3D PLM Software Solutions Limited | Registered Ofﬁce...

Annual Report2016-17

Registered Office

Plant 11, 3rd Floor, Pirojshanagar, Vikhroli (West), Mumbai 400 079

Unit No. 703-B, 7th Floor, B Wing, Reliable Tech Park, Airoli, Navi Mumbai – 400 708

• Plot No. 4, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

• Plot No. 15/B, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

3D PLM

Software Solutions Lim

ited | Annual R

eport -2016-17

Corporate Offices

Mumbai

Pune

Tel.: +91-22-6705 6001Fax: +91-22-6705 6891Website: www.3dplmsoftware.com Email: [email protected]

Contact Details

prin

t@pa

rkso

nsgr

aphi

cs.c

om

Our Culture isNurturing...It is the foundation that enables us to soarhigher !!!

1

The Annual Report

2016-17

CONTENTBoard of Directors 2

Report of the Board of Directors & Annexures 3

Financial Statements:

3D PLM Software Solutions Limited – Consolidated 43

3D PLM Software Solutions Limited – Standalone 102

Annual Report & Financial Statements of Subsidiary:

3D PLM Global Services Private Limited – Report of the Board of Directors & Annexures 156

3D PLM Global Services Private Limited – Financial Statements 166

Safe Harbour Provision

Certain statements in this report concerning our future growth prospects are forward looking statements, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, intense competition in IT Services including those factors which may affect our cost advantage, wage increases in India, our ability to manage our international marketing and sales operations, reduced demand for technology in our key focus areas, disruptions in telecommunications networks, liability for damages on our service contracts and product warranty, the success of the companies in which the Company has made strategic investments, withdrawal of governmental fiscal incentives, political instability, legal restrictions on acquiring companies outside India, and unauthorized use of our intellectual property and general economic conditions affecting our industry. The Company may, from time to time, make additional written and oral forward looking statements and our reports to shareholders. The Company does not undertake to update any forward-looking statements that may be made from time to time by or on behalf of the Company.

2

The Board of Directors:MANU PARPIA Chairman, Non-Executive, Non-IndependentANITA RAMACHANDRAN Non-Executive, Independent DOMINIQUE E. FLORACK Non-Executive, Non-IndependentDAVID DE MUER Non-Executive, Non-IndependentDIDIER GAILLOT Non-Executive, Non-IndependentVARGHESE THOMAS Non-Executive, IndependentSAMSON KHAOU Non-Executive, Non-Independent – Alternate Director

Executive officersSUDARSHAN MOGASALE Manager & CEOVISHWANATH SHET Chief Financial OfficerSUNIPA GHOSH Company Secretary and Compliance Officer

Board CommitteesAudit Committee:

ANITA RAMACHANDRAN ChairpersonDIDIER GAILLOT MemberVARGHESE THOMAS Member

Corporate Social Responsibility Committee:MANU PARPIA ChairmanDIDIER GAILLOT MemberVARGHESE THOMAS Member

Nomination and Remuneration Committee:ANITA RAMACHANDRAN ChairpersonDIDIER GAILLOT MemberMANU PARPIA MemberVARGHESE THOMAS Member

Stakeholder Relationship Committee:DIDIER GAILLOT ChairmanMANU PARPIA MemberANITA RAMACHANDRAN MemberVARGHESE THOMAS Member

Auditors:S.R. Batliboi & Associates LLP, Chartered Accountants

Registrar and Share Transfer Agent:Link Intime India Private Limited

C-101, 247 Park, LBS Marg, Vikhroli West, Mumbai – 400083 Tel No. 91 22 4918 6000; Fax No. 91 22 4918 6060;

3

The Annual Report

2016-17

REPORT OF ThE BOARD OF DIRECTORSToThe Members,3D PLM Software Solutions Limited

The Directors have pleasure in presenting their Report on the business and operations of the Company for the year ended March 31, 2017

I. FINANCIAL STATEMENT AND RESULTS:

1. Financial Results: Your Company’s financial performance for the year under review has been encouraging and is summarised below:

(Figures in Rs. Lakhs)

PARTICULARS Consolidated StandaloneFY17 FY16 FY17 FY16

Net Sales 40801.16 33,599.80 34949.68 30,050.97Total Expenses other than Depreciation& Finance Cost 30179.37 25,961.40 25800.66 23,061.82Profit from Operations before Other Income,Finance Cost & Exceptional Items 10621.78 7,638.40 9149.01 6989.16Depreciation 2564.98 2,307.94 2288.07 2,084.51Profit from Operations before Other Income,Finance Cost & Exceptional Items 8056.80 5,330.46 6860.94 4,904.65Foreign Exchange Gain/ (Loss) 1316.73 3,108.84 1378.70 3,132.51Other Income 520.58 348.00 539.54 380.73Profit before Finance Cost & Exceptional Items 9894.11 8,787.71 8779.18 8,417.89Finance Cost 0 - 0 -Profit Before Tax 9894.11 8,787.71 8779.18 8,417.89Tax Expense 2980.09 2,901.82 2983.81 2,894.88Net Profit for the period 6914.02 5,885.89 5795.35 5523.01AppropriationSurplus as at end of previous year 11300.42 13,287.43 10988.31 13,329.89Add: Net Profit for the year 6914.02 5,885.89 5795.35 5523.01Available for appropriation 18214.44 19,173.32 16783.49 18,852.90Less: Dividend 0 6,162.23 0 6,162.23Less: Tax on distributed profits 0 1,254.49 0 1,254.49Less : Adjustment pursuant to revision in useful life of assets (Net of tax impact) 0 - 0 -

Less: Transfer to General Reserve 0 570.00 0 570.00Total Appropriation 0 7,986.72 0 7,986.72Surplus Carried Forward 18214.44 11,186.60 16783.49 10,866.18

2. Operations [Nature of Business]:

3D PLM is the R&D center of Dassault Systèmes (3DS). We have been continuing to work to strengthen our activities and building synergies in what we do. 3D PLM works on 8 major software Brands of 3DS, viz, ENOVIA, CATIA, 3DVIA, SIMULIA, SOLIDWORKS, DELMIA, GEOVIA and 3DEXCITE. In the last financial year, we have added new team: BIOVIA

There was no change in nature of business of the company during the year.

Company still contributing in below areas:

Product Development: Support Dassault Systèmes in development of products in the areas mentioned above.

Testing & Quality Assurance: Our Product Testing & Quality Assurance teams are an integral part of our development process. They ensure that our software products are thoroughly tested at every stage.

Customer Support: The Customer Support team resolves customer queries, suggests workarounds, and advises best practices to global customers of Dassault Systèmes products.

4

Product Documentation: With each new release, our technical publications team develops and delivers user assistance, videos, and knowledge articles that enable our customers to stay updated.

Courseware Development: Our Learning Solutions team creates best-in-class learning content & learning software. The learning content is developed by a highly skilled team of technical domain specialists, subject matter experts, instructional designers & writers. Additionally, our trainers team provides training support to a global network of partners.

3. State of the Company’s Affairs: This year has been excellent year for 3DPLM. All the R&D deliveries were met as per plan without any significant

issues. We have started a new R&D team to develop the products for BIOVIA. We have also grown in our Business Application Processing Team (BAPS), IT applications team and rest of the R&D as well.

Subsidiary of 3DPLM, 3DPLM Global Services (3DGS), is also doing well and growing as per plan

Operationally, we have done fairly well with a growth of 9.8% in revenues (in INR) and 5 % growth in Profit Before Taxes (PBT).

