Directors’ Report Dear Shareholder, Your Directors have pleasure in presenting the Twentieth Annual Report together with the Audited statements of accounts for the year ended 31st March, 2015. Performance The Company's sales have shown an increase of 14.80% as compared to the previous year. This is mainly on account of the growth in sales of the Company's products in the European market. This trend will continue as long as the European Union remains in recession. The prolonged recession is forcing car dealerships and car manufacturers to cut costs wherever possible. That is leading to an increased demand for the company's Virtual Showroom product all across Europe. The other income has shown a sharp fall primarily on account of the INR remaining quite stable against the US Dollar. Analysis of Expenses The direct cost of operations in FY 14-15 are slightly higher than that incurred in FY 13-14. This is inspite of higher revenues from this Division in FY 14-15 as compared to FY 13-14. This is primarily on account of better price realization for Enterprise Connectivity products. The company has increased its employee headcount substantially in FY 14-15 as compared to the previous year. This has resulted in the sharply higher employee costs for the company. The company has added headcount as it is developing new products, which would be launched in India, US and Europe simultaneously in the current year. The new products are expected to contribute substantially to the company's topline and bottomline in the next few years. Financial costs have increased slightly as compared to the previous year. However, this should reduce substantially in the current year. Other expenses have shown a slight decrease over the previous year. The company's constant endeavor is to keep the costs at a bare minimum. Depreciation has seen a slight increase due to higher capital expenditure incurred during the year. The company has upgraded its production and Server infrastructure to ensure higher productivity. Profitability The overall profitability of the company is more or less similar to that of the previous year. The company has been able to maintain its profitability despite a substantial increase in its headcount. The company expects the profitability to further improve in the current year as a result of higher sales in the United States, Mexico, India and Europe. Business Overview Taking Wings - from Niche Marketing to the Global Marketplace After a decade of successfully marketing izmo web technology to the automotive vertical worldwide, the company has now decided to step into the mainstream global market place, with ready-to-go websites for any business, complete with business-ready content and elegant, attention-grabbing graphics. "Meri Website, Meri Pehchan" The new avatar of izmoWeb - "Meri Website, Meri Pehchan", or "My Website, My Identity" globally, is targeted at professionals and businesses. Research shows that almost anyone - from professionals like doctors, chartered accountants and lawyers to local businesses like restaurants, play schools, gyms, bars, beauty parlors and even hair stylists can derive enormous business advantage from an effective, well promoted website. Your company is now stepping into this new business territory with a new, business friendly concept, going miles ahead of the competition to make the web journey easy and convenient for our customers. izmoWeb - a true "one-stop" solution Earlier, businesses had to figure out from whom to buy a domain name, who will design the website, who will write the content for it, who will do the hosting, who will provide search engine optimization (SEO) and online marketing, who will create business email ids, and so on. A hundred hurdles needed to be crossed before they can have an effective, performing website bringing in new clients every day. Even businesses who can afford the large budget did not have the expertise to tie all of these together into a viable project and take the website live. As a result, most businesses were stuck with basic, "business card" websites. Many of them lost faith in web marketing altogether, continuing with expensive newspaper advertising for the lack of a better web alternative. Your company is about to change all of that, with izmoWeb. First in the World To begin with, izmoWeb is built for customers. All that customers need to do is fill in their business name, address, location, and pricing, and upload their logo if available. Everything else- from buying the domain to taking the website live, creating business email ids and creating and plugging in social ids - is done with no customer effort required. This is a revolutionary step, since no other provider in the world is now offering fully configured go-to-market websites complete with business content written by experts, to multiple business verticals as diverse as health care, accounting, hospitality, education, and more. Responsive Web Technology-Built for the New web izmoWeb is built for the new web -a web that is viewed on multiple devices, from a PC at the office to a laptop at home, a tablet device on the go, or increasingly, on cellphones. Your company uses the latest in "responsive web" technology to dynamically