Home  »  Company  »  Palred Technologies  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Palred Technologies Ltd.

Mar 31, 2015

1. Company Overview

Paired Technologies limited (the 'Company") is a public limited company domiciled in India and incorporated under the provisions of the Companies Act1956. The Company is head-quartered in Hyderabad, India and the Company's equity shares are listed on Bombay Stock Exchange ('BSE') and National Stock Exchange ('NSE'). The Company's line of business is to provide IT solutions and IT services for media and entertainment and to trade in computer peripherals.

2. Change in accounting estimate

Hitherto, depreciation on all tangible fixed assets except for building was provided on written down value method over the estimated useful lives using the rates prescribed under erstwhile Schedule XIV of the Companies Act, 1956. Effective 1 April 2014, in accordance with the requirements to Schedule II to the Act, the Company has re- assessed the useful Uves and adopted the rates prescribed under Schedule II to the Act.

Had the Company continued to use the earlier policy for depreciation of all tangible assets, the profit for the year ended 31 March 2015 would have been higher by Rs,1,087,808 and further an amount of Rs,214,712 has been charged to the opening balance of the retained earnmgs in respect of assets whose remaining useful life is nil as at 1 April 2014 in accordance with Schedule II to the Act.

3. Discontinuing operations

On 18 September 2013, the members of the Company approved the plan to sell the Company's transportation and logistics software business and investment in its wholly owned subsidiaries to Transport I.T.Solutions Pnvate Limited (a Kewill Group Company) by way of slump sale on a going concern basis and notified the stock exchanges. After obtaining necessary approvals, pursuant to the Business Transfer Agreement (BTA) dated 10 August 2013 between the Company and the acquirer company, the Company has transferred its trasportation and logistics software business and investment in subsidiaries with effect from 4 October 2013 for a lumpsum consideration of Rs.2,516,590,355. Accordingly, the transportation and logistics software business of the Company has been categorised as a discontinuing operations. The operating activities of the Company's discontinued operation are summansed as Mows:

4. Mergers

The Board of Directors at its meeting held on 24 January 2014, had approved the draft composite scheme of arrangement for the merger of 'Paired Media And Entertainment Private Limited' and 'Pal Premium Online Media Private Limited' with Paired Technologies Limited with effect from 30 November 2013 and was in the process of obtaining requisite regulatory approvals. During the year ended 31 March 2015, the Company has cancelled the scheme of arrangement for the merger.

5. Capital reduction

Subject to requisite regulatory approvals, the Board of Directors at its Meeting held on 1 December 2014 and the members of the Company at their extra-ordinary meeting held on 4 April 2015 approved 60% reduction in the issued, subscribed and paid-up share capital of the Company. Upon the above extinguishment, the issued, subscribed and paid-up share capital of the Company amounting to Rs.195,181,850 divided into 39,036,970 equity shares shall be reduced to Rs.78,073,940 divided into 15,614,788 equity shares and the shareholders of the Company shall be paid a sum of *16.50 per share cancelled.

6. Segment reporting

Pursuant to the sale of the transportation and logistics software products business, the management of the Company based on the Company's new business model and considering the internal financial reporting has identified "Trading in computer peripherals" as the only reportable segment. Further, all operations of the Company are based only in India and hence, no separate financial disclosures have been provided for the segment reporting.

7. Comparatives

The previous year comparatives have been regrouped/reclassified wherever necessary, to conform to the current year presentation.

8. Additional information as required under paragraph 5 of the part II of the Schedule III to the Act to the extent either "Nil" or "Not Applicable" has not been furnished.


Mar 31, 2014

1. Company Overview

Paired Technologies Limited (formerly "Four Soft Limited", the ''Company'') is a public limited company domiciled in India and incorporated under the provisions of the Companies Act 1956 ("the Act"). The Company is head quartered in Hyderabad, India and the Company''s equity shares are listed on Bombay Stock Exchange (''BSE'') and National Stock Exchange (''NSE'').

Pursuant to the sale of core business and entire investment in subsidiaries with effect from 4 October 2013 ("the effective date") the Company ceases to be transportation and logistics software products Company providing integrated enterprise solutions. The Company''s new line of business is to provide IT solutions and IT services for media and entertainment, online e-commerce portals and to trade online in computers, mobiles and electronic products. Further the name of the Company has been changed to ''Paired Technologies Limited'' with effect from 9 December 2013.

(a) Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 5 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing general meeting, except in case of interim dividend.

As per records of the Company''s share transfer agent, and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares.

