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Notes to Accounts of Tricom India Ltd.

Mar 31, 2015

A - Rights of the shareholders

1. The Company has only one class of equity shareholders. 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 is subject to approval by the shareholders at the ensuing Annual General Meeting.

2. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the 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.

c - Share application money:

As at 31 March 2015, the Company has converted loan of Rs 1,15,50,000/- towards share application money towards Rs 57,75,000/- equity shares of Rs 2/- each at Rs 11.50 per equity share. The share application money was received pursuant to an invitation to offer shares and in terms of such invitation.

d - Monies received against share warrants:

The Board of Directors of the Company at their meeting have resolved to create, offer, issue and allot up to 1,76,20,000 warrants, convertible into 1,76,20,000 equity shares of Rs 2/- each on a preferential allotment basis, pursuant to Section 81(1A) of the Companies Act, 1956, at a conversion price of Rs 2/- per equity share of the Company, arrived at in accordance with the SEBI Guidelines in this regard. The Company has converted loan of Rs 88,10,000 against 1,76,20,000 fully convertible warrants F.V. of Rs 2 each and Rs 0.50 each paid up at the time of issue and balance to be paid at the time of allotment.

e - The above mentioned offer of 1,76,20,000 fully convertible warrants and 57,75,000 equity shares, in point no. 3 & 4, have been scrapped by the Board in its meeting held on 7th May, 2015 due to change in price and addition of investor in earlier issue. The price of the each fully convertible warrant and equity share have been changed to Rs 2.5/-.

a - Security for Long Term - Secured Loans

(i) Loan from Banks are secured by way of hypothecation of fixed assets (except vehicles) of the Company, book debts, pledge of shares of subsidiaries and pledge of fixed deposits with a Bank and further secured by personal guarantee of a Director.

(ii) Vehicle Loans from Banks are secured against the specific vehicle financed by respective banks.

a - Loan from Banks are secured by way of hypothecation of fixed assets (except vehicles) of the Company, book debts, pledge of shares of subsidiaries and pledge of fixed deposits with a Bank and further secured by personal guarantee of a Director.

Note : Future cash outflows in respect of (ii) above are determinable only on receipt of judgments/decisions pending with the respective forums/authorities.

3. In the opinion of the Board, the Current Assets, Loans and Advances have been stated at a value realizable in the ordinary course of business.

4. Disclosures under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received any information from all its vendors regarding their status under Micro, Small and Medium Enterprises Development Act, 2006. However, as per the information available there are no amounts outstanding for a period beyond the stipulated period as specified under Micro, Small and Medium Enterprises Development Act, 2006.

5. Intangible Assets

During the year the company has internally generated software for its captive use for the various long term projects received and also developed software for sale of its licenses. The cost of Rs 37.04 Lacs (Previous Year Rs 50.72 Lacs) is capitalized and shown as Intangible assets under the Group Fixed Assets.

6. Few debtors, creditors and loans and advances are subject to confirmation and reconciliation if any.

7. Operating lease

The company's significant leasing agreements are in respect of operating lease for office premises. These leasing agreements are cancelable and renewable by mutual consent on mutually acceptable terms. The aggregate lease rentals payable by the company are charged to Statement of Profit and Loss as a rent amounting to Rs 108.40 Lacs (Previous year Rs 39.00 Lacs). The future minimum lease payments under non-cancelable operating leases due within a period of one year are estimated at Rs NIL (Previous year Rs NIL) and due later than one year but not later than five years are estimated at Rs NIL. (Previous year Rs NIL Lacs).

8. Due to severe financial crisis, the Company has requested some of the lenders to waive off some part of their interest on loan and negotiation on aforesaid matter is going on between the Company and the lenders. On the basis of discussion with lenders, management feels that no interest provision is required on loan from some of the lenders however, if any interest provision is required as per final negotiation it will be made as and when required.

9. Related party transactions

Description of relationship Names of related parties

Subsidiary Companies Tricorn Document Management Inc.

Tricorn Infotech Solutions Limited

Tricorn Data Processing Private Limited (formerly known as Mastiff Tech Private Limited)

eData Processing Private Limited (formerly known as Tricom I.T. Services Private Limited)

Tricom LPO Private Limited Pacific Data Centers, Inc. *

Tricom Data Services, Inc. *

Tricom Software Services, Inc. *

Tricom Litigation Coding Services, Inc. *

Tricom Search Services, Inc. *

Tricom Infotech Solutions, Inc. #

Tricom Infotech Solutions (Cyprus) Limited #

Grand Imaging Technology Inc. (formerly known as GTESS- Tricom Corporation) ##

* - Held through Tricom Document Management Inc.

