Birlasoft Ltd
Directors Reports
Dear Members,
The Directors are pleased to present the 32nd Annual Report on the business
and operations of the Company, along with the Audited Standalone and Consolidated
Financial Statements for the financial year ended March 31, 2023.
Summary of Financial Performance
The financial performance of the Company for the financial year ended March 31, 2023,
is summarized below:
( Rs in million)
Particulars |
Standalone |
Consolidated |
|
2022-23 2021-22 |
2022-23 2021-22 |
| Total Revenue including Other Income |
24,514.14 |
21,235.07 |
48,175.80 |
41,965.52 |
| Earnings Before Interest, Depreciation and Tax |
3,529.78 |
4,760.58 |
5,432.76 |
7,063.25 |
| Less: Interest |
98.44 |
107.18 |
185.89 |
130.16 |
| Less: Depreciation |
759.36 |
685.10 |
822.65 |
765.10 |
| Profit before exceptional items and tax |
2,671.98 |
3,968.30 |
4,424.22 |
6,167.99 |
| Exceptional items |
- |
- |
- |
(1.37) |
| Profit before tax |
2,671.98 |
3,968.30 |
4,424.22 |
6,166.62 |
| Less: Taxes |
668.34 |
1,007.82 |
1,108.38 |
1,530.24 |
| Profit for the Year |
2,003.64 |
2,960.48 |
3,315.84 |
4,636.38 |
| Other Comprehensive Income/(Loss)-net of tax |
(107.54) |
(102.34) |
912.52 |
294.61 |
| Total Comprehensive Income for the year |
1,896.10 |
2,858.14 |
4,228.36 |
4,930.99 |
Business Performance
During the year under review (FY'23), the Company delivered a growth-led performance
with expansion in revenue as well as deal signings. This was achieved during a period that
witnessed rising macro-economic uncertainty, ascending interest rates owing to
inflationary pressures, and challenges arising within certain industries in western
economies.
On a consolidated basis, revenues for the year under review grew by 16.1% to Rs 47,948
million from Rs 41,304 million in the previous year. Earnings before interest, tax,
depreciation, and amortization (EBITDA) stood at Rs 5,205 million (Rs 6,401 million in
FY'22). Net Profit after tax stood at Rs 3,316 million (Rs 4,636 million in FY'22),
translating into a basic earnings per share of Rs 11.96 for the year (Rs 16.63 in
FY'22).
On a standalone basis, revenue from operations increased by 18.0% to Rs 24,172 million
in FY'23 from Rs 20,494 million in the previous year. Net Profit after tax stood at Rs
2,004 million (Rs 2,960 in FY'22). The financial performance of the Company during the
year under review, both consolidated and standalone, reflect the impact of one-time
provision and the discontinuation of revenue pertaining to a customer that filed a
petition for relief under Chapter 11 of Bankruptcy Code in the United States Bankruptcy
Court, on 01 February 2023.
During the course of the financial year, Birlasoft continued to reinforce its
management team, augment its capabilities, and accentuate its differentiators to drive
sustained growth and deliver exceptional service to its customers. On the organization
front, Birlasoft underwent a leadership transition with Angan
Guha taking over as the CEO and MD in December 2022. Further, the Company is undergoing
an organizational transformation, which is chiefly around two dimensions in order to (1)
become sharply focused on select verticals and service lines, and (2) culturally become
more nimble and execution-oriented.
As part of ongoing investments in enhancing emerging technologies capability, the
Company has expanded its delivery footprint with a new Delivery Centre in Coimbatore,
Tamil Nadu. This new Delivery Centre, with 250 seating capacity that was operationalized
during the fourth quarter of FY'23, enables access to an emerging lower-cost tech talent
hub.
During the year under review, the Company also amicably entered into a Settlement and
Mutual Release Agreement with one of its customers in the US, Invacare Corp (Invacare).
This Agreement followed consultations after the filing of voluntary Chapter 11 proceedings
under the US Bankruptcy Code by Invacare on February 1, 2023. As a prudent accounting
practice, the Company created a provision amounting to US$ 18.97 million against the
outstanding receivables and contract assets as on December 31, 2022. The resulting
discontinuation of revenue contribution from this customer and the aforesaid provision are
reflected in the Company's financials for the period under review. In April 2023, the
Company's wholly-owned subsidiary Birlasoft Solutions Inc. entered into the aforementioned
Settlement and Mutual Release Agreement with Invacare. As per the Settlement Agreement
approved on April 24, 2023, parties have mutually provided releases and waiver from
claims. Birlasoft Solutions Inc. would receive $ 2 million for Disengagement Services
ending on May 31, 2023. This Settlement Agreement is a positive step forward for the
Company as it puts the uncertainties around this particular account behind and allows the
management team to focus completely on driving business growth going forward.