re-orient the website to make it work best on any device. izmoWeb responsive websites not only make it easy for the customers of our clients to access their services, but also ranks higher up in Google, out of the box, since the search engine now prefers responsive websites over older adoptive websites with separate mobile sites. Easy to Manage The new izmoWeb websites are quite easy to manage, even for people with little or no knowledge of websites. With the world's most sophisticated web platform under the hood, website content and marketing campaigns can be created on the fly. New customer testimonials can be added as soon as the business receives them. Website analytics is easily available with a few clicks. Easy to Scale Up Once business websites pick up traction and orders begin to pour in, many businesses may need to scale up their web marketing. Your company makes it easy for them to plug in web marketing and social marketing modules at will, by providing an expert team to work for them at competitive prices. Built to Extend Unlike other web providers, izmoWeb websites are not stand alone websites fending for themselves, but part of a larger "Mothership" business portal network which acts as a force multiplier and makes the izmoWeb web marketing platform unassailable. Typically, prospective customers do background research first, mostly on web portals before narrowing down to a buying decision by which time they start visiting business websites. With the Portal-Website duo, izmoWeb helps clients to capture prospective customers early on, when they are still researching on portals. izmoWeb- More than a Website, a Business Ecosystem izmoWeb websites also come with an advanced appointment system out of the box, making them a true web marketing solution that can deliver customers to our clients' doorstep. Once the websites and marketing automation gain traction, businesses can opt for a more advanced CRM system that will not only manage customers over long lifecycles, but also automate their customer communication. With izmoCRM, no customer will remain untouched for any period of time. Since an existing customer is as valuable as twelve or more new customers, the add-on CRM system will make izmoWeb an even more potent, and unbeatable web marketing solution. Scope of Business Worldwide, there are 500 million ineffective websites which can be replaced with izmoWeb. INDIA India alone has 1.3 million small and medium enterprises (SMEs), employing a full 40% of India's workforce. 94.9% of these SMEs are micro enterprises who are unlikely to have a dedicated web marketing team. izmoWeb and "Make in India" India's SMEs contribute only 17% to the GDP. One of the reasons behind the sluggish performance is a lack of marketing reach. izmoWeb can work wonders in this area, coupled with the "Make in India" campaign, opening up markets worldwide for Indian SMEs. NORTH AMERICA USA There are 28.4 million small businesses in the U.S., and they employ 56.1 million people - about half of the total U.S workforce. In the first quarter of 2014 alone, 382,000 small businesses opened in the U.S. - each one a potential izmoWeb customer. Your company is initiating a plan to roll out izmoWeb across the U.S., leveraging its strong connections with the business ecosystem to ramp up operations drastically. MEXICO izmo has significant presence in Mexico, where it is the largest provider of automotive websites. Mexico has over 4 million SMEs and izmo is hopeful of a successful nationwide rollout of izmoWeb services in the country, building on its spectacular success in automotive retail. EUROPE FRANCE France has an SMB sector in excess of 2.4 million businesses. French SMEs are highly entrepreneurial, and in the midst of a transition from traditional marketing to more cost-effective web-centric marketing. izmo has a stable client-base and good market reputation in France as the countries' largest web provider in the automotive vertical, and is hopeful of a quick rollout of izmoWeb in the country. OTHER EU NATIONS BELGIUM, ITALY, SPAIN, PORTUGAL AND GERMANY izmo is hopeful of leveraging its existing presence in Belgium, Italy, Spain, Portugal and Germany, to roll out izmoWeb in all of these counties expeditiously. As explained earlier, izmoWeb is a game-changer in digital marketing, opening up web marketing to businesses and professionals who could not have managed a web marketing presence otherwise due to budget and expertise constraints. Your company expects to generate rapid results in this area. AUTOMOTIVE VERTICAL North America USA Ending long years of disappointing sales slumps, U S auto sales retained the headwinds of 2014 in 2015 as well. Sales is expected to touch the Industry's best ever annual record of 17.4 million vehicles, even as vehicle prices remain at a record high. Riding on this renewed upsurge, the multi-media division of izmo was able to make considerable headway in the market, adding top-tier clients like GM, Microsoft, Toyota Motor Sales (TMS), Mitsubishi, USA123, ADS, AOL, Autonation, Autopoint, Autotrader, Dataone, DEP, DME, Dominion, Evolio, Gomoto, HGM, Jato, JDPA, Jetpack, Kukui, NEWS, SIM, Stickout and Vincentric, even as we retain clients such as Kuhio