Inspirisys Solutions Ltd
Directors Reports
To
THE MEMBERS OF INSPIRISYS SOLUTIONS LIMITED
The Directors are pleased to present the 28th Annual Report
of the Company together with the Standalone and Consolidated Audited Financial Statements
for the financial year ended 31st March, 2023.
1. FINANCIAL RESULTS
' in lakhs
| Particulars |
Consolidated |
Standalone |
31 March
2023 |
31 March
2022 |
31 March
2023 |
31 March
2022 |
| Total Revenue |
39,522 |
34,698 |
36,001 |
30,355 |
| Earnings before interest, tax,
depreciation and amortization (EBITDA) |
1,795 |
229 |
3,414 |
1,297 |
| Finance costs |
1,078 |
843 |
650 |
550 |
| Depreciation and amortization
expense and impairment loss |
561 |
549 |
559 |
547 |
| Profit / (loss) before tax and
exceptional items |
156 |
(1,163) |
2,206 |
200 |
| Exceptional items |
- |
- |
- |
- |
| Profit / (loss) before tax |
156 |
(1,163) |
2,206 |
200 |
| Tax expense |
411 |
171 |
411 |
171 |
| Profit for the year |
(255) |
(1,334) |
1,795 |
29 |
| Other comprehensive income for
the year, net of tax |
(662) |
(115) |
(56) |
(23) |
| Total comprehensive income for
the year |
(917) |
(1,449) |
1,785 |
6 |
2. BUSINESS PERFORMANCE
Total Revenue for the year ended 31st March, 2023 on
Consolidated basis stood at ' 39,522 Lakhs which is an increase of 14% from the Total
Revenue of ' 34,698 Lakhs reported for 31st March, 2022. Total Revenue on a
Standalone basis for the year ended 31st March, 2023 stood at ' 36,001 Lakhs
which is an increase of 19% from the Total Revenue of ' 30,355 Lakhs reported for year
ended 31st March, 2022.
Increase in revenue has come from all segments of the business within
India except warranty management services division. At the consolidated level Dubai
subsidiary revenue had a de-growth. Business continued to have challenges on large
products and services projects which were being deferred / delayed due to impact, of
Russia and Ukraine war.
Growth in Revenue and Margins helped the Company improve the
consolidated EBITDA for the financial year ended 31st March, 2023 to ' 1,795
Lakhs from ' 229 Lakhs for the year ended 31st March, 2022. The Company made an
EBITDA of ' 3,414 Lakhs on a standalone basis for the year ended 31st March
2023 compared to ' 1,297 Lakhs for 31st March, 2022.
Whilst the Company's standalone performance was profitable with a
profit before tax of ' 2,206 Lakhs for 31st March, 2023, the losses from the
Subsidiary Company in Dubai for the year brought down profit before tax to ' 156 Lacs at
Consolidated level.
3. DIVIDEND
The Directors do not recommend any dividend for the year ended 31st
March, 2023 due to inadequate profits.
4. HUMAN RESOURCES DEVELOPMENT
Attracting and retaining the right talent has been the foremost
objective of the HR Function and the actual results indicate the role of Human Capital in
the growth of the Company and its strategic activities. The Company recognises people as
the primary source of its competitiveness and continues its focus on people development by
leveraging technology. To achieve this, the Company has set in place an agile Talent
Acquisition System which helps the Company to handle demands from business by providing
resources on a continuous basis.
The head count of the company was 1,628 as on 31st March,
2023.
The on-boarding model followed helped the Company to integrate
associates acquired locally to the culture of the Company.
The learning and development team working as part of the Human
Resources function has imparted 3,358 man-days of training to employees on various
technology solutions and skill development.
The Company continues to initiate training of resources to keep up with
the new technological challenges, meet the market requirements and deliver high quality
services to our clients. The thrust of Human Resource has been on improvement of the
performance of employees through training and development.
The Company's pursuit to connect with its employees on a regular basis
and communicate in an open and transparent manner is evident from the voluntary attrition
rates during the year, which was 38 percent, that is equivalent to the current industry
trend, given the market dynamics.
5. BUSINESS EXCELLENCE AND QUALITY INITIATIVES
The Company continues to maintain highest levels of quality to enhance
customer satisfaction.
