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Notes to Accounts of Infinite Computer Solutions (India) Ltd.

Mar 31, 2015

1. Background

Infinite Computer Solutions (India) Ltd is a publicly listed global IT company. Accredited amongst NASSCOM's Top 20 IT companies and a recipient of Stevie Awards, Fierce innovation awards and TMC net CRM excellence awards. Infinite has its expertise in Platformized™ Solutions and Frameworks for IT Services, Product Engineering Services, Enterprise Mobility & Next-Gen Messaging Products & Solution. With a global team of over 5000 employees, Infinite partners with Fortune 1000 companies from Telecom & Media, Healthcare, BFSI, Hi-Tech & Technology sectors.

The accompanying Financial Statements reflect the Results of the activities undertaken by the Company during the Financial Year ended March 31, 2015.

2. Share Capital

a. Shares issued for consideration other than cash

During the preceeding period of five years there are no Shares issued for consideration other than cash.

b. Shareholding in excess of 5%

The following is the list of shareholders holding Equity shares in excess of 5 percent of the aggregate Share Capital of the Company as on March 31, 2015.

a) M/s. Mahavi Holdbull Inc. holding 2,58,23,336 shares forming 64.31%.

c. Shares reserved for issue under options

Performance ESOP 2010

The Board of Directors and the Shareholders of the Company approved the Key Executives Performance Option Plan 2010 (revised 2011) for grant of 35,00,000 options convertible into 35,00,000 equity shares, at their meeting in May 2010 and in August 2010 respectively. Pursuant to this approval, the Company instituted the Performance ESOP 2010 .

3. Commitment and Contingencies

Estimated amount of contracts remaining to be executed on capital account and not provided for against which advance has not been paid Rs. 152.97 Million (as at March 31, 2014, Rs. 192.23 Million).

Contingent liability towards bank guarantees and LC's given to customers and other business related requirements is Rs. 306.01 Million (as at March 31, 2014, Rs. 164.00 Million).

4. Accumulated Losses of Subsidiaries

The Investments in the subsidiary companies have been made considering strategic business expansion plans & in view of the intrinsic value and the business potential of the subsidiaries, these have been carried at cost. Some of the subsidiaries have accumulated losses, but as these are considered temporary and the future operations in the near term will offset these losses, the Company has carried the investments at cost.

5. Related Party Transaction

In the normal course of business, the Company enters into transactions with affiliated companies. The names of related parties of the Company as required to be disclosed under Accounting Standard 18 is as follows:

a. Subsidiary Companies

Infinite Computer Solutions Inc., USA Infinite Computer Solutions Limited, U.K Infinite Computer Solutions Pte Ltd, Singapore Infinite Computer Solutions Sdn, Bhd, Malaysia Infinite Computer Solutions (Shanghai) Co. Ltd. India Comnet International Pvt. Limited Infinite Convergence Solutions, Inc. Infinite Infocomplex Pvt. Limited Infinite Infoworld Limited Infinite Infopark Limited Infinite Techhub Limited Infinite Techworld Limited Infinite Infocity Limited Infinite Techcity Limited Infinite Techsoft Limited Infinite Skytech Limited Infinite Thinksoft Limited

b. Managing Director of the Company

Upinder Zutshi

c. Key Managerial Personnel

Sanjeev Gulati - CFO Rajat Kalra - Company Secretary

d. Non-Whole Time Directors of the Company

Sanjay Govil

e. Enterprises in which Key Management personnel and their relatives are able to exercise significant influence

N C Data Systems Private Limited

6. Depreciation

Pursuant to the enactment of the Companies Act 2013 ( the Act), the Company has, effective April 1, 2014, revised the estimated useful lives of its fixed assets, in accordance with the provisions of Schedule II to the Act. Consequently, during the year ended on March 31, 2015, the depreciation charged is higher and the Profits are lower by Rs. 2,08,03,165. Further, Rs. 8,39,06,539 representing the carrying amount of the assets whose useful life is nil, has been adjusted against the opening balance of retained earnings.


Mar 31, 2014

1. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Notes to these consolidated Financial Statements are intended to serve as a means of informative disclosure and a guide to better understanding. Recognising this purpose, the company has disclosed only such notes from the individual financial statements, which fairly present the needed disclosures.