During the year company has added 195 employees (net additions). It had voluntary employee turnover of 7.8% which is much lower than Industry in general.

4. Report on Performance of Subsidiary: A statement containing salient features, performance and financial position of each of the subsidiaries for the year

ended March 31, 2017 is attached and marked as Annexure I (AOC-1) which forms part of this Report.

The entire set of subsidiary financials will be kept ready for inspection at the registered office and the same will be displayed on the Company’s website, in accordance to the requirements of the Act.

The Board has approved formation of a wholly owned subsidiary Company with charitable objectives as per provisions of section 8 of the Companies Act, 2013.

5. Composite Scheme of Arrangement and Amalgamation during the year under review: During the year under review, the Company has undergone an amalgamation procedure pursuant to the High Court

approved Composite Scheme of Arrangement and Amalgamation amongst Geometric Limited, HCL Technologies Limited and the Company, and their respective shareholders and creditors, pursuant to the provisions of Sections 391 to 394 read with Section 100 of the Companies Act, 1956 or under Section 230 to 234 of the Companies Act, 2013 and other applicable provision, if any, of the Companies Act, 1956 and/or Companies Act, 2013 & the relevant provisions made thereunder [the “Scheme”].

The Scheme has become effective on March 2, 2017.

Pursuant to the effectiveness of the Scheme, the equity shareholding of the Company is now owned by Dassault Systemes S. E. and its affiliate, Dassault Systemes Americas Corp.

In consideration of the amalgamation of Geometric Limited’s remaining undertaking with the Company, as per the terms of the Scheme, the Company has during the year in review, issued and allotted (i) 55,844,179 Redeemable Preference Shares of face value of Rs. 68/- each (“RPS”) to the resident shareholders of the erstwhile Geometric Limited, on a 1:1 ratio; and (ii) 148,291 equity shares of face value of Rs. 10/- each to the non-resident shareholders of the erstwhile Geometric Limited, on a 1793:24 ratio (“Scheme Equity Shares”).

The Scheme Equity Shares were subsequently purchased by Dassault Systemes S. E. at a price of Rs. 5080.30 per share, as envisaged by the Scheme.

The RPS issued by the Company pursuant to the Scheme are listed on the BSE Limited. The approval for listing from BSE Limited was received on May 5, 2017.

In accordance with the terms of the Scheme, the RPS are redeemable on the expiry of 15 (fifteen) months from the date of allotment, and each RPS shall be redeemable at par. As per the terms of the Scheme, any holder of the RPS (“RPS holders”) shall have the right but not an obligation to request the Company for redemption of the RPS held by such person (“Redemption Option”) up to a period of 15 (fifteen) days prior to the end of every successive period of 3 (three) months from the date of allotment of the RPS (each such period, a “Quarterly Redemption Period”)

5

The Annual Report

2016-17

In connection with the foregoing, the first Quarterly Redemption Period was completed on June 19, 2017 and the redemption payout in respect of the RPS tendered during the first Quarterly Redemption Period was completed by July 4, 2017.

The subsequent redemption schedules in respect of the RPS, as set out in the advertisement dated April 28, 2017, issued by the Company, published in Business Standard [English and Hindi editions] and Mahasagar [Marathi] on Friday, April 28, 2017, are as hereunder:

Quarterly Redemption Period Last Date for Receipt of Redemption Request from holder(s) of

Redeemable Preference Share(s)

Last Date for Payment

First – March 20, 2017 - June 19, 2017 June 4, 2017 July 4, 2017Second – June 20, 2017 – September 19, 2017 September 4,2017 October 4, 2017Third – September 20, 2017 – December 19, 2017 December 4, 2017 January 3, 2018Fourth – December 20, 2017 – March 19, 2018 March 4, 2018 April 3, 2018March 20, 2018 to June 19, 2018 Not Applicable – shall be compulsorily

redeemed within 30 daysJuly 19, 2018

The integration of 3DPLM Software Solutions Limited into Dassault Systèmes as a result of the Amalgamation has marked the strategic next phase in the contribution of 3DPLM Software Solutions Limited in Dassault Systemes’ strategic research and development operations.

6. Dividend: With a view to conserve resources, your Directors have thought it prudent not to recommend any dividend for the

financial year under review.

7. Transfer to Reserves: The Board of Directors has not recommended transfer of any amount of profit to reserves during the year under review.

Hence, the entire amount of profit for the year under review has been carried forward to the Statement of Profit and Loss. An amount of Rs. 5795.35 lakhs is proposed to be carried forward to the Statement of Profit and Loss.

8. Revision of Financial Statement: There was no revision of the financial statements for the year under review.

9. Deposits: The Company has not accepted or renewed any amount falling within the purview of provisions of Section 73 of the

Companies Act 2013 (“the Act”) read with the Companies (Acceptance of Deposit) Rules, 2014 during the year under review. Hence, the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Act is not applicable.

10. Disclosures under Section 134(3)(l) of the Companies Act, 2013: No material changes and commitments which could affect the Company’s financial position, have occurred between

the end of the financial year of the Company and date of this report, except the following changes in securities issued by the Company:

The Company has redeemed 23,426,585 redeemable preference shares (RPS) by July 4, 2017, thereby reducing the RPS capital to Rs. 2,204,396,392 constituting of 32,417,594 RPS of Rs. 68/- each.

Further, the Company issued and allotted 246,000 Compulsorily Convertible Preference Shares of Rs. 5400/- each to the equity shareholders of the Company, i.e. Dassault Systemes S. E. and Dassault Systemes Americas Corp. on June 29, 2017.

11. Disclosure of Internal Financial Controls: The Internal Financial Controls with reference to financial statements as designed and implemented by the Company

are adequate.

12. Disclosure of Orders passed by Regulators or Courts or Tribunal: No orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status

and the Company’s operations in future.

6

13. Particular of Contracts or Arrangement with Related Parties: The details of transactions/contracts/arrangements entered by the Company with related party(ies) as defined under

the provisions of Section 2(76) of the Companies Act, 2013, during the financial year under review, are furnished in Annexure II (AOC-2) forms part of this Report.

14. Particulars of Loans, Guarantees and Investment: Particulars of loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, are given in

the notes to the financial statements provided in this Annual Report.

15. Disclosure under Section 43(a)(ii) of the Companies Act, 2013: The Company has not issued during the financial year under review any shares with differential rights and hence no

information as per provisions of Section 43(a) (ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

16. Disclosure under Section 54(1)(D) of the Companies Act, 2013: The Company has not issued any sweat equity shares during the year under review and hence no information as per

provisions of Section 54(1) (d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

17. Disclosure under Section 62(1)(B) of the Companies Act, 2013: The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review

and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

18. Disclosure under Section 67(3) of the Companies Act, 2013: During the year under review, there were no instances of non-exercising of voting rights in respect of shares purchased

directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is furnished.

II. MATTERS RELATED TO DIRECTORS AND KEY MANAGERIAL PERSONNEL 1. Directors & Key Managerial Personnel:

Mr. Ajay Mehra resigned from the Board of the Company w.e.f. December 8, 2016.

Mr. Varghese Thomas was appointed as Independent Additional Director of the Company on January 10, 2017

We have received a letter from the shareholder of the Company, Mr. Sudarshan Mogasale along with requisite deposit amount recommending Mr. Varghese Thomas for confirmation as Director of the Company at the ensuing Annual General Meeting.