In FY 2022-23 the Company kept the Quality Management Systems updated
with continued investment in technologies, infrastructure and processes.
The Company has certifications for:
• ISO 9001:2015 (Quality Management System)
• ISO 27001:2013 (Information Security Management System)
• ISO 20000-1:2018 (Service Management System)
• CMMI Level 3 Dev 2.0
• ISO 14001:2015 (Environmental Management System)
• SOC II Type I and SOC II Type 2.
The Company has various policies, processes and systems in place that
will not only enable strengthening and smooth functioning of the operations but also
improve the quality of operations.
6. DOCUMENTS PLACED ON THE WEBSITE (www.inspirisys.com)
The following documents have been placed on the Company's website in
compliance with the Companies Act:
a. Consolidated and Standalone Financial Statements of the Company.
b. Separate audited accounts in respect of subsidiaries as per fourth
proviso to Section 136(1).
c. Details of Vigil Mechanism for Directors and Employees to report
genuine concerns as per proviso to Section 177(10).
d. The terms and conditions of appointment of Independent Directors.
e. Details of unpaid dividend as per Section 124(2).
7. SUBSIDIARY COMPANIES
As at 31st March, 2023, the Company has operating wholly
owned subsidiaries in the United States, United Kingdom and United Arab Emirates (Dubai).
The wholly owned subsidiaries in Japan and India had suspended operations in March 2020
and March 2019 respectively. The Company also has a branch office in Singapore. There are
no associate or joint venture companies within the meaning of Section 2(6) of the
Companies Act, 2013 ("Act"). The Statutory Audit Report of the Subsidiary
Companies for the financial year are placed before the Audit Committee and reviewed by
them. Shareholders interested in obtaining a copy of the audited annual accounts of the
subsidiary companies may write to the Company Secretary. Pursuant to the provisions of
Section 129(3) of the Act, a statement containing the salient features of financial
statements of the Company's subsidiaries is in Form No. AOC- 1, which forms part of this
Annual Report.
As required by the SEBI LODR regulations, the Company has adopted the
regulations and formulated a Policy for determining Material Subsidiaries and the said
policy is available on the Company's website www.inspirisys.com. As per the policy, the
wholly owned subsidiary Inspirisys Solutions IT Resources Limited is material subsidiary
of the Company in accordance with the SEBI (LODR) Regulations, 2015. Mr. M S Jagan,
Independent Director of the Company is a Director on the Board of the unlisted material
subsidiary with effect from 14th February 2023. The material subsidiary Company
has also undertaken the Secretarial Audit in line with the requirements of Regulation 24
of SEBI LODR Regulations 2015.
8. CORPORATE GOVERNANCE REPORT REQUIRED UNDER SEBI (LODR) REGULATIONS,
2015
As per SEBI LODR Regulations, 2015, the Company has obtained a
Certificate from Practicing Company Secretaries confirming the Corporate Governance
requirements is attached and form part of this report.
9. MANAGEMENT DISCUSSION & ANALYSIS REPORT
In terms of Regulation 34 of SEBI (LODR) Regulations, a separate
Annexure II to this Report is enclosed where the Management Discussion and Analysis Report
and various initiatives and future prospects of the Company are provided.
10. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Act, the Board of Directors, to the
best of its knowledge and ability, confirm that:
i. in the preparation of the annual accounts, the applicable accounting
standards have been followed and there are no material departures;
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 at the end of the
financial year and of the profit of the Company for that period;
iii. they have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the Act for safeguarding
the assets of the Company and for preventing and detecting fraud and other irregularities;
iv. they have prepared the annual accounts on a going concern basis;
v. they have laid down internal financial controls to be followed by
the Company and such internal financial controls are adequate and operating effectively;
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.
On the basis of the internal financial control framework and compliance
systems established and maintained by the Company, the work performed by the Internal,
Statutory and Secretarial Auditors, including Internal Financial Controls Audit over
financial reporting by the Statutory Auditors and the reviews performed by management and
the relevant Board committees, including the Audit committee, the Board is of the opinion
that the Company's Internal Financial Controls were adequate and effective during the
financial year 2022-23.