On the back of its sales efforts, customer engagements, and established technology
capabilities, Birlasoft registered some important operating accomplishments during the
year, with multiple order wins including multi-million dollar engagements from both
existing and new clients. This has resulted in strong deal wins amounting to a Total
Contract Value (TCV) of US$ 869 million during FY'23, a 24.8% increase over the preceding
financial year.
Strong deal signings and a healthy opportunity pipeline indicate a positive performance
outlook in the next financial year.
The Management Discussion & Analysis of the Company's business, industry, and
performance, appears separately in this Annual Report.
Buyback of Equity Shares
The Company bought back 7,800,000 fully paid-up equity shares representing 2.79% of the
total number of equity shares in its paid-up share capital as at March 31, 2022, at a
price of Rs 500/- per equity share, for an aggregate amount of Rs 3,900 million (excluding
transaction costs, applicable taxes and other incidental and related expenses) through the
"tender offer" route as prescribed under the Securities and Exchange Board of
India (Buy-back of Securities) Regulations, 2018 (the "Buyback").
The Buyback period commenced on August 11, 2022 and closed on August 26, 2022. The
settlement of bids and payment of buyback consideration was made on September 2, 2022, and
the shares were extinguished on September 6, 2022. A capital redemption reserve was
created to the extent of share capital extinguished (Rs 15.6 million).
The details pertaining to Buyback are available on the website of the Company at
https://www.birlasoft.com/company/investors/ birlasoft-buyback-2022.
Dividend
During the year under review, the Board of Directors of the Company (the
"Board") declared an interim dividend of Rs 1.50/- (75%) per equity share of
face value of Rs 2/- each on the paid-up equity share capital of the Company.
Further, your Directors are pleased to recommend final dividend of Rs 2/- (100%) per
equity share of face value of Rs 2/- each for the financial year ended March 31, 2023,
subject to approval of the Members at the ensuing Annual General Meeting ("AGM")
of the Company.
The total dividend amount for the financial year 2022-23, including the proposed final
dividend, amounts to Rs 3.50/- per equity share of the face value of Rs 2/- each.
In view of the changes made under the Income-tax Act, 1961, by the Finance Act, 2020,
as amended, dividend paid or distributed by the companies shall be taxable in the hands of
the Members. The Company shall, accordingly, make the payment of dividend after deduction
of tax at source, at the rates prescribed therein.
Payment of dividend declared/paid is taxable in the hands of the Members and hence,
payment of dividend distribution tax is not required to be made by the Company.
The Record Date for determining the entitlement of the Members to the final dividend
for the financial year 2022-23, if approved by the Members at the AGM, is Friday, July 14,
2023.
The Dividend Distribution Policy of the Company, in terms of Regulation 43A of the
Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements)
Regulations, 2015 ("the SEBI (LODR) Regulations, 2015"), is available on the
Company's website at https://www.birlasoft.com/company/
investors/policies-reports-filings.
Share Capital
During the year under review, the Company allotted 3,174,465 equity shares of Rs 2/-
each, under its Employees Stock Option Plans and bought back 7,800,000 shares from the
Members. The issued, subscribed and paid-up capital of the Company, as on March 31, 2023,
is Rs 549,741,094, consisting of 274,870,547 equity shares of Rs 2/- each.
Transfer to General Reserves
During the year under review, the company has not transferred any amount to General
Reserve. For complete details on movement in Reserves and Surplus during the financial
year ended March 31, 2023, please refer to the ‘Statement of Changes in Equity'
included in the standalone and consolidated financial statements of this Annual Report.
Credit Rating
The Company has been rated by CARE Ratings Limited ("Credit Rating Agency"),
as below:
Facilities |
Rating |
| Long-term Bank Facilities |
CARE AA; Stable |
| Long-term/Short-term Bank |
CARE AA; Stable / CARE A1+ |
| Facilities |
|
| Short-term Bank Facilities |
CARE A1+ |
Quality and Information Security
We continue to improve our quality focus through internal initiatives and by getting
assessed against international standards. During the current Voice of Customer
("VOC") cycle, our customers have appreciated the value delivered by Project
teams and have rated them on an average at 4.5 on a scale of 1-5, 5 being the highest.
This further strengthens our resolve to make societies more productive by helping
customers run businesses more efficiently.