Mr. Manu Parpia, Mr. David De Muer and Mr. Didier Gaillot, Directors of the Company who were appointed at the AGM in 2014 by way of cumulative voting by proportional representation, are proposed to be appointed at the ensuing Annual General Meeting.

We have received letters from the shareholders of the Company, Mr. Milind Shastri, Mr. Rajiv Naithani and Mr. Manoj Bhat, along with requisite deposit amounts recommending Mr. Manu Parpia, Mr. David De Muer and Mr. Didier Gaillot respectively for re-appointment as Directors of the Company at the ensuing Annual General Meeting.

The aforesaid appointments of Mr. Varghese Thomas, Mr. Manu Parpia, Mr. David De Muer and Mr. Didier Gaillot, shall be placed before the shareholders for confirmation as Director of the Company at the ensuing Annual General Meeting, as stated in the Notice for the Annual General Meeting, appended herewith.

Mr. Samson Khaou was appointed as an Alternate Director to Mr. Didier Gaillot at the Board meeting held on July 31, 2017.

Ms. Pallavi Pathak resigned as Alternate Director to Mr. Manu Parpia, Director of the Company at board meeting held on January 13, 2017, as per the provisions of Section 161(2) of the Companies Act, 2013.

Mr. Vishwanath Shet, Chief Financial Officer has been confirmed as Key Managerial Personnel with effect from March 17, 2017.

7

The Annual Report

2016-17

Ms. Sunipa Ghosh has been appointed as Company Secretary with effect from March 17, 2017.

The Members accorded approval at the Extra-ordinary General Meeting held on March 20, 2017, for a commission not exceeding 1% of the net profits of the Company per annum computed in the manner prescribed in Section 197(8) of the Companies Act, 2013, in respect of the profits for each of the two financial years commencing from April 1, 2016, to be paid to Mrs. Anita Ramachandran, Mr. Varghese Thomas and Mr. Manu Parpia, Non-Executive Directors of the Company, who are not in whole time employment of the Company, such amounts or in such proportions and in such manner as may be recommended by the Nomination and Remuneration Committee and determined by the Board of Directors (or any committee thereof for the time being) and that the Commission paid to each of the Non-Executive Directors of the Company pursuant to this resolution shall be in addition to the fees for attending Meetings of the Board or any committee thereof which each such Non-Executive Director may be entitled to receive.

The details of commission payable and sitting fees paid to the Non-Executive Directors for the financial year 2015-16 are summarized below:-

Name of the Director Commission(Rs.)

Ms. Anita Ramachandran 1,87,500Mr. Manu Parpia 1,87,500Mr. Varghese Thomas 1,87,500Total 5,62,500

2. Statement on declaration given by Independent Directors:

The Company has received declarations from all the Independent Directors under Section 149(6) of the Companies Act, 2013 confirming their independence vis-à-vis the Company.

3. Disclosures related to Board, Committees and Policies:

(i) Board Meetings:

The dates on which the Board of Directors met during the financial year under review are April 1, 2016, April 18, 2016, July 21, 2016, October 18, 2016, January 13, 2017, March 9, 2017 and March 17, 2017.

(ii) Directors Responsibility Statement:

The Board of Directors of the Company confirms that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

b) 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 of the state of affairs of the Company for the financial year ending on March 31, 2017 and of the profit of the Company for the year ended on that period;

c) 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;

d) the directors had prepared the annual accounts on a going concern basis;

e) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f) 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.

(iii) Nomination and Remuneration Committee:

The Nomination and Remuneration Committee of Directors was constituted by the Board of Directors of the Company in accordance with the requirements of Section 178 of the Act.

8

The composition of the committee is as under:

1. Mr. Didier Gaillot, Chairman,

2. Ms. Anita Ramachandran, Member

3. Mr. Varghese Thomas, Member

4. Mr. Manu Parpia, Member

The Board has, in accordance with the provisions of sub-section (3) of Section 178 of the Companies Act, 2013, formulated the policy setting out the criteria for determining qualifications, positive attributes, independence of a Director and policy relating to remuneration for Directors, Key Managerial Personnel and other employees.

The Nomination & Remuneration Committee has met once during the year on July 31, 2016.

Nomination & Remuneration Policy of the Company is available on the Company’s website and can be accessed on the website i.e. www.3dplmsoftware.com.

(iv) Audit Committee:

The Board has constituted the Audit Committee of Directors in pursuance to the provisions of Section 177 of the Companies Act, 2013.


1. Mrs. Anita Ramachandran, Chairperson

2. Mr. Didier Gaillot, Member


During the year under review, the Board of Directors of the Company had accepted all the recommendations made by the Audit Committee.

The Audit Committee has met on the following dates during the year under review are April 1, 2016, April 18, 2016, July 21, 2016, October 18, 2016 and January 13, 2017.

(v) Corporate Social Responsibility Committee:

As per the provisions of Section 135 of the Act read with Companies (Corporate Social Responsibility Policy) Rules, 2014, the Board of Directors has constituted a Corporate Social Responsibility (CSR) Committee as under:

1. Mr. Manu Parpia, Chairman

2. Mr. Didier Gaillot, Member


During the year under review, the Corporate Social Responsibility Committee has met on July 21, 2016 and January 25, 2017.

The Board of Directors of the Company has approved CSR Policy based on the recommendation of the CSR Committee. The Company has initiated activities in accordance with the said Policy, the details of which have been prescribed in Annexure III.

The CSR Policy of the Company is available on the Company’s web-site and can be accessed on the website i.e. www.3dplmsoftware.com.

The Company collaborated with third party implementation agencies and spent part of the prescribed amount towards CSR during FY 2016-17. A detailed report on the CSR activities of the Company is enclosed as Annexure IV.

9

The Annual Report

2016-17

(vi) Stakeholders Relationship Committee:

The Board has constituted the Stakeholders Relationship Committee of Directors on April 25, 2017 in pursuance to the provisions of Section 178 of the Companies Act, 2013.


1. Mr. Didier Gaillot, Chairman

2. Mr. Manu Parpia, Member


4. Ms. Anita Ramachandran, Member

(vii) Development and Implementation of a Risk Management Policy:

The Board of Directors of the Company has developed and implemented Risk Management Policy and Guidelines to avoid events, situations or circumstances which may lead to negative consequences on the Company’s businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews.

(viii) Internal Control Systems:

Adequate internal control systems commensurate with the nature of the Company’s business and size and complexity of its operations are in place and have been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations, and that all assets and resources are acquired economically, used efficiently and adequately protected.

(ix) Disclosure under Section 197(12) of the Companies Act, 2013 and Other Disclosures as per Rule 5 of Companies (Appointment & Remuneration) Rules, 2014:

The ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year under review has been marked as Annexure V.

III. AUDITORS AND REPORTS:

The matters related to Auditors and their Reports are as under:

1. Observations of Statutory Auditors on Accounts for the year ended March 31, 2017:

The Auditors’ report for the financial year ended March 31, 2017 does not contain any qualification, reservation or adverse remark. The Auditors’ Report is enclosed with financial statements in this Annual Report.

2. Fraud reporting:

During the year under review, there were no instances of material or serious fraud falling under Rule 13(1) of the Companies (Audit and Auditors) Rules, 2014, by officers or employees reported by the Statutory Auditors of the Company during the course of the audit.