# - Held through Tricom Infotech Solutions Limited

## - Held through Tricom Infotech Solutions Inc.

Mr. Chetan S. Kothari - Managing Director

Executive Directors Mr. Paresh Pathak

Non-Executive Directors Tricom Fruit Products Limited

Entities having significant influence over the Company

Adilnath Finance Private Limited Trio Mercantile & Trading Limited Manshanti Enterprises Kothari Financial Services

10. Segment Reporting

Since the Company's activities fall within a single geographical and business segment (ITES-BPO) it has no other primary reportable segment.

11. Previous year's figures

Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Mar 31, 2014

A - Rights, preferences and restrictions attached to shares:

1- The Company has only one class of equity shareholders. 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 is subject to approval by the shareholders at the ensuing Annual General Meeting.

2- In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the 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.

a - Security for Long Term - Secured Loans

(i) Loan from Banks are secured byway of hypothecation of fixed assets (except vehicles) of the Company, book debts, pledge of shares of subsidiaries and pledge of fixed deposits with a Bank and further secured by personal guarantee of a Director.

(ii) Vehicle Loans from Banks are secured against the specific vehicle financed by respective banks.

a - Loan from Banks are secured by way of hypothecation of fixed assets (except vehicles) of the Company, book debts, pledge of shares of subsidiaries and pledge of fixed deposits with a Bank and further secured by personal guarantee of a Director.

Additional information to the Financial Statements

Note : 3.1 Contingent liabilities and commitments (to the extent not provided for) (Rs.in Lacs)

As at As at PARTICULARS 31 March, 2014 31 March, 2013

i) Bank Guarantees issued to Custom authorities & others 8.31 8.31

ii) Appeals filed at different forums/ authorities in respect of disputed demands:

Income Tax 1,350.46 681.73

iii) Corporate Guarantee given by the Company in respect of credit limits 869.00 869.00 sanctioned by a bank to a Subsidiary Company

Note : Future cash outflows in respect of (ii) above are determinable only on receipt of judgments/ decisions pending with the respective forums/ authorities.

Note : 3.2 In the opinion of the Board, the Current Assets, Loans and Advances have been stated at a value realizable in the ordinary course of business.

Note : 3.3 Disclosures under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

The Company has not received any information from all its vendors regarding their status under Micro, Small and Medium Enterprises Development Act, 2006. However, as per the information available there are no amounts outstanding for a period beyond the stipulated period as specified under Micro, Small and Medium Enterprises Development Act, 2006.

Note : 3.4 Intangible Assets

During the year the Company has internally generated software for its captive use for the various long term projects received and also developed software for sale of its licenses. The cost of ''50.72 Lacs (Previous Year ''75.73 Lacs) is capitalized and shown as Intangible assets under the Group Fixed Assets.

Note : 3.5 Few debtors, creditors and loans and advances are subject to confirmation and reconciliation if any.

Note : 3.6 Operating lease

The Company''s significant leasing agreements are in respect of operating lease for office premises. These leasing agreements are cancelable and renewable by mutual consent on mutually acceptable terms. The aggregate lease rentals payable by the Company are charged to Statement of Profit and Loss as a rent amounting to ''39.00 Lacs (Previous year ''188.00 Lacs). The future minimum lease payments under non- cancelable operating leases due within a period of one year are estimated at ''NIL (Previous year ''NIL) and due later than one year but not later than five years are estimated at ''NIL. (Previous year ''NIL Lacs).

Note : 3.7 Due to severe financial crisis, the Company has requested some of the lenders to waive off some part of their interest on loan and negotiation on aforesaid matter is going on between the Company and the lenders. On the basis of discussion with lenders, management feels that no interest provision is required on loan from some of the lenders however, if any interest provision is required as per final negotiation it will be made as and when required.

Note : 3.8 Employee Benefits:

The disclosure required as per the revised AS-15 are as under:

Brief description of the Plan :

The Company has schemes for long term benefits such as Provident Fund and Gratuity. The Company''s defined contribution plans are Provident Fund and Employees'' State Insurance Fund (under the provisions of the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions. The Company has Defined Benefit Plan comprising of Gratuity. The benefits are based on final salary and cost of the benefit is entirely borne by the Company. The benefits of the scheme are paid in accordance with the Payment of Gratuity Act, 1972 without any monetary limit. The liability for Gratuity is determined on the basis of an independent actuarial valuation done at the year end. As per the Company''s Policy Leaves can be accumulated upto 21 days during the tenure of the service and at any given time and employees are entitled to cash compensation for maximum 21 days of unused accumulated leave balance only in the event of exit of employee.