(b) Shares reserved for issue under options

(i) The Company has established Four Soft Limited Employees Welfare Trust (the ''Trust'') to administer the ESOP Scheme and as at 31 March 2014 had issued 1,170,200 equity shares of Rs. 5 each. Pursuant to the ESOP Scheme the trust has granted equity shares at an exercise price of Rs. 5 each to the eligible employees, which are subject to progressive vesting (1 year after date of issue of options) over a period of three years from the date of the grant. As of 31 March 2014 the total shares held by the trust is Nil (2013:143,987). Mode of settlement of these stock options is equity.

(ii) The stock compensation amortization expenses during the year ended 31 March 2014 amounted to Rs. 69,988 (2013: Rs. 2,300,625) including a prior period expenditure of Rs. Nil (2013:Rs. 188,295).

2. Trade payables

There are no micro and small enterprises, as defined under the provisions of the Micro, Small and Medium Enterprises Development Act, 2006, to whom the Company owes dues as at the reporting date. The micro and small enterprises have been identified by management on the basis of information available with the Company and have been relied upon by the auditors.

* The Company is in the process of transferring Rs. 173,898 to Investor Education and Protection Fund relating to dividend payable for the year 2005-06 upon expiry of 7 years from the date they remain unclaimed.

(a) Disposals during the year includes transfer of assets as indiciated in note 36.

(b) Amortisation for the year includes Rs. 2,279,479 (2013: Rs. 5,091,318) towards the amortisation charge attributable to the discontinued operations of the Company.

(a) Defined contribution plan

During year ended 31 March 2014, the Company contributed Rs. 4,711,775 (2013: Rs. 9,800,''770) to provident fund and Rs. 60,929 (2013: Rs. 120,691) towards employee state insurance fund.

(b) Defined benefit plan

The Company has a defined benefit gratuity plan. Even,'' employee of the Company who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy. Pursuant to the sale of the business of the Company all the employees of the Company and the related closing defined benefit obligation of Rs. 7,501,807 has been transferred to the acquirer Company.

During the year, the Company has created a new plan for the employees recruited for the new business of the Company.

Pursuant to the Business Transfer Agreement executed between the Company and Transport IT Solutions Private Limited (" the acquirer company") all the wholly owned foreign subsidiaries of the Company as on 4 October 2013 have been transferred to the acquirer Company for a purchase consideration of Rs. 1,381,247,877. The profit on such sale of investment amounting to Rs. 719,963,072 and the related transactions cost on sale of investments and core IT solutions business of the Company have been categorized as exceptional items.

3. Contingent Liabilities

For the year ended 31 March

2014 2013

(a) Claims against company not acknowledged as debt * 97,158,305 113,480,599

(b) Corporate guarantees given on behalf of a subsidiary - 358,633,092

* Claims against the Company not acknowledged as debts include demand from the Income tax authorities for payment of additional tax amounting to Rs. 97,158,305 for the assessment years 2008-09, 2009-10 and 2010-11. The claims arose on account of transfer pricing adjustments. The matter for these assessment years are pending before the Income Tax Appellate Tribunal and Dispute Resolution Panel and based on the recent positive intimations received by the Company, the management believes that the ultimate outcome of this proceeding will not have an adverse effect on the Company''s financial position and results of operations.

4. Value of imports calculated on CIF basis

During the year ended 31 March 2014 the Company has imported capital goods amounting to Rs. 270,930 (2013: Rs. 1,021,279).

5. Research and development

During the year ended 31 March 2014 the Company has incurred expenses amounting to Rs. Nil (2013: Rs. 54,098,117) towards research and development included under various heads of expenses.

6. Acquisition of business

The Board at its meeting held on 8 January 2014 approved the acquisition of business from "Premium Web Services Private Limited" for a purchase consideration of Rs. 2,932,969 and a contingent consideration based on a future earn-out plan, the terms of which are listed below:

* The total period for the transaction shall be 5 years i.e April 2014 to March 2019 (also called as "Transaction term").

* The valuation period for calculation of assets and stock of the e-Commerce division shall be 3 years.

* If the valuation of e-Commerce division reaches 25 crores, the transferee will be paid Rs. 25 crores and the earn-out model shall cease to exist.

* 50% of the value of shares allotted to the transferee cannot exceed 10% of paid-up share capital of the Company at the time of allotment.

* Share price shall be the price as per the date of agreement or price as per the SEBI guidelines on the date of the allotment, whichever is higher.