3. Secretarial Audit Report for the year ended March 31, 2017:

Provisions of Section 204 read with Section 134(3) of the Companies Act, 2013, mandates to obtain Secretarial Audit Report issued by, Mr. Atul Gandhi, Practicing Company Secretary, in Form MR-3 for the financial year 2016-17 forms part to this report and has been attached as Annexure VI. The said report does not contain any observation or qualification requiring explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

4. Ratification of Appointment of Auditors:

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, M/s. S. R. Batliboi & Associates LLP, Chartered Accountants, (Firm Registration No. 101049W) the Statutory Auditors of the Company have been appointed for a term of 5 years i.e. from the conclusion of the 13th Annual General Meeting until the conclusion of the 18th Annual General Meeting at the Annual General Meeting held on

10

July 16, 2014, subject to ratification at every Annual General Meeting. Accordingly, their appointment as Statutory Auditors of the Company shall be required to be ratified by the Members at the ensuing Annual General Meeting. The Company has received a certificate from the said Auditors confirming that their appointment, if ratified, would be within the prescribed limit under Section 139 of the Companies Act, 2013 and that they are not disqualified to act as the Auditors and are eligible to continue to hold office as Statutory Auditors of the Company. Your Directors recommend the ratification of appointment of M/s. S. R. Batliboi & Associates LLP, Chartered Accountants as the Statutory Auditors of the Company.

IV. OThER DISCLOSURES

Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:

1. Extract of Annual Return:

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return for the financial year ended March 31, 2017 made under the provisions of Section 92(3) of the Act is attached as Annexure VII – Form MGT-9 which forms part of this Report.

2. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo:

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in Annexure VIII which forms part of this Report.

3. Sexual harassment:

The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace and has also established Investigation and Redressal Committee, as stipulated by The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules thereunder. During the year under review, no complaints in relation to such harassment at workplace have been reported.

V. ACKNOWLEDGEMENTS:

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company.

On behalf of the Board of Directors,

Manu Parpia (DIN – 00118333) Sudarshan Mogasale (PAN-AAXPM5923B)Chairman Manager and CEO

July 31, 2017 Mumbai

11

The Annual Report

2016-17

Annexure I - Board’s ReportForm AOC - I

(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)Statement containing salient features of the financial statement of subsidiary/ associates companies/joint Ventures

Part “A” - Subsidiaries (Amount in Rs. except % of shareholding)

1. Name of the subsidiary 3D PLM Global Services Private Limited

2. Reporting period for the subsidiary concerned, if different from the holding company’s reporting period

March 31, 2017

3. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries

INR

4. Share capital 99,100,000.00 5. Reserves & surplus 149,416,066.00 6. Total assets 310,600,791.00 7. Total Liabilities 310,600,791.00 8. Investments 52,732,224.00 9. Turnover 586,833,836.00

10. Profit before taxation 111,493,432.00 11. Provision for taxation (373,352.00)12. Profit after taxation 111,866,784.00 13. Proposed Dividend - 14. % of shareholding 100.00

On behalf of the Board of Directors___________________________ ___________________________ Manu Parpia Sudarshan Mogasale (DIN: 00118333) (PAN: AAXPM5923B) Director Manager and CEO

Place: MumbaiDate: April 25, 2017

Annexure II - Board’s ReportForm AOC - 2

(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)This form pertains to the disclosure of particulars of contracts/arrangements entered into by the company with

related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arm’s length basis: All the transactions with related parties are in the ordinary course of business and on arm’s length basis.2. Details of material contracts or arrangement or transactions at arm’s length basis: (a) Name(s) of the related party : Dassault Systemes SE and its subsidiaries (b) Nature of relationship : Associate-Substantial Interest Party (c) Nature of contracts/arrangements/transactions: : Sale of Services (d) Duration of the contracts / arrangements/ transactions : April 1, 2016 - March 31, 2017 (e) Salient terms of the contracts / arrangements/ transactions : Based on transfer pricing guidelines (d) Amount (Rs.) : 3,694,967,510 (e) Date(s) of approval by the Board : July 31, 2017

On behalf of the Board of Directors______________________ ______________________Manu Parpia Sudarshan Mogasale (DIN – 00118333) (PAN: AAXPM5923B)Director Manager and CEO

Place: MumbaiDate: July 31, 2017

12

1. PREAMBLE: At 3DPLM Software Solutions, we are committed to the UDAAN vision of giving back to the society and help inclusive

growth of deprived community. Our strategic Corporate Social Responsibility (CSR) projects are aimed at achieving UDAAN goals and have helped us build a reputation of being one of the most socially and environmentally responsible companies in India.

2. PURPOSE: The key purpose of this policy is to: • Achievepositive,sustainablechangeinthecommunity. • Utilizecompanyassets(availableskillsetsandinfrastructure)forthebenefitoftheunderprivilegedcommunity. • Encouragevoluntaryeffortsbyemployeesandtheirfamilies.

3. POLICY STATEMENT: The policy focuses on addressing basic social, economic, environmental and economic needs of the marginalized/

underprivileged sections of the society. We adopt an approach that integrates the solutions to these problems into the strategy of the company, to benefit the communities at large and deliver social and environmental impact.

4. GOVERNANCE STRUCTURE: We have constituted a robust and transparent governance structure to oversee the implementation of our CSR Policy, in

compliance with the requirements of Section 135 of the Companies Act, 2013.

4.1 CSR Committee The CSR governance structure of 3DPLM will be headed by the CSR committee.

4.1.1CSR Committee Members This committee will report to the Board of the Company, and will comprise of: • Mr.ManuParpia-Director • Mr.DidierGaillot-Director • Mr.VargheseThomas-Director

4.1.2 Responsibilities • FormulateandrecommendtotheBoardaCSRPolicyandactivitiestobeundertaken • Recommendtheamountofexpendituretobeincurredontheactivities • MonitortheCSRPolicyfromtimetotime

4.2 Management CommitteeThe Management Committee is responsible for ensuring the smooth execution of all the CSR projects within the company. The committee will report to the CSR Committee and will comprise of:

Name LocationMr. Sudarshan Mogasale PuneMr. Vishwanath Shet PuneMr. Hemant Gadgil PuneMr. Rajiv Naithani PuneMr. Yogesh Rawat PuneMr. Huzefa Salim PuneMs. Dharmi Ghodpade Pune

4.2.1 Responsibilities • ResponsiblefortheexecutionofthedecisionstakenbytheCSRCommittee; • Ensureon-groundimplementationofprojects; • Maintainscheduleofexpensesasperapprovedproject-wisebudgets • SendperiodicreportstotheCSRCommittee;and • Meeteveryquartertoreviewtheprogress.

Annexure - IIICorporate Social Responsibility Policy

13

The Annual Report

2016-17

5. SCOPE OF CSR ACTIVITIES: CSR activities shall exclude activities undertaken in pursuance of normal course of business. This policy applies to all

our CSR projects. On a periodic basis this policy will be reviewed and updated in line with relevant codes of corporate governance, international standards and best practices.

The CSR activities may be undertaken by a registered trust or a registered society or a company established under Section 8 of the Companies Act, 2013 with such entities having a track record of at least 3 years in undertaking similar projects.

