Agnite Education Ltd
Directors Reports
Directors
To
The Members
Agnite Education Limited.
Chennai 600042.
Your Directors have pleasure in presenting the Twentieth Annual Report of the Company
along with the Audited Statement of accounts for the period ended 30 September 2011.The
Report also includes Management Discussion and Analysis in accordance with the guidelines
on Corporate Governance.
(Rs.in Cr)
| Particulars |
Period ended 30th September 2011 |
Year ended 31st March 2010 |
| Income from operations |
47.87 |
409.86 |
| Other income |
2.31 |
0.20 |
| Total Revenue |
50.18 |
410.06 |
| Total expenditure before Interest & Depreciation |
49.60 |
351.23 |
| Operating profit / Loss PBIDT |
0.58 |
58.83 |
| Interest |
0.08 |
54.09 |
| Depreciation / Amortization |
1.57 |
2.11 |
| Profit before tax |
(1.07) |
2.63 |
| Provision for tax |
0.32 |
0.40 |
| Profit after tax (PAT) |
(1.39) |
2.23 |
| Surplus brought forward |
487.08 |
484.85 |
| Balance carried to Balance sheet |
482.05 |
487.08 |
During the year, your Company has transformed itself into a Company devoted to provide
online education at a global scale. To offer better education globally through a series of
on-line solutions and provide the best possible education and training, the Company had
decided to change its name from Teledata Informatics Ltd to Agnite Education Limited.
Lines of Business:
Educational Solutions: Agnite Education Limited has developed solutions and
services by partnering with key institutions and has positioned itself to offer subject
matter expertise in key areas. The solutions offered by Agnite are as below:
• Tuition Edge Tuition Edge offers holistic education in the field of High School
Studies, Preparatory Studies, Professional Studies and General Studies.
• Skill Set Through Skill Set, Agnite focuses to offer skill development programme
by focusing on Trade Skills, Office Skills and Soft Skills.
• Distance Learning for Educational Institutions
Products
Agnite offers a varied range of products and software solutions for educational/
training institutions.
MonitorSIS is a highly customizable product capable of providing high quality and cost
effective solutions specific to the school’s needs.
WebEIM is a complete solution to the Enterprise Resource Planning (ERP) requirements
for educational institutions. WebEIM brings students, staffs, parents, educational
administrators and financial managers together using standard browser based access.
Directors' Responsibility Statement
In accordance with the provisions of Section 217(2AA) of the Companies Act, 1956, your
Directors confirm that:
• in the preparation of the annual accounts, the applicable accounting standards
had been followed along with proper explanation relating to material departures;
• they had selected such accounting policies and applied them consistently and
made judgments and estimates that are reasonable and prudent, so as to give a true and
fair view of the state of affairs of the Company at the end of the financial year and of
the profit of the Company for that period;
• they had taken proper and sufficient care for the maintenance of adequate
accounting records, in accordance with the provisions of this Act, for safeguarding the
assets of the company and for preventing and detecting fraud and other irregularities, and
• they had prepared the annual accounts on a going concern basis.
Corporate Governance
The disclosure requirements on corporate governance prescribed under clause 49 of the
listing agreement is annexed herewith as part of the report.
Directors
Gp.Capt. K. Balasubramanian IAF (Retd), Director is retiring by rotation and has
conveyed his acceptance to continue as a Director of the company.
Mr. M.S. Ramakrishnan has resigned from the position of Director of the Company with
effect from 01st October 2010.
Financial Year
The Company has received approval from the Registrar of Companies, Chennai vide their
letter dated 22nd July 2011 for the purpose of extension of financial accounting year from
01st March 2010 to 30th September 2011. Consecutively, the extension for conducting the
Annual General Meeting was granted by the Registrar of Companies, Chennai for 3 months
i.e. upto 30th March 2012 vide their letter dated 22nd July 2011.
