Prism Informatics Annual Report - Moneycontrol.com · 2014-09-30 · Prism Informatics Annual Report . ... Idhasoft Ltd. Alok Pathak Managing ... conditions as set out in draft letter

PRISM INFORMATICS LIMITED

2O14ANNUAL REPORT

For the year ended 31st March , 2014Prism Informatics Annual Report

Abridged Standalone Financial with

Auditors Report for year 2014

Abridged Consolidated Financial with

Auditors’ Report for year 2014

Directors’

Notice for Annual General Meeting

Directors’ Report

Report On Corporate Governance

CEO/CFO Certification

Certificate Under Clause 49 of Listing Agreement

Management Discussion & Analysis Report

Profile

Annexure “A” to Directors' Report

Annexure “B” to Directors' Report

Certificate Of Compliance

01-02

03-20

21-25

26

27

28-40

41

42

43

44-49

50-71

72-88

Attendance Slip

Proxy Form

89

91

CONTENTS

¡

¡

¡

¡

B Tech, IIT Bombay and PhD from University of Hawaii (US).

Advance Management Program at Harvard Business School.

30 years of experience in Information Technology business and 25 years with Tata Group of Companies.

Serves as Director on board of various companies and professional bodies.

Dr. Nirmal Jain Chairman & Independent Director

¡ B Tech, from Roorkee University, Served the Indian Navy for 34 years till 1994 and reached the rank of Rear Admiral.

¡ PhD from London University.

¡ Recipient of Ati Vishisht Seva Medal in 2003 by President of India.

Dr.Ajay Sharma Vice Chairman &Independent Director

¡ Engineering from NIT Raipur.

¡ M Tech, IIT Mumbai.

¡ One of the promoters, CEO and Executive Director - Idhasoft Ltd.

Alok Pathak Managing Director

¡ MBA from the American International College, USA .

¡ He belongs to the promoter group of Asian Paints Ltd., and is Vice Chairman & Managing Director of Secure Matrix India Private Limited.

¡ Member of CSI, eISA, ISACA, CYSI, Vice Chairman (IT Committee) of the IACCI and Regional Chairman of ESC.

Saurabh DaniWhole-Time Director

Important Communication to Members

The Ministry of Corporate Affairs has taken a “Green Initiative in the Corporate Governance” by allowing paperless compliance by the companies and has issued circulars stating that service of notice/ documents including Annual Report can be sent by e-mail to its members. To support this green initiative of the Government in full measure, members who have not registered their e-mail addresses, so far, are requested to register their e-mail addresses, in respect of electronic holdings with the Depository through their concerned Depository Participants. Members who hold shares in physical form are requested to fill the appropriate column in the Members Updation Form of the Annual Report and register the same with Company's Registrars and Transfer Agents, Sharex Dynamic (India) Private Limited. Postage for sending the feed back form will be borne by the Company.

As a measure of economy, copies of Annual Report will not be distributed at Annual General Meeting. Members are requested to brings their copies at the meeting.

Director’s Profile Currency : Indian Rupee

Annual Report 2014Prism Informatics Limited

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¡ Graduate in Science from University of Bombay with Diploma in Management Studies. Is also a Law Graduate and Member of Institute of Company Secretaries of India.

¡ Has served several organizations as head of Legal & Company Secretary for more then two decades.

V. Chandrashekar Director

¡ Graduate in Business Administration and Information Technology from a prestigious University of Saarbrucken, Germany.

¡ He served several organizations that include Bosch Telecom, PWC Coopers & Lybrand, SAP AG before founding SUMITS AG. After acquisitions of SUMITS AG by Prism Informatics, he took over as CEO of Prism Informatics, Europe. Currently, he serves Prism Informatics as a Director.

Christof AnderiDirector

Registered OfficeB-907, BSEL Tech Park, Sector 30-A, Opp. Vashi Railway Station, Vashi, Navi Mumbai-400703.

Phone-+91-22-67232976|945Fax-+91-22-27813555,

Email: [email protected]

Company Secretary & Compliance Officer

Auditors E.A. Patil & Associates 316, 3rd Floor, Nirman Vyapar Kendra, Sector-17,Vashi, Navi Mumbai 400703.

Registrars & Transfer AgentsSharex Dynamic India Pvt Ltd, Unit 1, Luthra Industrial Premises, Safed Pool , Andheri Kurla Road, Andheri (East), Mumbai-4000072.

Tel- 28515644, Fax- 28512885

E-mail- [email protected]; [email protected]

BankersSaraswat Co-operative Bank Limited Small and Medium Enterprise Branch, Prabhat Bhavan, 96, LBS Marg, Opp Cipla, Vikhroli (West), Mumbai-400083

Axis Bank Vardhman Chambers Premises CSL, Plot 84, Sector 17, Vashi-400705

Khushboo Gurbuxani

Director’s Profile


NOTICE is hereby given that 32nd (Thirty Second) Annual General Meeting (AGM) of the members of Prism Informatics Limited will be held at Celebration Banquets, Plot No. 46, 3rd Floor, Samna Press Building, Next to Inorbit Mall, Near Vashi Railway Station, Sector 30-A, Vashi, Navi Mumbai - 400 703 on Tuesday 30th day of September, 2014 at 4.00 p.m. (IST) to transact the following business:

Ordinary Business:

1. To receive, consider and adopt the Audited Balance Sheet as at 31st March 2014, Profit and Loss Account for the year ended on 31st March 2014 and the reports of Board of Directors and Auditors thereon.

2. To appoint a Director in place of Saurabh Dani, who retires by rotation and, being eligible, offers himself for re-appointment.

3. To consider and if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution.

“RESOLVED THAT pursuant to the provisions of section 139 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules framed there under, as amended from time to time, M/s E.A. Patil & Associates, Chartered Accountants, be and are hereby re-appointed as statutory auditors of the company to hold office from conclusion of this Annual General Meeting (AGM) till conclusion of thirty-seventh Annual General Meeting (AGM) of the Company to be held in the year 2019 (subject to ratification of their appointment at every AGM), at such remuneration as may be mutually agreed between the Board of Directors of the Company and the Auditors.”

Special Business:

4. Appointment of Dr. Nirmal Jain as an Independent Director of the Company:

To consider and if thought fit, to pass, with or without modification(s), the following resolution as SPECIAL RESOLUTION:-

“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152, 178 and any other applicable provisions of the Companies Act, 2013 and the rules made there under (including any statutory modification(s) or re-enactment thereof for the time being in force) read with Schedule IV to the Companies Act, 2013, Dr. Nirmal Jain

(holding DIN 02740724) who has submitted a declaration that he meets the criteria for independence as provided in section 149(6) of the Act be and is hereby appointed as an Independent Director of the Company to hold office for five consecutive years with effect from 30th September, 2014.

5. Appointment of Dr. Ajay Sharma as an Independent Director of the Company:

To consider and if thought fit to pass with or without modification the following resolution as an SPECIAL RESOLUTION:-

“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152 and any other applicable provisions of the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment thereof for the time being in force) read with Schedule IV to the Companies Act, 2013, Dr. Ajay Sharma (holding DIN 00228169), who has submitted a declaration that he meets the criteria for independence as provided in section 149(6) of the Act and who is eligible for appointment, be and is hereby appointed as an Independent Director of the Company to hold office for five consecutive years with effect from 30th September, 2014.

6. Re-appointment of Mr. Alok Pathak as Managing Director of the Company:

To consider and if thought fit to pass with or without modification the following resolution as a SPECIAL RESOLUTION

“RESOLVED THAT as recommended by Nomination and Remuneration Committee and pursuant to the provisions of Section 196, 197 and other applicable provisions, if any, of the Companies Act, 2013, including any statutory

NOTICE


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modifications or re-enactment thereof for the time being in force , read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 including Schedule V to the said Act, consent and approval of the Company be and is hereby accorded to the re-appointment and the remuneration, if any, being paid or provided to Mr. Alok Pathak as Managing Director of the Company for a period of five years with effect from 1st September, 2014 on the terms and conditions as set out in draft letter of appointment a copy whereof initialed by Dr. Nirmal Jain, Independent Director of the Company, for the purpose of identification has been placed before this Meeting, be and is hereby approved.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to vary the terms and conditions set out in the aforesaid draft letter of appointment including the remuneration, if any, to the extent the Board of Directors may consider appropriate and as may be permitted or authorized in accordance with any provision under the Act for the time being in force provided, however, that, the remuneration, if any, to be paid to Mr. Alok Pathak shall be within the limits set out in the said Act including Schedule V to the act or any amendments thereto or any modifications(s) or statutory re-enactment(s) thereof and/or any rules or regulations framed there under and the terms of the aforesaid appointment letter between the Company and Mr. Alok Pathak shall be suitably modified to give effect to such variation.

RESOLVED FURTHER THAT in the event of loss or inadequacy of profits in any financial year of the Company during the term of Mr. Alok Pathak's office as Managing Director, the remuneration, if any, set out in the aforesaid draft appointment letter be paid or granted to Mr. Alok Pathak as minimum remuneration provided that the total remuneration by way of salary and other allowances shall not exceed the ceiling provided in Section IIA of Part II of Schedule V to the said Act or such other amount as may be provided in the said Schedule V as may be amended from time to time or any equivalent statutory re-enactment(s) thereof.”

7. Re-appointment of Mr. Saurabh Dani as Whole-Time Director of the Company:


“RESOLVED THAT as recommended by Nomination and Remuneration Committee and pursuant to the provisions of Section 196, 197, 203 and other applicable provisions, if any, of the Companies Act, 2013, including any statutory modifications or re-enactment thereof for the time being in force , read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 including Schedule V to the said Act, consent and approval of the Company be and is hereby accorded to the re-appointment and the remuneration being paid or provided to Mr. Saurabh Dani as Whole-Time Director of the Company for a period of two years with effect from 1st September, 2014 on the terms and conditions as set out in draft letter of appointment a copy whereof initialed by Dr. Nirmal Jain, Independent Director of the Company, for the purpose of identification has been placed before this Meeting, which draft letter of appointment is hereby specifically approved.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to vary the terms and conditions set out in the aforesaid draft letter of appointment including the remuneration to the extent the Board of Directors may consider appropriate and as may be permitted or authorized in accordance with any provision under the Act for the time being in force provided, however, that, the remuneration to be paid to Mr. Saurabh Dani shall be within the limits set out in the said Act including Schedule V to the act or any amendments thereto or any modifications(s) or statutory re-enactment(s) thereof and/or any rules or regulations framed there under and the terms of the aforesaid appointment letter between the Company and Mr. Saurabh Dani shall be suitably modified to give effect to such variation or increase as the case may be.

RESOLVED FURTHER THAT in the event of loss or inadequacy of profits in any financial year of the Company during the term of Mr. Saurabh Dani's office as Whole-Time Director, the remuneration, if any, set out in the aforesaid draft appointment letter be paid or granted to Mr. Saurabh Dani as minimum remuneration

NOTICE


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provided that the total remuneration by way of salary and other allowances shall not exceed the ceiling provided in Section IIA of Part II of Schedule V to the said Act or such other amount as may be provided in the said Schedule V as may be amended from time to time or any equivalent statutory re-enactment(s) thereof.”

8. APPROVAL OF REMUNERATION PAID TO MR. V. CHANDRASHEKAR.


“RESOLVED THAT pursuant to the provisions of Section 196, 197 and other applicable provisions, if any, of the Companies Act, 2013, including any statutory modifications or re-enactment thereof for the time being in force, read w i t h C o m p a n i e s ( A p p o i n t m e n t a n d Remuneration of Managerial Personnel) Rules, 2014 including Schedule V to the said Act, consent and approval of the Company be and is hereby accorded for the payment of remuneration of Rs. 14,50,000 to Mr. V. Chandrashekar for a period from 01st April, 2014 to 31st July, 2014.

9. Alteration of Articles of Association of the Company:


“RESOLVED THAT pursuant to the provisions of Section 13, 14 and other relevant provisions, if any, of the Companies Act, 2013, the existing Articles of Association of the Company be and is hereby replaced, modified and revised to bring the same in alignment to Companies Act, 2013, a copy of which is placed before the meeting and duly initialed by the Chairman for the purpose of

identification and that the regulations contained in the altered Articles of Association of the Company be and are hereby approved and adopted as the Articles of Association of the Company.

RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorized to take all such steps and actions for the purpose of making all such filings and registrations as may be required in relation to the aforesaid amendment to the Articles of Association and further to do all such acts, deeds, matters and things as may be deemed necessary to give effect to this resolution.”

10. Approval of Related Party Transactions:


“RESOLVED THAT pursuant to provisions of Section 188 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules made there under, and Clause 49 of the Listing Agreement executed between Company and Stock Exchanges, consent of the member be and is hereby accorded to the Board of Directors to enter into various related party transactions for the period from 1st April, 2014 to 31st March, 2016 up to the maximum amount per annum as prescribed below:

NOTICE


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Prism Informatics Europe AG

Prism Informatics Schweiz,

Switzerland

Prism Informatics Deutschland

GMBH, Germany

Prism Informatics Inc, Delaware

Prism Informatics PTE Limited

Prism Software Consultancy JLT

Prism Infoglobal Limited, Mauritius

Idhasoft Inc., Delaware

Dani Financial Products Pvt. Ltd.

Secure Matrix Solutions Pvt. Ltd.

Secure Matrix India Pvt. Ltd.

Mr. Saurabh Dani

Dani Shares and Stocks Pvt. Ltd.

Idhasoft Limited

Consultancy Services, Lending loans,

Consultancy Services,

Consultancy Services,

Consultancy Services, import & export of software

Loan given or Loan taken or any obligation

arising among the parties.





Loan given or Loan taken or any

obligation arising among the parties.





Lending loans,

Lending loans,





1

2

3

4

5

6

7

8

9

10

11

12

13

14

Name of Related Party

8 Crores

3 Crore

2 Crore

8 Crores

8 Crores

8 Crores.

3 Crores

3 Crores

2 Crores

1 Crore

1 Crores

2 Crores

1.5 Crores

20 Crores

NOTICE


Type of TransactionMaximum amount

Per annum (in cores)

RESOLVED FURTHER THAT to give effect to this Resolution the Board of Directors be and is hereby authorized to settle any question, difficulty, doubt that may arise with regards to giving effect to the above resolution and to do all acts, deeds, things as may be necessary in its absolute discretion deem necessary, proper, desirable and to finalize any documents and writings related thereto.”

import & export of software







11. To approve Borrowing limits of the Company:

To consider and if thought fit to pass with or without modification the following resolution as a SPECIAL RESOLUTION.

“RESOLVED THAT in supersession of the Resolution adopted at the General Meeting held on 13th May, 2011 and pursuant to the provisions of Section 180(1)(c) and any other applicable provisions of the Companies Act, 2013 and the rules notified there under (including any statutory modification(s) or re-enactment thereof for the time being in force), the consent of the members be and is hereby accorded to and authority conferred upon the Board of Directors of the Company for borrowing any sum or sums of monies for and on behalf of the Company from time to time from one or more persons, firms, bodies corporate or bankers or financial institutions or from others by way of advances, deposits, loans or otherwise withstanding that the sum or sums or monies so borrowed together with the monies, if any, already borrowed by the Company (apart from temporary loans obtained from the Company's bankers in the ordinary course of business) will or may exceed the aggregate of the paid up capital of the Company and its free reserves which have not been set apart for any specific purpose so that the total amount up to which the monies may be so borrowed by the Board of Directors and outstanding at any time shall not exceed 150 Crores (Rupees One Hundred and Fifty Crores only) on account of the principal.”

12. Approval of fees for service of Documents to shareholders of the Company:


“RESOLVED THAT pursuant to provision of Section 20 of Companies Act, 2013 member of the Company may request for delivery of document as defined in section 2 of Companies Act, 2013 by way of registered post or by way of courier service at the fees of Rs. 50/- per document when recipient is in Maharashtra and Rs. 100/- per document when recipient is outside state of Maharashtra and such actual amount as may be incurred by the Company to deliver the document if documents to be delivered beyond the jurisdiction of India.

RESOLVED FURTHER THAT document to be sent to members in an electronic form shall not be subject to any fees and will be provided to the member at free of charge

and it shall be duty of member to furnish the email id and changes in same if any from time to time.

RESOLVED FURTHER THAT document for this purpose shall include summon, notice, requisition, order, declaration, form and register whether issued, sent or kept in pursuance of this Act or under any other law for the time being in force or otherwise, maintained on paper or in electronic form.”

13. APPROVAL OF RECLASSIFICATION OF AUTHORISED SHARE CAPITAL OF THE COMPANY:

To consider and if thought fit to pass with or without modification the following resolution as a SPECIAL RESOLUTION:

“RESOLVED THAT pursuant to provisions of Section 13, 61, 64 and other applicable provisions, if any, of Companies Act, 2013 (including any amendment thereto or re-enactment thereof) and the rules framed thereunder, consent of members be and is hereby accorded to reclassify the existing Authorized share capital of Rs. 217,500,000 (Rupees Twenty One Crores Seventy Five Lakhs Only) divided into 40,347,800 (Four Crores Three Lakhs Forty Seven Thousand Eight Hundred Only) equity shares of Re. 1/- each (Rupee One Only) each aggregating to Rs. 40,347,800 (Four Crores Three Lakhs Forty Seven Thousand Eight Hundred Only) and 17,71,522 (Seventeen Lakhs Seventy One Thousand Five Hundred and Twenty Two Only) Preference Shares of Rs. 100/- each aggregating to Rs. 177,152,200 (Seventeen Crores Seventy One Lakhs Fifty Two Thousand Two Hundred Only) be and is hereby reclassified to Rs. 21,75,00,000, divided into 60,347,800 (Six Crores Three Lakhs Forty Seven Thousand Eight Hundred Only) Equity Shares of Re. 1/- each and 15,71,522 (Fifteen Lakhs Seventy One Thousand Five Hundred and Twenty Two Only) of Rs. 100/- each and that Clause V(a) of the Memorandum of Association be altered accordingly.

RESOLVED FURTHER THAT Mr. Alok Pathak, Managing Director and/ or Mr. V. Chandrashekar, Director be and are hereby jointly and/or severally authorized to take the necessary steps as may be required to do all such acts, deeds, matters and things, as it may in its absolute discretion deem necessary, proper or desirable and to settle any question, difficulty or doubt that may arise in connection with or incidental to giving effect to the aforesaid resolutions including filing of necessary e-forms with Registrar of Companies”

For Prism Informatics Limited

Date: 1st September, 2014

Place: Navi Mumbai

Khushboo Gurbuxani

Company Secretary &

Compliance Officer

NOTICE


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1. A member entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy to attend and vote on a poll instead of himself and the proxy need not be a member of company. The instrument appointing the proxy should, however, be deposited at the Registered Office of Company not less than 48 hours before the commencement of the meeting. Members are requested to bring their attendance slip along with their copy of annual report to the Meeting.

A person can act as a proxy on behalf of members not exceeding fifty in number and holding in the aggregate not more than ten percent of the total share capital of the Company carrying voting rights. A member holding more than ten percent of the total share capital of the Company carrying voting rights may appoint a single person as proxy and such person shall not act as a proxy for any other person or Member.

2. Corporate members intending to send their authorised representatives to attend the Meeting are requested to send to Company a certified copy of the Board Resolution authorising their representative to attend and vote on their behalf at the Meeting.

