Chartered Accountants
The Board of Directors M/s. Majesco Canada Limited (Formerly Majesco Mastek Canada Limited) 1 Dundas Street West, Suite 2538 Toronto, ON, M5G 1Z3
Report on special purpose financial statements
1. This report is issued in accordance with the terms of our engagement letter dated March 15, 2016.
2. We have audited the accompanying special purpose financial statements of Majesco Canada Limited (Formerly Majesco Mastek Canada Limited) (the "Company") which comprise the balance sheet as at March 31, 2016, the statement of profit and loss, and cash flow statement for the year then ended on that date and a summary of significant accounting policies and other explanatory information, which we have signed under reference to this report.
Management's Responsibility for the Financial Statements
3.1 Management is responsible for the preparation of these special purpose financial statements in accordance with the Accounting Standards issued by Institute of Chartered Accountants of India, to the extent considered relevant by it for the purpose for which these special purpose financial statements have been prepared (the "accounting principles generally accepted in India").
3.2 This responsibility also includes the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting the frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
4. Our responsibility is to express an opinion on these special purpose financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India (ICAO. 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.
5. An audit involves performing procedures to obtain audit evidence about the amounts and 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 entity'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 entity's internal control. oP1/4 & `1"
303, Gokul Regency, J.B. Nagar, Andheri East, Mumbai 400059 Tel : +91 22 28395837 Email : [email protected] c()\ 077„ .zraYmo S5' 7tavezieff
Chartered Accountants
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
6. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
7. In our opinion and to the best of our information and according to the explanations given to us, the special purpose financial statements, together with the notes thereon and attached thereto, fairly present, in all material respects, in conformity with the accounting principles generally accepted in India:
i. In the case of Balance Sheet, the state of affairs of the Company as at March 31, 2016;
In the case of the Statement of Profit and Loss, 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.
Other Matter
8. 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. The Balance Sheet, Statement of Profit and Loss and Cash Flow Statement dealt with by this report are in agreement with the books of account.
9. The special purpose financial statements dealt with by this report have been prepared for use in connection with the preparation of the consolidated financial statements of Majesco Limited and for no other person or purpose.
10. We draw attention to Note 2.1 to the special purpose financial statements, which describes the basis of its preparation. The special purpose financial statements are not the statutory financial statements of the Company, and are prepared for the purposes of including these financial statements in the consolidated financial statements of the holding company and accordingly the presentation and disclosures to the extent applicable for that purpose have been included in these financial statements by the Management and the intended users of the special purpose financial statements for the purposes for which those have been prepared. Our opinion is not qualified in respect of this matter.
303, Gokul Regency, J.B. Nagar, Andheri East, Mumbai 400059 Tel : +91 22 28395837 Email [email protected] wvezzw.c4.ww/w Chartered Accountants
Restriction on Use
11. We have no obligations, responsibility, liability in respect of this report as Statutory Auditors of the Company and nothing in this report, nor anything said or done in the course of or in connection with the services that are the subject of this report, will extend any duty of care since we are not the Statutory Auditors of the Company.
12. These financial statements are prepared for the purposes referred to in SI. No. 9 above. As a result, these financial statements may not be suitable for another purpose. Our report is intended solely for Majesco Limited, the holding company, for the purposes of consolidation and should not be distributed to or used by parties other than Majesco Limited.
For Varma and Varma Chartered Accountant FRN 004532S
0
Fi r Jose Partner Place: Mumbai M No. 138208 Date: May 18, 2016
303, Gokul Regency, J.B. Nagar, Andheri East, Mumbai - 400059 Tel : +91 22 28395837 Email : [email protected] MAJESCO CANADA LIMITED BALANCE SHEET AS AT MARCH 31, 2016
(All amounts in Rs. Lakhs, unless otherwise stated) As at As at Note March 31, 2016 March 31, 2015 EQUITY AND LIABILITIES
Shareholders' funds Share capital 3 1,555.01 1,555.01 Reserves and surplus 4 (1,382.50) (1,490.69)
172.51 64.32 Non-current liability Long-term provision 5 31.34 33.51
Current liabilities Short-term borrowings 6 - 235.96 Trade payables 7 9.70 77.29 Other current liabilities 8 365.40 426.31 Short-term provisions 9 146.01 184.44
Total 724.96 1,021.83
ASSETS
Non-current assets Fixed assets Tangible assets 10 (i) 0.84 Long-term loans and advances 11 8.74 8.36
Current assets Trade receivables 12 170.08 363.64 Cash and bank balance 13 144.28 84.43 Short-term loans and advances 14 6.62 6.86 Other current assets 15 395.24 557.70
Total 724.96 1,021.83
Company overview and significant accounting policies 1 & 2 Other Notes 22 to 26
The accompanying notes are an integral part of these financial statements.