11. STATUTORY AUDITORS REPORT AND SECRETARIAL AUDIT REPORT
Management response to the qualification in the Statutory Auditor's
Report : -
As disclosed with Note 7(c) to the Standalone Financial and
Consolidated Financial Statements, the Company has a trade receivable of ' 4,033
Lakhs as on 31st March 2023 (' 3,628 Lakhs as on 31st March 2022)
from one of its Subsidiary Company Inspirisys Solutions North America, Inc (ISNA). The
balance reflects accumulation of receivables since 2016-17. ISNA, the wholly owned
subsidiary of Inspirisys Solutions Limited (ISL), India is the marketing arm for the
offshore services offered and delivered to the US customers of ISNA from ISL India. ISNA
has been working with customers in North America and have been engaging them for onsite
business in the US and offshore business for ISL India. The trade receivables in the books
of ISL India represents services performed and billed on ISNA over the years in respect of
offshore services for the clients of ISNA. The Management is working on turning around the
business performance of ISNA and are hopeful of generating profits to pay ISL India
against the trade receivables and to this effect have drawn up business plans for the
subsidiary for the next few years. In view of the above, the Management considers not
making any provision towards any expected credit loss against these Accounts Receivable
from ISNA including GST liability if any on such export receivables together with interest
thereon as we are hopeful of collecting the dues from ISNA. The impact of non-compliance
with Clause C.20 of the Master Direction - Export of Goods and Services (Updated as on 22nd
November, 2022) for non-realization of export proceeds within stipulated timeline has been
determined to be immaterial to the standalone & consolidated financial statements.
Emphasis of Matter - Show Cause Notice from SEBI:
As disclosed with Note 41(b) to the Standalone Financial and Note 40(b)
to the Consolidated Financial Statements, during the year 2021-22 the Company has received
a show cause notice from SEBI under sections 11(1), 11(4), 11(4A), 11B(1) and 11B(2) read
with 15HA and 15HB of the Securities Exchange Board of India Act, 1992, and Rule 4(1) of
Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing
Penalties) Rules, 1995 and Sections 12A(1), 12A(2) read with 23E and 23H of the Securities
Contracts (Regulation) Act, 1956 and Rule 4(1) of Securities and Exchange Board of India
(Procedure for Holding Inquiry and Imposing Penalties) Rules, 2005 in the matter of
alleged mis-representation of financials / manipulation of books of accounts of Inspirisys
Solutions Limited (formerly known as Accel Frontline Limited), in relation to FY2012-13 to
FY2015- 16. The Company's Management has engaged legal counsel and has been evaluating the
options that are available for the Company to pursue. The Company's management believes
that such alleged violations will not have any material impact in the standalone &
consolidated financial statements of the year under consideration.
Management response to the Emphasis of Matter in the Statutory Auditors
Report and Observation in the Secretarial Auditors Report on Disqualification and
Resignation of Director.
As disclosed with Note 43 to the Standalone Financial and Consolidated
Financial Statements & point No. 1 of Secretarial Audit Report, the Company is in
receipt of resignation letter from one of the Independent Directors, Mr. Raj Khalid, due
to his name appearing in the list of disqualified directors released by the Registrar of
Companies, Mumbai on 7th September 2017 and 3rd February 2020, for
reasons as more particularly provided therein. The Board of Directors has taken record of
his resignation with effect from 30th April, 2023 basis the resignation letter
submitted and has taken required steps in reconstituting its committees, where such
director was a member. The Management is of the view that the stated events do not have a
material impact on these financial results or functioning of the Company.
12. IMPORTANT DISCLOSURES MADE BY THE COMPANY UNDER REGULATION 30 OF
THE SEBI (LODR) REGULATIONS, 2015 TO THE STOCK EXCHANGES
• Proceedings of the 27th Annual General Meeting of the
Company.
• Appointment of Mr. Murali Gopalakrishnan as an Additional
Director and as an Executive Director cum Chief Executive Officer (Key Managerial
Personnel) of the Company with effect from 1st November, 2022.
• Appointment of Mr. Toru Horiuchi as Additional Director
(Non-Executive, Non-Independent) of the Company with effect from 1st November,
2022.
• Appointment of Mr. R. Balaji as the Chief Financial Officer of
the Company with effect from 1st November, 2022.
• Authorisation of Key Managerial Personnels (KMPs) for
determining materiality of events and making disclosures to stock exchanges in the light
of the change in the KMPs of the Company.