Furthermore, the policy also fulfills the requirements of the CSR as per the Section 135 of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility Policy) Rules, 2014 and Schedule VII of the said Act, namely :-

i. eradicating hunger, poverty and malnutrition, promoting health care including preventive health care and sanitation including contribution to the Swach Bharat Kosh set-up by the Central Government for the promotion of sanitation and making available safe drinking water;

ii. promoting education, including special education and employment enhancing vocation skills especially among children, women, elderly, and the differently abled and livelihood enhancement projects;

iii. promoting gender equality, empowering women, setting up homes and hostels for women and orphans; setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;

iv. ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources and maintaining quality of soil, air and water including contribution to the Clean Ganga Fund set-up by the Central Government for rejuvenation of river Ganga;

v. protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts:

vi. measures for the benefit of armed forces veterans, war widows and their dependents; vii. training to promote rural sports, nationally recognised sports, Para-olympic sports and Olympic sports; viii. contribution to the Prime Minister’s National Relief Fund or any other fund set up by the Central Government for

socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;

ix. contributions or funds provided to technology incubators located within academic institutions which are approved by the Central Government;

x. rural development projects. xi. slum area development. Explanation.— For the purposes of this item, the term ‘slum area’ shall mean any area declared as such by the Central

Government or any State Government or any other competent authority under any law for the time being in force.”

5.1 Normal Course of Business

3DPLM is a specialist in the domain of Product Lifecycle Management (PLM) solutions for Dassault Systemes.

6. PRIMARY ACTIVITIES UNDER CSR: UDAAN i. Achieve positive, sustainable change in the community; ii. Utilize company assets (available skill set and infrastructure) for the betterment of the community; iii. Involve voluntary efforts by employees and their families; and iv. Education & Welfare and beneficiary group as “Underprivileged Children and Youth” with activities as under: • Supportclassesforschoolchildren • FinancialsupportforEducationandChildWelfare • Books,ClothesandToyscollectionforchildren • ArrangingEcotripsforchildren • Careerguidanceforunderprivilegedyouth • Fundraisingduringnaturalcalamities&otherwise • Festivalcelebrationsatorphanages • SeveralOne-TimeActivitieslikeBloodDonationCamps,ArtExhibitions,etc.

14

Skill Development:

PRODUCT INNOVATION LABS

As part of the Corporate Social Responsibility Initiative, 3DPLM is promoting “Learn by Doing” approach aimed at improving the skills & competency development for students in engineering colleges / universities. 3D PLM is involved in setting up of ‘Product Innovation Labs’ in the premises of selected colleges, that are called as “3D PLM Product Innovation Labs”. The purpose is to promote ‘Learn by Doing’ approach, provide a platform for students to acquire integrated engineering, and multi-disciplinary skills, experiment with industry’s best software / hardware to bring product innovation, provide ‘hands-on’ practical experiences and industry exposure to the students and promote ‘Make in India’ , ‘Start-up’ culture amongst the engineering student. This will help the students Community to understand the power of Integrated engineering, advanced technologies like Systems Engineering, 3D printing, Robotics, Intelligent products, Engineering Automation, thereby make them ‘Industry Ready’ . It will provide them industry exposure and motivate them to explore, design and prototype ideas to contribute for Smart Cities / Smart Villages, build ‘Make in India’, ‘Start-up’ culture.

7. CSR EXPEDITURE:

The Companies Act, 2013 has prescribed and recommended the expenditure amount on CSR to be 2% of the average net profits of the Company, during the three immediately preceding financial years. In accordance with the regulations, if the Company is unable to make this expenditure, appropriate reasons shall be provided in the CSR Report, which would form a part of the Annual Report of the Company.

Such CSR expenditure shall include all expenditure including contribution to corpus, or on projects or programs relating to CSR activities approved by the Board on the recommendation of its CSR Committee, but does not include any expenditure on an item not in conformity or not in line with activities which fall within the purview of Schedule VII of the Act including all subsequent modifications notified.

The amount of expenditure made on activities undertaken through CSR capacities built with our own personnel in collaboration with registered entities shall not exceed 5% of the total expenditure of the Company in one financial year.

8. CSR BUDGET:

The total budget for the CSR projects will be decided in conformity to the aforementioned regulatory requirements and will form a part of the Annual Operating Plans, in accordance with the 3DPLM goals and priorities identified for each of the key focus areas by the CSR Committee.

9. PROJECT LIFE-CYCLE:

At 3DPLM, CSR projects are strategically planned and managed. Following are the key stages of a project:

9.1 Project Approval

The projects suggested by the Management Committee in consultation with the UDAAN team and company-level programme managers will be presented for the approval of the CSR Committee.

9.2 Implementation

The final projects approved by the CSR Committee will be sent to the individual Programme Managers, who in turn will break down the projects into time-bound targets and action plans. These projects will either be self-implemented, in partnership with an Implementing Agency or in collaboration with other corporates.

9.3 Monitoring

The individual Programme Managers will be responsible for monitoring approved projects, by methods which may include site visits, review meetings, progress reports etc. Periodic assessments have to be done to track data and monitor projects thereby ensuring transparency and efficiency in the implementation process. Projects will be evaluated against the predefined goals and milestones, together with the Implementing Agency (if any). The reports will be submitted to the Management Committee for the quarterly/half yearly review meetings.

9.4 Reporting

The CSR committee, based on reports presented by the Management Committee, will annually publish report on the CSR projects as a part of the Director’s report. The report will disclose information in the format as prescribed by the Section 135 of the Companies Act, 2013.

15

The Annual Report

2016-17

10. PARTNER QUALIFICATIONS:

If a third party is employed to carry out the implementation of our CSR projects, the Board of 3DPLM will ensure that they have a clearly explained mission/vision and an established track record of three years in undertaking similar projects or programmes. The implementation agencies should be able to produce their latest audited annual reports and in case of an NGO, they should also be able to produce their registration forms according to under Section 12A of the Income Tax Act. (Section 80G of the Income Tax Act is preferable).

10. TREATMENT OF SURPLUSES:

Any surplus generated from CSR projects undertaken by us will be tracked and channelized into our CSR corpus. These funds will be further used in development of the CSR projects and will not be added to the normal business profits.

16

Annexure IV – Board Report3D PLM: CSR Report 2016-2017

- Overarching Philosophy 3DPLM is a staunch supporter of the philosophy of inclusive growth. It has been our endeavour to give back to the society

and to facilitate the integration of the marginalized communities into mainstream society and the economy. We particularly endorse the concept of “equal access to education” as we truly believe that this lays the foundation of a more inclusive society and this ideology has reflected in the work that we have undertaken.

- CSR Policy For a long time now, 3D PLM has been undertaking a host of socially and environmentally responsible activities via the

UDAAN initiative, which was largely an employee driven movement. We aspire to build a reputation of being one of the most socially and environmentally responsible companies in India.

With the inclusion of mandatory CSR activities under the Companies Act in 2013, we have streamlined our body of work into a CSR Policy and have formalized our priorities, keeping in mind our overarching philosophy. We have identified key focus areas, keeping in mind the basic social, environmental and economic needs of our society. Our approach has then been to address these needs by incorporating necessary measures in the business strategy of the company, in a way that will benefit the communities at large and also achieve the desired social and environmental impact.

While Corporate Social Responsibility is now mandated by law, we continue to execute it with passion.

Our CSR Policy aims to:

Achieve positive and sustainable change in the community via a three pronged approach of targeting social, economic and environmental needs.

Undertake and implement projects in a manner that will yield long term, self-sustaining results.

Go beyond monetary contributions and utilize company assets (available skill sets and infrastructure) for the benefit of the underprivileged community.

Encourage voluntary engagement by employees.

- The CSR Committee The aim of the CSR Committee is to develop and monitor the CSR Framework for the Company, identify suitable projects,

lay down the guidelines for, and oversee the implementation of the projects. The Committee will also be responsible for measuring the success of the activities undertaken and for periodic CSR reporting.

