium Enterprises Development Act, 2006 at any point during the year that were outstanding for a period of more than 45 days from the date of acceptance.

6. FORWARD CONTRACTS

The Company does not hedge its risks associated with foreign currency fl uctuations relating to its receivables and payables, by entering into foreign currency forward contracts. The Company also does not use forward contracts for speculative purposes.

The foreign currency exposures as at the end of the fi nancial year that have not been hedged by a derivative instrument or otherwise are given below:

7. CONTINGENT LIABILITY

The Company has not provided any liability in respect of the following contested claim:

Name of the Statute : Income Tax Act, 1961

Nature of Dues : Income Tax

Amount : Rs. 499,559

Period to which amount relates : 1996-97

Forum where dispute pending : CIT (Appeals)

The Company has paid the said amount of Rs. 499,559 under protest. The Company however is of the opinion that the above demand is not sustainable and expects to succeed in its appeal.

8. The previous year fi gures have been regrouped / reclassifi ed, wherever necessary to confi rm to the current year presentation. Accordingly, amounts and other disclosure for the previous year are included as an integral part of the current year''s Financial Statement and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2012

Note: 1. Cash and Cash Equivalents represent Cash, Balances with Banks in Current Account and Fixed Deposits maturing within 3 months

2. Figures in brackets indicate Cash outflow,

3. Figures for the previous year have been regrouped / rearranged wherever found necessary

1. BACKGROUND

The Company is engaged in the business of IT services and consulting.

The Company was until February 2010, operating in the name of Jaisal Securities Limited. Effective from February 4, 2010, the name of the company was changed to AURUM SOFT SYSTEMS LIMITED. The Shares of the Company are listed on the Bombay and Madras Stock Exchanges.

* During financial year 2010-11, the company has sub-divided each equity share of Rs. 10 each into 5 (five) equity shares of Rs. 2 each.

b. Shares held by holding company, its subsidiaries and associates

The company does not have any holding company.

c. Rights, preferences and restrictions attached to equity shares

The company has one class of equity shares having a face value of Rs. 2/- per share. Each shareholder is eligible for one vote for each share held in the company. The dividend proposed by the Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

e. Shares allotted as fully paid up by way of bonus shares (during the 5 years preceding 31st March 2012)

The Company allotted 21,700,000 equity shares of face value Rs. 2/-, as fully paid up bonus shares by utilization of the Securities premium account on 7th February 2011, pursuant to a shareholder's resolution passed at the Extra ordinary General Meeting held on 19th January 2011.

2. SEGMENT REPORTING

Business Segment

The Company has only one reportable business segment viz., IT Services and Consulting.

Geographical Segments

Significant Revenue from IT Services and Consulting business is derived from clients in India and hence the Company does not have any separate reportable geographical segment.

3. CHANGE OF NAME OF THE COMPANY

The Company has changed its name to AURUM SOFT SYSTEMS LIMITED w.e.f. February 4, 2010, so as to reflect the change in the line of business. In accordance with Clause 32 and 41 of the listing agreement, the net sales or income, expenditure and net profit or loss after tax figures pertaining to the said new line of business are given below:

4. RELATED PARTY DISCLOSURE

i. Parties exercising Substantial control

Shripathee Investments Private Limited - Principal Shareholder - Holds 28.46% of the paid up equity share capital of the Company as on March 31, 2012.

ii. Key Managerial personnel

Mr. Srikanth Ramanathan, Managing Director

iii. Subsidiaries

Dicetek (Sing) Pte Limited, Singapore

Dicetek LLC., Dubai

Dice Technologies Inc., USA

Note: Figures in brackets represent previous year's figures

# Based on the exchange rate prevailing as on March 31, 2012

* Shares of face value Rs. 10/- The Company has not incurred any expenditure in foreign currency during financial year 2011-12 and 2010-11

5. The Company did not have any outstanding dues to any Micro or Small Enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 at any point during the year that were outstanding for a period of more than 45 days from the date of acceptance.

The loan is denominated in US$ and the INR equivalents are based on the exchange rate prevailing at the end of the year. The same includes accrued interest at the rate of 2.5% per annum.

6. FORWARD CONTRACTS

The Company does not hedge its risks associated with foreign currency fluctuations relating to its receivables and payables, by entering into foreign currency forward contracts. The Company also does not use forward contracts for speculative purposes.

The foreign currency exposure as at the end of the financial year that have not been hedged by a derivative instrument or otherwise are given below:

7. CONTINGENT LIABILITY

The Company has not provided any liability in respect of the following contested claim:

Name of the Statute : Income Tax Act, 1961

Nature of Dues : Income Tax

Amount : Rs. 499,559

Period to which amount relates : 1996-97

Forum where dispute pending : CIT (Appeals)

The Company has paid the said amount of Rs. 499,559 under protest. The Company however is of the opinion that the above demand is not sustainable and expects to succeed in its appeal.