3. The relative Explanatory Statement pursuant to Section 102 of the Companies Act, 2013, in respect of the business under Item no. 4 to Item no. 13 is annexed hereto. The relevant details as required by Clause 49 of the Listing Agreement entered into with Bombay Stock Exchange, of persons seeking appointment/re-appointment as Directors under Item no. 4 to Item no. 9 of the Notice, is also annexed.

4. The Register of Members and Share Transfer Books of Company will remain closed from 22nd September, 2014 to 30th September, 2014 (both days inclusive) for determining the names of members eligible for dividend on Equity Shares, if declared by the Shareholders at this Annual General Meeting.

5. Members holding shares in dematerialized form are requested to intimate all changes pertaining to their bank details, National Electronic Clearing Service (NECS), Electronic Clearing Service (ECS), mandates, nominations, power of attorney, change of address, change of name and e-mail address, etc., to their Depository Participant only and not to Company's Registrars and Transfer Agents, Sharex Dynamic (India) Private Limited (Sharex) Unit-1, Luthra Industrial Premises, Andheri Kurla Road, Safed Pool, Andheri (East), Mumbai 400 072; Tel: 022-28515606/44 -28516338; Fax: 022-28512885; E-mail: [email protected]; Website: www.sharexindia.com.

6. Company or its Registrars and Transfer Agents cannot act on any request received directly from the members holding shares in electronic form for any change of bank particulars or bank mandates. Such changes are to be advised only to the Depository Participant of the members. Changes intimated to the Depository Participant will then be automatically reflected in Company's records which will help Company and Sharex to provide efficient and better services. Members holding shares in physical form are requested to intimate such changes to Sharex.

7. Members holding shares in physical form are requested to consider converting their holding to dematerialized form to eliminate all risks associated with physical shares and for ease in portfolio management. Members can contact Company or Sharex, for assistance in this regard.

8. Reserve Bank of India has initiated NECS for credit of dividend directly to the bank account of Members. Members are requested to register their Bank Account details (Core Banking Solutions enabled account number, 9 digit MICR and 11 digit IFS code), in respect of shares held in dematerialized form with their respective Depository Participants and in respect of shares held in physical form with Sharex.

NOTES TO NOTICE


9. The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number (PAN) by every participant in securities market. Members holding shares in electronic form are, therefore, requested to submit the PAN to their Depository Participants with whom they are maintaining their demat accounts. Members holding shares in physical form can submit their PAN details to Company / Registrars and Transfer Agents, Sharex Dynamic (India) Private Limited.

10. Members desiring any information as regards the Accounts are requested to write to Company at an early date so as to enable the Management to keep the information ready at the Meeting.

11. The Ministry of Corporate Affairs (vide circular nos. 17/2011 and 18/2011 dated April 21 and April 29, 2011 respectively), has undertaken a 'Green Initiative in Corporate Governance' and allowed companies to share documents with its shareholders through an electronic mode. Members are requested to support this green initiative by registering/updating their e-mail addresses, in respect of shares held in dematerialized form with their respective Depository Participants and in respect of shares held in physical form with Sharex

12. Company in accordance with proviso to section 136 of Companies Act, 2013 has circulated abridged Financial Statement on standalone and consolidated basis to its members.

Company upon receipt of request from members shall provide detailed financial statements and same shall be available for inspection of members at the registered office of the Company till date of Annual General Meeting of the Company

“ALL MEMBERS ARE REQUESTED TO BRING ABRIDGED FINANCIAL STATEMENTS AS WELL AS DETAILED FINANCIAL STATEMENTS IF THEY HAVE OBTAINED ON REQUEST FROM COMPANY. AND NO EXTRA COPY OF FINANCIAL STATEMENTS BE CIRCULATED ON AMONG THE MEMBERS AT THE MEETING”


Date: 1st September 2014

Place: Navi Mumbai

Khushboo Gurbuxani


NOTES TO NOTICE


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As required by Section 102 of the Companies Act, 2013 (“Act”), the following explanatory statement sets out all material facts relating to the business mentioned under Item No.4.to Item No.13, of the notice convening Annual General Meeting

Item No 4,&5:

Section 149 of the Companies Act, 2013, which came into effect from 01st April, 2014, requires every listed Company to have one-third of the total number of directors as independent directors. As on the date of Annual General Meeting of the Company, the Board of Directors comprised Dr. Nirmal Jain and Dr. Ajay Sharma, as independent directors pursuant to erstwhile clause 49 of the listing agreement.

Accordingly, with the recommendations of the Remuneration and Nomination Committee, the Board of Directors at its meeting held on 1st September, 2014, appointed Dr. Nirmal Jain & Dr. Ajay Sharma, directors, as independent directors of the Company pursuant to section 149, Schedule IV and other applicable provisions, of the Companies Act, 2013, for a consecutive period of 5 years from 1st September, 2014 subject to the approval of shareholders.

Therefore, as required under Schedule IV, appointment of these independent directors is set out in Item No. 4 to 5 of the Notice for approval of shareholders.

The independent directors have submitted the declaration of independence, as required pursuant to section 149 (7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section (6). The respective appointee is not disqualified from being appointed as a director in terms of section 164 of the Act.

The terms and conditions of appointment of independent directors shall be open for inspection at the registered office of the Company by any member during normal business hours and the same shall also be available at the Company's website.

The Board is of the opinion that the aforesaid directors possess requisite skills, experience and knowledge relevant to the Company's business and it would be in the

interest of the Company to continue to have their association with the Company as directors.

Further, in the opinion of the Board, the proposed appointment of independent directors, fulfills the conditions specified in the Act and the Rules made thereunder and that the proposed appointment of independent directors is independent of the management.

None of the Directors/key managerial personnel and/or their relatives, except the concerned independent director, is directly or indirectly concerned or interested, financially or otherwise, except to the extent of their respective shareholding, if any, in the Company, in the resolutions set out in Item No. 4 & 5 of the Notice.

The Board recommends the resolution set forth in Item no. 4 & 5 for the approval of the members.

Item No.6 & 7

Special Resolution as set out in Item no 7 relates to the appointment of Mr. Alok Pathak as Managing Director of the Company for a period of 5 years from 1st September, 2014. Mr. Alok Pathak was appointed as a Managing Director for a period of 5 years commencing from 10th November, 2009 without any remuneration. The term of 5 years is expiring on 09th November, 2014 and proposal for re-appointment is placed before the members for approval.

Special Resolution as set out in Item no 8 relates to the appointment of Mr. Saurabh Dani as Whole-Time Director of the Company for a period of 2 years commencing from 09th November, 2014. Mr. Saurabh Dani was appointed as a Whole-Time Director for a period of 2 years commencing from 1st September, 2014 at the monthly remuneration of Rs. 3,00,000. The term of 2 years is expiring on 08th November, 2014 and proposal for re-appointment is placed before the members for approval.

EXPLANATORY STATEMENT




Salary, perquisites and Allowances per annum of the appointees:

Mr. Alok Pathak shall not draw any remuneration from the Company

Mr. Saurabh Dani shall draw remuneration of Rs. 3, 00,000 per month.

Nomination and Remuneration committee, at the meeting held on 1st September, 2014, has subject to the approval of the members of the Company recommended the following to the Board of Director for their approval.

i. Re-appointment of Mr. Alok Pathak as a Managing Director of the Company without any remuneration.

ii. Re-appointment of Mr. Saurabh Dani as a Whole Time Director of the Company at the remuneration of Rs. 3, 00,000 per month.

Mr. Saurabh Dani shall not be entitled to any sitting fees for Board/ Committee Meetings. Mr. Saurabh Dani shall also be a Key Managerial Personnel under Section 203 of the Companies Act, 2013.

None of the Directors/key managerial personnel and/or their relatives, except the concerned appointee directors, is directly or indirectly concerned or interested, financially or otherwise, except to the extent of their respective shareholding, if any, in the Company, in the resolutions set out in Item No. 6 & 7 of the Notice.

The Board recommends the resolution set forth in Item no. 6 & 7 for the approval of the members.

The following additional information as required by Section II of Part II of Schedule V to the Companies Act, 2013 is given below for item no. 6 & 7 .Although Mr. Alok Pathak is to be re-appointed without remuneration the same is given by way of abundant caution:

I. General Information:

i. Nature of Industry:

The Company is engaged in the business of Information Technology and Information Technology enabled services.

ii. Date or expected date of commencement of commercial production:

The date of commencement of commercial production is 08th March, 1983.

iii. Financial performance based on given indicators:

A. Based on Standalone Financials of the Company for the year ended 31st March, 2014:

Particulars

Sales and Other Income

Net Profit after Tax

Net Worth

Rs. in million

237.50

(43.45)

485

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Particulars

Sales and Other Income

Net Profit after Tax

Net Worth

Rs. in million

698.32

(124.88)

278.83

B. Based on Consolidated Financials of the Company for the year ended 31st March, 2014:

iv. Foreign investments or collaborations:

The details of the direct overseas subsidiaries of the Company are as under:

Name of the entity Number of Shares Amount (Rs. in million)Sr.No.

Prism Informatics Europe AG, Switzerland

Prism Informatics Inc., USA

Prism Software Consultancy, JLT

Prism Informatics Pte. Singapore

Prism Infoglobal Limited, Seychelles

22,133,150

56,000,000

50

6,50,777

100

156.02

25.62

0.7165

31.30

0.005

1

2

3

4

5

II. Information about the appointee:

Particulars Mr. Alok Pathak Mr. Saurabh Dani

Mr. Alok Pathak is a Director and promoter

of Idhasoft Limited. He held position of

Chief Executive Officer for 5 years. He was

appointed as a Managing Director of the

Company from 10th November; 2009.

He has completed his engineering from

NIT Raipur and M Tech from IIT Mumbai

He does not draw any remuneration from

the Company.

Mr. Saurabh Dani is MBA from the

American International College, USA. He

belongs to the promoter group of Asian

Paints Ltd., and is Vice Chairman &

Managing Director of Secure Matrix India

Private Limited. He is the member of CSI,

eISA, ISACA, CYSI, Vice Chairman (IT

Committee) of the IACCI and Regional

Chairman of ESC.

Total remuneration of Rs. 41,46,667 was

paid to Mr. Saurabh Dani for a period of 2

years from 09th November, 2012 to 31st

March, 2014.

i. Background details

ii. Past Remuneration





He has over 20 years experience in various

capacities across companies. He has been

actively involved in mergers of US & UK

based development centers with Indian

companies. He had been the President and

Vice President for a number of IT

companies and has headed operations for a

large US and UK based company. He has

also headed the BFSI and Telecom verticals

for a very large IT company.

Mr. Alok Pathak, Managing Director, is

responsible for day-to-day management of

the Company, subject to overal l

superintendence, control and direction of

the Board of Directors. Taking into

consideration his qualifications and

expertise in Information Technology, the

Managing Director is best suited for the

responsibilities of current assigned role.

Mr. Alok Pathak is proposed to be

appointed without remuneration.

He is a member of the major institutions

which includes, Computer Society of India

(CSI), e-Information Security Association

(eISA), Information Systems Audit &

Control Association (ISACA), Cyber Law

Society of India (CYSI), Vice Chairman (IT

Committee) of the Indo-Arab and Indo-

African Chambers of Commerce (IACCI)

and Regional Chairman of ESC ( Electronics

Software and Export Promotion Council of

India –a ministry of IT subsidiary).

Mr. Saurabh Dani, Whole Time Director is

responsible for day-to-day management of

the Company, sub jec t to overa l l

superintendence, control and direction of

the Board of Directors. Taking into

consideration his qualifications and

expertise in Information Technology, he is

best suited for the responsibilities of current

assigned role.

iii. Recognition or

awards:

iv. Job Profile and

Suitability

V. Remuneration

proposed:

The terms of the Remuneration proposed to

be paid to Mr. Saurabh Dani is as follows:

Period of Appointment: Two years

beginning from 1st September, 2014 and

ending on 31st day of August, 2016.

Salary up to Rs.3,00,000 p.m from 01st April,

2014 subject to applicable provisions.



Page|13

Page|14





NOT APPLICABLE

Mr. Alok Pathak is not related to any other

Director as well as Managerial Personnel of

the Company. He does not have any

pecuniary relationship directly or

indirectly with the Company or its

Managerial Personnel.

With Globalization and Liberalization

taking roots in India, the demand for the

knowledge and Skills in various fields are

on rise and there has been a phenomenal

growth in remuneration package for key

positions in the last few years.

Company has operations in India and in

USA. The remuneration paid to Mr. Saurabh

Dani is in line with Remuneration of CEO's

and Managing Directors of other companies

having Global operations, keeping in view

his job profile, Complexity of comparative

business of the company.

Mr. Saurabh Dani is not related to any other

Director as well as Managerial Personnel of

the Company. He does not have any

pecuniary relationship directly or indirectly

with the Company or its Managerial

Personnel, other than drawing his

remuneration in the capacity of Whole-Time

Director of the Company and his

shareholding as a Promoter in the

Company.

vi. Comparative

remuneration profile

with respect to

industry, size of the

company, profile of

the position and

person (in case of

expatriates the

relevant details

would be with

respect to the country

of his origin)

vii.Pecuniary

relationship directly

or indirectly with the

company or

relationship with the

managerial

personnel, if any :

III. Other Information:

i. Reasons of loss or inadequate profits:

Company suffered loss on account of shut down of operation in Thailand, and Austria which had no potential of growth for the Company. The operations carried on by the Company through its step down subsidiary could not add any strategic value to the Company's growth and hence income from Global Market reduced.

ii. Steps taken or proposed to be taken for improvement:

Management reorganized Middle East as “Growth oriented Market” in order to drive organic growth in the business.

iii. Expected increase in productivity and profits in measurable terms.

Keeping Middle east operations as main focus, Management anticipate to increase its revenue from 10,225,000 USD in FY 2013-14 to USD 12,050,000 in FY 2014-15.

IV. Disclosures:

The requisite disclosures of remuneration package of Mr. Saurabh Dani have been made in the Report on Corporate Governance which forms part of the Annual Report. Mr. Alok Pathak is proposed to be appointed without remuneration hence disclosures under “Corporate Governance” is not required.

The Board accordingly recommends the resolution as set out in Item no. 7 &8 for approval of Members.

Item No. 8

Special Resolution set out in Item no.8 relates to approval of remuneration of Rs. 14,50,000 paid/ payable to Mr. V. Chandrashekar as a Whole Time Director of the Company for the period 01st April, 2014 to 31st July, 2014. Mr. V. Chandrashekar has resigned as Whole-Time Director and continues to be a non executive director on the Board of the Company.

Hence, pursuant to provisions of Section 196, 197 and other applicable provisions, if any, of Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 including Schedule V to the said Act, your approval is sought for the remuneration of Rs. 14, 50,000 paid/ payable to Mr. V. Chandrashekar as a Whole-Time Director of the Company for the period 01st April, 2014 to 31st July, 2014.

None of the Directors/key managerial personnel and/or their relatives, except Mr. V.Chandrashekar, is directly or indirectly concerned or interested, financially or otherwise, except to the extent of their respective shareholding, if any, in the Company, in the resolutions set out in Item No. 8 of the Notice.

The Board recommends the resolution set forth in Item no. 8 for the approval of the members.

Item No. 9

The existing Articles of Association (AOA) of the Company are based on the Companies Act, 1956 and

several regulations ofAOA contain references to specific sections of the Companies Act, 1956 and some regulations in the existing AOA are no longer in conformity with the Companies Act, 2013 (Act).

With the coming into force of the Act, several regulations of the existing AOA of the Company require alterations or deletions in several articles. Given this position, it is considered expedient to wholly replace the existing AOA be a new set of Articles of Association of the Company.

The proposed draft Articles of Association of the Company shall be uploaded on the Company's website and be placed in the Annual General Meeting for perusal by the Shareholders.

None of the Directors/key managerial personnel and/or their relatives is directly or indirectly concerned or interested, financially or otherwise, except to the extent of their respective shareholding, if any, in the Company, in the resolutions set out in Item No. 09 of the Notice.

The Board recommends passing of the Special Resolution set out in Item no. 09 of the Notice.

A copy of the proposed draft of Articles of Association of the Company is available for inspection by the shareholders of the Company at the Registered Office of the Company between 11.00 a.m. to 5.00 p.m. on any working day of the Company up to date of Annual General Meeting.

Item No.10

According to the provisions of Section 188 and other applicable provisions under the Companies Act, 2013 and Rules notified there under and Clause 49 of the Listing Agreement executed between Company and Stock Exchanges, the consent of the Members by special resolution is to be accorded for entering into various types of transactions with related parties subject to the conditions prescribed under said provisions.

Related Party Transactions as set out in Item no .10 for the period from 1st October, 2014 to March, 2016 up to the maximum amount per annum have been approved by the Board of Directors of the Company.



Page|15

Page|16



Disclosures as required under Rule 15 (Meeting of Board and its powers) Rules, 2014 are given below for perusal of members:

1) Name of Related Parties:

a. Prism Informatics Europe AG

b. Prism Informatics Schweiz Gmbh, Switzerland

c. Prism Informatics Deutschland Gmbh, Germany.

d. Prism Informatics Inc, Delaware.

e. Prism Informatics PTE Limited, Singapore.

f. Prism Software Consultancy JLT.

g. Prism Infoglobal Limited, Mauritius.

h. Idhasoft Inc., Delaware

i. Dani Financial Products Private Limited

j. Secure Matrix Solutions Private Limited

k. Secure Matrix India Private Limited

l. Mr. Saurabh Dani

m. Dani Shares and Stocks Private Limited

n. Idhasoft Limited

2) Name of Director or Key Managerial personnel who is related, if any:

No Director or Key Managerial Personnel is related with above related parties except that of the Director's position held by them.

3) Nature of Relationship :

Name of Related Party


Prism Informatics Schweiz Gmbh, Switzerland

Prism Informatics Deutschland Gmbh, Germany

Prism Informatics Inc, Delaware

Prism Informatics PTE Limited, Singapore

Prism Software Consultancy JLT

Prism Infoglobal Limited, Mauritius

Idhasoft Inc, Delaware

Dani Financial Products Private Limited

Secure Matrix Solutions Private Limited

Secure Matrix India Private Limited

Mr. Saurabh Dani

Dani Shares and Stocks Private Limited

Idhasoft Limited

Nature of Relationship

Wholly Owned Subsidiary

Step Down Subsidiary

Step Down Subsidiary





Body Corporate having common Directors

Company having common Directors



Director of Company



4) Nature, material terms, monetary value and particulars of the contract or arrangement:

Nature of transactions, period of the transactions and monetary value of the transactions are referred in the resolution set out in Resolution no. 10. All transactions would be carried out as part of the business requirement of the Company and are ensured to be on arm's length basis. Further the Company is also subject to the transfer pricing norms as prescribed under the Laws.

None of the Directors and Key Managerial Personnel of the Company and their relatives are concerned or interested, financially or otherwise, in the resolution.

Item No.11

The Shareholders of the Company at the Extra-Ordinary General Meeting held on 13th May, 2011 has authorised the Board, through an Ordinary Resolution, to borrow monies up to 150 Crores in excess of the aggregate of paid-up capital and free reserves of the Company. As per the provisions of the Companies Act, 2013, this authority requires approval of Shareholders by way of Special Resolution. The Rules notified in this regard require the companies to pass Special Resolution of the Shareholders within a period of one year from the date of notification of this section i.e. 12th September, 2014.