In line with our focus to be assessed against international standards, Birlasoft is
appraised for CMMI-DEV? (Development) & CMMI-SVC? (Services) V2.0 at Maturity Level
5. This milestone is testimony to our commitment to continuously improve on our quality
& operational processes, while at the same time, strengthening our delivery
capabilities to meet customer expectations. Our Quality Management system is certified for
ISO 9001:2015 and ISO 20000:2018 Standards for IT Services and this reflects the Company's
belief in delivering the right quality.
Birlasoft continues to maintain a mature Information Security Management System &
Privacy Information Management System. Policies, Processes and Controls have been defined
and implemented to minimize and manage the cyber security risks. A robust governance and
management of security compliance and risk are ensured by periodic reviews.
Birlasoft continues to leverage leading industry standards and controls to secure its
infrastructure environment and has implemented world-class tools to prevent, detect,
correct & recover from any security threats identified. Birlasoft has successfully
retained its ISO 27001:2013 Information Security Management System and ISO 27701:2019
Privacy Information Management System certification. The NIST Cyber Security Framework has
also been leveraged and is validated by third party vendors regularly.
Productivity
The Company is committed to productivity improvements to create a future abundant with
a wealth of knowledge. Multiple initiatives like Knowledge Management, bRight, bAutomate,
UREKA, MyTime and Value IN Customer's Interest ("VINCI") enable the Company to
harness latent knowledge in the organization and mobilize it.
b Right is an initiative that has been introduced to celebrate our accounts with
exemplary performance, cross-account learning opportunities through eight different
themes.
Delivery Process Automation has been introduced to improve the project or program
execution efficiency.
A brand-new knowledge management repository has grown to a level where the Company can
showcase efficiencies in the deliverables translating into real value for customers.
Reusability of case-studies as a new key factor will be benefitting the teams within
Birlasoft. MyTime is a crowdsourcing platform being utilized by technical enthusiasts to
develop re-usable tools that enhance productivity.
Institutional Shareholding
As on March 31, 2023, the total Institutional Shareholding in the Company was 32.68% of
the total paid-up equity share capital.
Subsidiaries, Associates and Joint Venture Companies
As on March 31, 2023, the Company has 14 subsidiaries, including step-down
subsidiaries. The Company has two material subsidiaries, viz., Birlasoft Solutions Inc.
& Birlasoft Inc., details of which are given in the Corporate Governance Report.
Further, Enablepath, LLC, a step-down subsidiary of the Company, has merged with
Birlasoft Inc. (wholly owned subsidiary of the Company) w.e.f. April 1, 2023.
As per Section 129(3) of the Companies Act, 2013 ("the Act"), consolidated
financial statements of the Company and all its subsidiaries have been prepared, and form
a part of this Annual Report. In terms of Rule 5 of Companies (Accounts) Rules, 2014, a
statement containing salient features of the financial statements of subsidiaries, in Form
AOC-1, is annexed to this Report as "Annexure 1".
In accordance with Section 136(1) of the Act, this Annual Report of the Company,
containing the standalone and the consolidated financial statements and all other
documents required to be attached thereto has been placed on the website of the Company at
www.birlasoft.com.
During the financial year 2022-23, the Company had no Associate or Joint Venture
company.
Board of Directors, its Committees and Meetings thereof
The Company's Board has an optimal combination of executive, non-executive and
independent directors (including three women directors) who bring to the table the right
mix of knowledge, skills and expertise. The Board provides strategic guidance and
direction to the Company in achieving its business objectives and protecting the interest
of all stakeholders. The Board is supported by five Committees of Directors viz. Audit
Committee, Stakeholders Relationship Committee, Nomination & Remuneration Committee,
Corporate Social Responsibility Committee & Risk Management Committee.
The Board meets once every quarter. Additional meetings of the Board/Committees are
convened as may be necessary for the proper management of the business operations of the
Company. A separate meeting of Independent Directors is also held at least once in a year
to review the performance of Non-Independent Directors, the Board as a whole and the
Chairman.
During the year, six meetings of the Board were held on May 23, 2022, August 3, 2022,
October 21, 2022, November 4, 2022, February 2, 2023, and March 30, 2023. The maximum
time-gap between any two consecutive meetings was within the period prescribed under the
Act and SEBI (LODR) Regulations, 2015.
A detailed update on the Board and its Committees' composition, meetings held and
attendance of the Directors at these meetings is provided in the Corporate Governance
Report, which forms a part of this Annual Report.
Directors and Key Managerial Personnel
During the year under review, Dharmander Kapoor (DIN: 08443715) resigned from
the position of Chief Executive Officer & Managing Director ("CEO & MD")
and as a Key Managerial Personnel ("KMP") of the Company effective end of
business hours of November 30, 2022.