2. Commitment and Contingencies

Estimated amount of contracts remaining to be executed on capital account and not provided for against which advance has been paid Rs 192.23 Million (Previous year Rs. 227.58 million).

Contingent Liability towards Bank Guarantees and LCs given to customers and other business related requirements is Rs. 164.00 million (Previous year Rs. 281.40 million).

3. Share Capital

Share holding in excess of 5%

The following is the list of shareholders holding equity shares in excess of 5 percent of the aggregate share capital of the company as on March 31, 2014

M/s. Mahavi Holdbull Inc. holding 2,58,23,336 shares forming 63.85%

4. Related Party Transactions

In the normal course of business, the Company enters into transactions with affiliated Companies. The names of related parties of the Company as required to be disclosed under Accounting Standard 18 are as follows: -

Subsidiary Companies

Infinite Computer Solutions Inc., USA

Infinite Computer Solutions Pte Ltd, Singapore

Infinite Computer Solutions Sdn, Bhd, Malaysia

Infinite Computer Solutions (Shanghai) Co. Ltd.

Infinite Computer Solutions Ltd, U.K India Comnet

International Pvt. Ltd.

Infinite Infopark Ltd.

Infinite Data Systems UK Ltd.

Infinite Convergence Solutions, Inc.

Infinite Infocomplex Pvt. Ltd.

Infinite Infoworld Pvt. Ltd.

Infinite TechHub Limited Infinite TechWorld Limited

Infinite InfoCity Limited

Managing Director of the Company

Upinder Zutshi

Whole time Director of the Company

Navin Chandra

Non - Whole time director who is able to exercise significant influence

Sanjay Govil

Enterprises in which key management personnel & their relatives are able to exercise significant influence

N.C. Data Systems Private Limited Instos Inc. USA (formerly International Computer Solutions Inc, USA)

5. Goodwill on Consolidation

Opening goodwill as shown in the Consolidated Balance Sheet was Rs. 546.47 million in respect of acquisition of 100% stock of India Comnet International India Private Limited by Infinite Computer Solutions Inc. which has increased to Rs. 611.98 million as on March 31, 2014, increase of Rs. 65.51 million over the previous quarter's balance is attributable to exchange difference.

6. Share Buyback Scheme

Under the approved Share buy-back Scheme, the company has bought back and cancelled 2,116,836 equity shares during the year.

7. Closure of Subsidiary

The company has applied that its wholly owned subsidiary, Infinite Data Systems, UK , be struck off the register and the Registrar has confirmed the notification of the dissolution.

Previous year's figures have been regrouped / recast to conform to current year's classification.


Mar 31, 2013

1. Background

Infinite Computer Solutions (India) Limited (''the Company''), a Public Limited Company, is a global service provider of Application Management Outsourcing, Remote Infrastructure Management Services, R&D and Intellectual Property Leveraged Solutions and related IT Services.

The accompanying financial statements reflect the results of the activities undertaken by the Company during the year ended Mar31,2013.

2. Amalgamation of Subsidiary Companies

During the year M/s Comnet International Company, a sub-subsidiary, has been merged w.e.f. 1st April, 2012, with the Company''s subsidiary, Infinite Computer Solutions Inc,USA.

Further, two of the Company''s subsidiaries have been amalgamated with the Company with the appointed date 1st April 2012 and the effective date 26th Sep 2012. The transactions and cashflows during this period are not disclosed separately as these are not material. Therefore previousyearflgures do not includethe figures of these two subsidiary companies.

3. Commitment and Contingencies

Estimated amount of contracts remaining to be executed on capital account and not provided for against which advance has not been paid Rs.227.58 Million(as at 31st Mar12 Rs. 123.57).

Contingent liability towards Ban kGuarantees and LC''s given to customers and other business related requirements is Rs. 281.40 Million (as at 31st Mar 2012 Rs.288.31 Million).

A bank guarantee for an amount of Rs. 6.5 Million in respect of a contract for software services had been invoked by a customer in FY 2009-10. The company also has counter claims against the customer, and in order to recover its dues it has opted to go for arbitration. Pending conclusion of such arbitration proceedings no provisions have been made in the accounts.