Presently, the Company has borrowings of about Rs.3.68 Crores. With a view to meet the requirement of additional borrowing as may arise from time to time, consent of the Shareholders is sought to authorise the Board to borrow up to Rs.150 Crores (Rupees One Hundred and Fifty Crores) as outstanding at any time in excess of the Paid-up Capital and Free Reserves of the Company from time to time at set out in the Resolution.

The Board recommends the Resolution for approval of the Shareholders.

None of the Directors, Key Managerial Personnel of the Company or their relatives is interested or concerned in the proposed Resolution

Item No 12

As per the provision of Section 20 of Companies Act, 2013 Member of the Company may request for delivery of any document through a particular mode for which he shall pay such fees as may be determined by the Company in its Annual General Meeting.

Document shall include all those papers as defined in the resolution above. Accordingly approval of shareholder is sought to provide the documents in a particular mode as mentioned in the resolution.

None of the directors, Key Managerial Personnel of the Company or their relatives is interested or concerned in the proposed Resolution.



Page|17

Page|18

Item No.13:

Board of Directors in their Board Meeting held on 08th August, 2014, has approved issue of shares on rights basis to the existing equity shareholders of the company.

The existing authorized equity capital does not provide requisite blanket to allot equity shares under proposed rights issue of company. Company has available authorized preference share capital of Rs. 11.11 crores and company in near future has no plan to issue preference shares and have therefore proposed to reclassify the existing authorized preference share capital into equity share capital by reclassifying 2,00,000 preference shares of Rs. 100/- each into 2,00,00,000 Equity shares of Re. 1/- each.

Approval of shareholders is essence for reclassification as per section 61 of Companies Act, 2013.

Shareholders are further informed that reclassification calls for amendment of clause V a Memorandum of Association (MOA) and the said alteration will be subject to receipt of approval from shareholders by way of special resolution.

Your Directors recommend Resolutions at item No. 13 for your approval.

None of the Directors and the Key Managerial Personnel of the Company including their relatives are concerned or interested in aforesaid resolutions except to the extent of shareholding held by them and same has been mentioned in “Annexure B”. z





Place: Navi Mumbai

Khushboo Gurbuxani


Details of Directors Seeking Appointment/Re-appointment at the Annual General Meeting as per Clause 49 (G) of the Listing Agreement:

Sr.

No

Name of the

Director

Date of last

appointment on the

Board

Qualifications &

expertise in

specific functional

areas

Names of other

Companies in which

the person also holds

directorship and

membership of

Committees of the

Board (refer note)

Number of

shares held

as on

31st March

2014

Relations-

hip with

other

Directors

Mr. Alok

Pathak

Mr. Saurabh

Dani

07th November,

2009

12th November,

2012

Engineering from

NIT Raipur.

M Tech, IIT

Mumbai

B.COM, LLB,

MBA (USA),

cVa™, ISO 27001

LA, PMP ,ITIL

Foundation

Idhasoft Limited

1) Dani Shares and Stocks Pvt Ltd.

2) Dani Financials Product Pvt Ltd.

3) Secure Matrix India Pvt Ltd.

4) Secure Matrix Global Ltd.

5) Secure Matrix Solutions Private Ltd.

6) Dani Commodities Private Limited.

7) Dani Properties Private Limited.

8) Idhasoft Limited

NIL

23,93,600 shares

None

None

01

02



Dr. Ajay

Sharma

07th November,

2009

B.Tech from

Roorke University

and PhD from

London

University

Nil Nil None03

Page|19

Page|20

Sr.

No

Name of the

Director

Date of last

appointment on the

Board

Qualifications &

expertise in

specific functional

areas

Names of other

Companies in which

the person also holds

directorship and

membership of

Committees of the

Board (refer note)

Number of

shares held

as on

31st March

2014

Relations-

hip with

other

Directors

Dr. Nirmal Jain 07th November,

2009

B Tech, IIT Bombay and PhD from University of Hawaii (US).

&

Advance Management Program at Harvard Business School.

1) Cytel Statistical Software & Services Pvt. Ltd.

2) Rhombus Consulting Pvt. Ltd.

3) SpadeWorx Software

4) Talentica Software (India) Pvt.Ltd.

5) Triiton Mentors & Advisors Pvt. Ltd.

Nil None04



Note: Directorships in Body Corporate, alternate Directorships and membership in governing councils, chambers and other bodies are not included. Membership/Chairmanship in Audit Committee and Shareholder Grievance Committee of other Companies is included.

DIRECTORS REPORT


To

The Members,

PRISM INFORMATICS LIMITED,

The Board of Directors of your Company have pleasure in presenting the 32nd Annual Report of company along with the audited statement of accounts for the financial year ended 31st March 2014.

1. FINANCIAL PERFORMANCE: The Standalone financials of the Company for the financial year ended March 31, 2014 are as follows:

STANDALONE RESULTS

Total Income

Less: Total Expenditure

Profit before Depreciation

Depreciation

Profit after Depreciation and before

prior period items

Less: prior period items

Profit before taxation

Provision for Taxation:

Current Tax

Deferred Tax

Net profit after tax

Profit brought forward

Amount available for appropriation

Less: Appropriations

Interim Dividend

Proposed Equity Dividend

Preference Dividend

Dividend Tax

Profit transferred to Balance sheet

237,500,991

241,244,625

(1,471,497)

2,272,137

(3,743,634)

42,439,889

(46,183,523)

(1,335,329)

(1,395,753)

(43,452,441)

(29,297,995)

(72,750,436)

Nil

Nil

Nil

Nil

(72,750,436)

235,806,233

239,260,900

(3,132,462)

322,205

(3,454,667)

71,388,412

(74,843,078)

4,220,000

(569,722)

(78,493,356)

49,195, 362

(29,297,995)

Nil

Nil

Nil

Nil

( 29,297,994)

Particulars April 1, 2013 to March 31, 2014 April 1, 2012 to March 31, 2013

(In Rs.)

Page|21

Page|22

The Consolidated financials of the Company for the financial year March 31, 2014 are as follows:

CONSOLIDATED RESULTS:

Total Income

Less: Total Expenditure

Profit before Depreciation

Depreciation

Profit after Depreciation and before

prior period items

Less: Extra ordinary Items

Less: Exceptional Items

Profit before taxation

Tax Expense:

1) Current tax

2) Deferred tax

Net profit for year

Profit brought forward

Transfer to General Reserve

Less: Appropriations

Interim Dividend

Proposed Equity Dividend

Preference Dividend

Dividend Tax

698,320,959

715,239,516

(3,302,712)

13,615,845

(16,918,557)

11,559,352

-

(28,477,909)

90,304

(1,395,753)

(124,881,535)

(176,888,212)

-

-

-

-

-

636,762,220

678,286,063

(24,094,394)

17,429,450

(41,523,844)

90,890,123

(29,067,341)

(103,346,626)

4,747,132

(569,722)

(197,567,815)

20,679,603

-

-

-

-

-

Particulars For year ended March 31, 2014 For year ended March 31, 2013

(In Rs.)

2. COMPANY'S PERFORMANCE:

During the financial year 2013-14, company has achieved operational revenue of Rs. 20.99 Crores resulting in operational profit of Rs.1.15 Crores, however at net level there is a loss of Rs.4.34 Crores due to provisions made towards disinvestments in step down step subsidiary in USA.

On consolidated basis, Company booked a revenue of Rs. 67.04 Crores in FY 2013-14 as against Rs. 62.02 in FY 2012-13. The net loss of Company for FY 2013-14 is Rs. 12.48 Crores on account of increase in cost of Sales & Services and ammortisation of Goodwill on business acquisition.

DIRECTORS REPORT


3. DIVIDEND:

Board of Directors do not recommend any Dividend for the Financial Year 2013-14.

4. DIRECTORS:

¡ Mr. V. Chandrashekar was appointed as a whole-Time Director of Company with effect from 12th June, 2013 for period of 2 years.

¡ Mr. V. Chandrashekar resigned from post of Whole-Time Director and Company Secretary with effect from 8th August, 2014. However Mr. V. Chandrashekar will be on Board of Company as non-executive director of Company.

¡ Mr. Saurabh Dani retires by rotation and being eligible offers himself for reappointment at the ensuing Annual General Meeting.

¡ Dr. Ramesh Subramaniam was appointed as a Non-Executive Director of the Company on 14th February, 2013. He resigned from the post of Non-Executive Director with effect from 16th June, 2014.

5. HIGHLIGHTS OF 2013-2014:

i. Conversion of 11% 4,01,050 Compulsorily Convertible Debentures (CCDS - Series III) into equity shares:-

4,01,050, 11% Compulsory Convertible Debentures (CCD-Series III) of Rs. 100/- each allotted on 30th April, 2012 were converted into 7,41,174 equity shares, having a face value of Re. 1/- each (Rupee One) at a premium of Rs. 53.04/- per share on 29th October, 2013. The Company received listing approval on 07th March, 2014. Out of said 741,174 equity shares, 279,153 equity shares were allotted to Shantilal Hirji Lakha. Since he has not provided his Demat details his entitlement shall be given effect only upon receipt of demat details from him.

ii. Conversion of 2% 2,15,643 Non Cumulative Compulsorily Convertible Preference Shares (NCCPS - Series V) into equity shares:-

2,15,643, 2% Non Cumulative Compulsorily Convertible Preference Shares (NCCP-Series V) of Rs. 100/- each allotted on 30th April, 2012 were converted into 6,16,123 equity shares, having a face value of Re. 1/- each (Rupees One) at a premium of Rs. 34/- per share on 29th October, 2013. Company received listing

approval on 07th March, 2014. Company is in the process of giving credit to shares and making necessary applications for obtaining trading approval for same.

iii. Allotment of 2% 6,60,000 (nos) Non - Cumulative Compulsory Convertible Preference Shares (NCCP Series –VI) of Rs. 100 each on Preferential basis.

Company allotted 6,60,000, 2% Non-Cumulative Compulsorily Convertible Preference Shares (NCCP's Series VI) of Rs. 100/- each at par on 13th March, 2014 upon receipt of approval of the shareholders in Extra Ordinary General Meeting dated 07th February, 2014 and in-principle approval from Bombay Stock Exchange on 07th March, 2014. The said NCCPS are due for conversion on 12th September, 2014.

6. SUBSIDIARIES:

The Subsidiaries of the Company as on 31st March 2014 are as follows:

a. Prism Informatics Europe AG, Europe

b. Prism Informatics Schweiz Gmbh, Europe

c. Prism Informatics Deutschland Gmbh, Europe

d. Prism Informatics Inc., USA

e. Prism Informatics Pte Limited, Singapore

f. TLC Technologies Inc., USA**

g. Prism Software Consulting, JLT

h. Prism Infoglobal Limited, Seychelles

**TLC Technologies Inc., was acquired by Prism Informatics Inc, Wholly Owned Subsidiary of the Company. The said step down subsidiary of the Company was incurring losses from operations resulting in substantial erosion of the capital and hence the investment in said step down subsidiary was disposed off on 21st February, 2014. No RBI reporting is required for disposal of investment in step down subsidiary.

DIRECTORS REPORT


Page|23

Page|24

A statement containing brief financial details of the subsidiaries is included in the Annual Report. As required under the Listing Agreements with the Stock Exchanges, a Consolidated Financial Statement of the Company and all its subsidiaries is attached. The Consolidated Financial Statements have been prepared in accordance with the relevant Accounting Standards as prescribed under Section 211(3C) of the Companies Act, 1956 (“Act”). These financial statements disclose the assets, liabilities, income, expenses and other details of the Company, its subsidiaries and associate companies. The audited consolidated financial statements together with Auditors' Report form part of the Annual Report.

Company is its Board Meeting held on 13th August, 2014 has passed a resolution stating that balance sheet of subsidiaries shall not be attached to Annual Report of company as company fulfills necessary conditions under section 212(8) of Companies Act, 1956 and the rules made thereunder and in accordance with compliance of conditions in this regards prescribed by notification.

7. Report on Corporate Governance and Management Discussion and Analysis:

Report on Corporate Governance and Management Discussion and Analysis report statements along with a Certificate of Compliance from Practicing Company Secretary is attached as annexures to this Report.

8. D I R E C T O R S R E S P O N S I B I L I T Y STATEMENT:-

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 (“Act”), and based on the representations received from the operating management, the Directors hereby confirm that:

i. in the preparation of the Annual Accounts for the year 2013-14, 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 the financial year;

iii. they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956. They confirm that there are adequate systems and controls 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.

9. AUDITORS:

M/s E.A Patil & Associates, Chartered Accountants, Mumbai bearing ICAI Registration No.117371W are proposed to be appointed as Auditors of the Company from the conclusion of ensuing Annual General Meeting till the conclusion of the Thirty Seventh (37th) Annual General Meeting of the Company held thereafter, subject to ratification of the appointment by the members at every AGM held after the ensuing AGM.

As required under Section 139 of the Companies Act, 2013, the Company has obtained a written consent from M/s E .A. Patil & Associates, to such appointment and also a certificate to the effect that their appointment, if made, would be in accordance with Section 139(1) of the Companies Act, 2013 and the rules made there under.

10. AUDITORS REPORT:

The Board has duly examined statutory auditors' report on annual accounts of company and have provided clarifications wherever necessary, have been included in the Corporate Governance Report and Notes to Accounts section of the Annual Report.

11. PUBLIC DEPOSITS:

The Company has not accepted any public deposits and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the Balance Sheet.

DIRECTORS REPORT


DIRECTORS REPORT


12. PARTICULARS OF EMPLOYEES:

Ministry of Corporate Affairs vide notification dated 31st March, 2012 have amended the Limits with respect to the Particulars of employees pursuant to provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 required to be disclosed in the Directors Report. The said circular amended rule 1A of said rules and substituted the words Rs. “Twenty four Lakhs” per annum to Rs. “Sixty Lakhs” per annum and the words Rs. “Two Lakhs” per month to Rs. “Five Lakhs” per month. Accordingly as per the said amendment Company does not have any employee drawing remuneration above Rs. “Five Lakhs” per month or Rs. “Sixty Lakhs” per annum. So requirement of disclosure under section 217 (2A) of the Companies Act, 1956 is not applicable.

13. PARTICULARS UNDER SECTION 212 OF THE COMPANIES ACT, 1956:

Pursuant to the provision of Section 212(8) of the Act, Ministry of Corporate Affairs vide its circular dated February 8, 2011 has granted general exemption from attaching the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies with the Balance Sheet of the Company. A statement containing brief financial details of the Company's subsidiaries for the financial year ended March 31, 2014 is included in the Annual Report. The annual accounts of these

subsidiaries and the related detailed information will be made available to any member of the Company/its subsidiaries seeking such information at any point of time and are also available for inspection by any member of the Company/its subsidiaries at the registered office of the Company. The annual accounts of the said subsidiaries will also be available for inspection, as above, at the head offices/registered offices of the respective subsidiary companies. The Company shall furnish a copy of details of annual accounts of subsidiaries to any member on demand. Company has taken an approval of Board of Directors for availing the above said exemption in the Board Meeting dated 13th August, 2014.

14. C O N S E R V A T I O N O F E N E R G Y , T E C H N O L O G Y A B S O R P T I O N A N D FOREIGN EXCHANGE EARNINGS AND OUTGO:

The particulars as 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 in an Annexure to this Report.

15. APPRECIATION:

We thank our customers, vendors, investors and bankers for their continued support during the year. We appreciate hard work, cooperation and support of our employees at all levels.

For PRISM INFORMATICS LIMITED


Place: Navi Mumbai

Alok Pathak

Managing Director

Saurabh Dani

(Whole-Time Director)

Page|25

Page|26

Annexure “A” to Directors' Report


Particulars pursuant to Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988:

Conservation of Energy & Technology Absorption:

Company being in information technology sector, information in Part A and B pertaining to conservation of energy and technology absorption are not applicable to the Company. However, Company requires energy for its operations and every endeavor has been made to ensure the optimal use of energy, avoid wastage and conserve energy as far as possible.

Foreign Exchange Earnings & Outgo:

Particulars

Foreign Exchange Earnings

Foreign Exchange Outgo

As on 31st March, 2014

Rs.118,929,414

Rs.54,11,875

As on 31st March, 2013

Rs. 109,290,152

Rs. 58,48,760


Place: Navi Mumbai

Alok Pathak

Managing Director

For PRISM INFORMATICS LIMITED

Saurabh Dani

(Whole-Time Director)

Annexure “B” to Directors' Report


Statement pursuant to Section 212 (8) Of the Companies Act, 1956 relating to Subsidiary Companies:

Stat

emen

t und

er Se

ction

212 (

8) of

the C

ompa

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Page|27

Page|28

REPORT ON CORPORATE GOVERNANCE


Pursuant to Clause 49 of the Listing Agreement, a report on Corporate Governance is given below:

1) Company's philosophy on Code of Governance:

Corporate Governance is a concerned with the way corporate entities are governed, as distinct from the way business within those companies are managed. We believe that an active, well-informed and independent board is necessary to ensure the highest standards of corporate governance. It is well recognized that effective board is pre-requisite for strong and effective corporate governance. Corporate Governance deals with set of laws, regulations, rules, and good practices that enable an organization to perform efficiently and ethically generate long term wealth and create value for all its stakeholders. The Corporate Governance enables a corporation to complete more efficiently and prevent fraud and malpractices within organization. Our Corporate Governance framework ensures that we make timely disclosures and share accurate information regarding our financials and performance, as well as the leadership and governance of the Company.

Recently, the Securities and Exchange Board of India (SEBI) sought to amend the equity listing agreement to bring in additional corporate governance norms for listed entities. These norms provide for stricter disclosures and protection of investors rights, including equitable treatment for minority and foreign shareholders. Many of the amendments are effective from 1st day of October, 2014. The amended regulation requires Companies to obtain the approval of Shareholders for material related trade party transaction, to have women director on the Board of Company. The amended regulations are designed in alignment with Companies Act, 2013. Company accordingly has decided to obtain approval of Shareholders for all material related trade party transaction at this Annual General Meeting of the Company and same is mentioned in point 13 of Notice of Annual General Meeting of the Company. Further Company has adopted its own policy on “Related Trade Party Transaction” in its Board Meeting held on 13th August, 2014. Accordingly Company in its Board Meeting dated 13th August, 2014 has adopted the policy on transaction with Related Trade Party and same is available on website of the Company.

2) Board of Directors:

The Current policy is to have an appropriate mix of independent and executive director to maintain the independence of Board and to separate the functions of

governance and management.

As on 31st March, 2014 the Board of Directors of Company comprises of Seven Directors. Of the 7(Seven) Directors, two are Non- Executive Directors, two are Independent Directors, two are Whole-Time Directors & One Managing Director The composition of the Board is in conformity with Clause 49 of the Listing Agreement entered into with Bombay Stock Exchange (BSE). The Chairman of the Board is an independent director and hence 1/3 rd of the members of Board as per the said clause must consist of non executive directors. Following is the composition of Board of Directors of the Company:

¡ Dr. Nirmal Jain- Chairman and Independent Director.

¡ Mr. Alok Pathak- Managing Director.

¡ Mr. Saurabh Dani- Whole Time Director.

