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Notes to Accounts of Starcom Information Technology Ltd.

Mar 31, 2018

Note 1 Corporate Information

Starcom Information Technology Limited (“the Company”) is a public listed company, domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India (Bombay Stock Exchange and Ahmedabad Stock Exchange). The Company''s principal business is to be a global IT driven solution provider in the Business Intelligence, Analytics and Big Data space, focussed on innovative products and services.

The financial statements of the Company for the year ended March 31, 2018 were authorised for issue in accordance with resolution of the Board of Directors on May 30, 2018.

NOTE 2.2 : FIRST TIME ADOPTION OF IND AS

These are Company''s first financial statements prepared in accordance with Ind AS.

The accounting policies set out in Note 2.1 have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS balance sheet as at April 1, 2016 (The Company''s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with accounting standards notified under Companies(Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP).An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following tables and notes :

A) Exemptions and exceptions availed

1) Ind-AS optional exemptions :

Ind AS 101 allows first time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

a) Deemed cost

Ind AS 101 permits a first time adopter to elect to fair value of its property, plant and equipment as recognised in financial statements as at the date of transition to Ind AS, measured as per previous GAAP and use that as its deemed cost as at the date of transition or apply principles of Ind AS retrospectively. Ind AS 101 also permits the first time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognised in the financial statements as at the date of transition to Ind AS. This exemption can be also used for intangible assets covered by Ind-AS 38.

b) For financial instruments, wherein fair market values are not available (viz. interest free and below market rate security deposits or loans) the Company has elected to adopt fair value recognition prospectively to transactions entered after the date of transition.

2) Ind AS mandatory exceptions :

a) Estimates

An entity estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP.

b) Derecognition of financial assets and financial liabilities

Ind AS 101 requires a first time adopter to apply the derecognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. Accordingly,the Company has applied the derecognition requirement for financial assets and financial liabilities in Ind AS 109 prospectively for transactions occurring on or after date of transition to Ind AS.

c) Classification of financial assets and liabilities

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of facts and circumstances that exist on the date of transition to Ind AS. Accordingly, the Company has applied the above requirement prospectively. Ind AS 101 requires an entity to assess classification of financial assets on the basis of facts and circumstances existing as on the date of transition. Further, the standard permits measurement of financial assets accounted at amortised cost based on facts and circumstances existing at the date of transition if retrospective application is impracticable. Accordingly, the Company has determined the classification of financial assets based on facts and circumstances that exist on the date of transition. Measurement of financial assets accounted at amortised cost has been done retrospectively except where the same is impracticable.

d) Impairment of financial assets

Ind AS 101 requires an entity to assess and determine the impairment allowance on financial assets as per Ind AS 109 using the reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments which were initially recognised and compare that to the credit risk at the date of transition to Ind AS. The Company has applied this exception prospectively.

B) Transition to Ind AS - Reconciliations

The following reconciliations provide a quantification of the effect of significant differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

I. Reconciliation of Balance sheet as at April 1, 2016 and March 31, 2017

II. Reconciliation of Total Comprehensive Income for the year ended March 31, 2017

III. Reconciliation of Equity as at April 1, 2016 and March 31, 2017 between previous GAAP and IND AS

The presentation requirements under Previous GAAP differs from Ind AS and hence Previous GAAP information has been regrouped for ease of reconciliation with Ind AS. The Regrouped Previous GAAP information is derived from the Financial Statements of the Company prepared in accordance with Previous GAAP.

Footnotes to the reconciliation of equity as at April 1, 2016 & March 31, 2017 and Statement of profit and loss for the year ended March 31, 2017

1) Financial Assets

Under the previous GAAP, interest free lease security deposits (that are refundable in cash on completion of the lease term) are recorded at their transaction value. Under Ind AS, all financial assets are required to be initially recognised at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS. Difference between the fair value and transaction value of the security deposits has been recognised as prepaid rent.