4. Accumulated Losses of Subsidiaries

The Investments in the subsidiary companies have been made considering strategic business expansion plans, & in view of the intrinsic value and the business potential of the subsidiaries, these have been carried at cost. Some of the subsidiaries have accumulated losses, but as these are considered temporary and the future operations in the near term will offset these losses, the company has carried the investments at cost.

5. Related Party Transaction

In the normal course of business, the company enters into transactions with affiliated companies. The names of related parties of the company as required to be disclosed under Accounting Standard 18is as follows:

a. Subsidiary Companies Infinite Computer Solutions Inc USA Infinite Computer Solutions Ltd, U.K Infinite Computer Solutions Pte Ltd, Singapore Infinite Computer Solutions Sdn,Bhd, Malaysia Infinite Computer Solutions (Shanghai) Co. Ltd. India Comnet International Pvt. Ltd.

Infinite Convergence Solutions, Inc. Infinite Data Systems UK Ltd. Infinite Infocomplex Pvt Ltd Infinite Infoworld Ltd Infinite Infopark Ltd Infinite Techhub Limited Infinite Techworld Limited Infinite Infocity Limited

b. WholeTime Directors of the Company Navin Chandra

UpinderZutshi

6. Income Taxes

Minumum Alternate Tax (MAT) recoverable has been recognized, of Rs 45.44 million relating to the company and Rs 49.54 million relating to its erstwhile subsidiary Infinite Data Systems Pvt Ltd, since merged with the Company.

In accordance with accounting standard 22 on accounting for taxes on income the deferred tax charge of Rs.15.21 Million (Rs. 13.38 Million for the year ended 31" March 2012) for the current year has been recognized in the profits loss account. The tax effect of significant timing differences as of Mar 31,2013 that reverse in one or more subsequent years gave rise to the following net deferred tax assets/ (liability) as at Mar31,2013.

7. Transactions of Derivative Instruments & forwards contracts

All gains or losses in derivative instruments are recorded on the Balance Sheet date at mark to market value. The Company has accordingly provided for the Loss of Rs. Nil Million (previous year ended 31st Mar 2012 Rs. Nil Million) on such contracts in the books.

The following forward contracts are outstanding as on 31st Mar 2013: For USD-37.50 Million USD.

8. Reclassification

Previous year''s figures have been regrouped and/or re-arranged wherever necessary to conform to current quarter''s groupings and classifications.


Mar 31, 2012

1. BACKGROUND

Infinite Computer Solutions (India) Limited ('the Company'), a Public Limited Company, is a global service provider of Application Management Outsourcing, Remote Infrastructure Management Services, R&D and Intellectual Property Leveraged Solutions and related IT Services.

The accompanying financial statements reflect the results of the activities undertaken by the Company during the year ended Mar31, 2012.

2. SHARE CAPITAL

Share holding in excess of 5% :

The following is the list of shareholders holding Equity shares in excess of 5 percent of the aggregate share capital of the company as on March 31, 2012.

1) M/s. Mahavi Holdbull Inc. holding 2,58,23,336 shares forming 60.68%

2) M/s T.Rowe Price International Inc holding 22,02,278 shares forming 5.17%

The Company closed its Buy Back Scheme on December 12,2011 by buying-back 14,00,000 Equity Shares (being the "Maximum Offered Shares") from the open market. Till closure of Buy Back, the Company had utilized Rs. 16.30 Crores, being 60.38% of the total amount of Rs. 27 Crores authorized for the said Buy back. Post the extinguishment of these shares, the paid Up Equity Share Capital of the Company stands reduced to Rs. 42,55,99,950 constituting of 4,25,59,995 Equity Shares of Rs. 10/- each.

Performance ESOP 2010

The Board of Directors and the Shareholders of the Company approved the Key Executives Performance Option Plan 2010 ("ESOP 2010") for grant of 35,00,000 options convertible into 35,00,000 equity shares, at their meeting in May 2010 and in August 2010 respectively. Pursuant to this approval, the Company instituted the Performance ESOP 2010 in September 2010.

The Remuneration and Compensation committee of the Company administers this Plan. The options have been granted to employees of the Company and its subsidiaries at an exercise price that is not less than the fair market value. The particulars of the options granted are as follows:

3. AMALGAMATION OF SUBSIDIARY COMPANIES

The Board of directors has approved a scheme of Amalgamation of two of its wholly owned subsidiaries M/s Infinite Infosoft Services Private Limited and M/s Infinite Data Systems Private Limited with itself w.e.f. 1st April, 2012.