¡ Dr. Ajay Sharma- Independent Director.

¡ Mr. Christof Anderi- Non Executive Director.

¡ Dr. Ramesh Subramaniam- Non Executive Director**

¡ Mr. V. Chandrashekar- Whole Time Director^^

** Dr. Ramesh Subramaniam, Non-executive Director of the Company has resigned from Board of Company with

theffect from 16 June, 2014

^^Mr. V. Chandrashekar, Whole-Time Director and Company Secretary resigned from post of Whole-Time Director and Company Secretary on 08th August, 2014 and shall continue to act as Non-executive Director on Board of Company

Changes during the financial year (2013-2014) in the composition of Board of Directors of the Company:

– During the Financial year 2013-14, there is no change in Board of Prism Informatics Limited. However, Dr. Ramesh Subramaniam, Non executive Director has resigned. The composition after resignation also meets the requirements of Clause 49 of Listing Agreement.



A. Board Composition and Category:

The Composition of the Board and category of Directors as on date of this report are as follows:

Category Name of the Directors

Chairman & Independent Director

Independent Director

Managing Director

Whole Time Director

Non-Executive Director

Non-Executive Director

Mr. Nirmal Jain

Dr. Ajay Sharma

Mr. Alok Pathak

Mr. Saurabh Dani

Mr. Christof Anderi

Mr. V. Chandrashekar

The Composition of the Board of Directors meets the requirements of Clause 49(I) (A) of the Listing Agreement.

None of the Directors on the Board is a member of more than ten Committees and Chairman of more than five Committees (as specified in Clause 49) across all Companies in which they are Directors.

B. Board Meetings, Board Committee Meetings and Procedures

The Board of Director of the company meets at regular intervals with an annual calendar and formal schedule of matters specifically reserved for its consideration to ensure that the matters in relation to Strategy, Operations, Finance and Compliances are reviewed and monitored regularly. The calendar of meetings is communicated to the Directors to enable maximum participation. The Directors of the Company, through their participation in Board Meetings either in person or through technology enabled conferences, provide inputs to management from their relevant fields of knowledge and expertise.

C. Board Meetings held during the year, attendance of Directors and particulars of the Directorships, committee memberships/chairmanship and last AGM:

stDuring the year ended 31 March, 2014 seven board meetings were convened and the gap between two meetings did not exceed four month. The dates on which the said meeting were held as follows.

Date of Board Meeting

29th April 2013

30th May 2013

19th July 2013

13th August 2013

12th November 2013

13th February, 2014

Sr. No.1

2

3

4

5

6

Page|29

Page|30



The necessary quorum was present for all the meeting conveyed during the year ended 31st march, 2014

The details of the attendance at the meetings of the Board and at the last AGM together with the particulars of the other Directorships, committee membership/chairmanship, of the Directors are given below:

Name of Directors

Attendance of Directors in

meetings held during 2013-2014

(out of 7 meetings)

No of other

directorship

(excluding Prism)

No. of Membership

(s)/Chairmanship(s)

of Board

Committees in

Other Companies

(excluding Prism)

Board Meeting Last AGM

Mr. Alok Pathak

Dr. Nirmal Jain

Dr. Ramesh Subramanian

Mr. Ajay Sharma

Mr. Christof Anderi

Mr. Saurabh Dani

V. Chandrasekhar**

6

7

5

6

6

4

5

No

Yes

-

No

Yes

No

No

5

5

3

Nil

2

5

4

Nil

Nil

Nil

Nil

Nil

Nil

Nil

Notes:

1. The Directorships held by Directors as mentioned above, do not include Alternate Directorships and Directorships in Foreign Companies, Companies registered under Section 25 of the Companies Act, 1956.

2. Membership / Chairmanship of the Audit Committees and Shareholders' / Investors' Grievance Committee in all Public Limited Companies have been considered.

D. Most of the Decisions of the Company are taken in the Board Meeting. However due to business exigencies, availability of independent directors or urgency of matters, following resolutions were passed by circulation in accordance with the provisions of Section 292 of the Companies Act, 1956:

Date of Resolution Resolution PassedNo. of directors

approving the same

1)To consider the appointment of Mr. V. Chandrasekhar as Whole-Time Director on Board of company with effect from

th12 June, 2013

All Directorsth12 June, 2013

** Attended all board meetings from the date of appointment (12.06.2013).

Date of Resolution Resolution PassedNo. of directors

approving the same

All Directors

All Director Except Mr. Saurabh Dani

All Directors

All Directors Except Dr. Ramesh Subramaniam

th29 October, 2013

th13 March,2014

1) To allot 6,16,123 Equity Shares of Re. 1/- each at the premium of Rs. 34/- per share arising on conversion of 2,15,643 2% Non Cumulative Compulsorily Convertible Preference Shares of Rs. 100/-each (NCCP's Series IV) at the conversion price of Rs. 35/-per share determined in accordance with SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

2) To allot 7,41,174 equity shares of Re. 1/-each at the premium of Rs. 53.11/per equity share arising on conversion of 4,010,50 11% Compulsorily Convertible Debentures of Rs. 100/-each (CCD's Series Ill) conversion price of Rs. 54.11/-per share determined in accordance with SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

1) To allot 6, 30,000 (no's) 2% Non Cumulative Compulsorily Convertible Preference Shares (NCCP's Series V) of Rs. 100/- each at par to Megh Leasing and Investments Limited on a preferential allotment basis against conversion of unsecured loan.

2) To allot 30,000 (no's) 2% Non Cumulative Compulsorily Convertible Preference Shares (NCCP's Series V) of Rs. 100/- each at par to Dr. Ramesh Subramaniam on a preferential allotment basis against cash.

** Company had allotted 3,46,020 Equity shares on 21st April, 2014 arises on conversion of 50,000 12% Compulsorily Convertible Debentures (CCD's- Series V) of Rs. 100 each at par on 22nd October, 2012 on Preferential basis.

3) Committees:

A. Audit Committee:

The Audit Committee of the Company is constituted in line with the provisions of clause 49 of listing agreement entered into with Bombay Stock Exchange (BSE).

Composition: The audit committee of the Board comprises of Dr. Nirmal Jain, Dr. Ajay Sharma and Mr. Alok Pathak, Dr. Nirmal Jain is Independent Non executive Director and Chairman of audit committee, Dr. Ajay Sharma is Independent Non- executive Director, and Mr. Alok Pathak is Managing Director.



Sr. No.

1

2

3

Name of Audit Committee Members

Mr. Alok Pathak

Dr. Ajay Sharma

Dr. Nirmal Jain

Designation / Category

Managing Director


Chairman & Independent Director

Page|31

Page|32

P Objective, Role and terms of reference to Audit Committee: The terms of reference of the Audit Committee of the Company include the powers as referred to in sub-paragraph (C) of paragraph II of Clause 49 of the Listing Agreement and the role as stipulated in sub-paragraph (D) of paragraph II of Clause 49 of the Listing Agreement of the Company with the Stock Exchange(s). The Chairman of the Audit Committee was present at the Last Annual General Meeting of the Company to answer the shareholders queries.

P Meetings: During the financial year 2013-2014, five meetings of audit committee were held. The dates on which the said meetings were held are as follows:

Sr. No.

1

2

3

4

5

Date of Audit Committee Meeting

29th April 2013

30th May 2013

13th August 2013

12th November 2013

13th February, 2014

The composition of the committee and the attendance of the members at each of the meetings held during the financial year 2013-2014 are given below:

Name of the Committee Member

Dr. Nirmal Jain

Dr. Ajay Sharma

Mr. Alok Pathak

No. of meetings held

5

5

5

No. of meeting attended

5

5

5

Company Secretary – Secretary of Audit Committee, Statutory Auditor and Internal Auditors attend the audit committee Meetings.

A) Remuneration of Directors:No remuneration is paid to any Directors of the Company except following



Sr. No.

1

2

Name of the Director

Mr. Saurabh Dani

Mr. V. Chandrashekar^^

Remuneration paid them

3,00,000 p.m.

3,00,000 p.m.

No. of Equity

Shares holding

27,07,915

4,996

% of Share capital

12.33

0.02

** Dr. Ramesh Subramaniam, Non-executive Director of the Company has resigned from Board of Company with effect from 16th June, 2014.

^^Mr. V. Chandrashekar, Whole-Time Director and Company Secretary resigned from post of Whole-Time Director and Company Secretary on 08th August, 2014 and shall continue to act as Non-executive Director on Board of Company

Hitherto setting up of remuneration committee was not mandatory. With enactment of Companies Act, 2013, it is mandatory to constitute “Nomination and Remuneration” committee under provisions of Companies Act, 2013 and accordingly Board in its meeting held on 08th August, 2014 constituted committee consisting of Dr. Ajay Sharma, Dr. Nirmal Jain, and Mr. V. Chandrashekar. Board adopted “Nomination & Remuneration policy” as recommend by members of committee in its Board Meeting dated 13th August, 2014 & shall follow all parameters as stated in said policy for nomination, appointment and payment of remuneration to directors, key managerial personnel and senior management personnel.

B) Investors'/ Shareholders Grievance Committee:

Composition: Investors/Shareholders Grievance committee comprises of following members

Sr. No.

1

2

3

Name of Audit Committee Members

Mr. Alok Pathak

Dr. Ajay Sharma

Dr. Nirmal Jain

Designation / Category

Managing Director



Terms of Reference: The committee looks into redressal of shareholders'/ investors' complaints related to transfer of shares, non-receipt of Balance Sheet, non- receipt of declared dividend, etc. The Board has delegated the power of approving transfer of securities to the Managing Director and / or the Company Secretary.

Company Secretary and Compliance Officer has been authorized to take all necessary steps to comply with various regulations as issued by the relevant authorities.

No complaints were received by the Company/Registrar and Transfer Agent of Company for financial year 2013-14 and hence no meeting of Investors'/ Shareholders Grievance Committee was held.

Complaints outstanding as on April 1, 2013

Complaints received during the year ended March 31, 2014

Complaints resolved during the year ended March 31, 2014

(Need to confirm from RTA)

Nil

Nil



Name of Directors

Dr. Nirmal Jain (Independent Director)

Dr. Ajay Sharma (Independent Director)

Dr. Ramesh Subramaniam (Non Executive Director)

Mr. Christof Anderi

Remuneration if any (in Rs.)

-

-

-

-

No. of securities of

Company held

-

-

13,806**

5,31,870

Nil

Page|33

Page|34

4) General Body meetings:

A) Annual General meeting:

a) Date, time and location of the last three Annual General Meeting (AGM):

Year

2010-11

2011-12

2012-13

Day, Date and Time

12th August 2011 on Friday at 11 am.

17th August 2012 on Friday at 11 am

27th September, 2013 on Friday at 11 am

Venue

Four Points by Sheraton, Near Vashi Railway Station, Vashi, Navi-Mumbai 400 703.

Four Points by Sheraton, Near Vashi Railway Station, Vashi, Navi-Mumbai 400 703.

Hotel Zinga, Shop No. 176 to 179 Fantasiya Business Park, Plot No. 47, Sector – 30A, Opp. Vashi Railway Station, Vashi, Navi-Mumbai 400 703.

b) Special resolutions passed during previous three AGMs:

Special Resolutions passed

No Special resolution was passed

Appointment of Mr. Bhuman Dani son of Saurabh Dani as “operational Manager”

Issue and allot up to 7,00,000, 2% Non-Cumulative Compulsorily Convertible Preference Shares (NCCP Series V) of Rs. 100/- each

Year

2010-11

2011-12

2012-13

c) Special Resolutions passed through Postal Ballot in year 2013-2014:

a) Whether any special resolution passed last year through postal Ballot- NO

b) Company has not passed any resolution through postal during the year 2013-14

5) Disclosures:

a) Disclosures on materially significant related party transactions that may have potential conflict with the interests of company at large: In terms of Accounting Standard 18, details of transactions with related parties have been reported in the notes on accounts. There were no materially significant transactions that had conflict with the interest of the Company at large.

b) Details of non-compliance by the Company, penalties, structures imposed on the company by stock exchange or SEBI or any statutory authority on any matter related to capital markets, during the last three years: Not Applicable.

· Whistle Blower Policy/Vigil Mechanism: Company in its Board Meeting dated 13th August, 2014 established Vigil Mechanism as per provisions of section 177 (9) of Companies Act, 2013. Board nominated Mr. V.



Chandrashekar, Non-Executive Director as“Ethics Officer” to redress genuine concerns of directors and employees.

Directors and employees can redress the said concerns by adopting following steps:

a. Directors/Employees having concern may approach said officer by writing concern in prescribed form (Annexed hereto) and send the form on E-mail ID [email protected] With CC to [email protected]

b. Concern addressed to said officer in point (a) above shall resolve the same within 30 days of receipt of same. Concern pending beyond 30 days can be referred directly to Mr. Nirmal Jain, Chairman of Audit Committee.

c. All the concerns resolved & pending shall be placed at the meeting of Audit Committee in its quarterly meeting.

P The concern so received shall address and resolve within 30 days of receipt of same. Concern pending shall be raised by said officer to chairman of Audit Committee in its quarter meeting.

C) The Company has fulfilled the following non-mandatory requirements as prescribed in Annexure I D to the Clause 49 of the Listing Agreements with the Stock Exchanges:-

i) A communication on the financial performance of Company including a summary of the significant events was sent to every member.

ii) Company has adopted a Whistle blower policy and has established the necessary mechanism for employees to report concerns about unethical behavior. No employee has been denied access to the audit committee.

6) Means of Communication:

i) Quarterly Results: Quarterly Results are published in 'Free Press Journal' and / 'Navshakti' and are displayed on the Company's website www.prism-informatics.com.

ii) News Releases, Presentations, etc: Official news releases, detailed presentations made to media, analysts, institutional investors, etc. are displayed on the Company's website www.prism-informatics.com.

iii) Website: The Company's website www.prism-informatics.com contains a separate dedicated section 'Investors' where shareholders information is available. The Company has made no presentation to any Institutional Investors/Analysts during the year.

iv) Annual Report: The detailed Annual Report is available on website of company & on website of Bombay Stock Exchange, where shares of company are presently listed. Directors Report, Corporate Governance Report, Management Discussion Analysis Report, along with Abridged Audited Annual Financial Statement has been circulated to members and others entitle thereto.



Page|5

Page|36

7) General Shareholders Information:

i) Company Registration Details:

Company is registered under the jurisdiction of Mumbai – ROC in the State of Maharashtra. Corporate Identity Number (CIN) allotted to the Company by the Ministry of Corporate Affairs (MCA) is L67120MH1983PLC029483

ii) Date, time and venue of the Annual General Meeting:

Date: 30th September, 2014

Time: 04:00 P.M.

Place: Celebration Banquets, Plot No. 46, 3rd Floor, Samna Press Building, Next to Inorbit Mall, Near Vashi Railway Station, Sector 30-A, Vashi, Navi Mumbai-400703 on 30th day of September, 2014 at 4.00 p.m. (IST)

iii) Financial Year: April 1, 2013 to March 31, 2014

iv) Results for the quarter ending :

June 30, 2013 - 13th August, 2013

September 30, 2013 - 12th November, 2013

December 31, 2013 - 13th February, 2013

March 31, 2014 - 27th May, 2014(Audited Financials)

Annual General Meeting - 30th September, 2014

v) Date of Book Closure:

The share transfer book of the Company will be closed from Monday, 22nd September, 2014 to Tuesday, 30th September, 2014 (both days inclusive)

vi) Listing on Stock Exchange:

Bombay Stock Exchange, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001, Tel 022-22721233/34 Fax: 022-22723121. Stock Code: 505530.

The Annual listing fees have been paid and there is no outstanding amount as on date.

Demat ISIN Number for NSDL and CDSL: INE389J01028.

vii) Dematerialization of Equity Shares:

The Equity Shares of the company are admitted in the following depositories of the Country under the International Securities Identification Number (ISIN) INE389J01028.

This number is required to be quoted in each transaction relating to dematerialized Equity shares of the Company.



Name of Depository

National Securities Depository Limited

Central Depository Services (India) Limited

Address

Trade World, A Wing, 4th & 5th Floors, Kamala Mills Compound, Senapathi Bapat Marg Lower Parel, Mumbai - 400 013

Phiroze Jeejeebhoy Towers,16th Floor, Dalal Street, Mumbai - 400 001

Company has paid the custodial charges to the respective depository participant for the year ending 31st March 2014.

viii) Market Price Data:

Company : PRISM INFORMATICS LTD. ( 505530 )

Period : ( Apr 2013 to March 2014 )

Month

Apr 13

May 13

Jun 13

Jul 13

Aug 13

Sep 13

Oct 13

Nov 13

Dec 13

Jan 14

Feb 14

Mar 14

Open

Price

31.20

30.20

24.40

20.20

24.75

16.60

15.00

15.75

14.00

12.10

17.15

15.25

High

Price

31.20

30.20

24.40

27.50

24.75

18.30

15.00

16.10

14.30

18.78

17.65

16.50

Low

Price

31.20

23.25

16.90

18.55

17.45

15

15.00

13.94

11.90

9.54

14.40

11.82

Close

Price

31.20

23.25

19.50

26.05

17.45

15

15.00

14.10

12.10

17.15

15

14.42

No. of

Shares

5

1,128

2,233

32,328

25,716

25,794

162

1,94,192

5,14,515

1,69,925

60,093

19,972

No. of

Trades

1

10

23

29

13

23

1

2,319

2,867

2,037

282

120

Total Turnover

(Rs.)

156

30,361

44,780

6,83,289

5,21,705

4,16,806

2,430

29,51,685

68,49,364

21,99,151

9,61,395

2,96,619

H-L

0.00

6.95

7.5

8.95

7.30

3.30

0.00

2.16

2.40

9.24

3.25

4.68

C-O

0.00

-6.95

-4.90

5.85

-7.30

-1.60

0.00

-1.65

-1.90

5.05

-2.15

-1.05

* Spread (Rs.)

* Spread

H-L : High-Low

C-O : Close-Open



Page|37

Page|38

Month wise high and low prices and the volume of shares of the Company traded for the period 01st April, 2013 to 31st March, 2014 on the Bombay Stock Exchange (BSE) are given below:**Source: Website of Bombay Stock Exchange.

a) Performance in comparison to broad-based indices such as BSE Sensex etc:

b) Registrar and Transfer Agents:

Sharex Dynamic India Pvt Ltd,

Unit 1, Luthra Industrial Premises, Safed Pool,

Andheri Kurla Road, Andheri (East), Mumbai - 400 072

Tel- 28515644, Fax- 28512885

E-mail- [email protected]; [email protected]

c) Share Transfer System:

Managing Director and/or Company Secretary have been empowered by the Board for approving transfer/ transmissions of shares. The Company's registrar Sharex Dynamic (India) Private Limited have adequate infrastructure to process the share transfer applications received within 15 days from the date of lodgment of transfer subject to the transfer instrument being valid and complete in all respects.



ix) Distribution of shareholding as on 31-03-2014:

^^ Company had allotted 7,41,174 Equity Shares on 29th October, 2013 and said equity shares arises on account of conversion of 11%, 401050 Compulsorily Convertible Debenture (CCD Series IV) of Rs. 100/- each. Company is under process to obtain trading approval to these shares. Hence, presently issued capital is Rs. 2,19,56,455 divided into 2,19,56,455 equity shares of Re. 1/- each. While listed equity share capital is Rs. 2,05,99,158 divided into 2,05,99,158 Equity shares of Re. 1/- each.