2) Deferred Tax (Including MAT Credit)

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. This has resulted in recognition of deferred tax on new temporary differences which was not required under Indian GAAP.

In addition, the various transitional adjustments lead to temporary differences. According to the accounting policies, the Company has to account for such differences.Deferred tax adjustments are recognised in correlation to the underlying transaction either in other equity or a separate component of equity.

Under Previous GAAP, MAT credit was disclosed under non-current assets. In accordance with Ind AS 12, deferred tax asset shall include any carry forward unused tax credits. Hence, MAT credit entitlement has been included in deferred tax asset.

3) Trade Receivables

Under Indian GAAP, the Company has created provision for impairment of receivables which consists only in respect of specific amount for probable losses. Under Ind AS, impairment allowance has been determined based on Expected Credit Loss (ECL) model.

4) Interest Free Loan

In the financial statements prepared under Previous GAAP, the carrying value of Interest free loan was recognised at the principal amounts payable by the borrower. Under Ind AS, Interest free borrowing being a financial liability is required to be recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. The difference between such fair value and the carrying value is recognised as deferred income disclosed under Other liabilities.

5) Other Comprehensive Income

Under Indian GAAP, the company has not presented other comprehensive income (OCI) separately. Hence, it has reconciled Indian GAAP profit or loss to profit or profit or loss as per Ind AS. Further, Indian GAAP profit or loss is reconciled to total comprehensive income as per Ind AS.

6) Defined benefit liabilities

Both under Indian GAAP and Ind AS, the Company recognised costs related to its post-employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are charged to the statement of profit and loss. Under Ind AS, remeasurements [comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets excluding amounts included in net interest on the net defined benefit liability] are recognised immediately in the balance sheet with a corresponding debit or credit to other equity through OCI.

7) Statement of Cash Flows

The Ind AS adjustments are either non cash adjustments or are regrouping among the cash flow from operating, investing and financing activities. Consequently, Ind AS adoption has no impact on the net cash flow for the year ended 31st March, 2017 as compared with the previous GAAP.

a) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share.

In the event of liquidation of the Company, the holder of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Note: This information, as required to be disclosed under the MSMED Act, has been determined to the extent such parties have been identified on the basis of information available with the Company.

Trade payables are normally non-interest bearing and settled as per the payment terms stated in the contract.

Note 3 : Operating leases disclosures as required under Indian Accounting Standard 17, “Leases”:

The Company has taken premises on operating lease and entered in to non-cancellable Leave and License Agreements with various parties. An amount of Rs 1,28,79,151 (31 March 2017 : Rs 1,27,30,648) is recognised as lease expense in the Statement of Profit and Loss for the period ended 31th March, 2018

Future minimum lease payments payable under non-cancellable operating leases in aggregate for the following periods:

Defined Benefit Plans

The Company has the following Defined Benefit Plans:

Gratuity: In accordance with the applicable laws, the Company provides for gratuity, a defined benefit retirement plan (“The Gratuity Plan”) covering eligible employees. The Gratuity Plan provides for a lump sum payment to vested employees on retirement (subject to completion of five years of continuous employment), death, incapacitation or termination of employment that are based on last drawn salary and tenure of employment. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation on the reporting date. The following are the details of defined benefit plans:

Note 4 : Segment reporting as required under Indian Accounting Standard 108, “Operating Segments”

The Company has disclosed business segment as the primary segment . These have been identified taking into account nature of products and services, the differing risks and returns and the internal business reporting systems.

The company operates into two business segments as required to be reported as per Indian Accounting Standard 108 on Operating Segments ,(a) Test, Measurement & Embedded solutions for Educational sector (b) Data Quality,Statistical and Analytics Softwares.

Information about major customers

Transactions with single external customer which amounts to 10% or more of the Company''s revenue during the year amounted to Rs. 2,16,10,509(Previous year : Nil )

Note 5: Fair Value Measurement

A. Accounting classification and fair values

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2: other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: techniques which use inputs that have a significant effect on the recorded fair value that are not based on observable market data.