Pursuant to the recommendation of the Nomination and Remuneration Committee (the
"NRC"), and approval of the Board on November 4, 2022 and of the Members
(through postal ballot) on January 13, 2023. Angan Guha (DIN: 09791436) was appointed as
the CEO & MD and a KMP of the Company for a period of 3 years, effective December 1,
2022. As Angan is not a resident of India as stipulated under Part 1 (e) of Schedule V to
the Companies Act, 2013, the Company has made an application to the Central Government for
seeking its approval to the said appointment. As required under Section 197(14) of the
Act, the details of remuneration paid to Angan Guha from Birlasoft Solutions Inc., a
wholly owned subsidiary of the Company, are given in the Corporate Governance Report.
Anant Talaulicar (DIN: 00031051) completed his second term as Independent Director of
the Company on October 20, 2022, and consequently ceased to be a Director of the Company.
Ananth Sankaranarayanan (DIN: 07527676) was appointed as an Independent Director of the
Company, for a period of 5 years effective February 2, 2023, pursuant to the
recommendation of the NRC, and approval of the Board on February 2, 2023 and of the
Members (through postal ballot) on March 23, 2023.
Chandrasekar Thyagarajan resigned as the Chief Financial Officer and a KMP of the
Company, effective end of business hours of February 2, 2023.
Kamini Shah was appointed as the Chief Financial Officer and a KMP of the Company,
effective April 3, 2023, pursuant to the recommendation of the NRC and approval of the
Audit Committee and the Board.
Your Directors place on record their appreciation for the valuable contribution made by
the retiring and resigning Directors and the CFO during their tenure with the Company.
In accordance with Section 152 of the Act, Chandrakant Birla (DIN: 00118473),
Non-Executive Director of the Company, is liable to retire by rotation at the ensuing AGM
and being eligible, offers himself for re-appointment. The Board recommends the resolution
for his re-appointment for the approval of the Members at the ensuing AGM. A brief profile
and other details relating to Chandrakant Birla is provided in this Annual Report.
None of the Directors are disqualified under Section 164(2) of the Act.
The following persons are currently designated as KMP of the Company pursuant to
Sections 2(51) and 203 of the Act, read with the Rules framed thereunder:
Sr. No. |
Name |
DIN / Membership Number |
Designation |
| 1 |
Angan Guha |
09791436 |
Chief Executive Officer & Managing Director |
| 2 |
Kamini Shah |
FCA 203593 |
Chief Financial Officer |
| 3 |
Sneha Padve |
ACS 9678 |
Company Secretary |
Independence of the Board
The Board comprises of optimal number of Independent Directors. Based on the
confirmation/disclosures received from the Directors and on evaluation of the
relationships disclosed, the following Non-Executive Directors are independent in terms of
Regulation 16(1)(b) and Regulation 25 of the SEBI (LODR) Regulations, 2015 and Section
149(6) of the Act:
1. Ashok Kumar Barat (DIN: 00492930);
2. Ananth Sankaranarayanan (DIN: 07527676);
3. Alka Bharucha (DIN: 00114067); and
4. Nandita Gurjar (DIN: 01318683).
All the abovenamed Directors have registered themselves with the Independent Directors
Databank. They are either exempted from or have complied with the requirements of online
proficiency self-assessment test conducted by ‘Indian Institute of Corporate
Affairs'.
The Board is of the opinion that the Independent Directors of the Company, including
those appointed during the year, possess the requisite qualifications, experience and
expertise and hold the high standards of integrity.
Auditors
- Statutory Auditors
M/s. B S R & Co. LLP, Chartered Accountants (ICAI Firm Registration No.:
101248W/W–100022), were re-appointed as the Statutory Auditors of the Company, in the
AGM held on August 7, 2019, for a period of 4 years till the conclusion of the AGM to be
held in the year 2023. They have completed 10 years as Statutory Auditors of the Company.
The provisions regarding rotation of auditors, as prescribed under the Act, are applicable
to the Company. Hence, it is proposed to appoint M/s. S R B C & Co. LLP, Chartered
Accountants, (Firm Registration Number - 324982E/ E300003), as the Statutory Auditors of
the Company, for a period of 5 years, to hold office from the forthcoming AGM till the AGM
to be held in the year 2028, to the Members for their approval.
Accordingly, an item for appointment of M/s S R B C & Co. LLP as the Statutory
Auditors of the Company is being placed at the ensuing AGM for approval of the Members.
Information about the proposed appointment of statutory auditor is given in the Notice of
AGM, which forms part of this Annual Report. The Board recommend their appointment to the
Members.
The Notes on the Financial Statements referred to in the Auditors' Report are
self-explanatory and do not call for any further comments. There are no qualifications,
reservations or adverse remarks in the Report of the Statutory Auditors for the financial
year ended March 31, 2023.