Category of Equity Shareholders as on 31-03-2014:

Sr. No

1

2

3

4

5

6

7

8

No. of Equity

Shares held

1-5000

5000-10000

10000-20000

20000-30000

30000-40000

40000-50000

50000- 100000

100000 to above

TOTAL

No. of

Shareholders

675

8

11

7

2

3

12

33

751

No. of Shares

2,02,711

64,495

1,48,696

1,83,068

72,976

1,44,610

7,37,085

1,90,45,517

2,05,99,158^^

% of No of

Shareholders

89.88

1.07

1.46

0.93

0.28

0.40

1.60

4.39

100

% of

Shareholding

0.98

0.31

0.72

0.89

0.35

0.70

3.58

92.46

100

Category

Promoters, Directors & Relatives

Public Financial Institutions/ Banks

Mutual Funds/ UTI

FIIS

Venture capital fund

NRIS/ OCBS

Private Corporate Bodies/ Non Institutions Body Corporate

Indian Public

Total

No. of Shares

36,27,341

0

0

0

10,860

82,98,212

55,75,867

31,38,749

2,05,99,158

% of total Shareholding

17.60

0

0

0

0.05

40.28

27.06

15.23

100.00

Sr. No

1

2

3

4

5

5

6

7

x) Dematerialization of shares and liquidity:

The Shares of the Company form part of the compulsory demat segment. The company has established connectivity with both Depositories viz, National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) through the Share Transfer Agent. As on 31st March 2014, 98.32 % shares of Paid up capital of the Company comprising of 2,02,53,328 equity shares of Re 1/- each has been dematerialized.



Page|39

Page|40

xi) Outstanding GDRs/ADRs/Warrants or any Convertible instruments, conversion date and likely impact on equity:

· The Company had allotted 6,60,000 2% Non-Cumulative Compulsorily Convertible Preference Shares (NCCP's- Series V) of Rs. 100 each at par on 13th March, 2014 on Preferential basis with conversion period of 06 months from the date of allotment. The conversion price will be decided as per the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 at the time of conversion. The Conversion of these securities is due on 12th September, 2014.

xii) Plant Locations:

The Company has following operating divisions:

Registered office: Prism Informatics Limited is located at B-907, Bsel Tech Park, Opposite Vashi Railway Station, Sector 30 A, Vashi, Navi Mumbai - 400703.

Registered Office Address

Unit 602, Sixth Floor, Wing 2-Cluster C,EON FREE ZONE, Plot No.1,S.No.77,Kharadi MIDC, Knowledge Park, Pune- 411 014.

Gewerbestrasse 5, 6330 Cham/ Zug, Switzerland

Six Concourse Parkway, Fifth Floor, Atlanta, GA 30328, USA

Sciencepark 2,DE-66123 Saarbrucken, Germany

31, Cantonment Road, Singapore- 089747.

Unit No.2502, Fortune Tower Plot No.C1, Jmeriah Lakes Towers, Dubai, United Arab Emirates.

Suite 3, 1st Floor, La ciotat Building, Mont Fleuri, PO Box 438, Mahe, Seychelles

Operative Divisions located at

Pune

Europe

USA

Germany

Singapore

Dubai

Seychelles

Sr. No.

1

2

3

4

5

6

7

xiii) Address for Correspondence:

Shareholders may correspond on all matters to the address mentioned below:

1. Prism Informatics Limited: B-907, Bsel Tech Park, Opposite Vashi Railway Station, Sector 30 A, Vashi, Navi Mumbai - 400 703. Contact Number: 022-67232976/945

2. Sharex Dynamic (India) Pvt. Ltd: 1st Floor, 44-E, M Vasanti Marg, Andheri-Kurla Road, Safed pool, Andheri(E), Mumbai 400072. Tel No. 2270 2485, Fax No. 2264 1349




As provided under Clause 49 of Listing Agreement with the Stock Exchange, the

Board Members and Senior Management Personnel have confirmed compliance with

the code of conduct for the period ended 31st March, 2014.

ATTENDANCE SLIPCERTIFICATE OF COMPLAINCE WITH

THE CODE OF CONDUCT POLICY



Place: Navi Mumbai

Alok Pathak

Managing Director

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ATTENDANCE SLIP

CEO/CFO CERTIFICATION



Place: Navi Mumbai

Alok Pathak

Managing Director

The Board of Directors

Prism Informatics Limited

(a) I have reviewed the financial Statements, read with the cash flow statement of Prism Informatics

Limited for the year ended 31st March, 2014 and that to the best of my knowledge and belief, I state

that:

(i) These statements do not contain any materially untrue statement or omit any material fact or contain

statements that might be misleading;

(ii) These statements together present a true and fair view of the company's affairs and are in compliance

with existing accounting standards, applicable laws and regulations.

(b) To the best of my knowledge and belief, no transactions entered into by the company during the year

which are fraudulent, illegal or violative of the company's code of conduct.

(c) I accept responsibility for establishing and maintaining internal controls for financial reporting and

that they have evaluated the effectiveness of internal control systems of the company pertaining to

financial reporting and they have disclosed to the auditors and the audit committee, deficiencies in

the design or operation of such internal controls, if any, of which they are aware and the steps they

have taken or propose to take to rectify these deficiencies.

(d) I have indicated to the auditors and the audit committee

(i) Significant changes, if any, in the internal control over financial reporting during the year;

(ii) Significant changes, if any, in the accounting policies during the year and that the same have been

disclosed in the notes to the financial statements; and

(iii) Instances of significant fraud of which they have become aware and the involvement therein, if any, of

the management or an employee having a significant role in the company's internal control system

over financial reporting.


ATTENDANCE SLIP

CERTIFICATE OF COMPLIANCE WITH THE

CORPORATE GOVERNANCE REQUIREMENT UNDER

CLAUSE 49 OF LISTING AGREEMENT


Place: Navi Mumbai

We have examined compliance with conditions of Corporate Governance by Prism Informatics Limited (“the Company') for the year ended 31st March, 2014 Stipulated in Clause 49 of the Listing Agreement of the Company with Bombay Stock Exchange.

Compliance with the conditions of Corporate Governance is the responsibility of Company's management. Our examination was limited to review of procedures and implementation thereof, adopted by the Company for ensuring compliance with the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion, and to the best of our information and according to the explanations given to us and based on the representations made by the management, we certify that Company has complied with the conditions of Corporate Governance as stipulated in clause 49 of the above mentioned Listing Agreement.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

For Prashant Sharma & Associates

Company Secretaries

Prashant Sharma

C.P.No:7902 ACS No. 21775

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Economy and IT Industry Overview

Indian IT companies delivered a modest year in terms of financial performance, driven by an overall improvement in the quality of their service offerings combined with a flat pricing environment. They are now attempting to move up the value chain by providing more end-to-end solutions to their clients.

Increased confidence of business leaders in their companies performance and improved sentiment of consumers drove spending in technology products. Investment in technology is among top three priorities of companies across the world. Worldwide interactions with business leaders reveal that role of technology will create biggest impact on their business. An increasing acceptance of the fact that digital technologies will impact business models, processes, new products and services offerings, access to new markets, new customer base and will open up completely new set of opportunities for their companies, is a common feature across industries and markets.

As a result, spending on technology and technology services grew at a faster pace (4.5%) than global economic growth in 2013. US world's largest IT market grew at 5.6%, while continuing to lead investments in digital technologies. The need to find new ways to reach out to consumers prompted the European companies to invest in technology for optimization and innovation.

Revitalization of global economy continued during calendar year 2013 and global economy ended year on a better footing as compared to the start of the year. Global trade and activity picked up in the second half of 2013. Latest forecast from IMF says that world output growth will reach 3.6% in 2014, up from 3% recorded in 2013. Strengthening of developed economies is likely to boost demand, which, in turn, will help emerging markets and developing economies strengthen further.

US economy grew at an annual rate of 2.6% in last quarter of 2013 with better forecast for 2014. The Euro Zone appears to be transiting from recession to recovery with a projected GDP growth of 1% in 2014 as against a marginal de-growth of 0.4% recorded in 2013.

India's IT industry can be divided into five main components, viz. Software Products, IT services, En-gineering and R&D services, ITES/BPO (IT-enabled services/Business Process Outsourcing) and Hardware. Information Technology is one of the most important industry in the Indian economy.

MANAGEMENT DISCUSSION & ANALYSIS REPORT


Expected revenues of IT-BPM in financial year 2014 is USD 118 Billion. The actual revenue of India IT- BPM revenue stands at 109 USD Billion in year 2013 as against 68 USD Billion in year 2009. Indian IT services exports reached approximately USD 52 billion in FY 2014. IT Services Exports revenue was 45.4 USD billion in FY 2013 as against 27 USD billion in FY 2009.

Indian market continues to acts as a beta testing ground wherein 60% of the firms have India as their testing ground before going global. Indian software export is estimated to be 1.7 Billion USD in FY 2014. Export of software was 1.6 Billion USD in FY 2013 as against 1.1% in FY 2009. This indicates lower growth in terms of revenue from export of software products. Indian IT Service providers have increased their focus on:

i. Strengthening customer-facing teams and mining focus accounts

ii. Deepening vertical specialization and building deep domain expertise

iii. Broadening services portfolio

iv. Evolving newer business models, building non-linear revenue streams

v. Augmenting global delivery models.

Global ITES Industry has dramatically gone through a sea change, where Technology was an enabler for Automation, it is now an intricate service tool for e n s u r i n g n o t o n l y a u t o m a t i o n o r p r o c e s s implementation, but also as a bottom-line improvement tool.

Number of deals signed by Prism Informatics Limited (Prism) as of 2013-2014 is a clear indication that things are changing for the better. The following years 2015 and 2016 would see things substantially improve with the demand for ITES services on an upswing.

Prism is optimistic about the business prospects in USA, Europe, Middle East and the Asia Pacific regions and is geared to meet the challenges that such prospects may bring.

Factors leading to growth in the IT/ITes sector are:

¡ Low operating costs and tax advantage.

¡ Favorable government policies.

¡ Technically qualified personnel easily available in the country.

¡ Rapid adoption of IT technologies in major sectors as Telecom, Manufacturing and BFSI.

¡ Strong growth in export demand from new verticals and non-traditional sectors as public sector, media and utilities.

¡ Use of new and emerging technologies such as mobility analysis and cloud computing.

All these factors have given IT/ITES industry a strong competitive position with high market share.

Business Overview & Capabilities

Prism is a BSE listed company in the field of software development and IT business consulting headquartered in India. Company has grown by a combination of Organic and Inorganic growth. Today brand is well recognized across Europe, Asia-pac, Middle-East, Africa and South East Asia.

Prism has consistently proved its mettle in the consulting industry, and has grown organically and is focused on strategic investments to accelerate market presence and leadership position in chosen verticals including Retail, Manufacturing, Media & Entertainment, Engineering & Construction, Pharmaceuticals, Life Sciences and Education. Our approach is premised on building deep domain specialization in chosen verticals and augmenting our service offerings to provide end-to end solution for our customers. We recruit talent from some of the best universities, colleges and institutes in India and abroad, as well as some of the leading IT companies in India and overseas. In order to create a differentiated culture and preferred place to work, we have taken multiple measures. These include transparent evaluation criteria, continuous focus on training and new skills, competitive compensation packages, being a values-based organization, open communications policies and mentoring our minds for leadership roles.

Prism understands the varying needs of its customer's expectations and develops well- packaged solutions to fulfill their requirements. On time, cost-effective solutions have led Prism to consistently serve its clients across the globe. Prism provides a complete holistic



range of solutions by leveraging deep domain expertise and close-knit associations with leading technology companies.

Prism designs and delivers technology solutions and services that span across various industries, built up with matured, proven and integrated framework for managing technology infrastructure, providing IT and Technology Implementation, IT security consulting and IT forensics & Risk management services. Our expertise on Enterprise Solutions spans across Oracle, SAP, EPM and Cognos Controller. Prism has won several awards from SAP, IBM for its quality commitment and delivery leadership. Company has launched several new products in the Cloud computing and Mobility space. Prism leverages technology across every aspect of enterprise. Prism's experience in various technologies and domains enables Prism to suggest and choose the best technology and solution based on client's requirements and application type. Prism's consistent investments across R&D and innovation meet Prism's inherent need to scale greater heights.

Prism Success factor lies in entering into niche areas like:

¡ Business Planning and Consolidation.

¡ Predictive Analytics.

¡ KPI and Balance score card

¡ Risk Modeling

¡ Governance, Risk & Compliances

Prism's growth is powered by consultative approach, deep understanding of business and technology, passion for innovation and above all, values. Consistent performance has been hallmark of Prism's success. Focus on innovation ensures that Prism is constantly reaching the frontiers to cater diverse business requirement of the global market.

Key Differentiator

Today, India is transforming into world IT hub and all major players in the field are working constantly towards promoting and expanding their market. In this scenario Enterprise Resource Planning (ERP) is playing a major role in growth of small and medium size industries in India apart from contributing largely into the big business enterprises. Our approach towards business differentiates us from the rest.

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Opportunities and Risks

Prism has identified opportunities based on trends noticed in past couple of years, which continues to be focus of our growth strategies during 2014-15, the key ones among them are as follows:

1. The adoption of Social media, Mobile, Analytics and Cloud (SMAC) technologies is expected to drive growth in all the segments. Cloud and client maturity are the major drivers for this, especially in IT. PRISM is adapting this technology for upgrading its existing solutions as part of its offerings.

2. Emerging Geographies like MEA / APAC and emerging verticals – Healthcare, energy and retails are the key areas where CMC will tap opportunities with its core competency of asset based solution.

Threats:

1. Attrition: Since the IT sector is exposed to high attrition rate due to more opportunities available in market for the employee, retaining existing talent pool and attracting new talented manpower is a major risk to the Company. The Company has initiated various measures to enhance the retention of employees during the year which includes, employee engagement surveys, transparent Performance Management System, and Prismconnect to maintain employee-friendly culture in the organization.

2. Technological Changes: The Company operates in high end technology domain which is subject to continuous innovations based on customer requirement. To mitigate the risk of technological changes, Company has its own R&D center to track technological innovations which are relevant to the business of the Company.

Risk:

Risk internal to the Company:

I. Presently Company does not have bank guarantee facility and hence not able to conduct its SAP licensing business to its full extent.

II. Company has taken a cash credit facility from Saraswat Co-operative Bank of Rs. 5 Crores



which has been reduced to Rs. 1.5 Crore.

III. Company in order to meet its working capital requirement has availed certain inter corporate loan at higher rate of interest i.e. simple interest of 27% p.a.

Management representation (MP) for point (I) (II) and (III) above: The Company is taking all reasonable steps to avail bank guarantee. Company has approached various banks in this regards and is in talk with leading banks to assist the company by providing Bank Guarantee and enable company to secure the operational activities of the Company. One of the leading Bank have considered our proposal and we are in negotiation stage to solve these internal problems and same might take some time as same involves restructuring of business.

IV. Company has receivable of Rs. 11 Crores which is outstanding for a period of more than six months as on 31st March, 2014. Company has provided provision for receivables due from its own subsidiaries amounting to Rs. 5.76 Crores. The said provision requires approval from RBI.

MP: The Company is in process to file the application seeking approval from RBI to write off the said provision from its balance sheet.

Risk External to the Company:

I. IT business is technology driven and there is a risk of present technology becoming obsolete.

MP: Prism has a channel partner and leading implementation of SAP solutions constantly upgrades its resource with latest technology and encourages technical team to look into futuristic technology through var ious t ra in ing programmes designed and conducted through SAP.

II. Investment by customers in Information Technology is a function of prevailing economic conditions and government policies in their respective country. Any adverse political or economic shift will have a bearing on investment decisions of customers.

MP: Prism is present in India, Srilanka, USA and the Middle east and has thus spread its country specific risk.

III. IT business is subject to attrition

MP: Prism has been a leader in SAP implementation projects in SME segment and offers excellent work experience and knowledge to its employees. This leads to greater work satisfaction as demonstrated by low attrition rate of 14%.

IV. Information Technology business has no entry restriction and thus carries risk of competition:

MP: Prism by its sustained performance has earned a niche position in SME segment for implementation of SAP Solutions and as a channel partner of SAP is a leading reseller of SAP licenses and has thus curved out a place for itself to sustain competition.

V. Risk relating to exchange rate fluctuation

The Company is into IT and IT enabled services which subjects it to foreign exchange exposure. Fluctuations in foreign exchange rates might have an impact on the financial performance of the Company.

Marketing Strategies

Our Marketing Strategy revolves not only around the goal of increasing Prism's presence in market by acquiring new clients but also by serving existing client to their complete satisfaction. Modes in which we do marketing are:

a. Email Marketing

Our major focus for generating leads is through a series of event that starts with targeted & monitored email campaigns for which databases are created specific to every campaign (Industry, Revenue, Employees etc.). Modern tools helps us track the actions of recipient in respect to the emails,

b. Tele Marketing

A rigorous telecallling session follows up every email campaign in order to generate leads. The prospects who opened/clicked the emailers are first contacted and followed up. The purpose of the telecalling sessions is to help set up calls, client meetings in order to generate interest in our services & offerings.



c. Events

Our focus for attending/organizing events is to broaden our network of clients, contacts, vendors, prospects etc. These events help showcase Prism's diverse offerings and services. We can also generate a sizable database during these events with a sign-up sheet for people who visit our booth/contacts attending the event.

d. Account Mining

Our existing clients are targeted with our other offerings through various marketing collaterals & meetings.

e. Promoting Prism

We create the brand & service offering awareness by sharing our success stories through periodic news releases, releasing whitepapers, online promotions on various sites and targeting the Industry influencers regarding our services and offerings on social media.

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Internal control systems and their adequacy

The CEO and CFO Certification provided in the CEO and CFO Certification section of the Annual Report discusses the adequacy of our internal control system and procedures.

Segmental information (Standalone)

Business segments (For year ended 31st March, 2014)



Particulars

Total Income

Accounts Receivables

Unbilled Revenue

Software Consultancy Services

168,143,638

138,794,451

11,177,817

Total

209,993,239

138,794,451

11,177,817

Software License Sale

41,849,601

-

-

Particulars

Total Income


Unbilled Revenue

India

209,993,239

138,794,451

11,177,817

Total

670,427,309

206,757,919

19,416,253

Rest of world

460,434,070

67,963,468

82,38,436

Segmental information (Standalone)Business segments (For year ended 31st March, 2014)

i. Material developments in Human Resources / Industrial Relations front, including number of people employed.

The Human Resource initiatives of the company in the year continued to be aligned with the overall business strategy and individual career aspirations of staff members. Your company continued to invest in developing the human capital, building strong relationships with academia and establishing its brand in the market to attract and retain the best talent. Company has 177 employees as on March 31, 2014. The company continues to invest in recruiting highly qualified and skilled employees in the organization.