• Proceedings relating to the resolutions passed by way of Postal
Ballot through e-Voting by the shareholders.
• Resignation of Mr. Malcolm F. Mehta as the Chairman & Chief
Executive Officer and as a Director of the Company with effect from 31st
October, 2022.
• Resignation of Mr. Murali Gopalakrishnan as the Chief Financial
Officer of the Company with effect from 31st October, 2022 due to transitioning
into the role of Executive Director.
• Resignation of Mr. Raj Khalid as a Director of the Company with
effect from 30th April, 2023.
13. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS AND OUTGO
The Company has strong commitment towards conservation of energy and
adoption of latest technology in its areas of operations. The particulars as prescribed
under Rule 8(3) of the Companies (Accounts) Rules, 2014, are set out in an Annexure-III to
this forming part of the Annual Report of the Company.
14. SEPARATE MEETING OF INDEPENDENT DIRECTORS
The Independent Directors met on 12th October, 2022 & 28th
February, 2023 and evaluated the performance of NonIndependent Directors, the Board as a
whole and Chairperson of the Company and information flow from the Company. Details
regarding the same is provided in the Corporate Governance report forming part of the
Annual Report of the Company.
15. EVALUATION OF THE BOARD'S PERFORMANCE
The Board of Directors has carried out performance evaluation of Board,
its Committee and individual Directors, in accordance with the manner specified by
Nomination and Remuneration Committee and as approved by the Board of the Company The
manner in which the evaluation has been carried out is explained in the Corporate
Governance report forming part of the Annual Report of the Company.
16. AUDITORS
a) Statutory Auditors
The Statutory Auditors of the Company M/s. Walker Chandiok & Co
LLP, Chartered Accountants (Firm's Registration No. 001076N/N500013) hold office till the
conclusion of the 29th Annual General Meeting of the Company.
As required under SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015, the Auditors have confirmed that they hold a valid
certificate issued by the Peer Review Board of the Institute of Chartered Accountants of
India.
b) Secretarial Auditor
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
Company has appointed Mr. M.Alagar, Managing Partner (Membership No. F7488 and CoP No.
8196) of M/s. M.Alagar & Associates, Practicing Company Secretaries, Chennai to
undertake the Secretarial Audit of the Company for the financial year ended 31st
March, 2023. The Secretarial Audit Report is annexed as Annexure IV to this report.
Inspirisys Solutions IT Resources Limited, an unlisted material
subsidiary of the Company has obtained Secretarial Audit Report from a Practicing Company
Secretary and it does not have any qualification or adverse remark. The same is available
on the Company's website i.e. www.inspirisys.com/investors
17. PARTICULARS OF EMPLOYEES
Disclosures pertaining to the remuneration and other details, as
required under Section 197(12) of the Companies Act, 2013 read with rules 5(1) of the
Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, are provided
in the Annual Report. In terms of Section 197(12) of the Companies Act, 2013 read with
rules 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014 the annexures relating to the details of the employees who draw
remuneration in excess of the limits in terms of the above provisions and the statement
containing the name of top ten employees in terms of remuneration drawn are excluded in
the Annual Report which is being sent to the Shareholders of the Company in terms of the
first proviso to Section 136(1) of the Companies Act, 2013. The aforesaid annexures are
available for inspection in electronic mode and any member interested in obtaining a copy
of the same may write to the Company Secretary.
18. FIXED DEPOSITS FROM PUBLIC
The Company has not accepted any deposits from the public within the
meaning of sub-section (31) of Section 2 and Section 73 of the Companies Act, 2013 and the
Rules framed thereunder and as such, no amount on account of principal or interest on
deposits were outstanding as on the date of the Balance Sheet.
19. CORPORATE SOCIAL RESPONSIBILITY
Pursuant to the provisions of Section 135 and Schedule VII of the
Companies Act, 2013, Corporate Social Responsibility Committee was formed by the Company
to recommend:
(a) the policy on Corporate Social Responsibility and (b)
implementation of the CSR Projects or Programs to be undertaken by the Company as per CSR
Policy for consideration and approval by the Board of Directors. The policy on Corporate
Social Responsibility is available on the Company's website www.inspirisys.com. Detailed
report on CSR activities in the prescribed format is forming part of this annual report as
annexure.