Auto Group in the website and CRM space. With the average age of vehicles rising to an unprecedented 11 years, dealers are increasingly able to derive attractive revenue from sales and service, with the right CRM to automate customer interactions. izmoCRM in its new avatar is expected to make significant headway in the U.S. market. Mexico izmo dealer websites and portals also drive the sales of Renault, Volkswagen, Chrysler Ram Dodge Jeep, and Suzuki vehicles, as well as used cars. Prominent dealer groups in our portfolio include Autocom, Andanac, Autosur and Ga3. European Union Western Europe is now showing signs of a recovery, with sales picking up momentarily across the major markets ofUK, Germany, France, Italy and Spain. Half -yearly new car registrations in EU rose 8.2% in the first half, with 7,169,984 vehicles registered, according to European Automobile Manufacturers Association. The trend was visible in every major market in June, with Portugal (+ 33.9%) Spain (+23.5%), France (+15.0%), Italy (+14.4%), Germany (+12.9%) and U.K. (+ 12.9%) posting double-digit gains. Surprisingly, even Greece posted double digit growth at 13%. As a result, analysts now predict a more confident outlook in new car sales. Meanwhile, the prolonged decline in revenue that lasted for over 6 years forced dealerships across EU to look for marketing alternatives to the prohibitively expensive print and TV advertising. Across EU, dealerships have increasingly started looking at their websites as the primary marketing driver. izmo is the only solutions provider in the E.U. offering a "one-stop", all inclusive web marketing solution required by dealers to drive this online marketing shift. The izmo solution suite for EU auto dealers include "Virtual Showroom" Websites, Online Marketing and Social Media, Automotive CRM and ILM, Service Management and Dealership Performance Consulting, as well as image processing services. In order to address culturally diverse national markets, izmo has identified and engaged with well established channel partners in France, Spain, Portugal and Italy. The European division of izmoStudio made impressive gains in the automotive visual media segment, with a client list including major clients such as MSN, Hertz, Stickout, Leaseplan, JDPAAMTT (Global Clients), ASV, AutoICI, AutoReduc, AVIS, Bernard, Car Trawler, Elite, Eucon, Europ Car, EuroTax, Meinauto, Mobile DE, Multilease, Orange Wheels,Terberg Leasing andTusker. France Your company is delighted to report that izmo is now the #1 auto dealer website provider in France. This milestone was achieved with the addition of PGA. izmo continues to serve HESS, the Lamirault Group, Metin Group and Kayser Group. The dealer portfolio of your company in France now includes the French Brands Peugeot, Citroen, and Renault, as well as Audi, Alfa Romeo, Abarth, Chrysler, Chevrolet, Dacia, Dodge, Fiat, Fiat Professional, Hyundai, Jeep, Jaguar, Land rover, Kia, Lancia, Lexus, Mini, Mercedes Benz, Nissan, Opel, Porsche, Saab, Seat, Skoda, Subaru, Suzuki, Toyota, Volkswagen and Volvo as well as automotive portals. Spain Your company made significant inroads in the Spanish automotive market after adding Audi and Volkswagen websites for the Vilamobil group, and has added 18 websites to the Spanish portfolio, including Augusta Car Group, and Grupo Nicolas. Portugal izmo was able to make an important breakthrough in the service segment in Portugal, with hundreds of dealers signing up for an innovative service solution for Ancra. Presently izmo has 16 websites serving dealers in Portugal. Italy izmo has made significant inroads into the Italian market, with the addition 12 auto dealer websites for Linea Blu, Biella Auto Central Car Spa. ASIA India After a year of sluggish sales, the Indian automotive Industry closed 2015 on a very positive note, with vehicle sales up in all segments except commercial vehicles. The Indian automotive industry achieved an overall growth of 7.22% 2014-15, with auto dealerships reporting an increase of 4.99% in sales, selling 1,876,017 vehicles. Utility vehicle sales are also up, at 5.30%. Increasingly, automotive dealers are now switching their marketing strategies, making their website the center of their marketing activities. As a result, Carazoo, the only Automotive solutions provider in the Indian market to provide 360° auto retail solutions, is experiencing fast-paced growth. The Carazoo suite of solutions also include online marketing, CRM and Lead Management solutions. Some of these Carazoo-powered online showrooms are: Bimal Auto, NBS Mahendra, Landmark Group, PPS Group, Sai Service Group, Sagar Auto, Mody Auto Group, Kataria Automobiles, Fortpoint Automotive, Trident Automotive Group and Shaman Auto Group. On a strategic evaluation, Cap Gemini named Carazoo as one of the 7 Global entities that will influence Auto Retailing along with Yahoo, EBay, Wal-Mart and Edumunds.com. Market Opportunity and Growth Strategy With practically every business in the world's biggest markets looking forward to the web as their primary marketing source, the website segment for SMEs represent an opportunity of at least 10 million websites annually. With more than a decade of experience in the automotive