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.

Assets and Liabilities that are disclosed at Amortised Cost for which Fair values are disclosed are classified as Level 3.

If one or more of the significant inputs is not based on observable market data, the respective assets and liabilities are considered under Level 3.

Note 6 : Financial risk management objectives and policies

i. Risk management framework

A wide range of risks may affect the Company''s business and operational / financial performance. The risks that could have significant influence on the Company are market risk, credit risk and liquidity risk. The Company''s Board of Directors reviews and sets out policies for managing these risks and monitors suitable actions taken by management to minimise potential adverse effects of such risks on the company''s operational and financial performance.

ii. Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s trade and other receivables, cash and cash equivalents and other bank balances. To manage this, the Company periodically assesses financial reliability of customers, taking into account the financial condition, current economic trends and analysis of historical bad debts and ageing of accounts receivable. The maximum exposure to credit risk in case of all the financial instruments covered below is restricted to their respective carrying amount.

(a) Trade and other receivables from customers

Credit risk in respect of trade and other receivables is managed through credit approvals, establishing credit limits and monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business.

The Company measures the expected credit loss of trade receivables based on historical trend, industry practices and the business environment in which the entity operates. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables. The provision matrix takes into account available external and internal credit risk factors such as credit ratings from credit rating agencies, financial condition, ageing of accounts receivable and the Company''s historical experience for customers.

(b) Cash and cash equivalents and Other Bank Balances

The Company held cash and cash equivalents and other bank balances of Rs. 11,25,299 at 31st March 2018 (31st March 2017: Rs. 8,84,059, 1st April 2016 : Rs. 37,32,257). The cash and cash equivalents are held with bank with good credit ratings and financial institution counterparties with good market standing. Also, Company invests its short term surplus funds in bank fixed deposit, which carry no / low mark to market risks for short duration therefore does not expose the Company to credit risk.

iii. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset.

Liquidity risk is managed by Company through effective fund management of the Company''s short, medium and long-term funding and liquidity management requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and other borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted.

iv. Market risk

Market Risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk.

iv. a Currency risk

The Company is exposed to currency risk on account of its operating and financing activities. The functional currency of the Company is Indian Rupee. Our exposure are mainly denominated in U.S. dollars. The USD exchange rate has changed substantially in recent periods and may continue to fluctuate substantially in the future. The Company''s business model incorporates assumptions on currency risks and ensures any exposure is covered through the normal business operations. This intent has been achieved in all years presented. The Company has put in place a Financial Risk Management Policy to Identify the most effective and efficient ways of managing the currency risks.

Sensitivity analysis

A reasonably possible strengthening / (weakening) of the Indian Rupee against US dollars at 31st March would have affected the measurement of financial instruments denominated in US dollars and affected profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases. In cases where the related foreign exchange fluctuation is capitalised to fixed assets or recognised directly in reserves, the impact indicated below may affect the Company''s income statement over the remaining life of the related fixed assets or the remaining tenure of the borrowing respectively.

iv. b Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Company has interest free borrowings thus Company does not foresee and interest rate risk.

Note 7 : Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity holders of the Company. The Company strives to safeguard its ability to continue as a going concern so that they can maximise returns for the shareholders and benefits for other stake holders. The aim to maintain an optimal capital structure and minimise cost of capital.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may return capital to shareholders, issue new shares or adjust the dividend payment to shareholders (if permitted). Consistent with others in the industry, the Company monitors its capital using the gearing ratio which is total debt divided by total capital plus total debts.

Note 8 : Prior year comparatives

Previous year''s figures have been regrouped or reclassified, to conform to the current year''s presentation wherever considered necessary.


Mar 31, 2016

c. Terms / Right attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity share is entitled to one vote per share.