CEO Certification
The Managing Director has submitted a Certificate to the Board Meeting regarding the
Financial Statements and other matters as required and Clause 49 (V) of the Listing
Agreement.
Fixed Deposits
Your Company has not accepted fixed deposits and as such, no amount of principal or
interest was outstanding as at the Balance Sheet date.
Particulars of Employees
None of the employees of the company are falling under the information to be furnished
as per section 217 (2A) of the Companies Act 1956.
Auditors
M/s N.R. Krishnamoorthy and Company Chartered Accountants, retire at the ensuing Annual
General Meeting and have confirmed their eligibility and willingness to accept Office as
Statutory Auditors if re-appointed.
Subsidiaries
The financial statements of the subsidiaries of your Company are drawn up in accordance
with the applicable Accounting Standards and forms part of the Consolidated Financial
Statements in the Annual report. Your Company believes that the consolidated accounts
present a full and fair view of state of affairs and financial conditions. The financial
information relating to the subsidiary companies are not appended to this report.
As per Section 212 of the Companies Act, 1956, we are required to attach the
Director’s Report, Balance Sheet and Profit and Loss Account of our subsidiaries. The
Ministry of Corporate Affairs, Government of India vide its circular no. 2/2011 dated
February 8, 2011 has provided an exemption to companies from complying with section 212,
provided such companies publish the audited consolidated financial statements in the
Annual Report. Accordingly, the Annual Report 2010-11 does not contain the financial
statements of our subsidiaries. The audited annual accounts and related information of our
subsidiaries, where applicable, will be made available upon request. These documents will
also be available for inspection during the business hours at our registered office in
Chennai, India.
Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo
The particulars prescribed under Section 217(1)(e) of the Companies Act, 1956 read with
the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988
are set out separately, which forms a part of this report.
Acknowledgements
Your directors extend their gratitude to customers, alliance partners and employees for
their continued valuable support. The unrelenting contribution made by our employees to
ensure customer care deserves a special acknowledgement. Your directors place on record
their appreciation for the excellent continued co-operation from Bankers, vendors and
various Government and Non-Government Agencies including SEBI, Stock Exchanges, Registrar
of Companies, STPI, RBI & others and look forward to their continued support in the
future.
|
|
For and on behalf of the Board of Directors |
|
Sd/- |
Sd/- |
|
K. Padmanabhan |
N. Sakthivel |
|
Managing Director |
Director |
| Place: Chennai |
|
|
| Date: 16.03.2012 |
|
|
ADDENDUM TO DIRECTORS’ REPORT
Director’s Comments on the Qualifications made by Auditors in their report on
financial statements of the Company
1. a. We draw attention to Note No.22 of Schedule Q on booking of revenue on sale of
products to marketing agents and legal action against debtors, wherever necessary.
DC- The Company has agreement with marketing agents in various countries through whom
products are sold. To recover the dues the Company has initiated legal action.
b. We are unable to comment on the ultimate realisability of investments amounting to
Rs.110.33 crores in Rainforest Trading Limited and amount advanced to Baytech Inc BVI to
the tune of Rs.186.13 crores, in the absence of audited financial statements for the last
five years of their ultimate subsidiary ESys Technologies Pte Limited which is the
substance of the said investments/advances as referred to in Note No.19 of Schedule Q
DC The Board of directors are of the opinion that the investments amounting to
Rs.110.33 crores in Rainforest Trading Limited and amount advanced to Baytech Inc BVI of
Rs.186.13 crores are realizable and necessary legal proceedings have been initiated
against parties concerned for recovery of the dues.