Human resource strategy enabled the company to attract, integrate, develop and retain the best talent required for driving business growth. Sustained strategic focus to enhance employee capability, improve efficiency and groom future leaders has helped company to maintain its benchmark status in the IT Industry. Our Mature HR processes enable us to agile and responsive to the dynamic global environment and stay relevant to the customers. Companies have created a performance based environment where innovations are welcomed by the top management, their performance is valued and recognized, further employees are motivated to realize their potential.

ii. Cautionary Statements:

Company in this Management Discussions and Analysis have stated certain statements relating to company's objectives, estimates, projections, Outlook, expectations and others, may Constitute future prospects of the Company with reference to relating Laws and Regulations viz. Companies Act, 2013 , Securities Laws and other such applicable rules and regulations. With respect to certain uncontrollable measures such as climatic conditions in the industry, market price in domestic and overseas markets, any changes in government regulations and tax laws, Global economic conditions affecting demand/supply and other environmental measures on which company cannot have any control on such uncertain conditions affecting companies objectives and profitability.



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Abridged StandaloneFinancial Information

Auditors' Report


To the Members of


We have audited the accompanying Balance Sheet of Prism Informatics Limited ('the Company') as at

31st March 2014, the Profit and Loss Account and the Cash Flow Statement for the year ended 31st

March, 2014 and a summary of the significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

The Company's Management is responsible for the preparation of these financial statements that give

a true and fair view of the financial position, financial performance and cash flows of the

Company in accordance with Accounting Standards referred to in Section 211 (3C) of the Companies

Act, 1956 (the “Act”) and in accordance with the accounting principles general accepted in India. This

responsibility includes the design, implementation and maintenance of internal controls relevant to

the preparation and presentation of the financial statements that give a true and fair view and are free

from material misstatements, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We

conducted our audit in accordance with Standards on Auditing issued by the Institute of Chartered

Accountants of India. Those Standards require that we comply with the ethical requirements and

plan and perform the audit to obtain reasonable assurance about whether the financial statements are

free of material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the

disclosures in the financial statements. The procedures selected depend on the auditor's judgment,

including the assessment of the risks of material misstatement of the financial statements, whether

due to fraud or error. In making those risk assessments, the auditor considers internal control

relevant to the Company's preparation and fair presentation of the financial statements in order to

design audit procedures that are appropriate in the circumstances, but not for the purpose of

expressing an opinion on the effectiveness of the Company's internal control. An audit also includes

evaluating the appropriateness of the accounting policies used and the reasonableness of the

accounting estimates made by the Management, as well as evaluating the overall presentation of the

financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis

for our audit opinion.

Opinion

In our opinion, and to the best of our information and according to the explanations given to us, the

aforesaid financial statements give the information required by the Act in the manner so required and

give a true and fair view, except in case of receivable balances of Rs.7,66,47,135 and unsecured loan of

Rs.1,00,00,000 from All state Finance & Leasing Ltd which are subject to confirmation and reconciliation (if

any), unbilled revenue Rs 1,11,77,817/- which has been as certified by the management, in conformity with

the accounting principles generally accepted in India:

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Auditors' Report


i. in the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2014

ii. in the case of the Profit and Loss Account, of the profit for the year ended on that date; and

iii. in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor's Report) Order, 2003 (the “Order”) issued by the Central Government in terms of Section 227 (4A) of the Act, we give in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the Order.

2. As required by Section 227 (3) of the Act, we report that:

a. we have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit;

b. in our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

c. the Balance Sheet, the Statement of Profit and Loss Account and the Cash Flow Statement dealt with by this report are in agreement with the books of account;

d. in our opinion, the Balance Sheet, the Statement of Profit and Loss Accountand Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the Act;

e. On the basis of written representation received from the directors of the Company, as on31st March, 2014 and taken on record by the Board of Directors, we report that none of the directors are disqualified as at 31st March, 2014 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act,

f. Without qualifying our report, we draw attention to Note no.1.1 to the financial statements indicates the Company's 100% subsidiary Prism Inc has been incurring losses from the operations and sale of its subsidiary Company TLC Technologies INC Company, in which Prism Inc held 51% holding, resulting in substantial erosion of capital of Prism Inc. as on the balance sheet date. In the opinion of the management these conditions indicate the existence of material uncertainty that may cast significant doubt about the subsidiary's ability to continue as a going concern. Hence the carrying amount of investment Rs.2,56,23,329 has been impaired while receivables from the TLC Technologies Rs 1,68,16,560 has been provided as doubtful debt and the said impairment and doubtful debts is considered in the exceptional / Extraordinary items.

For M/s. E.A.Patil & Associates

Chartered Accountants

Firm Registration No. 117371W

CA. E. A. Patil

Partner

Membership No. 031979

Date : 27th May 2014

Annexure to the Auditors’ Report for the year ended March 31s t, 2014. (Referred to in our report of even date)

i. a) The Company has maintained proper records showing full particulars, including quantitative details and situation, of fixed assets. b) The Company has a regular program of physical verification of its fixed assets, by which all fixed assets are verified in a phased manner over a period of three years. For the current financial year, physical verification for the fixed assets is yet to be carried out by the company.

ii. The Company is a service sector company, primarily rendering IT consulting, software

implementation and software development services. Accordingly, it does not hold any physical inventories. Thus, paragraph 4(ii) of the Order is not applicable.

iii. a. In our opinion, the rate of interest and other terms and conditions on which the loan has been granted to the body corporate, amounting to Rs. 11,73,72,310, listed in the registered maintained under Section 301 of the Act are not, prima facie, prejudicial to the interest of the company. b. The Company has taken unsecured loans, payable on demand, aggregating to Rs. 1,38,20,302 from the companies, firms or parties covered in the register maintained under Section 301 of the Actare not, prima facie, prejudicial to the interest of the company.

iv. In our opinion and according to the information and explanations given to us, the company is in process of implementation of internal control system commensurate with the size of the company and nature of its business with regard to purchase of fixed assets and with regard to sale goods &services. In our opinion, the internal control in respect of service income needs to be strengthened.

v. a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act, have been entered in the register required to be maintained under that section.

b) In our opinion, and according to the information and explanations given to us, the transactions made in pursuance of contracts and arrangements referred to in(a) above and exceeding the value of Rs. 5 lakh with any party during the year have been made at priceswhich are reasonable having regard to the prevailing market prices at the relevant time

vi. The Company has not accepted any deposits from the public.

Annexure to the Auditors’ Report


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vii. The company does not have internal audit system commensurate with its size & nature of its business.

viii. As per the information and explanations provided by the management, the Central

Government has not prescribed themaintenance of cost records under Section 209(1)(d) of the Act, for any of the services rendered by the Company.

ix. a) According to the information and explanations given to us and on the basis of our

examination of the records of the company, amounts deducted/accrued in the books of account in respect of undisputed statutory dues including Income tax, TDS, Service tax, Profession Tax and other material statutory dues have been generally regularly deposited during the year by the Company with the appropriate authorities except for the sum specified in below table which were outstanding as at the last day of financial year concerned. The said sum are outstanding for more than six months from the date it become payable and are yet to be paid:

Name of Statute Nature of Dues Period for which mount pertains

Amount in INR

Income Tax Act, 1961

Tax deducted at source 2013-14 1,57,32,922

Interest on delayed Payment 2013-14 16,05,249

Interest on delayed Payment 2012-13 32,84,173

Finance Act, 1994 Service Tax Jan 13 to Mar 14 13,15,775

Interest on delayed Payment Jan 13 to Mar 14 66,497 *Service Tax Till Dec 12 57,40,765

Maharashtra Value added Tax Act,2002

VAT 2013-14 7,21,703

Interest on VAT 2013-14 19778

CST 2013-14 3,01,687

Interest on CST 2013-14 5,383

Local Body Tax LBT 2013-14 94,541

Interest on LBT 2013-14 11,602

*Application were made under Voluntary comp liance Encouragement Scheme (VCES) for payment of Service Tax and Paid 50% amount of Service Tax, and balance amount is payable before June 30, 2014. b) We have been informed by the management, that there are no dues of sales tax/ income tax/ custom tax/ wealth tax/ excise duty/cess have been deposited on account of dispute.

x. The Company does not have accumulated losses at the end of the financial year, however the accumulated loss do not exceed the more than fifty percent of its net worth hence the clause is not applicable.

xi. In our opinion and according to the information and explanations given to us, the company has availed loan of Rs 1 crore which was due for repayment in the month of 6th March 2014, however the Company has requested for extension of the same.





xii. The Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

xiii. In our opinion and according to the information andexplanations given to us, the Company is

not a chit fund / nidhi / mutual benefit fund / society.

xiv. According to the information and explanations given to us,the Company is not dealing in or trading in shares,securities, debentures and other investments.

xv. According to the information and explanation provided by the management, the Company

has not given any guarantee for loans taken by others from banks or financial institutions.

xvi. The Company did not have any term loans outstanding during the year.

xvii. According to the information and explanations given to us, and on an overall examination of the balance sheet of the Company, we are of the opinion that the funds raised on short-term basis have not been used for long term investment.

xviii. The Company has allotted 30,000 Non Cumulative Compulsorily Convertible Preference

Shares of Rs. 100/- each on preferential basis to Dr. Ramesh Subramaniam, Director of the Company and necessary entry of same is made in Statutory Register maintained under Section 301 of Companies Act, 1956.

xix. The company has not created security or charge against the issue of debentures.

xx. The Company has not raised any money by public issue during the year.

xxi. According to the information and explanations given to us, no fraud on or by the Company

has been noticed orreported during the course of our audit. For M/s. E.A.Patil& Associates Chartered Accountants Firm Registration No. 117371W

CA. E. A. Patil

Partner

Membership No. 031979

Date:. 27th May, 2014

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Amount (in Rs.) Amount (in Rs.)

Capital and Liabilities

Shareholder's Funds

Share Capital 87,956,455 42,163,458

Reserves and Surplus

Capital Reserves (including

Revaluation reserve, if any)

- -

Revenue Reserves 470,179,330 409,867,327

Surplus -72,750,436 -29,297,995

Money received against share warrants - -

Share application money pending allotment 5,961,034 -

Non current liabilities

Long term borrowings - 55,000,000

Deferred tax liabilities (net) - -

Other long term liabilities 43,110,681 39,097,510

Long term provisions 3,511,780 3,566,777

Current liabilities

Short term borrowings 46,847,706 94,472,040

Trade payables 15,480,974 9,979,219

Other current liabilities 58,771,001 60,198,684

Short term provisions 317,151 344,077

Total 659,385,676 685,391,096

Assets

Non-current assets

Fixed assets:

Tangible assets 4,009,517 5,684,894

Intangible assets

-Goodwill on Business Acquisitions - 13,015,054

Capital work in progress - -

Intangible Assets under development - -

Non-current investments 385,985,312 411,603,146

Deferred tax assets (net) 4,329,815 2,934,062

Long-term loans and advances 26,306,100 14,465,135

Other non-current assets

Abridged Balance Sheet as on 31st March, 2014

Standalone Balance sheet

Annual Report 2014

Currency : Indian Rupee


Current assets

Current investments - -

Inventories - -

Trade receivables 76,647,135 96,043,942

Cash and bank balances 14,931,910 8,716,953

Short-term loans and advances 135,754,588 126,766,728

Other current assets 11,421,299 6,161,183

Total 659,385,676 685,391,096

For E.A. Patil & Associates Alok Pathak Saurabh Dani

Chartered Accountants Managing Director Whole - Time Director


CA E.A. Patil

Partner

Membership No: 031979

Place: Navi Mumbai

Date: 27th May, 2014

V. Chandrashekar

Whole Time Director & Company Secretary

Annual Report 2014



Standalone Balance sheet

Page|57

Page|58

Annual Report 2014



Standalone Profit and Loss Account

Particulars March 31, 2014 March 31, 2013

(In Rs.) (In Rs.)

Revenue

Revenue from Operations* 209,993,239 221,656,941

Other income 27,507,752 14,149,292

Total Revenue 237,500,991 235,806,233

Expenses

Cost of Sales & Service 52,002,656 54,967,945

Employee benefits expense 123,047,050 109,584,935

Other expenses 30,749,201 45,553,640

Depreciation 2,272,137 322,205

Amortisation 13,015,054 4,457,253

Finance costs 20,158,527 24,374,921

Total Expenses 241,244,625 239,260,900

Exceptional / Extraordinary Expenses 42,439,889 71,388,412

Profit before tax -46,183,523 -74,843,078

Tax expense:

- Current tax -1,335,329 4,220,000

- MAT credit entitlement

- Deferred tax charge -1,395,753 -569,722

Profit after taxation for the year from continuing

operations -43,452,441 -78,493,356

`

Earnings per equity share of Re. 1 each

- Basic -2 -5

- Diluted -2 -5

Weighted average number of equity shares outstanding

during the year

- Basic 21,168,107 16,034,449

- Diluted 21,168,107 16,034,449

* Details of Revenue from Operations:

Abridged Profit and Loss Account for year ended 31st March, 2014

Annual Report 2014



Standalone Profit and Loss Account

Particulars 31.03.2014 31.03.2013

Sale of Services 168,143,638 173,647,543

Sale of Products 41,849,601 48,009,398

209,993,239 221,656,941




CA E.A. Patil

Partner


Place: Navi Mumbai


a) In respect of a company other than a finance company, revenue from operations shall be disclosed as under:

V. Chandrashekar


Page|59

Page|60

Annual Report 2014



Standalone Cash Flow Statement

Particulars 31.03.2014 31.03.2013

A. Cash flow from / (used in) operating

activities -5,513,662 -103,847,730

B Cash Flow from Investment Activities 22,445,446 -56,132,481

C. Cash Flow from Finance Activities -10,716,826 153,153,307

Net decrease in cash and cash

equivalents during the year (A+B+C)6,214,958 -6,826,904

Cash and cash equivalents at the beginning

of the year 8,716,953 15,543,858

Cash and cash equivalents at the end of

the year 14,931,911 8,716,954


Chartered Accountants Managing DirectorWhole - Time Director


CA E.A. Patil

Partner


Place: Navi Mumbai


(Amount In Rs.)

Abridged Cash Flow Statement for year ended 31st March, 2014

V. Chandrashekar


Annual Report 2014



Notes to the Abridged Financial Statements

1. Basis or Preparation :

These abridged financial statements have been prepared in accordance with the requirements of Rule 7A of the Companies (Central Government’s) General Rules and Forms, 1956 and clause 32 of the Listing Agreement. These abridged financial statements have been prepared on the basis of the complete set of financial statements for the year ended March 31, 2014. The amounts shown here are as same as shown in the corresponding aggregated heads in the financial statements as per Schedule VI or as near thereto as possible. These abridged financial statements have been circulated among the members of the Company in accordance with the provision of Section 136 of the Companies Act, 2013 read with the rules made thereunder.

2. Company as on 31st March, 2014 does not have any contingent liability.

3. Auditors have drawn attention in their auditor’s report without qualifying the report: a. Accounts receivable of Rs. 76,647,135 and unsecured loan of Rs. 1, 00, 00,000 from Allstate Finance & Leasing Limited are subject to confirmation and reconciliation if any. b. Unbilled revenue of Rs. 1, 11, 77,817/- has been certified by the management in conformity with the

accounting principles generally accepted in India. c. Losses from the operations of Prism Inc., Wholly Owned Subsidiary of the company and sale of TLC Technologies INC, subsidiary of Prism Inc results in substantial erosion of capital of Prism Inc. as on date of balance sheet. In the opinion of Management these conditions indicate existence of material uncertainty and may cast significant doubt about the ability of Prism Inc. to continue as a going concern. Hence the carrying

amount of investment of the Company in Prism Inc. being Rs. 25,623,329 has been impaired and receivables from TLC Technologies Inc Rs. 16,816,560/- has been provided as doubtful debts and the said impairment and doubtful debts is considered in the exceptional/ Extraordinary items.

4. Company has not revalued the fixed assets of the Company and the fixed assets of the company have been adequately disclosed herein below:

Computers

and other

service

equipments

Office

equipments

Furniture and

fixtures

Vehicles Total as at

March31,2014

Total as at

March31,2013

Original Cost

As at 1st April, 2013 5,649,729 - 100,675 1,057,142 6,807,546 1,740,915

Additions 596,760 - - 596,760 5,066,631

Deletions - - - - -

As at 31 March, 2014 6,246,489 - 100,675 1,057,142 7,404,306 6,807,546

Accumulated depreciation and amortization

As at 1st April, 2013 512,147 - 6,287 604,218 1,122,652 800,447

Depreciation for the period 2,137,791 17,084 117,262 2,272,137 322,205

Deductions/Adjustments during the period - - - - -

As at 31 March, 2014 2,649,938 - 23,371 721,480 3,394,789 1,122,652

Net block as at 31 March 2014 3,596,551 - 77,304 335,662 4,009,517 5,684,894

Net block as at 31 March 2013 5,137,582 - 94,388 452,924 5,684,894 940,468

Tangible Assets

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Page|62

5. Items constituting 20% or more of the total income or expenditure and such items of significant

importance:

1) Cost of Sale and Service amounting Rs. 5, 20, 02,656 constituting 21.89% of total income and 21.56% of total expenditure comprises of following: a) Cost of License Sales amounting to Rs. 41,216,906 and b) Cost of technical sub-contractors amounting to Rs. 10,785,750

2) Being a software company, manpower constitutes a primary asset of organization and hence Employee benefits

expenses amounting to Rs. 123,047,050 aggregates to 51.80% of total income and 51% of total expenditure of the Company. Break up of employee benefit expenses is given as below :

Salaries, bonus and allowances, including overseas employee expenses 115,542,594

105,625,090

Contribution to provident & other funds (120,885) 1,958,418

Staff welfare 638,806 549,162

Insurance Charges 767,717 505,598

Director's remuneration 6,218,818 946,667

Total

123,047,050

109,584,935

3) Provisions made by the company during the FY 2013-14 are as below:

Sr. No Nature of Provision Amount (In Rs.) % of Total income 1 Provision for Bad and doubtful debts 2,098,945 0.88% 2 Provision for leave encashment and

gratuity 1,093,605 0.46%

3 Provision for rent equalization 148,692 0.06% 4 Provision for taxation (2,731,082) -1.15%

Company has given Loans & Advances to various parties (including Related Trade Parties). The Details of same are as below

Short-term loans and advances

(Unsecured and considered good)

Loan to Related Parties* 11,73,72,310 12,76,16,445

Interest receivable* 2,22,30,582 25,27,381

Advance to creditors 12,700 4,76,906

Rent deposits - 7,000

13,96,15,593 13,06,27,733

Less: Provision for loans & advances & Interest receivable

Loan & Interest receivable from Related parties* (38,61,005)

(38,61,005)

13,57,54,588 12,67,66,728

* Refer Note 34(a) for loans & Advances due from the companies under the same management under section 370 (1) (B) of the Companies Act, 1956.

Annual Report 2014




Annual Report 2014




1) Company has honored its obligation with respect to repayment of loans and interest on its due date and there has been no default on the part of Company to honor its commitments.