In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company, after distribution of all prefential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

d. Shareholders having more than 5% shareholding

1. Temporary Overdraft facility from “The Jammu & Kashmir Bank Limited” was availed against personal guarantee of the Managing Director of the Company. During, the previous year, the Company had defaulted in repayment of the Temporary Overdraft Facility and accordingly the said account was classified as NPA by the Bank. During the year, the Company has settled the account with the Bank and accordingly paid a sum of Rs. 21,23,00,000 (Principal and Interest) as full and final settlement. Accordingly, excess liability towards interest accounted in the books amounting to Rs. 2,35,19,613 has been reversed and disclosed as “Exceptional Item” under note no. 27 of the financial statements.

2. Amount of continuing default as on the balance sheet date in respect of loans and interest.

Note 3 : Contingent Liabilities

Disputed claims in respect of provident fund amounting to Rs 26,84,662 (P.Y Rs Nil).

Note 4 : Accompanying Notes to Accounts

1) In the opinion of the Board the Current Assets, Loans & Advances are realizable in the ordinary course of business at least equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

2) Disclosure pursuant to Accounting Standard - 15 ‘Employee Benefits''

A. Gratuity

5.) During the year, the management has decided not to acquire Sigmaplot & Systat product range in the Company due to commercial expediency. Accordingly, an advance payment amounting to Rs. 25,00,00,000/- done by the Company in the earlier years which was erroneously capitalized in the previous year along with the various expenses of Rs. 10,07,48,762 incurred on the certain other under-development IP''s / Softwares have been reversed and the amortization charge up to previous year on the aforesaid capitalization amounting to Rs. 1,29,82,814 (net of deferred tax assets amounting to Rs. 58,05,629) has also been reversed and disclosed as Exceptional Item.

6.) In order to augment the operational efficiency of the Company and to sustain business growth in the competitive market, the promoter of the Company have decided to waive of the rent for the current financial year amounting to Rs. 1,25,50,120 (including service tax).

7.) Related Party disclosures

As required under Accounting Standard 18 “Related Party Disclosure” (AS-18), following are the details of transactions during the year with the related parties of the Company as defined in AS 18:

8) No amount pertaining to related parties have been provided for as doubtful debts. Also no amount has been written off/back which was due from/to related parties.

9.) Segment Information

During the year, the management has identified that the company operates in two business segments -(a) Test, Measurement and Embedded Solution for Educational Sector and (b)Statstical and Analytics Softwares.

10.) The Company has taken premises on operating lease and entered in to non-cancellable Leave and License Agreements with various parties. An amount of Rs 1,69,97,396 (P.Y. Rs. 2,60,06,647/-) is recognized as lease expense in the Statement of Profit and Loss for the year ended 31st March, 2016. The disclosure required to be made in accordance with Accounting Standard 19 on “Leases” is as under ;

a) Future minimum lease payments payable under non-cancellable operating leases in aggregate for the following periods:

11.) Effective from 1st April, 2014 the Company has charged depreciation on its fixed assets based on their useful life as stipulated under Schedule II of the Companies Act, 2013. Due to this, the depreciation for the year ended on 31st March, 2015 is lower by Rs. 18,70,677 as compared to the depreciation computed under the provisions of the Companies Act, 1956. Further, based on the transitional provision as provided in Note 7(b) of Schedule II, there is no amount which is required to be adjusted against opening balance of retained earnings as on 1st April,2014.

12.) Figures of the previous year have been regrouped, reclassified and/or rearranged wherever necessary.


Mar 31, 2015

1) In the opinion of the Board the Current Assets, Loans & Advances are realizable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

2) The Company had paid an amount of Rs. 25,00,00,000 to The Jammu and Kashmir Bank (J & K Bank) towards purchase of "Sigmaplot Software product range and Systat Software product range" (herein referred as "Software,s") which was mortgaged to the J & K Bank by one of its clients, Cranes Software International Limited who had defaulted with the J & K Bank. On the payment of the said amounts, the Company has been assigned the global sales and marketing rights of these Software,s. Also, the Company had incurred various expenditure amounting to Rs. 10,07,48,762/- towards up gradation of these Software,s and bringing them into saleable form. During the year, up gradation of these softwares were completed and these products were ready for commercial exploitation. Hence, the Company has capitalized these amounts as Intangible Assets w.e.f. 31st August, 2014.