sector, a highly competitive segment, the time is now ripe for izmo to enter the global market for websites for businesses and professionals with the launch of izmoWeb.com. izmo is entering the market with five distinct competitive advantages: • True one stop-solution, ideal for small businesses. All they have to do is enter their business name, address, preferred domain name and pricing information, and upload an optional logo. Izmo then performs all of the steps required to have a web business set up, including registering their domain name, setting up their website, hosting it, creating email ids, setting up their profile on Google and more. • Professional content for all major business segments. With any other provider, the client will have to either write the content or hire others. • Advanced appointments system built in: almost any business requires an appointment system. • More than a website, a web ecosystem: izmo websites are not merely standalone website offering, but a complete system including a mother ship portal, that tracks and drives customers to the business right from day one. • No other provider in the world offers all of these at our price. With our India advantage + global market presence, the entry barrier is quite high for others to offer any significant competition. izmo is hopeful of entering the global big league in this segment in a very short time, capitalizing on the conducive business environment provided by the "Make in India" initiative and aggressively targeting markets, employing innovative media strategies. #1 Global Provider of automotive imagery and visual marketing solutions With state-of-the-art studios in close proximity to the global nerve centers of the automotive world, namely in Long Beach, USA and Brussels, Europe and sophisticated image processing facilities in Bangalore, izmo consolidated its position as the world's largest producer of automotive images and animation years back. We are now expanding the izmoStudio product portfolio to part video and VGI enhanced imagery, to further consolidate and expand our market leadership. Presently, izmo studio is serving: • Automotive OEMs • Prominent Portals • Companies in automotive related businesses like leasing, etc. • Media • Ad Agencies and creative studios • Retail clients In the next fiscal, we are hopeful of further consolidating our position in all of these categories, aggressively marketing the enhanced capabilities of izmoStudio. izmo. The #1 Automotive web solutions provider in France, Mexico and India Your company is also in the process of consolidating the auto dealer solutions business in North America, Europe and Asia. We are already the #1 auto dealer website provider in France, Mexico and India. With the launch of the new generation "Responsive" web platform, arguably the most advanced web platform in the world, the new generation appointments "Responsive" web platform, arguably the most advanced web platform in the world, the new generation appointments system, and the new version of izmoCRM with marketing automation, we hope to make great progress in our automotive business segment in all of our markets. India Advantage The India advantage of high-end support services at a relatively modest cost is a strategic advantage that greatly supports the organic growth of the company. Unlike other players, the India component is not merely another cost-cutting measure for izmo - it is integral to the very corporate structure of the company, built into its corporate DNA. Fully developed, mobile-ready responsive websites for any business. • Ready to go, no development required - Just add your name, logo and address • Comes with pre-built content • The most advanced web platform in the world • Latest responsive website technology - your website will work well on any device, from big screen PCs to laptops, tablets and mobiles. • In-built booking system for appointments • Create as many new pages as you like - Completely flexible • Designed for Search Engines. See your profile grow online • No hassle deployment. We buy your domain, setup your website and do everything izmoRainmaker is a comprehensive, interactive, Internet marketing solution developed exclusively for the automotive retail industry by online marketing experts. Every izmocars customer works with a dedicated Rainmaker team, whose job is to increase your traffic, market your brand online through Search Engine Marketing (SEM) for car dealers, Social Media Marketing (SMM) and Search Engine Optimization (SEO). izmoRainmaker Offers: Creative Services • Social Media Marketing - Facebook, Twitter, Linkedin... • Interactive Marketing Campaigns • Organic Search Engine Optimization • Website Optimization • Online Brand Marketing • Research & Data Analysis iCRM is an enterprise class Customer Relationship Management solution industry. iCRM is delivered as a service, is completely Web- based and contains the following core functionalities: Sales Force Automation Finance & Insurance Campaign Management Service Management Business Development Center (BDC) iCRM is certified by Ford, Jaguar, Lincoln, Volvo, Land Rover, Mercury, GM brands including Buick, GMC, Pontiac, Cadillac, Hummer, Saturn, Honda, Acura, Nissan, Infiniti, Mercedes