8. The previous year figures have been regrouped / reclassified, wherever necessary to confirm to the current year presentation. Accordingly, amounts and other disclosure for the previous year are included as an integral part of the current year's Financial Statement and are to be read in relation to the amounts and other disclosures relating to the current year.


Mar 31, 2010

1. Background

Aurum Sof Systems Limited was incorporated in March 1994 and was tll recently operating in the name of Jaisal Securites Limited. The Shares of the Company are listed on the Bombay and Madras Stock Exchanges.

The Company at present is engaged in the business of IT solutons and consulting.

The Company was initally engaged in Investment Consultancy having its own Portolio of Investments besides advising Clientele on Investments and other related maters. The Company was also registered as a Non-banking Finance Company.

The Company has ceased all its Operatons in relaton to Investment Consulting and other related actvites and has diversifed into actvites relating to IT Solutons and Consulting. Consequent to this, the Company has during the fnancial year 2009-10, got itself de-registered as a Non-banking Finance Company and has also changed its name to AURUM SOFT SYSTEMS LIMITED in line with the diversifed business actvites of the Company.

2. Segment Reporting Business Segment

The Company had got itself de-registered as a Non-banking fnance Company during the fnancial year 2009-10. During the said period, the Company has earned only interest income from the unsecured loans lent by the Company, amounting to Rs. 3.83 lakhs, from its fnancial services business. Also loans and advances to the tune of Rs. 157.08 lakhs have been writen-of as the same is found not realisable. The Company is taking steps to realise the balance fnancial assets in its books. Apart from that, there has been no actvity pertaining to the Financial Services business segment.

The Company has diversifed into IT Solutons and Consulting business and is concentrating solely on its new line of business.

Since the revenue earned by the Company from its erstwhile business (i.e. Financial Services) is less than 10% of the total revenue, there is only one reportable business segment (i.e. IT Solutons and Consulting).

Geographical Segments

In relaton to the fnancial services business, the Company carries on its operaton only in India.

In relaton to the IT Solutons and Consulting business, the Companys revenues for the fnancial year 2009-10 have been derived from sale of sofware products and related services to its clients in India, Republic of Maldives and to its subsidiary in Dubai.

The revenue from sale to clients in India represents 4.38% (Previous year - Nil) and that of the Republic of Maldives represent 1.34% (Previous year - 100%) of the total turnover (net of bad debts). The revenue from the license granted to the Companys subsidiary in Dubai represents 94.28% (Previous year - Nil) of the total turnover.

3. Related Party Disclosure

The company has entered into transactons with the following related partes:

i) Partes exercising Substantal control Shripathee Investments Private Limited - Principal Shareholder - Holds 28.46% of the paid up equity share capital of the Company as on March 31, 2010.

ii) Key Managerial personnel Mr. Srikanth Ramanathan, Managing Director

iii) Subsidiaries Dicetek (Sing) Pte Limited, Singapore Dicetek LLC., Dubai Dice Technologies Inc., USA

4. Bad Debts

During the fnancial year 2009-10, the Company has writen-of loans to the tune of Rs. 15,708,538 (Previous Year - Rs. Nil), which were extended when the Company was a Non-banking Finance Company, as the same is found not realisable. The provision created in the books in respect of the loans which have been fully writen-of has been reversed during the current fnancial year. As at March 31, 2010, the Company has a provision on Loans of Rs. 395,692 (Previous Year - Rs. 2,352,997), in respect of Loans outstanding. Consequent to cancellaton of the Business Transfer Agreement with M/s. Intek Systems Private Limited, Maldives, the company has writen-of Debtors to the tune of Rs. 1,616,550 (Previous Year – Nil) which were found to be not realisable.

5. Contingent Liability

The Company has not provided any liability in respect of the following contested claim:

Name of the Statute : Income Tax Act, 1961

Nature of Dues : Income Tax

Amount : Rs. 4.99 lakhs

Period to which amount relates : 1996-97

Forum where dispute pending : CIT (Appeals)

The Company is of the opinion that the above demand is not sustainable and expects to succeed in its appeal.

6. The Company did not have any outstanding dues to any Micro or Small Enterprises as defned under Micro, Small and Medium Enterprises Development Act, 2006 at any point during the year that were outstanding for a period of more than 45 days from the date of acceptance.

7. The Company is engaged in the business of IT solutons and consulting services. The development and sale of sofware and services cannot be expressed in any generic unit. Hence, it is not possible to give the quanttatve details as required under paragraphs 3 and 4C of Part II of Schedule VI of the Companies Act, 1956.

8. The Company has not granted any loans to its Subsidiaries

9. Previous years fgures have been regrouped / reclassifed wherever necessary. Accordingly, amounts and other disclosure for the previous year are included as an integral part of the current years Financial Statement and are to be read in relaton to the amounts and other disclosures relating to the current year.