3) Related Party disclosures

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are the details of transactions during the year with the related parties of the Company as defend in AS 18:

4) The Company has taken premises on operating lease and entered in to non-cancellable Leave and License Agreements with various parties. An amount of Rs. 2,60,06,647 (P.Y Rs. 2,97,42,784/-) is recognized as lease expense in the Statement of Profit and Loss for the year ended 31st March, 2015. The disclosure required to be made in accordance with Accounting Standard 19 on "Leases" is as under;

5) During the year, the Company has re-negotiated the terms of its office premises taken on lease. Accordingly the lessee has agreed to waive the escalated lease rent and also accepting the original lease rent for the entire duration of the lease.

Liabilities no longer payable written back in Note no. 21 includes:-

i. Rs. 51,18,270 being escalated lease rent accounted in the books.

ii. Rs. 1,01,74,688 being Rent Equalization Reserve created as per Accounting Standard (AS)-19 accounted in the books.

6) Effective from 1st April,2014 the Company has charged depreciation on its fixed assets based on their useful life as stipulated under Schedule II of the Companies Act, 2013. Due to this, the depreciation for the year ended on 31st March, 2015 is lower by Rs. 18,70,677 as compared to the depreciation computed under the provisions of the Companies Act, 1956. Further, based on the transitional provision as provided in Note 7(b) of Schedule II, there is no amount which is required to be adjusted against opening balance of retained earnings.

7) The Company has incurred substantial loss during the year and its accumulated loss as at March 31, 2015 amounts to Rs. 3,77,64,443 as against the equity share capital of Rs. 5,00,06,000. In the current financial year, Company,s profitability was adverse due to two major reasons reduction in sales as compared to previous year and high depreciation and amortization expenses due to capitalization of software modules.

The Board has projected its business plan and the management is of the view that the company would able to generate sufficient cash fows in future and be able to meets its obligation. Also, the management is working on completely revamping the business as well. Thus going concern assumption is valid and no adjustment is required to be made to carrying values or classification of balance sheet accounts.

8) Figures of the previous year have been regrouped, reclassified and/or rearranged wherever necessary.


Mar 31, 2014

Note 1 : Deferred Tax Assets (net)

The major components of deferred tax liability / asset as recongised in the financial statement is as follows:

Note 2 : Accompanying Notes to Accounts

1) In the opinion of the Board the Current Assets, Loans & Advances are realisable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

2) Contingent Liabilities not provided for :- Estimated amount of contracts remaining to be executed on capital account (net of advances) not provided for Rs. Nil (Previous year Rs. 20,00,00,000/-).

3) Disclosure pursuant to Accounting Standard – 15 ''Employee Benefits'' :

Actuarial assumption:

* The estimates of future salary increases, considered in a actuarial valuation, takes account of infl ation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

4) (a) The Company had paid an amount of Rs. 25,00,00,000/- to The Jammu and Kashmir Bank (J & K Bank) as an advance towards purchase of "Sigmaplot Software product range and Systat Software product range" (herein referred as "Softwares") which was mortgaged to the J & K Bank by one of its clients, Cranes Software International Limited (CSIL) who had defaulted with the J & K Bank. On the payment of the said amounts, the Company has been assigned the global sales and marketing rights of these Softwares. However, due to pending valuation and transfer of ownership rights of these softwares to the Company, the said advance is disclosed under the head Capital Advances in Note no. 13 "Long-Term Loans and Advances".