The CSR Committee at 3DPLM is constituted of

1) Mr. Manu Parpia, Director

2) Mr. Didier Gaillot, Director

3) Mr. Varghese Thomas, Independent Director

- Average net profit of the Company for last three financial years The Company’s average net profit for the prescribed year was Rs. 73.36 Crores, as computed under Sections 135 and 198

of the Companies Act, 2013.

- Prescribed CSR Expenditure The Company’s prescribed expenditure was Rs. 1.47 Crores towards CSR, for the year under review, as computed under

Section 135 and 198 of the Companies Act, 2013. Additionally, the Company had brought forward the unspent amount of Rs. 1.02 Crores from last financial year 2015-16.

- Sector Focus and Location of Spending In compliance with Schedule VII of the Companies Act 2013, 3DPLM has identified the following focus areas for its CSR

spending for the financial year 2016-17: Promote education

Generate awareness, and promote the use of new and innovative technology, via skill development, to empower the youth with appropriate skills that can enhance employability and include them in the workforce

17

The Annual Report

2016-17

Geographically, 3DPLM has undertaken CSR Projects in cities where it has a presence, including Pune and Bangalore

- Details of CSR spent during the financial year

Total CSR Expenditure for the financial year was Rs. 1.36 Crore.

- Implementation Strategy and Partners

3D PLM has worked with third party implementation agencies to carry out the CSR Projects, as identified. Most of the agencies are pioneers in their field of work and 3D PLM has established long term relationships with them.

The details of the initiatives funded are herewith mentioned along with names of the third party implementation agency:

Sector Implementation Agency

CSR Project Activities being supported

Education(via UDAAN Initiatives)

hope for Children Foundation

The Disha Darshan Project

• Improve the quality of life of under privileged childrenand help them integrate within the system, via a holistic approach including imparting life skills, teacher training etc.

• Thusfar,28sessionshavebeenconcludedaroundvarious‘Interpersonal’, ‘Emotional’, ‘Self-Management’ & ‘Thinking’ Skills

• Thusfar,704childrenfrom3differentschoolsbenefittedFY’16 and 1000 children are undergoing this session

Door Step School “Every Child Counts - Parents’ Participation in Children’s Education” (ECC- PPCE)

• Supports the Education of Migrant laborer’s children toenroll into mainstream Education

• BuildParents’CapacitythroughawarenessaboutRTEandinvolvement, to encourage them to send their children to school.

• Identify and remove all other barriers to enrollment andcontinuity of children’s education.

• Supportedconstructionofwashroomsanddrinkingwatertanks in 2 schools, Gopal Krishna Primary School and Zilla Parishad Primary School in Pune

• Thusfar,317childrenhavebeenenrolledfromconstructionsites in identified areas

Niwant Andha Mukta Vikasalaya (NAMV)

Supporting the mission of NAMV at large

• Support theeducationandwelfareofvisuallychallengedchildren

• Evolved higher education possibility to 10 visuallychallenged people by supporting them with laptops

Manonandana Trust

Supporting the mission of Manonandana at large

• Assess&Evaluatespecialchildren’sabilitiesanddisabilities• Conducteducativeandinteractiveseminars/workshopsfor

medical and paramedical professionals• Createmediatogenerateawareness&sensitizationinthe

society-at-large about these children• Contribute towards improving the quality of 62 life of

specially-abled residential children through various welfare initiatives.

Mahesh Foundation

Support & Enhance Quality of Life of HIV/AIDS affected children

• SupporttheEducationofHIVaffectedchildren• Supportinconstructionofaclassroomforthesechildren• Sponsor1000SchoolKits• ConductProgramforOrphans

18

Sector Implementation Agency

CSR Project Activities being supported

Lila Poonawalla Foundation

Leading Indian Ladies Ahead

• PromotingEducationofgirls• Empowerment of girls by providing support for overall

personality Development• Makesgirlseconomicallyindependent• TosponsortheGirlseducationinthefieldofengineeringof

minimum 5 girls with help of 3DPLM Scholarship through the LPF. These girls will be called Lila Girls.

• RegularlyconducttrainingprogramsforLilaGirlstomakethem empowered and confident

Skill Development

3DPLM Product Innovation Labs

Academia-Corporate Skill Development Initiative

• Enhancing employability of engineering students byfostering a “Learn by Doing” approach.

• Fourlabshavebeensetupthusfarandthestandardizationof the labs has been done. 2 more labs have been approved.

• WorkshopforProfessorsofthecollegeswereconductedtoorient/train them on Product Innovation Lab

• Fourlabshavebeenconstructedandarefunctionalandina good state.

• 5newstudentprojectstobedevelopedbyeachofthelabs• 5liveindustryproblemssolvedbyeachofthelabs• 5workingprototypesofnewproductideastosolveIndia’s

problemsSocial Innovation Start Up IncubatorCOEP (BhAU Institute)

Entrepreneurship Skill Development Initiative

3 teams have been successfully incubatedTechnical and Business Mentoring provided

Details of the projects are as hereunder:

a) Disha Darshan Project

Hope for the Children Foundation (HFCF) works to improve the quality of life of underprivileged children, their mothers and in turn, their communities in India. They target children who are either school dropouts or on the verge of dropping out of the formal system of education and gently help them integrate with the system. These children are usually from single mother from a very vulnerable background.

Their holistic approach involves nutritional support in the form of daily meals, monthly food grains, medical aid, educational support and mentorship programs for the children; awareness and literacy programs, vocational training and other forms of humanitarian aid for the mothers.

Their core programs are Atmanirbharata, Shiksha Ki Asha, Disha Darshan which are complimented by family counseling, monthly medical check-ups, recreational activity, various training & soft skill sessions, micro finance and micro insurance to help woman regain their independence.

3DPLM as a part of Corporate Social Responsibility Initiative decided to contribute to the “Disha Darshan” which has the following objectives:

• Improvingthequalityoflifeofunderprivilegedchildrenandhelpingthemintegratewiththesystem,viaaholisticapproach

• Instillingasetofinterpersonal,thinking,emotionalandself-managementskillsamongstchildrenacrossidentifiedschools in Pune

• Trainingstafftoguidechildrentowardsthisend

19

The Annual Report

2016-17

b) Parents’ Participation in Children’s Education (PPCE) “Door Step School” was established in Mumbai, India in 1989 with the aim of addressing literacy amongst the marginalized

sections of society. The school provides education and support to the often-forgotten children of pavement and slum dwellers, construction site families and many other underprivileged families. Many of these children are not enrolled in school and have limited access to books and a place to study. Additionally, many of these children are forced to drop out of school to work or care for younger children. With neither support nor resources at home these children too often suffer from very low learning levels. At Door Step School, they trying to bridge this gap by bringing education to the “Doorstep” of these underprivileged children.

In 2011, Door Step School launched a Citizens’ Campaign- EVERY CHILD COUNTS(ECC) to help meet the UN Millennium Development Goal of “Universal Elementary Education for all by 2015”. Over 1300 children from migrant families were located and enrolled in schools across the city of Pune in 2012.

The “Parents’ Participation in Children’s Education (PPCE)” program was launched in 2013, as a pilot to address “lack of parent awareness and involvement”, which was a key barrier to children not being enrolled under ECC. The larger aim was to “build Parent’s Capacity to take responsibility for the child’s schooling”. The program is into its third year since it was started in Kondhwa and Mohammedwadi areas of Pune and the results are highly encouraging.