During the year under review, the Auditor has not reported any matter under Section
143(12) of the Act, therefore no detail is required to be disclosed under Section
134(3)(ca) of the Act.
- Secretarial Auditor
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment and
Remuneration of Managerial Personnel) Rules, 2014, Dr. K. R. Chandratre, Practising
Company Secretary (FCS No.: 1370 and CP No.: 5144), was appointed as the Secretarial
Auditor to conduct audit for the year under review. The Report of the Secretarial Auditor
is annexed as "Annexure 2". It does not contain any qualification,
reservation or adverse remark.
During the year under review, the Secretarial Auditor has not reported any matter under
Section 143(12) of the Act, and therefore no details are required to be disclosed under
Section 134(3)(ca) of the Act.
- Internal Auditor
The Internal Auditor and the Head of Internal Audit function within the Company reports
functionally to the Audit Committee of Board, which reviews and approves risk based annual
internal audit plan and the performance of internal audit function. The scope of work,
including annual internal audit plan, authority and resources, is regularly reviewed and
approved by the Audit Committee. Annual internal audit plan is aligned with the ERM to
ensure that all critical risks are covered in the audit plan. Besides, Internal Audit work
is supported by the services of leading international audit firms.
Annual Secretarial Compliance Report
The Company has undertaken an audit for the year ended March 31, 2023, pursuant to
Regulation 24A of the SEBI (LODR) Regulations, 2015 for all applicable compliances as per
the said Regulations. The Annual Secretarial Compliance Report duly signed by Dr. K. R.
Chandratre, Practising Company Secretary is available on the website of the Company at
https://www. birlasoft.com/company/investors/policies-reports-filings.
Corporate Governance
Pursuant to Regulation 34 of the SEBI (LODR) Regulations, 2015, Corporate Governance
Report for the year ended March 31, 2023, with a detailed compliance report thereon forms
an integral part of this Annual Report and is set out as separate section herein. It also
includes a certificate from the Statutory Auditors in respect of compliance with the
provisions of the SEBI (LODR) Regulations, 2015 related to Corporate Governance.
Management Discussion and Analysis
In terms of provisions of Regulation 34(2) of the SEBI (LODR) Regulations, 2015, a
detailed review of the operations, performance and outlook of the Company and its business
is given in the Management Discussion and Analysis Report, which is presented in a
separate section forming part of this Annual Report.
Awards & Recognitions
In recognition of its constant quest for excellence, the Company has been awarded and
recognised at various forums. The prominent ones are listed below:
1. Recognized by Microsoft as a Solution Partner for Infrastructure and Cloud workloads
(Azure) and for Azure Data and AI.
2. Birlasoft's Project Shodhan conferred with CSR Project of the Year at India CSR
Summit 2022.
3. Conferred with BTX Top Enterprise Award 2022 Asia at BTX Roadshow and Transformation
Awards 2022 Asia.
4. Birlasoft conferred with the "CXO Cloud Leadership Award" under the
category "Digital Transformation using Cloud" at CXO Cloud Summit and Award
2022.
5. Conferred with "Best Use of Cloud Services - IT" at the 3rd Technology
Excellence Awards 2023
6. Birlasoft earns DevOps with GitHub on Microsoft Azure Advanced Specialization
7. Birlasoft won the Information Software System Integrator Innovator Award at Asia
Pacific Partner NetworkTM Conference 2022 by Rockwell Automation
8. Birlasoft's Partner Pernod Ricard India awarded Excellence in Debut Automation
Program at UiPath Automation Excellence Awards 2022
9. Birlasoft recognized as ‘Leader' in ISG's SAP Ecosystem 2022 ISG Provider
Lens™ Study for the U.S.
10. Birlasoft identified as a ‘Leader' in the ‘Salesforce Ecosystem Partners
2023' ISG Provider Lens™ Study for ‘Implementation Services for Core Clouds
Midmarket' and ‘Managed Application Services for Midmarket' quadrants in the U.S.
Also positioned as a ‘Contender' in ‘Implementation Services for Industry
Clouds' quadrant for the U.S. and ‘Managed Application Services for Midmarket' for
the U.K. quadrant.
11. Birlasoft recognized in the Leadership Zone in Zinnov Zones's Intelligent
Automation Services H1– 2023
12. Birlasoft positioned as a ‘Leader' and ‘Contender' in various quadrants
for ISG Provider Lens™ Quadrant study on Next-Gen ADM Services 2022.