6) Going Concern :

The financial report has been prepared on a going concern basis, which contemplated continuity of normal business activities and the realisation of assets and settlement of liabilities in the ordinary course of business.

i. The Company has step down subsidiary TLC Technologies INC under Prism Inc US. The Prism India

holds 100% shareholding in the Prism Inc US and Prism Inc held 51% in the TLC Technologies INC Company. The TLC was incurring losses from the operations resulting in substantial erosion of the capital. Subsequent to the sale of shares of step down subsidiary TLC, the business conditions indicate the existence of material uncertainty that may cast significant doubt regarding Prism Inc's., ability to continue as going concern. In the Opinion of the management there is a decline, other than temporary, in the carrying amounts of long term investments. Hence reduction in the carrying amount of investment Rs 2, 56, 23,329/- has been charged to the profit and loss statement as an exceptional / extraordinary item. The Accounts receivable from the TLC Technologies Rs 1, 68, 16,560/- has also been provided as doubtful debt and considered in the exceptional / Extraordinary items.

ii. During the previous financial year the Company had 100% subsidiary Prism Informatics Pte Ltd at Singapore. The subsidiary was incurring losses from the operations resulting in substantial erosion of capital as on the balance sheet date. The subsidiary had borrowed Rs 30, 97,325 from Prism India for its working capital requirements. Also, refer Note no 13 (b) for the step down subsidiary of the Prism Pte for closing agreement signed by the company with its ex-owners which may require additional quantification of liability, if any. These conditions indicate the existence of material uncertainty that may cast significant doubt about the subsidiary's ability to continue as a going concern. In the opinion of the management there is a decline, other than temporary, in the carrying amounts of long term investments. Hence, reduction in the carrying amount of investment Rs 3, 12, 97,902 has been charged to the profit and loss statement as an exceptional / extraordinary item in the previous financial year.

7) Following statutory payments relating to FY 13-14 are yet to be paid by the Company :

Sr. No Nature of Tax Amount (In Rs.) 1 Service tax payable 6,564,556 2 TDS payable 15,414,223 3 VAT payable 1,023,390 4 PT payable 34,875 5 LBT Payable 106,143 6 PF Payable 1,475 Total 23,144,658

8) Investments:

Long-term investments are stated at cost, and provision for diminution is made when, in the management's opinion, there is a decline, other than temporary, in the carrying value of such investments. Current investments are carried at lower of cost and fair value.

9) Details of cash and cash equivalents shall be disclosed as follows:

1. Balances with banks; 14,304,871 8,374,203 2. Cheques, drafts on hand; - - 3. Cash in hand; 627,039 342,750 4. Others (specify nature) - -

Page|63

Page|64

1) Company provides IT and IT enable services in global markets through its subsidiaries and accordingly information of segmental revenues, capital employed is provided on consolidated basis. On standalone basis below is the segmental information:

As at March 31, 2014 and for the year then ended

Particulars Software Consultancy

Services Software License Sale Total

Total Income 168,143,638 41,849,601 209,993,239


76,647,135 - 76,647,135

Unbilled Revenue

11,177,817 - 11,177,817

Geographic Segments

As at March 31, 2014 and for the year then ended

Particulars India Rest of World Total

Total income 91,063,825

118,929,414

209,993,239

Accounts receivables 9,523,967

67,123,168

76,647,135

Unbilled revenue 1,343,000

6,304,056

7,647,056

2) Related Party Disclosures: (a) Names of related parties and nature of relationship where control exists:

Sr. No Category of Related parties Names 1 Subsidiaries 1) Prism Europe AG, Switzerland 2) Prism informatics Schweiz

GmbH, Switzerland 3) Prism informatics Deutschland

GmbH, Germany 4) Prism Informatics Inc,

Delaware

5) Prism Informatics Pte, Limited, Singapore

6) Prism Software Consultancy JLT

7) Prism Infoglobal Ltd., Mauritius

8) TLC Technologies ( Disposed off on 21st Feb 2014)

Annual Report 2014




2 Key Management personnel 1) Dr. Nirmal Jain (Chairman) 2) Alok Pathak (Managing

Director) 3) Saurabh Dani (Executive

Director) 4) Dr. Ajay Sharma 5) Christof Anderi 6) Dr. Ramesh Subhramanium

7) V.Chandrashekar ( (appointed w.e.f 12.06.2013)

3 Parties with substantial interest 1) Secure Matrix Solutions Private Limited

2) Dani Financial Products Private Limited

3) Relatives of key management personnel

4 Associates Idhasoft Limited

(b) Transactions and balances with related parties

Nature of the transaction

Transactions during the year ended 31 March March 31,2014 March 31,2013 March 31,2014 March 31,2013 March 31,2014 March 31,2013

Investments purchased 5,495 5,381,924 - - - -

Sale of Investments - - - - - -

Service Income 31,096,270 27,172,409 - - - -

Remuneration paid - 6,218,818 946,667 1,050,001 1,800,000

Loans given - - - - 43,298,000 132,830,311

Loans recovered - 132,681 - - 53,591,590 8,311,191

Interest income - 234,354 - - 21,892,445 1,764,200

Interest paid - - 2,456,239 619,863 523,084 506,301

Loan Taken - - 1,800,000 - 9,550,000 -

Loan Repaid - - 1,200,000 - 5,750,000 -

Rent paid - - - - - 180,000

Rent received - - - - -

Allotment of equity shares - - 19,999,976 63,221,500 5,000,000 5,350,000

Allotment of preference shares 2,972,714 - - - - -

Share application money - - 3,000,000 39,850,000 - -

Debenture application money received - - - - - -

Balance as at 31 March

Investments 156,742,042 213,657,778 - - 229,218,270 229,218,270

Debtors 26,134,369 93,637,728 - - 1,027,617 403,938

Creditors - - - - 1,975,343 -

Loans receivable - 3,097,325 - - 114,225,530 126,283,320

Interest Receivable - - - - 21,467,401 1,764,200

Loan Payable - - 10,020,302 9,420,302 3,800,000 -

Interest Payable - - 227,025 97,875 203,632

Dividend Payable 1,177,981 - -

Key management personnel Parties with substantial interestSubsidiaries

Annual Report 2014




Page|65

Page|66

27 Related party transactions (Continued)

( C) Out of the above, transactions with related parties in excess of 10% of the total related party transactions are as under :

Transactions during the year ended March 31,2014

March 31,2014

March 31,2013

A Key management personnel

(i) *Remuneration to Directors

Saurabh Dani 3,200,000 946,667

V. Chandrashekar 3,018,818 -

*Management is yet to apply to the Central Government for approval towards the payment of Director Remuneration in accordance with provision of Section 309 of Companies Act, 1956.

(ii) Share application money received

Saurabh Dani -

39,850,000

Dr. Ramesh Subhramanium 3,000,000

-

(iii) CCP Application Money

Saurabh Dani 2,972,714

-

(iv) Allotment of Equity shares


63,221,500

(v) Interest Expenses


1,333,381

(vi) Loan Taken


-

(vii) Loan repaid


-

Annual Report 2014




B Subsidiaries

(i) Service income

Prism Informatics, Thailand -

3,233,000

TLC Technologies Ltd 10,930,600

14,737,830

Prism Informatics Pte Ltd -

2,643,389

Prism Software Consultancy, JLT 20,165,670

6,558,190

31,096,270

27,172,409

(ii) Investments purchased

Prism Informatics Pte Ltd -

5,381,924

Prism Infoglobal Limited, Seychelles 5,495

-

5,495

5,381,924

(iii) Loans recovered

Prism Software Consultancy JLT -

132,681

-

132,681

(iv) Interest Income

Prism Software Consultancy, JLT -

5,810

Prism Informatics Pte Limited, Singapore

-

228,544

-

234,354

(v) Provision for outstanding receivables


-

7,111,100

Prism Informatics Pte Limited, Singapore

-

10,361,035

Prism Informatics, Thailand -

11,356,636

TLC Technologies Ltd 28,802,760

11,986,200

28,802,760

40,814,972

Annual Report 2014




Page|67

Page|68

(vi) Provision for Interest receivables

Prism Informatics Pte Limited, Singapore -

332,949


-

430,731

-

763,680

(vii) Provision for Investments


31,297,902

Prism Informatics Inc, USA 25,623,329

-

25,623,329

31,297,902

(viii) Provision for Loans & Advances


3,097,325

-

3,097,325

C Parties with Substantial interest

(i) Allotment of Equity shares

Bankim Dani -

4,050,000

Bhuman Dani -

400,000

Secure Matrix -

900,000

Dani Financials Products Pvt Limited 5,000,000

-

(ii) CCP Application Money

Dani Financials Products Pvt Limited 743,178

-

(iii) Investments purchased

Idhasoft Limited -

56,863,636

(iv) Loans given

Idhasoft Limited

43,298,000

132,830,311

Annual Report 2014




(v) Loans recovered

Idhasoft Limited

53,591,590

8,311,191

(vi) Interest income

Idhasoft Limited 21,892,445

1,764,200

(vii) Loan Taken


-

(viii) Loan repaid


-

(ix) Interest Expenses

Dani Financials Products Pvt Limited 523,084

506,301

(x) Rent Paid

Secure Matrix Solutions Private Limited

-

180,000

(xi) Remuneration paid

Shilpi Pathak

750,000

900,000

Bhuman Dani

300,001

900,000

Annual Report 2014




Page|69

Page|70

Balance as at year end

March 31,2014

March 31,2013

(i) Investments

Prism Infomatics Europe AG 156,020,047

156,020,047

Prism Informatics, USA 25,623,329

25,623,329

Prism Informatics Pte Ltd 31,297,902

31,297,902

Prism Software Consultancy JLT 716,500

716,500

Prism Infoglobal Limited, Seychelles 5,495

-

213,663,273

213,657,778

Less: Provision made for Investment

Prism Informatics, USA (25,623,329)

-

Prism Informatics Pte Ltd (31,297,902)

(31,297,902)

Total 156,742,042

182,359,876

Parties with substantial interest

Idhasoft Limited

229,218,270

229,218,270

229,218,270

229,218,270

(ii) Debtors

Prism Europe AG -

8,157,000

Prism Thailand (NEXUS) -

12,622,685

TLC Technologies -

37,791,326

Prism Dubai (2,052,908)

5,342,907

Prism Informatics Inc 28,187,277

18,407,630

Prism Informatics Pte (Singapore) -

11,316,180

Total 26,134,369

93,637,728

Annual Report 2014





Idhasoft Limited 1,027,617 403,938 1,027,617 403,938

Total

(iii) Creditors

Idhasoft Limited 1 ,975,343

-

1 ,975,343

-

(iv) Loan s receivable

Idhasoft Limited 114 ,225,530

124,519,120

Prism Software Consultancy JLT -

-

Prism Inform atics Pte Lim ited, Singapore 3 ,097,325

3,097,325

117 ,322,855

129,380,645

Less: Provision for l oans & advances

Loan to Prism Inform atics Pte Lim ited, Singapore

(3,097,325)

(3,097,325)

T otal 114 ,225,530

126,283,320

(v) In terest Receivable

Idhasoft Limited 21,467,401

1,764,200

Prism Inform atics Europe AG

332 ,949

332,949

Prism Inform atics Pte Lim ited, Singapore 430 ,731

430,731

22,231,081

2,527,879

Less: Provision for In terest

Prism Inform atics Pte Lim ited, Singapore (332,949)

(332,949)

Prism Inform atics Europe AG

(430,731)

(430,731)

T otal 21,467,401

1,764,200

(vi) Loan Payable

Dani Financials Products Pvt Lim ited

3 ,800,000

-


9,420,302

T otal 13,820,302

9,420,302

(vii) In terest Payable

Dani Financials Products Pvt Lim ited

203 ,632

-

Saurabh Dani 227 ,025

97 ,875

T otal 430 ,657

97 ,875

Annual Report 2014




Page|71

Page|72

Abridged ConsolidatedFinancial Information

Auditors' Report


PRISM INFORMATICS LTD.

Annual Report 2013-14

INDEPENDENT AUDITORS' REPORT ON CONSOLIDATED FINANCIAL STATEMENTS

TO THE BOARD OF DIRECTORS OF PRISM INFORMATICS LTD.

We have audited the accompanying Consolidated financial statements of Prism Informatics Limited (“the

Company”) and its subsidiaries (the Company and its subsidiaries constitute the “Group”), which comprise

the Consolidated Balance Sheet as at 31st March 2014, the Consolidated Statement of Profit and Loss and the

Consolidated Cash Flow Statement for the year ended on 31st March, 2014 and a summary of the significant

accounting policies and other explanatory information.

Management's Responsibility for the Consolidated Financial Statements

The Company's Management is responsible for the preparation of these consolidated financial statements that

give a true and fair view of the consolidated financial position, consolidated financial performance and

consolidated cash flows of the Group, in accordance with the accounting principles generally accepted in

India. This responsibility includes the design, implementation and maintenance of internal control relevant to

the preparation and presentation of the consolidated financial statements that give a true and fair view and are

free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We

conducted our audit in accordance with the Standard on Auditing issued by the Institute of Chartered

Accountants of India. Those Standards require that we comply with ethical requirements and plan and

perform the audit to obtain reasonable assurance about whether the financial statements are free from material

misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and the disclosures in

the consolidated financial statements. The procedures selected depend on the auditor's judgment, including

the assessment of the risks of material misstatement of the consolidated financial statements, whether due to

fraud or error. In making those risk assessments, the auditor considers internal control relevant to the

company's preparation and presentation of the consolidated financial statements that give a true and fair view

in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of

expressing an opinion on the effectiveness of the Company's internal control. An audit also includes

evaluating the appropriateness of the accounting policies used and the reasonableness of the accounting

estimates made by the Management, as well as evaluating the overall presentation of the consolidated

financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our

audit opinion.

Page|73

Page|74

Auditors' Report


Opinion

In our opinion and to the best of our information and according to the explanations given to us, and based on the consideration of the reports of the other auditors on the financial statements / financial information of the subsidiaries referred to below in the Other Matter paragraph, the aforesaid consolidated financial statements give a true and fair view in conformity with the accounting principles generally accepted in India, except in case of accounts receivable of Rs.14,46,10,602, and unsecured loan of Rs.1,00,00,000 from All state Finance & Leasing Ltd which are subject to confirmation and reconciliation (if any), unbilled revenue Rs 1,94,16,253/- which has been as certified by the management in conformity with the accounting principles generally accepted in India:

a) in the case of the Consolidated Balance Sheet, of the affairs of the Prism Informatics and its subsidiaries as at 31st March 2014;

b) in the case of the Consolidated Profit and Loss Account, of the profit for the year ended on that date; and

c) in the case of the Consolidated Cash Flow Statement, of the cash flows for the year ended on that date.

Other Matter

We did not audit the financial statements of the subsidiaries of Prism Informatics Limited whose financial statements reflect total assets (net) of Rs. 2277.96 lacs as at 31st March 2014 and total revenue of Rs. 4916.64 for the year ended on 31st March 2014, as considered in the consolidated financial statements. These financial statements have been audited by other auditors. The audit reports of the subsidiaries have been furnished to us, and in our opinion, in so far as it relates to the amounts included in respect of those associates and subsidiaries, is based solely on the report of the other auditors.

Without qualifying our report, we draw attention to Note no.1.1 to the financial statements indicates the Company's 100% subsidiary Prism Inc has been incurring losses from the operations and sale of its subsidiary Company TLC Technologies INC Company, in which Prism Inc held 51% holding, resulting in substantial erosion of capital as on the balance sheet date. In the opinion of the management these conditions indicate the existence of material uncertainty that may cast significant doubt about the subsidiary's ability to continue as a going concern. Hence the carrying amount of investment Rs.2,56,23,329 has been impaired and receivables from the TLC Technologies Rs 1,68,16,560 has been provided as doubtful debt and the said impairment and doubtful debts is considered in the exceptional / Extraordinary items.

The Company had also provided some of the intercompany balances for other subsidiaries aggregating (net) to Rs (3,08,80,538). These have been considered to the profit and loss statement as an exceptional / extra-ordinary item.

For E.A.Patil & Associates Chartered AccountantsFirm Registration No. 117371W

Vashi, Navi Mumbai

Date:. 27th May, 2014

CA. E. A. PatilPartnerMembership No. 031979

Amount (in Rs.) Amount (in Rs.)

Capital and Liabilities

Shareholder's Funds

Share Capital 87,956,455 42,163,458

Reserves and Surplus 492,638,578 267,618,186

Capital Reserves (including

Revaluation reserve, if any)

- -

Revenue Reserves

Surplus (301,769,748)

Money received against share warrants - -

Shareholders Funds (A) 278,825,286 309,781,644

Share Application Money pending Allotment (B) 5,961,034 -

TOTAL (A+B) 284,786,320 309,781,644

Non current liabilities

Long term borrowings 49,578,605 100,316,752

Deferred tax liabilities (net) -

Other long term liabilities 43,110,681 39,097,510

Long term provisions 3,511,780 3,566,777

Total (C ) 96,201,066 142,981,039

Current liabilities

Short term borrowings 46,847,706 94,663,506

Trade payables 62,811,585 21,087,427

Other current liabilities 100,664,300 107,104,856

Short term provisions 4,972,151 1,819,721

Total (D) 215,295,742 224,675,510

Total (A+B) 596,283,127 677,438,193

Assets

Non-current assets

Fixed assets:

Tangible assets 7,341,033 4,260,556

Intangible assets 7,753,116 43,697,380

-Goodwill on Business Acquisitions -

Capital work in progress - -

Intangible Assets under development - -

Non-current investments 41,490,416 139,199,491

Deferred tax assets (net) (1,167,786) 15,052,316

Long-term loans and advances 41,059,880 25,352,816

Other non-current assets 16,831 12,807,950

Total Fixed Assets (A) 96,493,491 240,370,509

Abridged Balance Sheet as on 31st March, 2014

Annual Report 2014



Consolidated Abridged Balance Sheet

Page|75

Page|76

Goodwill on consolidation (B) 110,865,418 146,647,988

Current assets

a.Current investments - -

b. Inventories - -

c. Trade receivables 144,610,602 113,974,317

d. Cash and bank balances 34,111,784 18,569,819

e. Short-term loans and advances 147,885,073 126,247,205

f. Other current assets 62,316,759 31,628,355

Current assets (C ) 388,924,219 290,419,696

Total (A+B+C) 596,283,127 677,438,192




CA E.A. Patil

Partner


Place: Navi Mumbai



V. Chandrashekar

Annual Report 2014



Consolidated Abridged Balance Sheet

Annual Report 2014



Consolidated Abridged Profit and Loss Account

Particulars March 31, 2014 March 31, 2013

(In Rs.) (In Rs.)