(b) During the previous year, the Company had entered into a contract with CSIL for upgradation of these softwares at a cost which is to be charged monthly on time basis. During the year, the Company has incurred a cost of Rs.2,58,02,520 (P.Y. Rs.75,49,002/-) on the upgradation of these softwares which is also disclosed under Capital Advances in Note no. 13 "Long- Term Loans and Advances".

5) Related Party disclosures

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are the details of transactions during the year with the related parties of the Company as defi ned in AS 18:

Note: Related Parties are as disclosed by the Management and relied upon by the auditors.

6) Segment Information

The Company is operating in single business i.e Software and Analytical Lab Equipments and as such all business activities revolve around this segment. Hence, there is no separate segment to be reported considering the requirement of segment reporting as per AS-17 pursuant to Companies (Accounting Standards) Rules 2006.

7) The Company had during the previous year taken an office premises under cancellable operating lease agreements that are renewable at the option of both the lessor and lessee. An amount of Rs. 2,97,42,824 (P.Y. Rs. 2,35,47,658) is recognised as lease expense in the Statement of Profit and Loss for the year ended 31st March, 2014. The future guaranteed lease payments under non cancellable portion of cancellable lease are as follows.


Mar 31, 2013

1. In the opinion of the Board the Current Assets, Loans & Advances are realisable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

2. Contingent Liabilities not provided for :- Estimated amount of contracts remaining to be executed on capital account (net of advances) not provided for Rs. 20,00,00,000/- (Previous year Rs. Nil).

3. Since the Company did not have any employees who has completed atleast 6 months of service at the year end, no provision and disclosure for Retirement Benefts as required AS-15 is made.

4. (a) During the year, the Company had made an offer to The Jammu and Kashmir Bank (J & K Bank) to purchase ''Sigmaplot Software product range and Systat Software product range'' for a total consideration of Rs. 25,00,00,000 which is presently mortgaged to the J & K Bank by one of its clients, Cranes Software International Limited (CSIL) who had defaulted with the J & K Bank. In terms of the Offer, the consideration to be paid by the Company is in 5 equal instalments of Rs. 5,00,00,000 each upto December, 2013, to the J & K Bank towards the outstanding dues of CSIL. In January, 2013 the Company has paid Rs. 5,00,00,000 towards the frst instalment and the same is disclosed under the head Capital Advances in Note no. 11 ''Long-Term Loans and Advances''. Post Balance Sheet date another instalment of Rs. 5,00,00,000 was paid in April, 2013.

On payment of full amount of consideration of Rs. 25,00,00,000 J & K Bank shall transfer the ownership rights of the above softwares to the Company and the same will be capitalised upon the said transfer.

(b) The Company has also entered into a contract with CSIL for upgradation of these two softwares at a cost which is to be charged monthly on time basis. As on 31st March, 2013, the Company has incurred a cost of Rs. 75,49,002 on the upgradation of these softwares which is also disclosed under Capital Advances in Note no. 11.

5. The name of the Company has been changed from Jatia Finance Limited to Starcom Information Technology Limited and the fresh certifcate of incorporation dated 10th December, 2008 has been received from the Registrar of Companies, Mumbai.

6. Segment Information

In accordance with the requirements of Accounting Standard 17 ''Segment Reporting'', the Company''s business consists of one reportable business segment i.e. ''Software Development Services'', hence no separate disclosures pertaining to attributable revenues, Profts, Assets, Liabilities, Capital Employed are given.

7. The Company has during the year taken an offce premises under cancellable operating lease agreements that are renewable at the option of both the lessor and lessee. An amount of Rs. 2,35,47,658/- (P.Y. Rs. Nil) is recognised as lease expense in the Statement of Proft and Loss for the year ended 31st March, 2013. The future guaranteed lease payments under non cancellable portion of cancellable lease are as follows:-

8. Figures of the previous year have been regrouped, reclassifed and/or rearranged wherever necessary.


Mar 31, 2012

A. Terms I Right attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity share is entitled to one vote per share.

In the event of liquidation of the company' the holder of equity shares will be entitled to receive remaining assets of the company' after distribution of all credential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

1.) In the opinion of the Board the Current Assets' Loans & Advances are realisable in the ordinary course of business atleast equal to the amount at which they are stated in the Balance Sheet. The provision for all known liabilities is adequate and not in excess of amount reasonably necessary.