* The valuation should be the higher of below :

a) (60% of gross margin x 2) (40% of PBDT x 8)

b) Net asset value

7. Capital reduction and consolidation of shares

Subject to requisite regulatory approvals, the shareholders at its Annual General Meeting held on 27 November 2013 approved 50% reduction in the issued, subscribed and paid-up share capital of the Company. Upon the above extinguishment, the issued, subscribed and paid-up share capital of the Company amounting to Rs. 195,181,850 divided into 39,036,970 equity shares shall be reduced to Rs. 97,592,425 divided into 19,518,485 equity shares and the shareholders of the Company shall be paid a sum of Rs. 29 per share cancelled.

Further, the equity share capital of the Company of Rs. 97,590,925 divided into 19,518,185 equity shares of Rs. 5 each shall be consolidated into the equity share capital of Rs. 97,590,925 divided into 9,759,093 equity shares of Rs. 10 each.

8. Segment reporting

Pursuant to the sale of the transportation and logistics software products business, the management of the Company based on the Company''s new business model and considering the internal financial reporting has identified "Trading in computer peripherals" as the only reportable segment. Further, all operations of the Company are based only in India and hence, no separate financial disclosures have been provided for the segment reporting.

9. Previous year comparatives

The previous year comparatives have been regrouped/reclassified wherever necessary, to confirm to the current year presentations.

9. Additional information

Additional information as required under paragraph 5 of the part II of the Schedule VI to the Act to the extent either "Nil" or "Not Applicable" has not been furnished.

This is the summary of significant accounting policies and other explanatory information referred to in our report of even date.


Mar 31, 2013

1. Company Overview

Four Soft Limited (the ''Company'' or ''Four Soft'') is one of the world''s leading transportation and logistics software products company providing innovative and integrated enterprise solutions. Founded in 1999, Four Soft provides solutions to enterprises across the supply chain management market. Four Soft is head quartered in Hyderabad, India and has 8 development centers across the globe to cater to its large clientele. The Company''s equity shares are listed on Bombay Stock Exchange (''BSE'') and National Stock Exchange (''NSE'').

2. Trade payables

There are no micro and small enterprises, as defined under the provisions of the Micro, Small and Medium Enterprises Development Act, 2006, to whom the Company owes dues as at the reporting date. The micro and small enterprises have been identified by management on the basis of information available with the Company and have been relied upon by the auditors.

3. International transactions with related parties

The Company is required to use certain specified methods in computing arm''s length price in respect of international transactions with itsassociated enterprises and is also required to maintain prescribed information and documents in connectionwith such transactions. The appropriate methods to be adopted depends on the nature of transactions/class of transactions, class of associated persons, functions performed and other factorsas prescribed under Rule 10B of the Income Tax Rules, 1962. The Company is in the process of updating the Transfer Pricing documentation for the year ended 31 March 2013 following detailed Transfer Pricing update conducted for the financial year ended 31 March 2012. In the opinion of management, the same would not have any impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

4. Segment information

In accordance with AS 17 ''Segment Reporting'' as notified by the Rules, segment information has been given in the consolidated financial statements of the Company and therefore no separate disclosure on segment information is given in these financial statements.

5. Exceptional item

In the previous year the company had entered into an agreement with Four Soft Nordic A/s, Denmark for sale of intellectual property rights for the e-customs product, for consideration of `68,000,000 payable in accordance with the terms. The sale consideration had been mutually agreed between parties based on the valuation report obtained from an independent valuer.

6. Value of imports calculated on CIF basis

During the year ended 31 March 2013 the Company has imported capital goods amounting to Rs.1,021,279 (2012: Rs.396,780).

7. Research and development

During the year ended 31 March 2013 the Company has incurred expenses amounting to Rs.54,098,117 (2012: Rs.76,581,382) towards research and development included under various heads of expenses.

8. Previous year comparatives

The previous year comparatives have been regrouped/reclassifiedwherever necessary, to confirm to the current year pre- sentations.

9. Additional information

Additional information as required under paragraph 5 of the part II of the Schedule VI to the Act to the extent either "Nil" or "Not Applicable" has not been furnished.

This is the summary of significant accounting policies and other explanatory information referred to in our report of even date.


Mar 31, 2012

1. Company Overview

Four Soft Limited (the 'Company' or 'Four Soft') is one of the world's leading transportation and logistics software products company providing innovative and integrated enterprise solutions. Founded in 1999, Four Soft provides solutions to enterprises across the supply chain management market. Four Soft is head quartered in Hyderabad, India and has 8 development centers across the globe to cater to its large clientele.

(a) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.5 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors, if any, is subject to the approval of the shareholders in the ensuing Annual General Meeting.