Overall, 7000 children have been enrolled into mainstream schools under the ‘Every Child Counts’ program and Parents’ Participation in Children’s Education since 2013-14. Through programs like Every Child Counts and Parents Participation in Education, Doorstep School hopes to reach out to migrant children and ensure they have access to schooling thereby increasing their chances of a better future.

3DPLM as a part of Corporate Social Responsibility Initiative decided to contribute to the “Parents Participation Programme” with the following objectives:

to build Parent’s Capacity via awareness and involvement, to take responsibility for the child’s schooling

to identify and remove all other barriers to enrollment and continuity of children’s (particularly of migrant workers) education

to help establish the necessary infrastructure such as preparatory camps, bridge classes and school transport to ensure children’s education in identified project areas.

c) Supporting Niwant Andh Mukta Vikasalay Niwant Andh Mukta Vikasalay is a trust set up in Pune in 1996 that works towards the upliftment of the visually impaired

students through education and vocational training. 3DPLM as a part of Corporate Social Responsibility Initiative decided to contribute towards the following activities being

undertaken by NAMV Conducting educational workshops (including the organization of outdoor camps and nature walks), to sensitise the

visually impaired students to what nature has to offer Ensuring overall growth and development of the students by providing healthy nutritious meals, regular medical

check-ups and access to recreational activities

Enhancing employability, and ensuring employment of NAMV graduates at different organisations, including at NAMV

d) Supporting Manonandana Trust Manonandana Centre, established in the year 1996 provides comprehensive special education to mentally challenged and

multiple disabled children belonging to lower economic group in the society. The Manonandana team works towards ensuring better quality of lives of the families of special children.

3DPLM as part of Corporate Social Responsibility Initiative decided to contribute towards the following activities being undertaken by Manonandana Trust:

Assessment & Evaluation of special children’s abilities and disabilities through electronic media documentation for professional monitoring.

Conducting educative and interactive seminars/workshops for medical and paramedical professionals to provide a common platform for the betterment of special children (Mentally Challenged, Cerebral Palsy, Autism & Attention Deficit-Hyper Activity Disorder).

To build cognitive social, speech language and daily living skills using special games with realistic environment setup dedicated for moderate to severe - mental retardation and multiple disability children.

To provide a special child friendly infrastructure like mobility, safety, etc. in the existing building.

20

e) 3DPLM Product Innovation Labs

As part of the Corporate Social Responsibility Initiative, 3DPLM is promoting the “Learn by Doing” approach aimed at improving the skills & competency development for students in engineering colleges / universities. 3D PLM has set up ‘Product Innovation Labs’ in the premises of 4 colleges in Pune and Bangalore, that are called as “3D PLM Product Innovation Labs”. Process of setting up one more Engineering lab has been initiated. The purpose is to promote ‘Learn by Doing’ approach, provide a platform for students to acquire integrated engineering, and multi-disciplinary skills, experiment with industry’s best software / hardware to bring product innovation, provide ‘hands-on’ practical experiences and industry exposure to the students and promote ‘Make in India’, ‘Start-up’ culture amongst the engineering student. This will help the students Community to understand the power of Integrated engineering, advanced technologies like Systems Engineering, 3D printing, Robotics, Intelligent products, Engineering Automation. It will also provide them industry exposure and motivate them to explore, design and prototype ideas to contribute for Smart Cities / Smart Villages, build ‘Make in India’, ‘Start-up’ culture.

The ‘3DPLM Product Innovation Lab’ will be accessible to the students, faculty members, researchers of the College and also to the students, professors, researchers of other colleges / institutes as well as industries, entrepreneurs, in the region to promote the aforementioned objectives.

The 3DPLM Product Innovation Labs have been set up at 4 colleges at the moment: Pimpri Chinchwad College of Engineering, Pune BMS College of Engineering, Bangalore Army Institute of Technology, Pune Pune Vidyarthi Gruhas College of Engineering and Technology, Pune

f) Supporting Social Innovation Startup Incubator

As part of the Corporate Social Responsibility Initiative, 3DPLM has supported the creation of Social Innovation Start-up Incubator at COEP, Pune. The purpose is to identify ideas that aim at leveraging technology to develop & implement innovative solution in the area of education, healthcare and rural development. Through this project, 3DPLM has provided an incubation platform for such ideas, and also extend Technical Mentoring Support to convert the idea from concept to reality.

In Phase I of the Project, the idea was identified and 135 entries were received in the selection process. In Phase II of the Project, the applications were scrutinized, bootcamps conducted and 24 teams were shortlisted. In Phase III, the final phase of the project, 3 final teams were selected and will be mentored.

Manner in which the amount has been spent during the financial year is detailed below:

(1) (2) (3) (4) (5) (6) (7) (8)

S.No.

CSR Project or activity identified

Sector in which the project is covered

Project or programs Amount outlay

(budget) project or programs

wise

Amount spent on the projects or programs sub

heads:

Cumulative expenditure

up to the reporting

period

Amount spent Direct or through

implementing agency

(1)Local area or other

(2)Specify

the state and district

where projects or programs

was undertaken

(1)Direct

Expenditure on projects

and programs

(2)Overheads:

1. Every Child Counts - Parents’ Participation in Children’s Education” (ECC- PPCE)-Door Step School

Literacy / Education

Pune Maharashtra 3,050,000 1,727,165 - 1,727,165 1,727,165

2. Disha Darshan Literacy / Education

Pune Maharashtra 16,20,000 15,08,100 6,500 15,14,600 15,14,600

21

The Annual Report

2016-17

(1) (2) (3) (4) (5) (6) (7) (8)

S.No.





wise


heads:


up to the reporting

period


implementing agency


(2)Specify



was undertaken

(1)Direct


and programs

(2)Overheads:

3. Supporting Niwant Andha Mukta Vikasalaya


Pune Maharashtra 1,750,000 803,000 - 803,000 803,000

4. Supporting Manonandana Trust


Bengaluru Karnataka 380,000 380,000 - 380,000 380,000

5. Support & Enhance Quality of Life of HIV/AIDS affected children – Mahesh Foundation


Bengaluru Karnataka 1,020,000 600,000 - 600,000 600,000

6. Lila Poonawalla Foundation -Leading Indian Ladies Ahead



7. 3DPLM Product Innovation Lab @ B.M.S. Educational Trust

Skill Development

Bangalore Karnataka 100,000 100,000 - 150,000 150,000

8. 3DPLM Product Innovation Lab @ PCCOE (PCET)

Skill Development


9. 3DPLM Product Innovation Lab @ AWES - AIT(Army Educational Welfare Trust)

Skill Development


10. 3DPLM Product Innovation Lab @ PVG CoET (PVG)

Skill Development


11. Fees to Prashant bhat (Co-ordinator)– Routed through Pimpri Chinchwad Trust

Skill Development

Pune Maharashtra 330,000 330,000 - 330,000 330,000

12. 3DPLM Product Innovation Lab @ – Vishwakarma Institute Of Information Technology [VIT], Pune

Skill Development


13. Seth Walchand Hirachand Memorial Trust (WHMT)

Skill Development

Pune Maharashtra 1,700,000 - - - -

14. Additional new lab Skill Development

Pune Maharashtra 1,200,000 - - - -

15. 3DPLM Product Incubation Lab

Skill Development


22

(1) (2) (3) (4) (5) (6) (7) (8)

S.No.





wise


heads:


up to the reporting

period


implementing agency


(2)Specify



was undertaken

(1)Direct


and programs

(2)Overheads:

16. Consultancy fees paid to Ms. Preeti Ramdasi, CSR Consultant

- Mumbai Maharashtra - 200,000 200,000 200,000

Total 24,850,000 13,318,265 206,500 13,574,765 13,574,765

Note: The Company had allocated an additional budget of Rs. 1.15 Crores towards planned expenditure for the following activities which remained unspent:

1. Door Step School

2. Disha Darshan

3. Mahesh Foundation

4. Lila Poonawalla Foundation

5. Walchand Engineering Lab - New lab

6. Purchase of High End Computers with Graphics machines for each lab

7. Organisation of workshops in the labs on new technology domains and internship

8. Cost for maintaining and Expansion of commissioned labs and purchase of new equipment for the labs

9. Setting up of an additional lab

Unspent amounts

Amount unspent for the financial year, including the amount carried forward from last financial year: Rs. 1.13 Crores

Some of the projects committed to by the company, could not be completed in the current financial year because of reasons beyond the control of the Company including delay in getting requisite Governmental permissions, procedural delays in submission of documents by partners for due diligence, setting up of the requisite infrastructure and machinery etc.