As a responsible Corporate Entity, at Inspirisys, we always strive to
make a positive and lasting impact on our environment and the community we operate in. In
the year 2022-23, the Company through its CSR efforts initiated a collaborated CSR Program
on "Education of Children of migrant unorganised sector workers employed in the Brick
Kilns Project" between Inspirisys & Aide Et Action (AEAI) (A Not-for-profit
autonomous society).
This program helped parents on the necessity of sending children to
schools through continuous Education & Training, sensitize on healthy parenting,
savings, worksite-abuse, basic needs, self-care, protection, health, hygiene &
literacy training. Through this program, around 601 Children, 142 Adolescent Girls &
Women are benefitted.
20. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMPs) Directors
Mr. Murali Gopalakrishnan (DIN: 08066529), Director is liable to retire
by rotation at the ensuing Annual General Meeting and being eligible, offers himself for
re-appointment. The Directors have recommended the appointment / re-appointment for the
approval of Shareholders. The brief profile of the Director is furnished in the Notice
convening the AGM of the Company.
Changes in the Directors & KMPs
• Appointment of Mr. Murali Gopalakrishnan (DIN: 08066529) as an
Executive Director cum Chief Executive Officer (Key Managerial Personnel) of the Company
with effect from 1st November, 2022.
• Appointment of Mr. Toru Horiuchi (DIN: 08111162) as
Non-Executive Non-Independent Director of the Company with effect from 1st
November, 2022.
• Appointment of Mr. R. Balaji as the Chief Financial Officer of
the Company with effect from 1st November, 2022.
• Resignation of Mr. Malcolm F. Mehta (DIN: 03277490) as the
Chairman & Chief Executive Officer and as a Director of the Company with effect from
31st October, 2022.
• Resignation of Mr. Murali Gopalakrishnan as the Chief Financial
Officer of the Company with effect from 31st October, 2022 due to transitioning
into the role of Executive Director.
• Resignation of Mr. Raj Khalid (DIN: 00169691) as a Director of
the Company with effect from 30th April, 2023.
21. POLICY ON PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
The Company has adopted a Policy on Prevention of Sexual Harassment at
Workplace which is in line with the requirements of The Sexual Harassment of Women at the
workplace (Prevention, Prohibition & Redressal) Act, 2013. The Policy has been formed
in order to prohibit, prevent or deter the commission acts of sexual harassment at
workplace. Internal Complaints Committee (ICC) has been set up to redress complaints
received regarding sexual harassment. All employees are covered under the Policy and the
Policy is gender neutral. During the year there were no cases pending for disposal.
22. ACKNOWLEDGEMENTS
The Directors take this opportunity to thank the Company's employees,
customers, vendors, investors, alliance partners, business associates, bankers for their
continuous support given by them to the Company and their confidence reposed on the
management. The Directors also thank the Central and the State Governments in India,
Governments of the countries where the Company has operations and concerned Government
departments and agencies for their continued co-operation. The Directors acknowledge the
unstinted commitment and valuable contribution made by all members of the Inspirisys
family.
ANNEXURE - I TO THE DIRECTOR'S REPORT
1. ANNUAL RETURN
As required pursuant to Section 92(3) of the Companies Act, 2013 the
Annual Return of the Company is posted on the Company's website www.inspirisys.com. The
requisite link is www.inspirisys.com/investors
2. NUMBER OF MEETINGS OF THE BOARD
There were 6 meetings of the Board of Directors during the year under
review. For details of the meetings, please refer to the Corporate Governance Report,
which forms part of this Report.
3. INDEPENDENT DIRECTORS' DECLARATION
Mrs. Ruchi Naithani, Mr. Rajesh R. Muni and Mr. M.S. Jagan who are
Independent Directors, have submitted a declaration that each of them meets the criteria
of independence as provided in sub-section (6) of Section 149 of the Act and SEBI (LODR)
Regulations. Further, there has been no change in the circumstances which may affect their
status as Independent Director during the year.