2.) Contingent Liabilities: Rs. Nil (RY Rs. Nil)

3.) No provision for retirement benefits in pursuant to the Accounting Standard (AS)- 15 (Revised) is required' since the Company did not have any employees during the year.

4.) The name of the Company has been changed from Jatia Finance Limited to Starcom Information Technology Limited and the fresh certificate of incorporation dated 10th December' 2008 has been received from the Registrar of Companies' Mumbai.

5.) Segment Information

The segment wise details as per Accounting Standard 17 "Segment Reporting" as notified by the Companies (Accounting Standard) Rules' 2006 is not applicable since the Company do not have separate reportable business segments.

6.) There is no items attributable to the timing difference between taxable income and accounting income hence no deferred tax liabilities / (assets) as required by Accounting Standard (AS) - 22 has been recognized during the year.

7.) The previous year’s figures have been re-grouped / re-classified to conform to this year’s classification which is as per Revised Schedule VI. This adoption does not impact recognition and measurement principles followed for preparation of financial statements as at 31st March' 2011.


Mar 31, 2010

1. Estimated amount of contracts remaining to be executed on capital account not provided for net of Advances Rs.200 Lakhs. (Previous year Nil)

2. Some of the Sundry creditors and Loans ft Advances are subject to confirmation and reconciliation. Consequential adjustment thereof, if any, will be given effect into the books of accounts in the year of such adjustments.

3. The Company has not made provision for Gratuity during the year as no employee have completed six month period of service.

4. As on 31.03.2010, there are no dues to Micro, Small and Medium Enterprises suppliers defined under "The Micro Small and Medium Enterprises Development Act, 2006".

5. The Company had made an application to the Reserve Bank of India (RBI) for deregistering the Company from Non-Banking Finance Company (NBFC). The said application has been approved by the Reserve Bank of India (RBI) vide order dated September 04, 2009.

6. In the opinion of Board of Directors, the Current Assets, Loans and Advances are approximately of the value stated as realisable in the ordinary course of business and the provisions of all known liabilities are adequate and not in excess of amount reasonably necessary.

7. The name of the Company has been changed from Jatia Finance Limited to Starcom Information Technology Limited and the fresh certificate of incorporation dated 10th December, 2008 has been received from the Registrar of Companies, Mumbai

ii) Expenditure, earning and remittance in foreign currency: Nil

8. Related Party Disclosures

Related party disclosures as required by the Accounting Standard -18 on "Related Party Disclosures" Notified by the Companies (Accounting Standard) Rules, 2006 are given below:

i) For the year ended 31st March 2010,

(a) Key Management Personnel

Name of Person Category

Mr. Mahesh Saraf Managing Director

During the year, the Company has not entered into transaction with any related party.

ii) For the year ended 31st March 2009,

(a) Key Management Personnel

Name of Person Category

Mr. Mahesh Saraf Managing Director

Mr. Anil Raika Whole Time Director *

Resigned w.e.f 24th January, 2009

(b) Associates

M/s. Impex Developers Limited Associate Concern

9. Segment Information

The segment wise details as per Accounting Standard 17 "Segment Reporting" as notified by the Companies (Accounting Standard) Rules, 2006 is not applicable as there are no separate reportable segments

10. Deferred Taxes

There are no items attributable to the timing difference between taxable income and accounting income hence no deferred tax liabilities (assets) as required by Accounting Standard (AS) - 22 as notified by the Companies (Accounting Standard) Rules, 2006 has been recognized during the year.

11. Previous year figures have been regrouped, reclassified and rearranged wherever necessary

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