13. Birlasoft identified as a ‘Rising Star' in the Digital Business Enablement and
ESG Services 2022' ISG Provider Lens™ Study - U.S. for the ‘Supply Chain
Transformation Services' quadrant. Also identified as ‘Leader' in ‘Traditional
Enterprise' Archetype report of this study.
14. Birlasoft identified as a ‘Leader/Rising Star' in the ‘Oil and Gas
Industry - Services and Solutions 2022' ISG Provider Lens™ Study - North America,
Nordics. Recognized as ‘Leader' in Data Management and Cloud Computing- North
America; ‘Rising Star' in Data Management and Cloud Computing - Nordics, Next-Gen
IT/OT Services- North America.
15. Birlasoft recognized as a ‘Rising Star' in Life Sciences Digital Services 2022
ISG Provider Lens™ Study- Global for ‘MedTech Digital Transformation' quadrant.
Also positioned as ‘Product Challenger' in: ‘Patient Engagement Digital
Transformation' and ‘Manufacturing Supply Chain Digital Transformation' quadrants.
16. Birlasoft positioned as a ‘Rising Star' in the ‘Enterprise Service
Management 2023' ISG Provider Lens™ Study - U.S. for ‘ESM Consulting Services'
quadrant. Also positioned as ‘Product Challenger' in: ‘ESM Managed Services' and
‘ESM Implementation & Integration Services' quadrants.
Particulars of Employees, Directors and Key Managerial Personnel
The ratio of remuneration of each Director to the median employee's remuneration and
other details prescribed in Section 197(12) of the Act, read with Rule 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are annexed
to this Report as "Annexure 3".
In terms of the provisions of Section 197(12) of the Act, read with Rules 5(2) and 5(3)
of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a
statement showing the names of employees and other particulars of the top ten employees
and employees drawing remuneration in excess of the limits as provided in the said Rules
are set out in the Board's Report as an addendum thereto. However, in terms of provisions
of the first proviso to Section 136(1) of the Act, this Annual Report is being sent to the
Members of the Company excluding the aforesaid information. The said information is
available for inspection and any Member interested in obtaining such information may write
to the Company Secretary for the same.
Employees Stock Option Plans ("ESOPs")
The information pursuant to the provisions of the Act and Regulation 14 of the
Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity)
Regulations, 2021, relating to ESOPs of the Company, is annexed to this Report as "Annexure
4" and has been uploaded on the website of the Company and can be accessed
through web link https:// www.birlasoft.com/company/investors/policies-reports-filings.
Certificate from Dr. K. R. Chandratre, Practising Company Secretary (FCS No.: 1370 and
CP No.: 5144), the Secretarial Auditor of the Company, confirming that the schemes have
been implemented in accordance with the said SEBI Regulations, would be placed at the
ensuing AGM of the Company for inspection by the Members.
Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013
The Company has zero tolerance towards sexual harassment at the workplace and has
adopted a policy on prevention and prohibition of sexual harassment at workplace. The
Company has also put in place a redressal mechanism for resolving complaints received with
respect to sexual harassment and discriminatory employment practices for all genders. This
process ensures complete anonymity and confidentiality of information. An Internal
Complaints Committee has been constituted which is responsible for redressal of complaints
related to sexual harassment.
During the year under review, four complaints of sexual harassment were received by the
Company. Details as per the provisions of Sections 21 and 22 of the Sexual Harassment of
Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, are as under:
Number of cases pending at the beginning of the financial year |
Nil |
Number of complaints filed during the financial year |
4 |
Number of cases pending at the end of the financial year |
1 |
Details of workshops or awareness programs against sexual harassment
carried out |
The Company regularly conducts necessary awareness programs &
trainings for its employees & the Internal Complaints committee members. |
|
All new employees are provided detailed education during their
induction and required to complete a mandatory training at the time of joining. All
existing employees are required to complete annual refresher trainings. |
Nature of action taken by the employer or district officer |
Basis the inquiry and recommendations, the following actions were
taken: |
|
- One accused employee was terminated. |
|
- Another accused employee was issued warning and transferred to
another location. |
|
- Accused in the third incident was a vendor resource, whose contract
was immediately terminated and vendor withdrew the resource from the services of the
Company. |
Policy on Directors' appointment and remuneration
Pursuant to the provisions of Section 134(3)(e) of the Act, the policy of the Company
on the appointment and remuneration of Directors including criteria for determining
qualifications, positive attributes, independence of a director and other matters provided
under Section 178(3) of the Act is annexed to this Report as "Annexure 5".
This Nomination and Remuneration Policy as approved by the Board is available on the
Company's website and can be accessed through the web link https://www.
birlasoft.com/company/investors/policies-reports-filings.