4. POLICY OF DIRECTORS' APPOINTMENT AND REMUNERATION
The Company's policy on Directors' appointment and remuneration
including criteria for determining qualifications, positive attributes, independence of a
Director and other matters provided under Section 178(3) of the Act has been disclosed in
Corporate Governance Report which forms part of this Report. Further, information about
elements of remuneration package of Individual Directors is provided in the Annual Return
(under Section 92(3) of the Act), which is disclosed in the Company's website
www.inspirisys.com under investors section.
5. CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT
As provided under Regulation 34 read with Schedule V of the SEBI
(Listing Obligations and Disclosure Requirements) Regulations, 2015, all Board Members
& Senior Management Personnel have affirmed compliance with Inspirisys Solutions
Limited Code of Conduct for the year ended 31st March, 2023.
6. RELATIONSHIP BETWEEN DIRECTORS INTER-SE
Transactions with any of the related parties were not in conflict with
the interest of the Company. Members' attention is drawn to the transaction with related
parties disclosure set out in Note No. 36 of Consolidated Accounts and Note No. 37 of
Standalone Accounts forming part of the Financial Statements as at and for the year ended
31st March, 2023. The Company's related party transactions are primarily with
its subsidiaries and associates and between subsidiaries and other related parties. The
related party transactions are entered into based on consideration of various business,
exigencies, such as synergy in operations, sectorial specialization and the Company's
long-term strategy for sectorial investment's, optimization of market share profitability,
legal requirements, liquidity and capital resources of subsidiaries and associates.
All related party transactions are negotiated on arm's length basis and
are intended to further the Company's interests.
The particulars of transactions between the Company and its related
parties as per the Ind AS 24 "Related Party Disclosures" referred under Section
188 of the Companies Act, 2013 are set out in the Notes forming part of the financial
statement as at and for the year ended 31st March, 2023. There have been no
materially significant related party transactions, which may have potential conflicts with
the interest of the company.
7. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS
The details of the Loans and Investments made by company are given in
the notes to the financial statements. The Company has not given any Guarantees covered
under the provisions of Section 186 of the Companies Act, 2013.
8. TRANSACTIONS WITH RELATED PARTIES
The Company has entered into contract / arrangements with the related
parties in the ordinary course of business and on arm's length basis and complied the
provisions of the companies Act.
9. INTERNAL CONTROL
The Company has adequate internal control procedures commensurate with
the size and nature of its operations.
The internal control system is further strengthened by Internal Audit
carried by an Independent firm of Chartered Accountants and periodical review conducted by
the management. The Audit Committee of the Board addresses issues raised by Internal
Auditors and the Statutory Auditors.
The financial objective of the Company is to bring in efficiencies of
operations at all levels so as to maximize return on capital employed and to generate
sufficient cash profits to fund ongoing expansions and to meet the growth objectives.
The Audit Committee and the Board periodically review performance
parameters related to financial performance of the Company to ensure smooth implementation
of the internal control systems and efficient management of the various resources. The
Audit Committee conducts periodic reviews with the management, internal auditors and the
statutory auditors.
10. RISK MANAGEMENT
The Board of Directors of the Company oversee the Risk Management of
the Company on a continuous basis. The Board oversees the Company's process and policies
to frame, implement and monitor the risk management plan for the Company. The Board is
responsible for monitoring and reviewing the risk management plan and ensuring its
effectiveness. Major risks identified by the businesses and functions are systematically
addressed through mitigating actions on a continuous basis. For details, please refer to
the Management Discussion and Analysis report which form part of the Board Report.
11. FAMILIARIZATION PROGRAM FOR INDEPENDENT DIRECTORS
The Company has practice of conducting familiarization program of the
Independent Directors as detailed in the Corporate Governance Report which forms part of
the Annual Report.
The same is disclosed in the Company's website www.inspirisys.com under
investors section.
12. VIGIL MECHANISM
The Company has a Whistle Blower Policy and has established the
necessary vigil mechanism for Directors and Employees in confirmation with Section 177(9)
of the Act and Regulation 22 of SEBI (LODR), to report concerns about unethical behaviour.
The details of the policy have been disclosed in the Corporate Governance Report, which is
a part of this report.
13. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES
The wholly owned subsidiaries of the Company continue to be engaged in
the business of providing IT / ITES services, business solutions and consulting services.