Note : 3.10 Related party transactions

Description of relationship Names of related parties

Subsidiary Companies Tricom Document Management Inc. Tricom Infotech Solutions Limited

Tricom Data Processing Private Limited (formerly known as Mastiff Tech Pvt Ltd)

Tricom I.T. Services Private Limited

Tricom LPO Private Limited

Pacific Data Centers, Inc. *

Tricom Data Services, Inc. *

Tricom Software Services, Inc. *

Tricom Litigation Coding Services, Inc. *

Tricom Search Services, Inc. *

Tricom Infotech Solutions, Inc. #

Tricom Infotech Solutions (Cyprus) ltd

Grand Imaging Technology Inc. (formerly known as GTESS- Tricom Corporation)

Held through Tricom Document Management

Held through Tricom Infotech Solutions Ltd Held through Tricom Infotech Solutions Inc.

Executive Directors Mr. Chetan S. Kothari - Managing Director

Non-Executive Directors Mr. Jayant B. Tanksale *

Mr. Baldev Boolani **

Mr. Paresh Pathak

Entities having significant Tricom Fruit Products Limited influence over the Company Adilnath Finance Private Limited

Trio Mercantile & Trading Limited

Manshanti Enterprises Kothari Financial Services

Ceased to be Director w.e.f. 8th January, 2014 Ceased to be Director w.e.f. 30th September, 2013

Note : 3.12 Segment Reporting

Since the Company''s activities fall within a single geographical and business segment (ITES-BPO) it has no other primary reportable segment.

Note : 3.13 Previous year''s figures

Previous year''s figures have been regrouped/ reclassified wherever necessary to correspond with the current year''s classification/disclosure.


Mar 31, 2013

Note : 1.1 Contingent liabilities and commitments (to the extent not provided for)

(Rs.in Lacs)

As at As at PARTICULARS 31 March, 2013 31 March, 2012

i) Bank Guarantees issued to Custom authorities & others 8.31 8.31

ii) Appeals filed at different forums/authorities in respect of disputed demands:

Income Tax 681.73 369.33 iii) Corporate Guarantee given by the Company in respect of credit 869.00 996 25 limits sanctioned by a bank to a Subsidiary company

iv) Uncalled liability on partly paid shares 149.14

Note: Future cash outflows in respect of

(ii) above are determinable only on receipt of judgments/decisions pending with the respective forums/authorities.

Note : 1.2 In the opinion of the Board, the Current Assets, Loans and Advances have been stated at a value realizable in the ordinary course of business.

Note: 1.3 Disclosures under Section 22 of the Micro, Small and Medium Enterprises Development Act,

The Company Ijas not received any information from all its vendors regarding their status under Micro, Small and Medium Enterprises Development Act, 2006. However, as per the information available there are no amounts outstanding for a period beyond the stipulated period as specified under Mjcro, Small and Medium Enterprises Development Act, 2006.

Note: 1.4 Intangible Assets

During the year the company has internally generated software for its captive use for the various long term projects received and also developed software for sale of its licenses. The cost of Rs. 75.73 Lacs (Previous Year Rs. 82.93 Lacs) is capitalized and shown as Intangible assets under the Group Fixed Assets.

Note : 1.5 Few debtors, creditors and loans and advances are subject to confirmation and reconciliation if any.

Note : 1.6 Financial Instruments

The Company uses Foreign Currency Forward Contracts to hedge its risks associated With Foreign Currency Fluctuations. The Company does not use Forward Contracts for speculative purposes. The outstanding Foreign Exchange Forward Contract (4 Nos.) as on 31st March, 2013 in US $ 5,00,000 amounting to Rs. 280.03 Lacs.

Note : 1.7 Operating lease

The company''s significant leasing agreements are in respect of operating lease for office premises. These leasing agreements are cancelable and renewable by mutual consent on mutually acceptable terms. The aggregate lease rentals payable by the company are charged to Statement of Profit and Loss as a rent amounting to Rs. 188 Lacs (Previous year Rs. 303.33 Lacs). The future minimum lease payments under non-cancelable operating leases due within a period of one year are estimated at Rs. NIL (Previous year Rs. NIL) and due later than one year but not later than five years are estimated at Rs. NIL. (Previous yearRs. NIL Lacs).