For and on behalf of the Board As per our report of even date
For Varma & Varma Chartered Accountants Ketan Mehta 004532S Director
Place Navi Mumbai Fizo or Jose Date May 18, 2016 Partner 0:138208 Nimish Sankalia Director Place Navi Mumbai Date:- 155 0 5 16 Place 1.1•ew
Date - 1 3 MAY 2016
Page 1 of 13 MAJESCO CANADA LIMITED PROFIT AND LOSS STATEMENT FOR THE YEAR ENDED MARCH 31, 2016
(All amounts in Rs. Lakhs, unless otherwise stated)
Year ended Year ended Note March 31, 2016 March 31, 2015
Revenue from operations 16 1,427.54 2,134.17 Other income 17 0.30 12.78
Total revenue 1,427.84 2,146.95
Expenses Employee benefits expenses 18 455.88 899 90 Finance costs Depreciation and amortization expenses 19 0.85 1.09 Other expenses 20 882.09 1.645 01
Total expenses 1,338.83 2,546 00
Profit / (Loss) before tax 89.02 (399.05)
Tax expense
Profit / (Loss) for the year 89.02 (399.05) Earnings / (Loss) per equity share 21 Basic (Face value of C$ 1 each) Rs. 2.540 Rs. (11.40) Diluted (Face value of C$ 1 each) Rs. 2.540 Rs. (11.40)
Company overview and significant accounting policies 1 & 2 Other Notes 22 to 26
The accompanying notes are an integral part of these financial statements. For and on behalf of the Board As per our report of even date
For Varma & Varma Chartered Accountants Ketan Mehta / FRN 004532S Director
Place : Navi Mumbai Fizo K Jose Date: May 18, 2016 rtner o 138208
Nimish Sankalia Director
Place Navi Mumbai Place : Date:- 15 • 0.5% IC, Date:- 1 3 Page 2 of 13 MAJESCO CANADA LIMITED CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2016
(All amounts in Rs. Lakhs, unless otherwise stated) Year ended Year ended March 31, 2016 March 31, 2015 Cash flows from operating activities Profit / (loss) before tax 89 02 (399.05) Adjustments for Depreciation and amortization 0.85 1.09 Provision for doubtful debts 363.56 Operating profit before working capital changes 89.86 (34.40) Decrease / (Increase) in trade receivables 209.86 (14.68) (Increase) / Decrease in loans and advances and other assets 188.26 111.03 (Decrease) in trade payables, other liabilities and provisions (126.81) (135.05) Cash generated from operations 361.18 (73.10) Income taxes paid (net of refunds received) (0.27) Net cash generated from / (used in) operating activities 360.91 (73.10) Cash flows from investing activities Purchase of tangible and intangible assets, net of capital work in progress capitalised (1 86) Net cash used in investing activities (1.86) Cash flows from financing activities Repayment of loans and advances to holding company, net (246.53) 74.88 Net cash (used in) / generated from financing activities (246.53) 74.88
Net Increase / (decrease) in cash and cash equivalent during the year 114.38 (0.08) Cash and cash equivalent at the beginning of the year 84.42 55.73 Effect of changed in exchange rates (54.52) 28.77 Cash and cash equivalent at the end of the year 144.28 84.42
Notes : 1 The above cash flow statement has been prepared under the 'Indirect Method' as set out in the Accounting Standard -3 on Cash Flow Statement issued by the Institute of Chartered Accountants of India. 2 Cash and cash equivalents (Refer note 13) 3 Figures in brackets indicate cash outflow. 4 Previous year figures have been regrouped or reclassified wherever necessary.