Revenue

Revenue from Operations* (I) 670,427,309 620,277,459

Other income (II) 27,893,649 16,484,761

Total Revenue (III) 698,320,959 636,762,220

Expenses

Cost of Sales & Service 197,906,360 133,325,779

Employee benefits expense 350,759,999 343,015,710

Other expenses 114,915,329 151,187,527

Depreciation 13,615,845 17,429,450

Amortisation 13,015,054 4,457,253

Finance costs 25,026,929 28,870,344

Total Expenses (IV) 715,239,516 678,286,063

Profit before exceptional & extra ordinary items

(III-IV) (16,918,557) (41,523,844)

Exceptional items - (29,067,341)

Profit before extra ordinary items & tax (VII = V-VI) (16,918,556) (12,456,504)

Extra Ordinary Items (VIII) 11,559,352 90,890,123

Profit before tax(IX = VII-VIII) (28,477,908) (103,346,627)

Tax expense: (X)

- Current tax 90,304 4,747,132

- MAT credit entitlement (1,395,753) 569,722

- Deferred tax charge

Share of profit/ (loss) of Associates (97,709,075) (90,043,779) Profit after taxation for the year from continuing

operations (XI= IX-X) (124,881,535) (197,567,815)

Abridged Profit and Loss Account for year ended 31st March, 2014

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Annual Report 2014



Consolidated Abridged Profit and Loss Account

Earnings per equity share of Re. 1 each

- (6) (12)

- Diluted (6) (12)

Weighted average number of equity shares outstanding during

the year

- Basic 21,168,107 16,034,449

- Diluted 21,168,107 16,034,449

* Details of Revenue from Operations:

Particulars 31.03.2014 31.03.2013

Sale of Services 598,505,545 557,396,109

Sale of Products 71,921,764 62,881,350

Total 670,427,309 620,277,459




CA E.A. Patil

Partner


Place: Navi Mumbai


a) In respect of a company other than a finance company, revenue from operations shall be disclosed as under:

V. Chandrashekar


Basic

Particulars 31.03.2014 31.03.2013

A. Cash flow from / (used in) operating activities (A) (14,115,179) (114,099,017)

B Cash Flow from Investment Activities (B) 29,128,591 (82,030,353)

C. Cash Flow from Finance Activities (C ) (11,514,842) 146,683,885

Foreign Currency Translation Reserve Impact on Cash Flow (D) 12,043,396 10,977,282

Net decrease in cash and cash equivalents during the year (A+B+C+D) 15,541,966 (38,468,203)

Cash and cash equivalents at the beginning of the year 18,569,819 57,038,022

Cash and cash equivalents at the end of the year 34,111,784 18,569,819




CA E.A. Patil

Partner


Place: Navi Mumbai


(Amount In Rs.)

Abridged Cash Flow Statement for year ended 31st March, 2014

V. Chandrashekar


Annual Report 2014



Consolidated Abridged Cash Flow Statement

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Annual Report 2014




1. Basis or Preparation and Going concern :

These abridged financial statements have been prepared in accordance with the requirements of Rule 7A of the Companies (Central Government’s) General Rules and Forms, 1956 and clause 32 of the Listing Agreement. These abridged financial statements have been prepared on the basis of the complete set of financial statements for the year ended March 31, 2014. The amounts shown here are as same as shown in the corresponding aggregated heads in the financial statements as per Schedule VI or as near thereto as possible. These abridged financial statements have been circulated among the members of the Company in accordance with the provision of Section 136 of the Companies Act, 2013 read with the rules made thereunder.

The figures in the consolidated Balance sheet representing Prism Inc., Delaware, Prism PTE & Prism Informatics Europe Group operating outside India and are converted into Indian Rupees. The figures in profit & loss Account for the period April'13 to March'14 have been converted at the average INR rate for the financial year ending March 31, 2014. The figures in Balance Sheet have been converted at closing INR rate for the financial year ending March 31, 2014. The accompanying consolidated financial statements have been prepared in compliance with the requirements of the Companies Act, 1956, and Generally Accepted Accounting Principles ('GAAP') in India, under the historical cost convention. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government, in consultation with National Advisory Committee on Accounting Standards ('NACAS') and relevant provisions of Companies Act, 1956, to the extent applicable. The preparation of the consolidated financial statements in accordance with generally accepted accounting principles requires that management makes estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent liabilities as of the date of financial statements and the reported amounts of revenue and expenses during the reporting period. Management believes that the estimates used in the preparation of financial statements are prudent and reasonable. Actual results could differ from these estimates. Any revision to accounting estimates is recognized prospectively in the current and future periods. The company has following subsidiaries which form part of the consolidation.

Name of Subsidiary Country of incorporation % of Shareholding

Prism Informatics INC USA 100%

Prism Informatics PTE LTD Singapore 100%

Prism Informatics Europe AG Switzerland 100%

Prism Informatics Schweiz GmbH Switzerland 100%

Prism Informatics Deutschland GmbH Germany 100%

Prism Software Consultancy JLT Dubai 100%

Prism Infoglobal Limited Seychelles 100%

TLC Technologies, Inc. (Acquired under Prism Informatics Inc) share holding disposed of on February 21, 2014.

Annual Report 2014




These consolidated financial statements are prepared in accordance with the principles and procedures prescribed by Accounting Standard 21 - "Consolidated Financial Statements" (AS-21) for the purpose of preparation and presentation of consolidated financial statements. The financial statements of the parent Company and its subsidiaries have been combined on a line-by-line basis by adding together the book values of like items of assets, liabilities, income and expenses after eliminating intra-group balances/transactions and resulting unrealized profits in full. Unrealized losses resulting from intra-group transactions have also been eliminated unless cost cannot be recovered in full. In case of subsidiaries acquired during the financial year, income and expenses have been considered from the date of acquisition.

The Company has step down subsidiary TLC Technologies INC under Prism Inc US. The Prism India holds 100% shareholding in the Prism Inc US and Prism Inc held 51% in the TLC Technologies INC Company. The TLC was incurring losses from the operations resulting in substantial erosion of the capital. Subsequent to the sale of shares of step down subsidiary TLC, the business conditions indicate the existence of material uncertainty that may cast significant doubt regarding Prism Inc's., ability to continue as going concern. In the Opinion of the management there is a decline, other than temporary, in the carrying amounts of long term investments. Hence reduction in the carrying amount of investment Rs 2, 56, 23,329/- has been charged to the profit and loss statement as an exceptional / extraordinary item. The Accounts receivable from the TLC Technologies Rs 1, 68, 16,560/- has also been provided as doubtful debt and considered in the exceptional / Extraordinary items The Company had also provided some of the inter company balances for other subsidiaries aggregating (net) to Rs 3,08,80,538 these have been considered to the profit and loss statement as an exceptional / extra ordinary item.

2. Company as on 31st March, 2014 does not have any contingent liability.

1. 3. Auditors have drawn attention in their auditor’s report without qualifying the report:

a. Accounts receivable of Rs. 144,610,602 and unsecured loan of Rs. 1, 00, 00,000 from Allstate Finance & Leasing Limited are subject to confirmation and reconciliation if any.

b. Unbilled revenue of Rs. 1, 94, 16,253/- has been certified by the management in conformity with the accounting principles generally accepted in India.

c. Losses from the operations of Prism Inc., Wholly Owned Subsidiary of the company and sale of TLC Technologies INC, subsidiary of Prism Inc results in substantial erosion of capital of Prism Inc. as on date of balance sheet. In the opinion of Management these conditions indicate existence of material uncertainty and may cast significant doubt about the ability of Prism Inc. to continue as a going concern. Hence the carrying amount of investment of the Company in Prism Inc. being Rs. 25,623,329 has been impaired and receivables from TLC Technologies Inc Rs. 16,816,560/- has been provided as doubtful debts and the said impairment and doubtful debts is considered in the exceptional/ Extraordinary items.

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4. Company has not revalued the fixed assets of the Company and the consolidated fixed assets of the company are

same as standalone fixed assets of the company and accordingly detailed disclosure remains to be same as disclosed in standalone abridged financials.

5. Items constituting 20% or more of the total income or expenditure are as below :

1) Cost of Sale and Service amounting Rs. 19,79,06,360 constituting 28% of total income comprises of following: a) Cost of License Sales amounting to Rs. 66,868,639 and b) Cost of technical sub-contractors amounting to Rs. 131,037,722

2) Being a software company, manpower constitutes a primary asset of organization and hence Employee benefits

expenses amounts to Rs. 35, 07, 59,999 which is equal to 50% of total income of the Company. Break up of employee benefit expenses is given as below : Salaries, bonus and allowances, including overseas employee expenses 315,237,905 309,560,492

Contribution to provident & other funds 1,041,025 1,958,418

Staff welfare 2,905,791 3,151,311

Social Benefits 21,093,207 23,451,442

Insurance Cost 4,263,252 3,947,379

Director's remuneration* 6,218,818 946,667

Total 350,759,999 343,015,710

*Management is yet to apply to the Central Government for approval towards the Payment of Director Remuneration in accordance with provision of Section 309 of the Companies Act, 1956

3) Provisions made by the company during the FY 2013-14 are as below: Sr. No Nature of Provision Amount (In Rs.) % of Total income 1 Provision for Bad and doubtful debts 62,147,316 6.25% 2 Provision for leave encashment and gratuity Long term provision 1,751,205 0.25% Short term provision 317,151 0.05% 3 Provision for rent equalization 458,290 0.06% 4 Provision for taxation 351,043 0.05% 5 Provision for expenses 6,929,324 0.99%

Annual Report 2014




4) Company has honored its obligation with respect to repayment of loans and interest on its due date and there has been no default on the part of the Company to honor its commitments.

5) Following statutory payments relating to FY 13-14 are yet to be paid by the Company :

Sr. No Nature of payable Amount (In Rs.) 1 Interest payable 12,488,541 2 Service Tax payable 6,564,556 3 TDS Payable 15,414,223 4 VAT Payable 721,703 5 Provident fund payable 1,470 6 Professional Tax payable 34,875 Total 35,225,369

6) Investments:

Long-term investments are stated at cost, and provision for diminution is made when, in the management's opinion, there is a decline, other than temporary, in the carrying value of such investments. Current investments are carried at lower of cost and fair value.

7) Details of cash and cash equivalents shall be disclosed as follows:

1. Balances with banks; 23,431,063 5,566,582 2. Cheques, drafts on hand; - - 3. Cash in hand; 680,721 352,489 4. Fixed Deposit with Bank* 10,000,000 12,650,748 5. Others (specify nature) - -

*Fixed deposit with bank of INR 1, 00, 00,000 are held as margin money against bank overdraft facilities from bank.

8) Company provides IT and IT enable services in global markets through its subsidiaries and accordingly

information of segmental revenues, capital employed is provided on consolidated basis. On Consolidated basis below is the segmental information:

Sr. No Particulars Year

2013-14 2012-13

1 Segment Revenue (net sale/income from each segment should be disclosed under this head).

India 2,099.93 2,216.57

USA 697.63 987.44

Europe 3,078.51 2,943.11

South East Asia - 41.57

Middle East 1,140.50 260.76

Total 7,016.58 6,449.45

Less : Inter segment revenue 24.17 239.39

Net sales/income from operations 6,992.40 6,210.05

Annual Report 2014




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2 Segment Results (Profit)(+)/loss(-) before tax and interest from each segment)

India 164.15 209.20

USA (146.18) (109.16)

Europe 67.50 (169.04)

South East Asia 4.74 (99.16)

Middle East 11.43 36.79

Total 101.64 (131.38)

Less :

(i) Interest* 270.82 294.16

(ii) Other unallowable expenditure net off - -

Unallowable Income.

Total Profit Before Tax (169.19) (425.53)

3 Capital Employed (Segment assets–Segment Liabilities).

India 4,913.38 4,227.33

USA (523.34) 19.42

Europe 402.75 624.31

South East Asia 0.00 4.96

Middle East 43.87 29.79

Total 4,836.68 4,905.82

*Other than the interest pertaining to the segments having operations which are primarily of financial nature.

1) Related Party Transactions: (a) Names of related parties and nature of relationship where control exists

Sr. No. Category of related parties Names 1 Key management personnel 1) Dr. Nirmal Jain (Chairman)

2) Alok Pathak (Managing Director)

3) Saurabh Dani (Executive Director)

4) Dr. Ajay Sharma

5) Christof Anderi

6) Dr. Ramesh Subramaniam (appointed w.e.f. 14.02.2013)

7) V.Chandrashekar ( (appointed w.e.f. 12.06.2013)

2 Parties with substantial interest 1) Secure Matrix Solutions Private Limited

2) Dani Financial Products Private Limited

3) Relatives of Key Management personnel

- Shilpi Pathak

- Bankim Dani

- Bhuman Dani

Annual Report 2014




Out of the above, transactions with related parties in excess of 10% of the total related party transactions are as under :

Transactions during the year ended March 31,2014 March 31,2014 March 31,2013

A Key management personnel

(i) Remuneration to Directors

Saurabh Dani 3,200,000 946,667

V.Chandrashekar 3,018,818 -

Management is yet to apply to the Central Government for approval towards the Payment of Director Remuneration in accordance with provision of Section 309 Of the Companies Act, 1956.

(ii) Share application money received

Saurabh Dani - 39,850,000

Dr. Ramesh Subramaniam 3,000,000 -

(iii) Allotment of preference shares

Saurabh Dani - -

(iv) CCP Application Money

Saurabh Dani 2,972,714 -

(iii) Allotment of Equity shares

Saurabh Dani 19,999,976 63,221,500

(iv) Interest Paid

Interest to Saurabh Dani 2,456,239 1,333,381

(v) Loan Taken


(v) Loan repaid


Annual Report 2014




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B Parties with Substantial interest

(i) Allotment of Equity shares

Bankim Dani - 4,050,000

Bhuman Dani - 400,000

Secure Matrix - 900,000

Dani Financials Products Pvt Limited 5,000,000 -

5,000,000 5,350,000

(ii) Investments purchased

Idhasoft Limited - 56,863,636

(iii) Loans given

Idhasoft Limited 43,298,000 132,830,311

(iv) Loans recovered


(v) Interest income


Idhasoft INC 550,747 473,895

(vii) Rent Paid

Secure Matrix Solutions Private Limited - 180,000

(viii) Remuneration paid

Shilpi Pathak 750,000 900,000

Bhuman Dani 300,001 900,000

(ii) CCP Application Money

Dani Financials Products Pvt Limited 743,178 -

(vii) Loan Taken


(viii) Loan repaid


(ix) Interest Expenses

Dani Financials Products Pvt Limited 523,084 506,301

Annual Report 2014




4 Related party transactions (Continued)

Balance as at year end March 31,2014 March 31,2013

(ii) Loan Payable

Saurabh Dani 10,020,302 9,420,302


13,820,302 9,420,302

(iii) Loans Receivable


Idhasoft INC 14,753,780 9,517,475

128,979,310 134,036,596

(v) Interest Receivable


21,467,401 1,764,200

(vii) Interest Payable

Dani Financials Products Pvt Limited 203,632 -

Saurabh Dani 227,025 97,875

430,657 97,875

(ii) Debtors


Idhasoft Limited 1,027,617 403,938

(iii) Creditors

Idhasoft Limited 1,975,343 -

Annual Report 2014




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1) Other Important Notes to accounts:

Goodwill

Goodwill on standalone

In case of business acquisition the amount paid towards business relationship has been recognized as goodwill.

Goodwill on consolidation

The excess of the cost of the Holding Company of its investment in subsidiaries over the Holding Company's portion of equity in the subsidiaries, at the respective dates on which investments in subsidiaries were made, is recognized in the consolidated financial statements as Goodwill. The holding company's portion of equity in the subsidiaries is determined on the basis of the book value of the acquired assets and liabilities as per the financial statements of the subsidiaries as on the date of investment.

The goodwill recorded in these consolidated financial statements has not been amortized but instead evaluated for impairment. The Group evaluates the carrying amount of its goodwill whenever events or changes in circumstances indicate that its carrying amount may be impaired.

Short Term Borrowing consists of following:

Short-Term Borrowings March 31,2014 March 31,2013

Secured loans : Bank Overdraft* 18,027,404 34,946,738

Loan from All State Finance** 10,000,000 10,000,000

28,027,404 44,946,738

Unsecured loans : Loan from others/Financial Institution*** 8,800,000 191,467

Compulsory Convertible Debentures**** - 40,105,000

Loan from Directors 10,020,302 9,420,302

18,820,302 49,716,769

46,847,706 94,663,506

* The Company has availed bank overdraft facility from Saraswat Co-operative Bank Limited. Bank overdraft facility is secured against fixed Deposit of Rs. 100 Lacs and pledge of 5, 00,000 Shares of Re. 1/- each of Prism Informatics Limited held by Idhasoft Limited as collateral securities. Further personal guarantee and corporate guarantee are also given by Alok Pathak, managing director and Idhasoft Limited respectively.

**The loan facility was guaranteed by Anor Technologies Private Limited by creating pledge on 12,500,000 shares of Prism Informatics Limited held by Anor Technologies Private Limited & Loan taken from Allstate Finance & Leasing Ltd. amounting Rs. 1 Crore having interest rate 27% p.a however repayment schedule has not defined.

***During the F.Y. 2013-14, Loan taken from Dani Financials Products Pvt Ltd. and Dani Shares & Stocks having interest rate 18 % p.a. however repayment schedule has not defined.

****401050, 11% CCD are converted into 741174 Equity Shares of Rs. 1 each on 29th Oct., 2013

Annual Report 2014





(to be presented at the entrance)


Registered Office: B-907, BSEL TechPark, Sector 30-A, Opp. Vashi Railway Station, Vashi, Navi Mumbai- 400 703, India

ATTENDANCE SLIP

Folio no: DP ID No.:

Client ID No.: ______________________

Name of the member: ______________________ Signature: ______________________

Name of the proxy holder: ____________________ Signature:______________________

1. Only Members/Proxy holders can attend the meeting.

2. Members/Proxy holders should bring his/her copy of the Notice for reference at the meeting.

______________________ ______________________

Annual General Meeting on 30th September, 2014 Plot

No. 46, 3rd Floor, Samna Press Building, Next to Inorbit Mall, Near Vashi

Railway Station, Sector-30A, Vashi, Navi Mumbai-400703 at 4.00 p.m (IST).

At Celebration Banquets,

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[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of the Companies (Management and Administration) Rules, 2014]


Registered Office: B-907, BSEL TechPark, Sector 30-A, Opp. Vashi Railway Station, Vashi, Navi Mumbai- 400 703, India

PROXY FORM

CIN: L67120MH1983PLC029483

Name of the company: PRISM INFORMATICS LIMITED

Registered office: B-907, BSEL TechPark, Sector 30-A, Opp. Vashi Railway Station,

Vashi, Navi Mumbai- 400 703, India.

Name of the member (s):____________________________________________________

Registered Address:_________________________________________________________

E-mail Id:___________________________________________________________________

Folio No. / Client Id:_________________________________________________________

DP ID:_______________________________________________________________________

I/We, being the member (s) of _____ shares of the above named company, hereby appoint

1.

Address: _______________________________________________________________________

Email ID: _______________________________________________________________________

Signature______________________________________or failing him

_______________________________________________________________________Name


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2.

Address: _______________________________________________________________________

Email ID: _______________________________________________________________________


_______________________________________________________________________Name

3.

Address: _______________________________________________________________________

Email ID: _______________________________________________________________________


_______________________________________________________________________Name

As my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the Annual

General Meeting of the company, to be held on the 30th day of September At 4.00 p.m.

(Place) and at any adjournment thereof in respect of such resolutions as are indicated below:

Resolution No.

1. _______________

2. _______________

3. _______________

Signed this ___ day of___________, 2014

Signature of shareholder

At Celebration Banquets,Plot No. 46, 3rd Floor, Samna Press Building, Next to Inorbit Mall, Near Vashi Railway Station, Sector-30A, Vashi, Navi Mumbai-400703 at 4.00 p.m (IST).

Signature of Proxy Holder

Notes:

1. This Proxy must be lodged with the Company at its Registered Office at B-907, BSEL Tech Park, Sector 30-A, Opp. Vashi Railway Station, Vashi, Navi Mumbai- 400 705, India, not less than 48 hours before the time for holding the aforesaid meeting.

2. Those members who have multiple folios with different joint holders may use copies of their Attendance/Proxy Slip.

Affix Revenue

Stamp Re. 1/-


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