(b) Shares reserved for issue under options

(i) The Company has established Four Soft Limited Employees Welfare Trust (the 'Trust') to administer the ESOP Scheme and as at 31 March 2012 had issued 1,170,200 equity shares of Rs.5 each. Pursuant to the ESOP Scheme the trust has granted equity shares at an exercise price of Rs.5 each to the eligible employees, which are subject to progressive vesting (1 year after date of issue of options) over a period of three years from the date of the grant. As of 31 March 2012 the total shares held by the Trust is 243,987 (2011: 289,327). Mode of settlement of these stock options is equity.

(ii) During the year ended 31 March 2012 the stock compensation amortization expenses/ (income) is amounting to Rs.(1,445,721) (2011: Rs.2,323,981).

The expected volatility was determined based on historical volatility data; historical volatility includes early years of the Company's life; the Company expects the volatility of its share price to reduce as it matures.

The weighted average share price at the date of exercise for stock options exercised during the year was Rs.14.19 (2011: Rs.21.11). Options outstanding at 31 March 2012 had an exercise price of Rs.10 to Rs.21.05, and a weighted average remaining contractual life of 19.24 months (2011: 17.46 months).

2. Trade payables

There are no micro and small enterprises, as defined under the provisions of Micro, Small and Medium Enterprises Development Act, 2006, to whom the Company owes dues as at the reporting date. The micro and small enterprises have been identified by management on the basis of information available with the Company and have been relied upon by the auditors.

a. Defined contribution plan

During year ended 31 March 2012, the Company contributed Rs. 12,467,987(2011: Rs.11,273,805) to provident fund and Rs.485,519 (2011: Rs.Nil) towards employee state insurance fund.

b. Defined benefit plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy. The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the gratuity:

Expected employer's contribution next year Rs.2,745,217(2011: Rs.2,500,000). The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors.

3. Exceptional item

During the year the Company has entered into an agreement with Four Soft Nordic A/s, Denmark for sale of intellectual property rights for the e-customs product, for a consideration of Rs.68,000,000 payable in accordance with the terms. The sale consideration has been mutually agreed between parties based on the valuation report obtained from an independent valuer.

The loss per equity share, based on diluted weighted average number of shares is anti-dilutive. Accordingly, the basic and dilutive earnings per equity share is the same.

4. Contingent liabilities

As at 31 March

2012 2011

(a) Claims against the Company not acknowledged as debt

- Income tax 52,541,539 26,454,812

- Service tax 3,563,314 3,563,314

(b) Guarantees 295,633,092 305,422,230

5. Leases

The company has entered into operating lease agreements for its development centres for the period 1-3 years. The maxi- mum obligations on non-cancellable operating leases payable as per the rentals stated in the respective agreements are as follows :

There are no restrictions imposed by lease arrangements. There are no subleases.

6. Segment information

In accordance with AS 17 'Segment Reporting' as notified by the Rules, segment information has been given in the consolidated financial statements of the company and therefore no separate disclosure on segment information is given in these financial statements.

The Company has an outstanding guarantee given on behalf of Four Soft B.V for its overdraft and term loan facility of Rs.295,633,092 as at 31 March 2012 (2011: Rs.305,422,230).

*During the year the company has allotted 20,000 shares to Mr. Raj Shekhar Roy at an exercise price of Rs.5 each.

7. International transactions with related parties

The Company is required to use certain specified methods in computing arm's length price in respect of international transactions with its associated enterprises and is also required to maintain prescribed information and documents in connection with such transactions. The appropriate methods to be adopted depends on the nature of transactions/class of transactions, class of associated persons, functions performed and other factors as prescribed under Rule 10B of the Income Tax Rules, 1962. The Company is in the process of updating the Transfer Pricing documentation for the year ended 31 March 2012 followingdetailed TransferPricing updateconducted forthe financial yearended 31 March 2011. In theopinion of management, the same would not have any impact on these financial statements. Accordingly, these financial statements do not include the effect of the transfer pricing implications, if any.

8. Value of imports calculated on CIF basis

During the year ended 31 March 2012 the Company has imported capital goods amounting to Rs.396,780 (2011: Rs.4,022,577).

9. Research and development

During the year ended 31 March 2012 the Company has incurred expenses amounting to Rs.76,581,382(2011: Rs.79,174,357) towards research and development included under various heads of expenses.

10. Previous year comparatives

The previous year comparatives have been regrouped/rearranged to comply with the presentation requirement of revised Schedule VI as stated in the note 2(a).