2. In our opinion, the Balance Sheet, the Profit and Loss Account and the Cash Flow
Statement dealt by with this report have been prepared in all material respects in
compliance with the applicable Accounting Standards referred to in Section 211(3C) of the
Companies Act, 1956 except for non-compliance in respect of the reinstatement of
debtors, creditors and advances in accordance with Accounting Standard 11 "Effects of
Changes in Foreign Exchange Rates" (Revised)
DC The Company will be taking steps to comply with the provisions of Accounting
Standard 11 "Effects of Changes in Foreign Exchange Rates" (Revised)
3. In our opinion and according to the information and explanations given to us and
having regard to the explanation that purchases of certain items of contents and
consumables for projects are for the Company’s specialized requirements for which
suitable alternate sources are not available to obtain comparable quotations, there are
adequate internal control procedures commensurate with the size of the Company and the
nature of its business with regard to purchase of contents through approval by the
technical committee, fixed assets and with regard to the provision of services. In our
opinion and according to the information and explanations given to us , we have not
observed any continuing failure to correct major weaknesses in internal controls except
incase of the sale of goods and services wherein the Company does not keep the details of
the end users of the software licenses sold through the agents.
DC- The Company has marketing agreement with marketing agents in various countries
through whom products are sold and hence the onus of keeping details of end users of
software licenses lie on the above marketing agents. The revenue is normally recognized by
the Company on sale of products to marketing agencies and this policy is being followed by
the Company consistently over past years which are in tune with the agreement entered into
by the Company with respective parties.
4. According to the information and explanations given to us, the Company is not
regular in depositing with appropriate authorities undisputed statutory dues including
provident fund, employees’ state insurance, income tax, sales tax, wealth tax,
service tax and other statutory dues applicable to it. As explained to us, the Company did
not have any dues on account of customs duty and excise duty.
Further, since the Central Government has till date not prescribed the amount of Cess
payable under section 441A of the Companies Act, 1956, we are not in a position to comment
upon the regularity or otherwise of the Company in depositing the same.
According to the information and explanations given to us, no undisputed amounts
payable in respect of the aforesaid dues were outstanding as at September 30th, 2011 for a
period of more than six months from the date of becoming payable other than:
a. Provident fund previous year amounting Rs. 0.29 Crores
DC- The company has already paid major portion and is arranging to pay the balance on
priority basis.
5. Based on our audit procedures and according to the information and explanations
given to us, the Company has continuously defaulted in repayment of dues to banks and
the advances received by the Company from the State Bank of India to the tune of Rs.
314.99 crores and from other banks to the tune of Rs. 87.58 crores as on the
Balance Sheet Date have been classified as Non-Performing Assets (NPAs) by the Banks.
DC- The Company is taking steps to repay the amount to the bank and is confident of
repaying the dues to the bank.
6. According to the information and explanations given to us, the Company is not
dealing or trading in shares, securities, debentures and other investments. All securities
and other investments have been held by the Company in its own name except in case of
investments in certain foreign companies where shares are held by its directors/nominees
as referred to in Note No.19(a) of Schedule Q of notes to accounts wherein the share
certificate for the investments are not in possession of the Company.
DC- The Company is taking effective steps to recover the investments made by the
company.
Director’s Comments on the Qualifications made by Auditors in their report on
Consolidated financial statements of the Company
1. We report that subsidiaries as disclosed in Note No 4 (b) of Schedule Q have been
consolidated on the basis of unaudited financial statements which reflect total assets
(net) of Rs. 5.92 Crores as at 30th September, 2011, total revenues of Rs.
7.42 Crores and aggregate Profit of Rs. 0.45 Crores for the period ended on that
date. The financial statements of the above said subsidiaries have been certified by the
management and have been furnished to us and in our opinion in so far as it relates to the
amounts included in respect of the subsidiaries are based solely on certified unaudited
financial statements. We have relied on management certifications for elimination of
inter-company transactions of the group in the absence of any confirmation from the
directors/auditors of group companies.
DC The Board of Directors of the Company felt that as financial year of subsidiaries
are not in coincidence with the financials of the parent company, the parent company is
not in a position of giving consolidated audited financial statement and such accounting
treatment are in agreement with provisions of the Companies Act, 1956.