Note : 1.8 Employee Benefits:

The disclosure required as per the revised AS-15 are as under:

Brief description of the Plan :

The Company has schemes for long term benefits such as Provident Fund and Gratuity. The Company''s defined contribution plans are Provident Fund and Employees'' State Insurance Fund (under the provisions of the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions. The Company has Defined Benefit Plan comprising of Gratuity. The benefits are based on final salary and cost of the benefit is entirely borne by the company. The benefits of the scheme are paid in accordance with the Payment of Gratuity Act, 1972 without any monetary limit. The liability for Gratuity is determined on the basis of an independent actuarial valuation done at the year end. As per the Company''s Policy the unused accumulated leave balance lapses at the year end and no employee is entitled to cash compensation for unused accumulated leave balance at the end of the year and no provision is required to be made.

Note: 1.9 Payment of Dividend

The Company had declared dividend of Rs. 131.39 Lacs in its Annual General Meeting held on 31st December, 2011. Due to paucity of funds, the amount could not be transferred to separate Dividend Account within the time limit prescribed u/s 205A(1) of the Companies Act, 1956. However, the Company has transferred Rs. 52.97 Lacs upto 30th May 2013.

Note : 1.10 Segment Reporting

Since the Company''s activities fall within a single geographical and business segment (ITESBPO)it has no other primary reportable segment.

Note : 1.11 Previous year''s figures

Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.


Mar 31, 2010

1) CONTINGENT LIABILITY As at March As at March 31, 2010 31, 2009 Rs.in Lacs Rs.in Lacs

i. Bank Guarantees issued to 3.40 3.40

customs Authorities

ii. Appeals filed at different forums/authorities in respect of disputed demands:

Income Tax 28.25 92.00

iii. Bank Guarantees issued on 338.55 764.25

behalf of Subsidiaries to the parties

iv. Corporate Guarantee given 867.15 706.00

by the Company in respect of credit limits sanctioned by banks to a subsidiary company

v Uncalled liability on partly 149.14 149.14

paid shares

Note : Future cash outflows in respect of (ii) above are determinable only on receipt of judgments/decisions pending with the respective forums/authorities.

2) In the opinion of the Board, the Current Assets, Loans and Advances have been stated at a value realizable in the ordinary course of business.

3) As per the notification dated March 31, 2009 , by The ministry of Corporate Affairs, in respect of provisions of Accounting Standard (AS-11) “The Effect of Changes in Foreign Exchange Rates”, exchange loss of Rs.27.97 Lacs (net of Rs.154.25 Lacs amortised during the year) is reported as Foreign Currency Monetary Item Translation Difference under the head Reserves & Surplus and will be amortised over the term of the loan but not beyond 31st March 2011.

4) Minimum Alternative Tax (MAT) paid in accordance to the tax laws, which gives rise to future economic benefits in the form of adjustment of future income tax liability, is considered as an asset if there is convincing evidence that the company will pay normal tax after the tax holiday period. Accordingly, MAT is recognised as an asset in the Balance Sheet when it is probable that the future economic benefit associated with it will flow to the Company and the asset can be measured reliably. Accordingly Rs.249.36 Lacs is recognised as asset for the Financial Year in the Balance Sheet.

5) Security for Secured Loans

a. Loans from Banks are secured by way of hypothecation of fixed assets except Vehicles of the Company, book debts, pledge of fixed and recurring deposits with a Bank and further secured by personal guarantee of a Director.

b. Vehicle Loans from Banks are secured against the specific vehicle financed by respective banks.

6) Employee Benefits

The disclosure required as per the revised AS-15 are as under :

Brief description of the Plan

The Company has schemes for long term benefits such as Provident Fund and Gratuity. The Companys defined contribution plans are Provident Fund and Employees State Insurance Fund (under the provisions of the Employees Provident Funds and Miscellaneous Provisions Act, 1952). The Company has no further obligation beyond making the contributions. The Company has Defined Benefit Plan comprising of Gratuity. The benefits are based on final salary and cost of the benefit is entirely borne by the company. The benefits of the scheme are paid in accordance with the Payment of Gratuity Act, 1972 without any monetary limit. The liability for Gratuity is determined on the basis of an independent actuarial valuation done at the year end. As per the Companys Policy the unused accumulated leave balance lapses at the year end and no employee is entitled to cash compensation for unused accumulated leave balance at the end of the year and no provision is required to be made.

7) Amount due to Micro, Small and Medium Enterprises

The Company is in process of compiling the data of suppliers which are covered under the Micro, Small & Medium Enterprises Development Act, 2000. Hence, the details pertaining to that are not disclosed separately. However, out of the total Sundry Creditors Rs. NIL is due to Small Scale and / or ancillary Industrial Suppliers (Previous Year Rs. NIL). No amount is outstanding for more than 30 days with SSI Units. Information regarding Small Scale Industrial Undertakings has been determined to the extent such parties have been identified on the basis of information available with the company. This has been relied upon by the Auditors.