Mar 31, 2010

1. Background

Four Soft Limited (the Company or Four Soft) is one of the worlds leading transportation and logistics software products company providing innovative and integrated enterprise solutions. Founded in 1999, Four Soft provides solutions to enterprises across the supply chain management market. Four Soft is head quartered in Hyderabad, India and has 8 development centers across the globe to cater to its large clientele. The Companys headquarter is registered as 100% export oriented unit under the Software Technology Park scheme of Government of India. Four Soft is a public limited company since April 2003 and has been registered with recognized stock exchanges of India.

2. Related party transactions

Names of the related party Country Nature of relationship

Four Soft B.V. Netherlands Wholly owned subsidiary (WOS)

Four Soft UK Ltd. United Kingdom WOS of Four Soft BV

Four Soft NL BV Netherlands WOS of Four Soft BV

Four Soft Singapore Pte. Ltd. Singapore WOS

Four Soft Japan KK Japan WOS of Four Soft Singapore Pte. Ltd

Four Soft Australia Pty Ltd. Australia WOS of Four Soft Singapore Pte. Ltd

Four Soft Nordic A/S Denmark WOS

Four Soft (HK) Ltd. Hong Kong WOS of Four Soft Nordic A/S

Transaxiom USA Inc. USA WOS of Four Soft Nordic A/S

Four Soft Malaysia Sdn. Bhd. Malaysia WOS

Four Soft USA, Inc. USA WOS of Four Soft BV

Four Soft Employee Welfare Trust India Controlling interest

Palem Srikanth Reddy India Key management personnel (KMP)

Biju S. Nair India KMP

Raj Shekhar Roy (w.e.f 30 September 2008) India KMP Sonata Information Technology Limited India Enterprises signific- antly influenced by KMP or their relatives.

P. C Reddy Trust India Enterprises significa- ntly influenced by KMP or their relatives.

GKP Reddi India Relative of KMP

P Soujanya Reddy India Relative of KMP

P Mangamma India Relative of KMP

Dakshayani Reddy India Relative of KMP

3. Research and development

During the year ended 31 March 2010 the Company has incurred expenses amounting to Rs 80,586,288 (2009: Rs 59,608,490) towards research and development included under various heads of expenses.

4. Employee stock options (ESOP)

(a) The Company has established Four Soft Limited Employees Welfare Trust (the Trust) to administer the ESOP Scheme and as at 31 March 2010 had issued 1,170,200 equity shares of Rs 5 each, including 217,200 equity shares issued pursuant to issue of bonus shares in 2003. Pursuant to the ESOP Scheme the trust has granted equity shares at an exercise price of Rs 5 each to the eligible employees, which are subject to progressive vesting (1 year after date of issue of options) over a period of three years from the date of the grant. As of 31 March 2010 the total shares held by the Trust is 348,325 (2009: 466,318). Mode of settlement of these stock options is equity.

(b) During the year ended 31 March 2010 the Company has amortized stock compensation expenses amounting to Rs 1,350,139 (2009: Rs 2,790,587).

5. Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy. The following tables summarize the components of net benefit expense recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the gratuity:

6. Contingent liabilities not provided for:

Included in sundry debtors are dues from companies under the same management:

As at March 31, Particulars

2010 2009

Income tax demand in respect of which the Company has gone

on appeal. Management is of the opinion that appeal is likely

to be accepted by appellate authority. - 2,625,937

7. Additional information pursuant to the provisions of paragraphs 3, 4C and 4D of Part II of Schedule VI to the Act

The Company is primarily engaged in the development and maintenance of computer software. The production and sale of such software cannot be expressed in any generic unit. Hence it is not possible to give quantitative details of sales and certain other information as required under paragraph 3, 4C and 4D of Part II of Schedule VI to the Act.

8. Earnings per share (EPS)

ICAI has issued guidance note on Accounting for Employees Share Based Payments applicable to employee based share plan the grant date in respect of which falls on or after 1 April 2005. In accordance with such guidance note shares allotted to the ESOP Trust pursuant to an employee share based payment plan has not been included in the outstanding shares for computation of basic EPS till the employees have exercised their right after fulfilling the vesting conditions. Until such time the shares so allotted have been considered as dilutive potential equity shares for the purpose of calculating diluted EPS.

9. Segment information

In accordance with AS 17 Segment Reporting as notified by the Rules, segment information has been given in the consolidated financial statements of the Company and therefore no separate disclosure on segment information is given in these financial statements.

10. Sundry creditors

The identification of micro, small and medium enterprise suppliers as defined under the provisions of The Micro, Small and Medium Enterprises Development Act, 2006 is based on Managements knowledge of their status. There are no dues to micro, small and medium enterprises as on 31 March 2010.

11. Previous year comparatives

Previous years figures have been regrouped where necessary to conform to this years classification.

 
Subscribe now to get personal finance updates in your inbox!