Benz, Chrysler, Subaru, Saab and Mazda. izmoStock is the world's leading automotive stock photography provider with dedicated vehicle photography studios in USA and Europe. izmoStock produces high volume automotive stock photography for over 800 vehicles per year. In addition to our consistent quality standard picture sets of car stock photos, we also produce video with voice over, CGI enhanced imagery. High resolution (HDRI) interactive interior panoramas, 360 exterior animations, and several other high res stop frame animations of every car in the U.S.A. and Europe. The automotive images library at izmoStock is the largest and most comprehensive car stock photography collection of its kind, with hundreds of thousands of images available for download, since 2002. izmoStudio Automotive Imagery & Animation izmoStudio is the world leader in Digital Imagery and Interactive Media Solutions for the Automotive vertical, since 2002. izmoStudio produces High Quality Photographic images, video and Digital Animations for the North American and EU markets, covering all major makes and models. Large Automotive Photography Studios strategically located in Long Beach, USA and Brussels, Belgium, combined with state-of-the-art post-production facilities in Bangalore, enables izmoStudio to quickly produce large volumes of work, covering about 500 automotive models. Presently, the izmoStudio client list includes leading portals like Yahoo!, AOL, AutoUSA and Jato Dynamics, as well as OEMs like GM, Ford and Mitsubishi Motors. izmoStudio has more than a decade of experience in working with ad agencies specialized in producing creative for automotive clients. Over the years izmoStudio photographers have worked with art directors from DDB, Y&R, Traffic, Digitas, Organic and Campbell-Ewald. Data Analytics for Auto Dealers Using the data accumulated across the organization remains one of the biggest challenges today. iDataMagic is your end to end solution that transforms raw data into actionable strategic knowledge to guide decisions, helping to increase market share, revenue and profits. iDataMagic's predictive analytics is about seizing opportunities for competitive advantage by leveraging insight hidden in data. For example, knowing which customer is most likely going to stop servicing their car when their warranty is over or knowing which leads are more likely to close based on overall customer behavior trends. The challenge today is not just in handling data but trying to understand what it's trying to tell us. iDataMagic delivers cost savings, while helping you increase your market share profitably. Growth Strategies izmocars is uniquely positioned as the innovation leader globally in automotive retail, providing end-to-end solutions ranging from a web platform to mobile websites, online marketing & Social Media, Email Marketing, CRM, Lead Management, and Service Management, apart from market-leading interactive selling tools and automotive photography, izmocars aims to consolidate market position and thought leadership as the only end-to-end Automotive e-Solutions Provider globally. The company is also consolidating its market leadership in the OEM space for high-end imaging, automotive animation, and web solutions. A major addition to the image portfolio is MSN global, covering USA, Canada, UK, France, Germany, Russia, Spain, Italy, Netherlands, Mexico, Brazil, Australia, China, and Japan. Izmo is also expanding its OEM portfolio of GM, Ford, Toyota, Lexus, Mitsubishi, Nissan, Renault, ISUZU, and Hyundai. Other prominent companies in the visual solutions portfolio include: AOL, YAHOO, AutoTrader, DATAONE, Jato , DME, AmFam, ImageSpan, SIM, MeinAuto, Elite, Hertz, Terberg Leasing, Mobile DE, ASV, Eurpocar, Dominion, Avis, Multilease, VP, Cartrawler, Individual Cars, Dealer E Process, and Stickout. Subsidiaries: The Company is having three wholly owned Subsidiaries. Izmo Europe BVBA, Izmo Inc. and Midrange Software Pte Ltd,. The Consolidated Financial Statement is provided in this Annual Report as per the Companies Act 2013. Fixed Deposits: Your Company has not accepted any deposits. Particulars of loans/ Guarantees/investments under Section 186: The Company has taken a working capital loan from Barclays Bank PLC, for an amount of Rs. 12.15 Crores. As a collateral security the Company has pledged the securities held by it as investment along with all the rights, title, claims, demand, benefit and interests of the company as per the terms of the Agreement between the Company and the Bank. Committees of the Board of Director: Following Committees of the Board as required to be constituted under the provisions of Companies Act, 2013 and the Clause 49 of the Listing has been constituted by the Company: a. Audit Committee b. Nomination and Remuneration Committee c. Stakeholders Relationship Committee d. Risk Management Committee The three Independent Directors of the Company Viz., Mr. Vijay Kumar D Gupta, Mr. Perur Phaneendra and Mr. Ramanujam Krishnamurthy constitutes all the aforesaid Committees of the Board. Number of meetings of the Board: During the Financial Year 6 Board Meetings were held on 30.05.2014, 23.06.2014, 04.08.2014, 03.09.2014, 10.11.2014 and 