There has been no material change in the nature of the business carried on by the
subsidiaries during the year under review. The Company's active subsidiaries are:
1. Inspirisys Solutions DMCC, Dubai.
2. Inspirisys Solutions North America Inc., USA
3. Inspirisys Solutions Europe Ltd. U.K.
The Company also has the following wholly owned subsidiaries which had
suspended its operations:
1. Network Programs (USA) Inc., USA (Suspended its operations from
March 2020)
2. Inspirisys Solutions Japan KK, Japan (Suspended its operations from
March 2020)
3. Inspirisys Solutions IT Resources Limited, India (Suspended its
operations from March 2019)
Gross Revenue from operating subsidiaries for the year ended 31st
March, 2023 was ' 4,905 Lakhs which is a reduction of 10% compared to the gross revenue of
' 5,465 Lakhs during the financial year ended 31st March 2022. Whilst, the
Gross Revenue from the US Subsidiary increased by 9% from ' 2,788 Lakhs in 2021-22 to '
3,037 Lakhs in 2022-23, the Gross Revenue from Dubai subsidiary continued to be lower at '
1,868 Lakhs in 2022-23 compared to ' 2,677 Lakhs in 202122. The Net losses of the
subsidiaries on consolidated basis is ' 1,942 Lakhs during the Financial Year 2022-23
which is lower than the losses the subsidiary companies incurred in Financial Year 2021-22
and which stood at ' 2,113 Lakhs. The financial position of each of the subsidiaries is
provided in a separate statement AOC-1, attached to the Financial Statement pursuant to
first proviso to Section 129(3) of the Act.
14. PARTICULARS OF REMUNERATION
The information required under Section 197 of the Act and the Rules
made thereunder, in respect of employees of the Company, is follows:-
(a) The ratio of the remuneration of each director to the median
remuneration of the employees of the Company for the financial year;
Except Mr. Murali Gopalakrishnan, no directors were in receipt of
remuneration except sitting fees. For this purpose, Sitting fees paid to the Directors
have not been considered as Remuneration.
| Name of the Director |
Ratio to median
remuneration |
Remuneration Paid
(' In Lakhs) |
| Mr. Murali Gopalakrishnan (Director with
effect from 01/11/2022)* |
55.84 |
43.15 |
| Mr. Malcolm F. Mehta (Director upto
31/10/2022) |
|
124.37 |
* Mr. Murali Gopalakrishnan was CFO of Inspirisys Solutions Limited
upto 31st October, 2022.
(b) The percentage increase in remuneration of each Director, Chief
Executive Officer, Chief Financial Officer, Company Secretary or Manager, if any, in the
financial year;
| Name of the Person |
% increase in Remuneration |
| Mr. Murali Gopalakrishnan, Executive Director
& Chief Executive Officer (with effect from 01/11/2022) |
0% |
| Mr. Malcolm F. Mehta, Chairman & Chief
Executive Officer (upto 31/10/2022) |
0% |
| Mr. S. Sundaramurthy, Company Secretary |
12% |
| Mr. R. Balaji, Chief Financial Officer (with
effect from 01/11/2022) |
0% |
| Mr. Murali Gopalakrishnan, Chief Financial
Officer (upto 31/10/2022) |
5% |
(c) The percentage increase in the median remuneration of employees in
the financial year was 7.3%.
(d) The number of permanent employees on the rolls of Company;
There were 1,628 permanent employees in India on the rolls of Company
as at 31st March, 2023.
(e) Average percentage increase already made in the salaries of
employees other than the managerial personnel in the last financial year and its
comparison with the percentage increase in the managerial remuneration and justification
thereof and point out if there are any exceptional circumstances for increase in the
managerial remuneration.
The average increase in salaries of employees other than managerial
personnel in 2022-2023 was 7.46 %. Percentage increase in the managerial remuneration for
the year was 0 percent.
(f) Affirmation that the remuneration is as per the remuneration policy
of the Company;
The Company's remuneration policy is based on the performance of the
employees and that of the Company. The Company's compensation consists of fixed component,
benefits and variable pay based on the individual's performance which is measured through
the annual appraisal process.
15. PECUNIARY RELATIONSHIP OR TRANSACTIONS OF NON EXECUTIVE DIRECTORS
During the year, the Non-Executive Directors of the Company had no
pecuniary relationship or transactions with the Company.
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