MAJESCO Notes to Accounts

1. Considering the fact that substantial portion of the building has been let out for longer period of time, the portion of the building let out has been reclassified as investment property.


2. Mahape building which has been transferred pursuant to the scheme of arrangement, is pending to be registered in the name of Majesco Limited as at March 31, 2017. Additions during the year represents stamp duty paid.


3. Considering the fact that substantial portion of the building has been let out for longer period of time, the portion of the building let out has been reclassified as investment property.


4. Mahape building which has been transferred pursuant to the scheme of arrangement, is pending to be registered in the name of Majesco Limited as at March 31, 2016.


Total


(a) Rs. 7,340 with HSBC bank (Previous year-? 5,000) under lien for stand by documentary credit (SBDC) of US$ 10 million (previous year US$ 6.8 million) given by HSBC Bank, for the term loan availed by Majesco, USA, subsidiary of the Company.


(b) Rs. 500 with Yes bank (Previous year Rs. 2,400) for PCFC facility availed by Majesco Software and Solutions India Private Limited, step down subsidiary ofthe Company.


(c) Fixed deposit of Rs. 2.20 is held as security for bank guarantee of Rs. 2.20 given to Maharashtra Pollution Control Board (Previous year'''' 22.00 was held as security for bank guarantee of which Rs. 20.00 given to Life Insurance Corporation of India in lieu of earnest money deposit.)


5. Employee Stock Option Scheme


(a) Nature and extent of employee share-based payment plans that existed during the year: Plan I


The company introduced the employee stock option scheme as a part of the scheme of arrangement, approved by the Hon''''ble High Court of Gujarat and Hon''''ble High Court of Bombay. The shareholders of Mastek Limited approved the Scheme of Arrangement in the Court Convened meeting held on March 05, 2015, and the shareholders of Majesco Limited approved the scheme of arrangement through consent letter.


The Company introduced the scheme for granting up to 8,000,000 stock options to the employees, each option representing one equity share of the Company. The exercise price is to be determined by the Nomination and Remuneration Committee ("Committee") and such price may be the face value of the share from time to time or may be the market price or any other price as may be decided by the Committee and will be governed by the Securities and Exchange Board of India (SEBI) (Share based employee benefits) Regulations, 2014 and accounted in accordance with the guidance note on Employees Share Based Payments issued by the Institute of Chartered Accountants of India using the intrinsic value. The first vesting of the stock options shall happen only on completion of one year from the date of grant and the options are exercisable within seven years from the date of vesting. As per the SEBI guidelines, the excess of market price of the underlying equity shares as of the date of the grant of the options over the exercise price of the option is to be recognized and amortized on a straight line basis over the vesting period. Consequently, the amortized compensation cost for the exercisable option is Rs. 8.91 (net of reimbursement received from subsidiaries / Mastek) and have been charged to the Profit and Loss Statement during the year.


6. Demerger from Mastek Limited and slump sale to Majesco Software and Solutions India Private Limited


(a) Pursuant to a Scheme of Arrangement (the "scheme") under section 391 to 394 read with Section 100 to 103 and other applicable provision of the Companies Act, 1956 and other applicable provision of the Companies Act, 2013, the Board of Directors of Mastek Limited ("Mastek"), at its meeting held on September 15, 2014, had approved the demerger of the Insurance Products and Services business of Mastek, into the Company (Formerly known as Minefields Computers Limited), followed by transfer by the Company of the offshore insurance operations business in India to Majesco Software and Solution India Private Ltd ("MSSIPL") a wholly owned subsidiary of Majesco Software and Solution Inc., USA ("MSSUS") a step down subsidiary of the Company, retaining the domestic operations with the Company. The appointed date of the scheme was April 1, 2014 and the appointed date for transfer of the offshore insurance operation business transfer was November 1, 2014. Mastek obtained necessary approvals for the scheme under clause 24(f) of the Listing Agreement with the BSE and NSE from SEBI on December 9, 2014. The scheme has also been approved by the Hon''''ble High Court of Bombay and Hon''''ble High Court of Gujarat and on filing with the Registrar of Companies ("ROC") the said scheme became effective from June 1, 2015. As specified in the scheme, Mastek shareholders have been issued one equity share in the Company for every share held in Mastek, while retaining their existing Mastek share. Existing 50,000 equity shares of Rs. 10/- each of the Company (Formerly known as Minefields Computers Limited) were cancelled on June 1, 2015.


The shares of the Company were listed on August 19,2015 on the BSE and NSE, where Mastek is listed. The demerger has resulted in the transfer of the assets, liabilities, other reserves and surplus, employee stock options outstanding account and hedging reserve account related to the demerged entity from Mastek and accordingly have been given effect to in these financial statements. The difference in book value of the above assets net of liabilities and specific reserves and net of transfer to MSSIPL as on March 31, 2015 aggregating to Rs. 20,344.01 lakhs have been credited to surplus in Profit and Loss Statement.


(b) Consequent to transfer of the offshore insurance business in India to MSSIPL, the business with reference to which the Capital Reserve was created stand transferred and is no longer with the Company. Hence the capital reserve of Rs. 106.07 lakhs has been transferred to General Reserve


(c) The deferred tax assets arising from difference between the book value of depreciable fixed assets and of their written down value for tax purpose and timing difference of certain expenses relating to the period prior to April 1, 2015 aggregating to Rs. 284.02 lakhs has been credited to General Reserve.


7. Segment reporting


The Company has presented data relating to its segments in its consolidated financial statements which are presented in the same annual report as Majesco Limited. In terms of provisions of Accounting Standard (AS) 17 - ''''Segment Reporting'''', no disclosures related to segments are therefore presented in these stand-alone financial statements.


8. Indian accounting standards


The Ministry of Corporate Affairs (MCA), through its notification in Official Gazette a dated February 16, 2015, notified the Indian Accounting Standards (Ind AS) applicable to certain classes of Companies. Ind As would replace the existing Indian GAAP prescribed under Section 133 of the Companies Act, 2013 read with Rule 7 of Companies (Accounts Rules, 2014, with a transition date of April 1, 2017


The Company has evaluated the effect of transition from Indian GAAP to Ind As and following are the areas which would have an impact of account of the transition on the Group :


Fair valuation of certain financial instruments.


Employee costs pertaining to defined benefit obligations and stock option.


Discounting of certain long-term liabilities.


Further, there would be a change in the presentation of financial statements including additional disclosures.


9. Previous year figures have been regrouped or reclassified wherever necessary to correspond with current year''''s classification / disclosure.

CIN: U67190WB2003PTC096617. Trading in Commodities is done through our Group Company Dynamic Commodities Pvt. Ltd. The company is also engaged in Proprietory Trading apart from Client Business.
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