Particulars of loans, guarantees or investments
The details of loans, guarantees and investments, if any, which are covered under the
provisions of Section 186 of the Act are given in the notes to the financial statements.
Related Party Transactions
The Company has adequate procedures for identification and monitoring of related party
transactions. All the transactions entered into with the related parties during the
financial year were on arm's length basis and were in the ordinary course of business. All
related party transactions were placed before the Audit Committee and the Board for
approval, wherever required.
Prior omnibus approval of the Audit Committee is obtained for the transactions that are
repetitive in nature. These transactions are reviewed by the Audit Committee on a
quarterly basis.
For details on related party transactions, Members may refer to the notes to the
financial statements. The Policy on Related Party Transactions as approved by the Board is
available on the Company's website and can be accessed through the web link
https://www.birlasoft.com/company/investors/policies-reports-filings.
Pursuant to the provisions of Section 134(3)(h) of the Act, the particulars of
contracts or arrangements with related parties referred to in Section 188(1) of the Act
and prescribed in Form AOC-2 of Companies (Accounts) Rules, 2014, is annexed to this
Report as "Annexure 6".
Material changes and commitments
There are no material changes and commitments affecting the financial position of the
Company that have occurred between the end of the financial year of the Company to which
the financial statements relate and till the date of this Report.
Risk Management Policy
The Company has constituted a Risk Management Committee (the "RMC") of the
Board to review the risk management plan/ process of the Company. The RMC assists the
Board in its oversight of the Company's management of key risks, including strategic and
operational risks, as well as the guidelines, policies and processes for monitoring and
mitigating such risks under the aegis of the overall Business Risk Management Framework.
The Company has a Risk Management Policy which has been approved by the Board. The Risk
Management Policy acts as an overarching statement of intent and establishes the guiding
principles by which key risks are managed across the organization. The Board monitors and
reviews periodically the implementation of various aspects of the Risk Management Policy
through the RMC.
A write-up on Enterprise Risk Management forms part of this Annual Report.
There are no risks identified by the Board which may threaten the existence of the
Company.
Internal Control Systems and Adequacy of Internal Financial Controls
The Company has put in place adequate internal financial control procedures
commensurate with its size, complexity and nature of business. The Company has identified
and documented all key financials controls, which impact the financial statements as part
of its Standard Operating Procedures. The financial controls are tested for operating
effectiveness through ongoing monitoring and review process by the management and also
independently by the Internal Auditor. Where weaknesses are identified as a result of the
reviews, new procedures are put in place to strengthen controls and these are in turn
reviewed at regular intervals.
Based on the review, nothing has come to the attention of Directors to indicate that
any material breakdown in the function of these controls, procedures or systems occurred
during the year under review.
Audit Committee
The Board has a duly constituted Audit Committee in line with the provisions of the Act
and the SEBI (LODR) Regulations, 2015. The primary objective of the Committee is to
monitor and provide effective supervision of the management's financial reporting process,
to ensure accurate and timely disclosures, with the highest level of transparency,
integrity and quality of financial reporting. The Committee met five times during the
year. Detailed information pertaining to the Audit Committee has been provided in the
Corporate Governance Report.
Committee Recommendations
During the year, recommendations of all the Committees were accepted by the Board. The
composition of the Committees is provided in the Corporate Governance Report, which forms
a part of this Annual Report.
Corporate Social Responsibility ("CSR")
The details of the initiatives taken by the Company during the year on CSR, in
accordance with Section 135 of the Act and the Companies (Corporate Social Responsibility
Policy) Rules, 2014 & the amendments thereto, along with information about CSR
Committee of the Board, have been annexed to this Report as
"Annexure 7".
The CSR Policy of the Company is placed on the website of the Company and can be
accessed through the web link https://
www.birlasoft.com/company/investors/policies-reports-filings.
Annual Evaluation of the Board, its Committees and Individual Directors
A formal evaluation of the performance of the Board, its Committees, the Chairman and
the individual Directors was carried out for the financial year 2022-23. The performance
evaluation was done using individual questionnaires, covering amongst others, composition
of Board, receipt of regular inputs and information, functioning, performance and
structure of Board Committees, skill set, knowledge and expertise of Directors,
preparation and contribution at Board meetings, leadership, etc. The performance
evaluation of the respective Committees and that of Independent and Non-Independent
Directors was done by the Board, excluding the Director being evaluated. List of key
skills, expertise & core competencies of the Board, including the Independent
Directors is provided in the Corporate Governance Report.
The performance evaluation of Non-Independent Directors, the Chairman and the Board was
done by the Independent Directors.