10.02.2015. Statement on Declaration of Independence given by Independent Directors under Section 149: All Independent Directors have given declarations that they meet the criteria of independence as laid down u/s 149 (6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. Familiarization Program for Independent Directors: The Independent Directors are provided with a detailed report on the Company for past 5 years, internal policies, a write up on powers delegated by the Board to various Officers of the Company, Bio data of Key Managerial Personnels, Service Rules applicable to the employees of the Company, Organization Chart, Proceeding of General Meetings of the Company for the past 5 years to enable them to familiarize with the Company's policies and practices. Compliance of Code of Conduct by Directors This Code envisages that the Board of Directors of the Company and Senior Management Personnel must act within the bounds of the authority conferred upon them and with a duty to comply with the requirements of applicable law. The purpose of this Code is to enhance ethics & transparency in the governance of the Company, and thereby reinforce the trust and confidence reposed in the Officers by the shareholders of the Company. All the members of the Board ans Senior Management Personnel have affirmed compliance to the Code, as at 31st March2015. A declaration to this effect signed by Managing Director is provided in the Corporate Governance Report.A copy of the Code has been posted in the Company's Website (www.izmo.com) and Formal annual evaluation of Board on its own performance and that of its committees and individual Directors: Pursuant to the Companies Act 2013 and Clause 49 of the Listing Agreement evaluation of performance is carried out by the Company. Performance of executive directors has been evaluated by Independent directors and that of independent directors has been evaluated by Executive directors. Evaluation report shows that performance of all the directors are satisfactory. Company's Policy on directors appointment, remuneration criteria for determining qualifications, etc as provided under 178(3) This Nomination and Remuneration Policy is being formulated in compliance with Section 178 of the Companies Act, 2013 read with the applicable rules thereto and Clause 49 of the Listing Agreement, as amended from time to time. This policy on nomination and remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated by the Nomination and Remuneration Committee ("the Committee") and has been approved by the Board of Directors. Details of policy on director's Appointment, remuneration criteria etc is given in Annexure A Audit Committee Composition The Audit Committee of the Company has 3 independent directors as its members viz., Mr. Perur Phaneendra, Mr. Vijay Kumar D Gupta and Mr. Ramanujam Krishnamurthy. The terms of appointment, role and the powers of audit Committee is as per the Section 177 Companies Act 2013 and Clause 49 of the Listing Agreement. Four meetings of Audit Committee were held during the Financial Year 2014-15 on 30.05.2014, 04.08.2014, 10.11.20l4and 10.02.2015. Vigil Mechanism/Whistle Blower Policy The Company believes in the conduct of the affairs of its constituents in a fair and transparent manner by adopting highest standards of professionalism, honesty, integrity and ethical behavior. Towards this end, the Company has adopted the Code of Conduct, which lays down the principles and standards that should govern the actions of the Company and its employees. Any actual or potential violation of the Code, howsoever insignificant or perceived as such, would be a matter of serious concern for the Company. Therefore the Company has established Vigil Mechanism/ Whistle Blower Policy for directors and employees to report concerns of unethical behavior, actual or suspected, fraud or violation of the Company's code of conduct or ethics policy. The policy of the Company on Vigil Mechanism / Whistle Blower has been uploaded in the Company's Website (www.izmo.com). No complaints have been received during the year Financial Year 2014-15. Corporate Social Responsibility It is not mandatory for your company to constitute a CSR Committee as it does not fall under the criteria mentioned in Section 135 of Companies Act 2013. Risk Management Policy During the year, the Company has constituted a risk management committee to assist the Board in effective risk management. Three independent directors of the Company viz, Mr. Perur Phaneendra, Mr. Vijay Kumar D Gupta and Mr. Ramanujam Krishnamurthy constitutes the risk management committee. A copy of Risk Management Policy is available in the Company's Website (www.izmo.com). Particulars of Contracts/arrangements with related parties During the year, the Company had not entered in to any contract/arrangement/ transaction with related parties. Your directors draw attention of the members to notes to the financial statement which sets out related party disclosures. Particulars of related party transactions in Form AOC-2 is annexed with this Report in Annexure G.The policy on related party transactions may be accessed on the company's website, www.izmo.com. Management Discussion & Analysis Report: Pursuant to the provisions of Clause 49 of the Listing Agreement, Management Discussion & Analysis Report is annexed as part of this report separately as Annexure B. Report on Corporate Governance The report on Corporate Governance together with the Auditor's Certificate regarding the Compliance of conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement is annexed and forms part of this Annual Report as Annexure C. Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo: A. Conservation of Energy: The operations of the Company are not energy intensive. Adequate measures have been taken to conserve and optimize the use of energy through improved operational methods. B. Technology Absorption and Research & Development (R&D): The Company uses the latest technology available in modern technology applications. Indigenous technology available is continuously being upgraded to improve overall performance. The Company has a dedicated team of technically competent personnel who relentlessly work on technology up gradation and development related fields. Research and Development continues to be given very high priority in Software Technology in the area of telecommunications, and hardware technology in the area of embedded systems. C. Foreign Exchange Earnings & Outgo: During the year, the details of Foreign Exchange transactions were: Earnings - Rs. 1656.90 Lakhs (PYRsl425.56 Lakhs) Outgo Rs.172.60 Lakhs (PYRs.135.29 Lakhs) Extract of Annual Return The extract of Annual Return of the Company is given in this Annual Report -Annexure D Directors' Responsibility Statement: The Directors have fulfilled their responsibility in preparation of the accompanying financial statements by takin all reasonable steps to ensure that: (i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (ii) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view for the financial year ended 31st March 2015; (iii) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; (iv) the Directors had prepared the annual accounts on a going concern basis; (v) the Directors has laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; & (vi) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. Explanation or comments by the Board on every qualification/reservation/adverse remark/ disclaimer by the Statutory Auditor in his report POLICY ON PREVENTION, PROHIBITION AND REDRESSAL OF SEXUAL HARASSMENT AT WORK PLACE: The Company has adopted a policy on Prevention, Prohibition and Redressal of Sexual Harassment at the Workplace, in line with the provisions of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules thereunder. The Policy aims to provide protection to employees at the work place and prevent and redress complaints of sexual harassment and for matters connected or incidental thereto, with the objective of providing a safe working environment, where employees feel secure. The Company has also constituted an Internal Complaints Committee, known as the Prevention of Sexual Harassment Committee, to inquire into complaints of sexual harassment and recommend appropriate action. The Company has not received any complaint of sexual harassment during the financial year 2014-15. Human Resources: As on March 31, 2015 the employee strength was 192 employees. This includes staff in India and in overseas offices. ESOP: The Company was given 'in principal approval' by both the stock exchanges for listing of ESOP shares under the 'Employee Stock Option Plan 2013". The Board on recommendation of Nomination and Remuneration Committee noted the list of eligible employees in its meeting dated 30.05.2015. First vesting of shares which will be 30 % of total options granted to the eligible employees will be due in the month of June 2016. Auditors: Secretarial Auditors: As per the Section 204 of the Companies Act 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014, the Company has appointed Mr. V. Sreedharan, Practising Company Secretary, Founder and Senior Partner of V Sreedharan & Associates, Company Secretaries, for conducting the secretarial audit. The said audit covers the Companies Act and the Rules made there under, Listing Agreement and other related laws including sector specific laws which are applicable to the Company. A copy of Secretarial Audit Report has been given in Annexure E Ratio of Managerial Remuneration Details of employees as required under Section 197 of the Companies Act, 2013, is as given in the Annexure F Acknowledgment: Your Directors place on record their deep appreciation for the support extended by the business associates, customers and vendors. Your Directors place on record their gratitude of the significant contribution made by employees at all levels who have been instrumental in enabling your Company to make rapid progress during the year. Your Directors also thank Bankers, Government and Quasi Government Agencies, STPI Authorities, Capital market, media and the shareholders fraternity for their support during the year. By order of the Board For IZMO Limited Sd/- Sanjay Soni Managing Director DIN: 00609097 Sd/-Shashi SoniChairperson and Wholetime Director DIN: 00609217 Place: Bangalore Date: 3rd September, 2015 Address: Flat No. 9, Prestige Casablanca Apartments, 12/1, Airport Road, |