Further M/s Comnet International Company, a sub-subsidiary, is merging with the Company's subsidiary Infinite Computer Solutions Inc., USA w.e.f. 1st April, 2012.

Pending completion of requisite formalities, appropriate accounting entries in the books of accounts are yet to be passed.

4. COMMITMENT AND CONTINGENCIES

Estimated amount of contracts remaining to be executed on capital account and not provided for against which advance has not been paid Rs. 123.57 Million (Previous year Rs. NIL).

Contingent liability towards Bank Guarantees and LC's given to customers and other business related requirements is Rs 288.31 Million (Previous year Rs. 487.84 Million) and towards corporate guarantee on behalf of wholly owned subsidiaries is USD 100 Million (Previous year USD 100 Million).

A bank guarantee for an amount of Rs. 6.5 Million in respect of a contract for software services had been invoked by a customer in FY 2009-10. The company also has counter claims against the customer, and in order to recover its dues it has opted to go for arbitration. Pending conclusion of such arbitration proceedings no provisions have been made in the accounts.

The company has provided a Corporate Guarantee to DBS Bank Limited, Singapore, to secure the short term foreign currency loan granted to its Subsidiary Infinite Convergence Solutions Inc, of USD 8.80 million.

5. ACCUMULATED LOSSES OF SUBSIDIARIES

The Investments in the subsidiary companies have been made considering strategic business expansion plans, & in view of the intrinsic value and the business potential of the subsidiaries, these have been carried at cost. Some of the subsidiaries have accumulated losses, but as these are considered temporary and the future operations in the near term will offset these losses, the company has carried the investments at cost.

Pursuant to the closure of the Australian Subsidiary, Infinite Australia Pty. Ltd. on 04th May 2011, and the repatriation of the balance, the investment has been written back, after providing for the loss of Rs. 78,473.

6. RELATED PARTY TRANSACTION

In the normal course of business, the company enters into transactions with affiliated companies. The names of related parties of the company as required to be disclosed under Accounting Standard 18 is as follows:

a) Subsidiary Companies

Infinite Computer Solutions Inc., USA

Infinite Computer Solutions Ltd, U.K

Infinite Computer Solutions Pte Ltd, Singapore

Infinite Computer Solutions Sdn, Bhd, Malaysia

Infinite Computer Solutions (Shanghai) Co. Ltd.

Comnet International Company

India Comnet International Pvt. Ltd.

Infinite Data Systems Pvt Ltd

Infinite Infosoft Services Pvt Ltd

Infinite Convergence Solutions, Inc.

a) Subsidiary Companies

Infinite Data Systems UK Ltd.

Infinite Infocomplex Pvt Ltd

Infinite Infoworld Ltd

Infinite Infopark Ltd

Infinite Computer Solutions FZE

b) Whole Time Directors of the Company

Navin Chandra

Upinder Zutshi

c) Non-Whole Time Directors of the Company

Sanjay Govil

d) Enterprises in which key management personnel and their relatives are able to exercise significant influence

N C Data Systems Private Limited

7. INCOME TAXES

In accordance with accounting standard 22 on accounting for taxes on income the deferred tax charge of Rs. 13.38 Million for the current year has been recognized in the profit & loss account. The tax effect of significant timing differences as of Mar 31, 2012 that reverse in one or more subsequent years gave rise to the following net deferred tax assets/(liability) as at Mar 31, 2012.

8. TRANSACTIONS OF DERIVATIVE INSTRUMENTS & FORWARDS CONTRACTS

All gains or losses in derivative instruments are recorded on the Balance Sheet date at mark to market value. The Company has accordingly provided for the Loss of Rs. Nil Million (previous year Rs 0.62 Million) on such contracts in the books.

The following forward contracts are outstanding as on 31 st Mar 2012:

- For USD-82.35 Million USD.

9. RECLASSIFICATION

Previous year's figures have been regrouped and/or re-arranged wherever necessary to conform to current year groupings and classifications.


Mar 31, 2010

1, COMMITMENT AND CONTINGENCIES

Estimated amount of contracts remaining to be executed on capital account and not provided for against which advance has not been paid Rs. NIL (Previous year Rs. NIL).