8) Employees Stock Option Scheme

Pursuant to the Board resolution dated January 21, 2005, the company has granted 203,500 stock options on January 21, 2005 to the eligible employees. The total options of 203,500 are granted with the total vesting period of 36 months and exercise period of 6 months from the respective vesting dates.

The stock option discount in the aforesaid scheme computed as per SEBI guidelines in this respect, is being amortised on a straight line basis over the vesting period. Accordingly, during the year Rs.NIL/-(Previous Year Rs. 5.82 Lacs) being the proportionate charge of option discount for the year, has been included in the staff cost.

The company has calculated option discount on the basis of Intrinsic Value method and has amortized Rs.NIL/- (previous year Rs.5.82 Lacs) being the proportionate charge of option discount for the year as stated herein above. During the year, there being no other transaction remaining to ESOS, balance of Rs.39,90,480/- standing to the credit of ESOP outstanding Account is now transferred to the Share Premium Account.

9) Intangible Assets

During the year the company has internally generated software for its captive use for the various long term projects received and also developed software for sale of its licences. The cost of Rs. 76.40 Lacs (Previous Year Rs.101.40 Lacs) is capitalized and shown as Intangible assets under the Group Fixed Assets.

10) Capital Work in Progess

The Company has accumulated Rs.120.35 Lacs ,the amount spent on the establishing a new business vertical. The said amount will be adjusted in the accounts on either getting a contract for the vertical or on the managements decision if no contract is received in reasonable time.

11) Few debtors, creditors and loans and advances are subject to confirmation and reconciliation if any.

12) Financial Instruments

The Company uses Foreign Currency Forward Contracts to hedge its Risks associated with Foreign Currency Fluctuations. The Company does not use Forward Contracts for speculative purposes.

The outstanding Foreign Exchange Forward Contract (10 Nos.) as on 31st March, 2010 in US $ 500,000 amounting to Rs.2,33,64,500/-.

13) Operating lease

The companys significant leasing agreements are in respect of operating lease for office premises. These leasing agreements are cancelable and renewable by mutual consent on mutually acceptable terms. The aggregate lease rentals payable by the company are charged to profit and loss account as a rent amounting to Rs. 238.48 Lacs (Previous year. Rs. 238.86 Lacs). The future minimum lease payments under non- cancelable operating leases due within a period of one year are estimated at Rs. 115.61 Lacs (Previous year. Rs. 126.12 Lacs) and due later than one year but not later than five years are estimated at Rs.NIL.(Previous year Rs. 115.61 Lacs).

14) Remittance of Dividend in Foreign Currency

The Company has not remitted any amount in Foreign Currency on account of dividend during the year and does not have information as to the extent to which remittances, if any, in foreign currencies on account of dividend have been made by / on behalf of non resident shareholders. The particulars of Gross dividend declared to 66 non-resident shareholders for the year 2008-09 amounted to Rs.11,65,774/-.

15) Segment Reporting

Since the Companys activities fall within a single geographical and business segment (ITES-BPO) it has no other primary reportable segment.

21) Related Party Disclosure

As per Accounting Standard 18, issued by the Institute of Chartered Accountants of India, the disclosure of Related Parties and related parties with whom the transactions have taken place and the transactions are given below:

RELATED PARTIES

a. Subsidiary Companies:

i. Tricom Document Management Inc.

ii. Tricom Infotech Solutions Limited

iii. Pacific Data Centers, Inc.*

iv. Tricom Infotech Solutions (Cyprus) Limited #

v. Tricom Infotech Solutions, Inc.##

vi. Tricom Software Services,Inc.*

vii. Tricom Data Services, Inc.*

viii. Tricom Litigation Services, Inc.*

ix. Tricom Data Discovery Services, Inc.*

* Held through Tricom Document Management Inc.

# Held through Tricom Infotech Solutions Ltd. ## Held through Tricom Infotech Solutions

(Cyprus) Limited

b. Executive Directors:

i. Mr. Chetan S. Kothari - Managing Director ii. Mr.Jayant B. Tanksale – Executive Director – Operations

c. Non-Executive directors: i. Mr. Shailesh Bathiya ii. Mr. Gautam Berry iii. Mr. Hariom Tulsyan iv. Mr. Baldev Boolani

v. Mr. Anil Bakshi

vi. Mr. Rasik Chaturvedi

d. Entities having significant influence over the Company: i. Tricom Agrochem Limited

ii. Adilnath Finance Private Limited iii. Trio Mercantile & Trading Limited

16) Figures for the previous year have been regrouped / reclassified wherever necessary to confirm the classification of the current year.

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