Establishment of Vigil Mechanism
The Company has a Whistle Blower Policy covering vigil mechanism as per Regulation 22
of the SEBI (LODR) Regulations, 2015, for the Directors and employees to report their
genuine concerns. The details of the same are explained in the Corporate Governance
Report. The Whistle Blower Policy may be accessed on the Company's website at https://www.
birlasoft.com/company/investors/policies-reports-filings.
Annual Return
Pursuant to Sections 134(3)(a) and 92(3) of the Act, read with Rule 12 of the Companies
(Management and Administration) Rules, 2014, the Annual Return in e-form MGT-7 may be
accessed on the Company's website at https://www.birlasoft.com/company/
investors/policies-reports-filings#annual-return.
Conservation of energy, technology absorption and foreign exchange earnings and outgo
Information on conservation of energy, technology absorption and foreign exchange
earnings and outgo stipulated under Section 134(3)(m) of the Act, read with Rule 8 of the
Companies (Accounts) Rules, 2014, is annexed as "Annexure 8" to this
Report.
Responsibility Statement of the Board of Directors
To the best of their knowledge and belief and according to the information and
explanations obtained by them, your Directors, pursuant to Section 134(3)(c) and Section
134(5) of the Act, state that:
i) in the preparation of the annual accounts for the financial year ended March 31,
2023, the applicable accounting standards have been followed along with proper explanation
relating to material departures, if any;
ii) they have 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 as on March 31, 2023 and of the profit of the
Company for the year ended March 31, 2023;
iii) they have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Companies Act, 2013, for
safeguarding the assets of the Company and for preventing fraud and other irregularities;
iv) they have prepared the annual financial statements on a going concern basis;
v) they have laid down internal financial controls to be followed by the Company and
that such internal financial controls are adequate and are operating effectively; and
vi) they have devised proper systems to ensure compliance with the provisions of all
applicable laws and that such systems are adequate and operating effectively.
CEO & CFO Certification
As required by Regulation 17(8) of the SEBI (LODR) Regulations, 2015, the CEO and CFO
certificate, for the year under review was placed before the Board at its meeting held on
May 8, 2023.
A copy of such certificate forms a part of the Corporate Governance Report.
Secretarial Standards issued by the Institute of Company Secretaries of India
The Company complies with all applicable mandatory Secretarial Standards as issued by
the Institute of Company Secretaries of India.
Listing with Stock Exchanges
The Equity Shares of the Company continue to be listed on National Stock Exchange of
India Limited and BSE Limited. The Annual Listing Fee for the financial year 2023-24 has
been paid to these exchanges.
Directors & Officers Insurance Policy
The Company has in place an insurance policy for its Directors & Officers with a
quantum and coverage as approved by the Board. The policy complies with the requirement of
Regulation 25(10) of SEBI (LODR) Regulations, 2015.
Other Statutory Disclosures
Your Directors state that no disclosure or reporting is required with respect to the
following items as there were no transactions related to these items during the year under
review:
- Details relating to Deposits covered under Chapter V of the Act;
- Issue of sweat equity shares or equity shares with differential rights as to
dividend, voting or otherwise;
- Raising of funds through, preferential allotment or qualified institutions placement;
- Provision of money for purchase of its own shares by employees or by trustees for the
benefit of employees;
- Significant or material order passed by any regulators or courts or tribunals against
the Company impacting the going concern status and Company's operations in future;
- Application made or any proceeding pending under the Insolvency and Bankruptcy Code,
2016; and
- Instance of one-time settlement with any financial Institution.
- Maintenance of cost records and requirement of cost audit as prescribed under the
provisions of Section 148(1) of the Companies Act, 2013.
Acknowledgments
The Board of Directors take this opportunity to thank all the Members of the Company
for their continued support.
The Directors thank all the customers, vendors, investors and bankers for their
continued support during the year. The Directors place on record their appreciation to the
contribution made by the employees at all levels, the Company's consistent growth was made
possible by their hard work, solidarity, co-operation and support.
The Directors further thank the governments of various countries where the Company has
its operations. The Directors also thank the Government of India, particularly the
Ministry of Communication and Information Technology, the Ministry of Commerce, the
Ministry of Finance, the Ministry of Corporate
Affairs, the Customs and Indirect Taxes Departments, the Income Tax Department, the
Reserve Bank of India, the State Governments, the Software Development Centres (SDCs)/
Special Economic Zones (SEZs) – Pune, Noida, Mumbai, Navi Mumbai, Chennai, Bengaluru,
Hyderabad and all other government agencies and look forward to their continued support in
the future.
|
For and on behalf of the Board of Directors |
|
Amita Birla |
| New Delhi |
Chairman |
| May 8, 2023 |
DIN: 00837718 |