Contingent liability towards Bank Guarantees given to customers and other business related requirements is Rs 288.82 million (Previous year Rs. 18.35 million) and towards corporate guarantee on behalf of wholly owned subsidiaries is USD 100 million (Previous year Rs. 120 million).

2, ACCUMULATED LOSSES OF SUBSIDIARIES

The Investments in the subsidiary companies have been made considering strategic business expansion plans, and in view of the intrinsic value and the business potential of the subsidiaries, these have been carried at cost. Some of the subsidiaries have accumulated losses, but as these are considered temporary and the future operations in the near term will offset these losses, the Company has carried the investments at cost.

3, MANAGERIAL REMUNERATION

Managerial Remuneration under Section 198 of the Companies Act, 1956 paid to the Managing and Whole Time Directors of the Company are as follows:

As no commission is payable to the Directors, the computation of net profits in accordance with Section 309 (5) read with section 349 of the Companies Act, 1956 has not been given.

4. LEASES

The Company is a lessee under various operating leases. Rental expense for operating leases in the year ended March 31, 2010 and year ended March 31, 2009 was Rs. 24,758,171 and Rs. 20,856,780 respectively. Expected future minimum commitments for non-cancellable leases are as follows:

5.SEGMENT REPORTING

The Company develops software products and provides software consulting services. The disclosures as required under accounting Standard 17 on segment reporting would cover geographical regions, which is as follows :-

Operating income, net income, assets and liabilities has not been provided by geographies as these are not realistically allocable and identifiable.

6. EARNINGS PER SHARE

The following is a computation of earnings per share and a reconciliation of the equity shares used in the computation of basic and diluted earnings per equity share.

7. RELATED PARTY TRANSACTION

In the normal course of business, the Company enters into transactions with affiliated companies and its parent. The names of related parties of the Company as required to be disclosed under Accounting Standard 18 are as follows:

a) Subsidiary Companies

Infinite Computer Solutions Inc., USA

Infinite Computer Solutions Ltd, U.K

Infinite Computer Solutions Pte Ltd, Singapore

Infinite Computer Solutions Sdn, Bhd, Malaysia

Infinite Computer Solutions (Shanghai) Co. Ltd.

Comnet International Company

Infinite Australia Pty Ltd

India Comnet International Pvt. Ltd.

Infinite Data Systems Pvt Ltdl

nfinite Infosoft Services Pvt Ltd

Infinite Convergence Solutions, Inc.

Infinite Data Systems UK Ltd.

b) Whole Time Directors of the Company Navin Chandra

Upinder Zutshi

c) Non-Whole Time Directors of the Company Sanjay Govil

d) Enterprises in which key management personnel and their relatives are able to exercise significant influence

N C Data Systems Private Limited Mumal Mining Private Ltd

8).In accordance with Accounting Standard 22 on accounting for taxes on income the deferred tax charge of Rs. 5,461,731 for the current year has been recognized in the Profit & Loss Account. The tax effect of significant timing differences as of March 31, 2010 that reverse in one or more subsequent years gave rise to the following net deferred tax assets / (liability) as at March 31,2010.

9. TRANSACTIONS OF DERIVATIVE INSTRUMENTS & FORWARDS CONTRACTS

As required by the announcement made by ICAI on March 29, 2008, all derivative instruments should be recorded on the Balance Sheet date at mark to market value. As such, these contracts are accounted for after adjusting the carrying amount of the contract to the market value of each period end and recognizing any loss in earning. The Company has accordingly provided for the loss of Rs. Nil million (previous year Rs 5.58 million) on such contracts in the books.

The following forward contracts are outstanding as on March 31, 2010:

10, RECLASSIFICATION

Previous years figures have been regrouped and/or re-arranged wherever necessary to conform to current years groupings and classifications.

ADDITIONAL INFORMATION PURSUANT TO THE PROVISIONS OF PART-II OF SCHEDULE-VI TO THE COMPANIES ACT, 1956.

i. Licensed and Installed Capacity

Not Applicable

ii. Information in respect of purchase of Finished Goods

Not Applicable

iii. Information in respect of Turnover

Not Applicable

iv, Value of Imports on C.I.F basis

 
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