2. We report that the Group has not consolidated the results of a subsidiary company
i.e. PT Teledata Energy Services, Indonesia and Insoft System Pte Ltd, Singapore in
accordance with AS 21 on "Consolidated Financial Statements"(Refer Note No. 2(h)
of Schedule Q) in the absence of any financials to this effect .We also report that the
Group has not consolidated the results of the subsidiary companies i.e., Baytech Inc. BVI
and Rainforest Trading Ltd (SPV) in accordance with AS 21 on "Consolidated Financial
Statements"(Refer Note No. 2(h) of Schedule Q) due to the ongoing legal proceedings
against Vikas Goel and eSys Technologies Pte Ltd, Singapore which is a wholly owned
subsidiary of Rainforest Trading Ltd (SPV) . Effectively the profit and loss account and
balance sheet is understated to the extent of financials of these subsidiaries.
DC- The Board of Directors are of the opinion that financials of PT Teledata Energy
Services Ltd., Indonesia is being reconciled and of the opinion, that it will not
materially affect the financials of the company on a consolidated basis. In the case of
Baytech Inc and Rainforest Trading Pvt Ltd, Company has initiated legal proceedings for
breach of terms of Share Purchase Agreement which includes non submission of Audited
financials.
3. We draw attention to Note No. 20 of Schedule Q on booking of revenue on sale of
products to marketing agents by the Parent Company and legal action against debtors,
wherever necessary
DC- The Company has agreement with marketing agents in various countries through whom
the products are sold. The company has initiated legal action against debtors wherever
necessary to recover the dues to the company.
4. We are unable to comment on the ultimate realisability of investments amounting
to Rs..110.33 crores made by the Parent Company in Rainforest Trading Limited and
amount advanced to Baytech Inc BVI to the tune of Rs.186.13 crores in the absence
of audited financials for the last five years of their ultimate subsidiary Esys
Technologies Pte limited which is the substance of the said investment/advances as
referred to in Note No. 17(a) of Schedule Q.
DC The Board of directors are of the opinion that the investment amounting to Rs.110.33
crores in Rainforest Trading Limited and amount advanced to Baytech Inc BVI of Rs. 186.13
crores are realizable and necessary legal proceedings have been initiated against parties
concerned for recovery of the dues
5. The Group has not complied in respect of the reinstatement of debtors, creditors
and advances in accordance with Accounting Standard 11 "Effects of Changes in Foreign
Exchange Rates" (Revised).
DC -The Companies shall be taking steps to comply with the provisions of Accounting
Standard 11 - "Effects of Changes in Foreign Exchange Rates" (Revised)
ANNEXURE TO DIRECTORS’ REPORT
A) Conservation of Energy:
The operations of your Company are not energy intensive. The Company has, however,
taken adequate measures to conserve energy consumption by using efficient computer
terminals and building management systems. The impact of these efforts has enhanced energy
efficiency. As energy cost forms a very small part of total expenses, the financial impact
of these measures is not material and not measured.
B) Technology Absorption, Adaptation and Innovation:
The Company's business demands constant absorption of and adaptation to changing
technologies to stay competitive in the rapidly changing world.
C) Foreign Exchange Earnings and Outgo:
Your Company is making continuous efforts to explore new foreign markets and increase
its share in the market for export of software. The details of foreign exchange earned and
the outgo is as under:
(Rs. In Cr)
| Particulars |
30 September 2011 |
31 March 2010 |
| Foreign exchange earnings |
44.10 |
400.99 |
| Foreign exchange outgo |
38.96 |
318.50 |
| Earnings in Foreign currency on receipt basis |
71.80 |
86.99 |
| Expenditure in foreign currency |
33.12 |
56.55 |
|
|
For and on behalf of the Board of Directors |
|
Sd/- |
Sd/- |
|
K. Padmanabhan |
N. Sakthivel |
|
Managing Director |
Director |
| Place: Chennai |
|
|
| Date: 16.03.2012 |
|
|
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