The projects that the Company is associated with, could not be completed during the financial year under review and hence the full amount allocated to the respective projects could not be spent. The Company, as a policy, stresses on detailed implementation of the CSR initiatives and identification of the right partners who share the same spirit and objectives, to ensure efficacious use of the resources. In this process some of the projects have got delayed and the entire budget has not been fully spent on CSR initiatives.

However, the Company is fully committed to ensure full utilization of the allocated CSR budget. The amount which remained unspent due to unavoidable circumstances, has been added to the CSR budget for the Financial Year 2018.

Given the need to boost education opportunities to underprivileged section of the society and skill development in engineering and scientific domain, 3DPLM would like to optimize the benefits of its CSR Projects in a way that they feed into the overarching priorities of the nation.

In pursuit of this commitment, listed below are some of the specific projects that are under planning and will be implemented in the financial year 2017-18 utilizing the CSR budget for the period under review.

1. Instituting an additional 3D PLM Product Innovation Lab

23

The Annual Report

2016-17

2. Strengthen our support to existing partners and extend support to 2 other institutions working in the field of education and skill development

- Responsibility statement

3DPLM undertakes regular monitoring exercises to ensure that the projects being implemented by agencies in a manner that are compliant with the Company’s overall policies (particularly CSR Policy) and ethics and are achieving the desired results. The endeavor is to also put in place impact assessment measures to quantify the success of the CSR Projects being undertaken.

On behalf of the Board of Directors

Manu Parpia(DIN :00118333)

Sudarshan Mogasale(PAN: AAXPM5923B)

DirectorPlace: MumbaiDate: July 31, 2017

Manager and CEO

24

Annexure V – Board’s ReportDisclosure for Ratio of Remuneration of each Executive Director to the Median Employee’s Remuneration and other details as per Rule 5 of the Companies (Appointment & Remuneration) Rules, 2014

a) The ratio of the remuneration of Manager & CEO to the median remuneration of the employees of the Company for the financial year:

Median Remuneration : Rs. 750,000 Manager Remuneration : Rs. 91,59,200 Ratio : 12.21:1 None of the Non-Executive and Independent Directors have drawn any remuneration from the Company during the year

under review.

b) Table for comparison of remuneration of Manager & CEO, Chief Financial Officer and Company Secretary along with percentage increase and Company performance for FY 2016-17:

Name of KMP/Director

Designation Remuneration for FY 2016-17 (in Rs.)

Percentage increase in

remuneration of Director / KMP

Ratio of remuneration of

Executive Director to Median

remuneration of Employees

Comparison of remuneration of KMP / Director

against the performance of the

CompanyMr. Sudarshan Mogasale

Manager & CEO 91,59,200 7% 12.21:1 PBT increased by 4.29% over FY17. PAT increased by

4.93% over FY 17.Mr. Vishwanath Shet

Chief Financial Officer

46,37,700 7%

Ms. Sunipa Ghosh

Company Secretary

Annual – 27,00,000Prorata – 610,000#

# Ms. Sunipa Ghosh was appointed with effect from March 2, 2017 and the remuneration includes a joining bonus of Rs. 200,000.

c) The percentage increase in the median remuneration of employees in the financial year was 7.1%.

d) The number of permanent employees on the rolls of the Company as on March 31, 2017 is 2100.

e) Explanation on the relationship between average increase in remuneration and the Company’s performance:

The Profit before Tax for the financial year ended March 31, 2017 increased by 4.29% whereas the average increase in remuneration was 7.1%.

f) Variations in the market capitalization of the Company, price earning ratio as at the closing date of the current financial year and previous financial year and percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer: NOT APPLICABLE

Note: The Company got its redeemable preference shares listed with Bombay Stock Exchange Limited with effect from May 5, 2017.

g) Average percentile increase already made in the salaries of employees other than the managerial personnel for FY17 was 7.1% and & whereas the increase in managerial remuneration was 7% for the same financial year. The increase in managerial remuneration was based on achievement of revenue and net profit targets and certain other qualitative goals set by the Nomination and Remuneration Committee for the Manager.

h) The key parameters for variable component of remuneration availed by the Manager & CEO are as follows: i. Growth of the R&D centre in India. Measured on Projected and Actual billed man-months ii. Cost per person iii. Efficiency & Quality Parameters for R&D labs iv. Employee Retention

25

The Annual Report

2016-17

i) The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year:

Not Applicable

j) Affirmation that the remuneration is as per the remuneration policy of the Company:

The terms of remuneration paid to the employees of the Company are in consonance with the remuneration policy of the Company, as approved by the Nomination & Remuneration Committee of the Directors of the Company.

Note:

The Remuneration for the purpose of this Annexure is defined as “Total Cost to the Company TCC” (which includes Fixed Pay + Variable Pay + Insurance & Retirement benefits + Additional Benefits if any) for all employees including the Managing Director. The actual pay-out of Variable pay is contingent on individual and company performance, the amount taken is an approved variable pay or variable pay at 100% and not at actuals. The final payout of any salary component is subject to the tax rules and regulations existing from time to time.


Manu Parpia Sudarshan Mogasale(DIN – 00118333) (PAN – AAXPM5923B)Chairman Manager & CEO


26

Ann

exur

e V

- B

oard

’s R

epor

t (c

ontd

.)St

atem

ent

Pur

suan

t to

Rul

e 5(

2) o

f Co

mpa

nies

(App

oint

men

t an

d R

emun

erat

ion

of M

anag

eria

l Per

sonn

el) R

ules

, 201

4 Th

e fo

llow

ing

tabl

e st

ates

the

det

ails

of

empl

oyee

s w

ho w

orke

d w

ith

the

Com

pany

for

the

yea

r: N

one

of t

he E

mpl

oyee

s fa

ll un

der

this

cat

egor

y.Sr

. N

oN

ame

of

empl

oyee

Des

igna

tion

Rem

uner

atio

n re

ceiv

ed(in

R

s.)

Nat

ure

of

empl

oym

ent

Qua

lifica

tion

Dat

e of

co

mm

ence

men

t of

em

ploy

men

t

Expe

rien

ce

(in y

ears

)A

geLa

st

empl

oym

ent

held

by

such

em

ploy

ee

befo

re

join

ing

the

Com

pany

% o

f eq

uity

sh

ares

hel

d by

the

em

ploy

ee in

th

e Co

mpa

ny

Whe

ther

any

su

ch e

mpl

oyee

is

a re

lati

ve o

f an

y D

irect

or o

r M

anag

er o

f th

e Co

mpa

ny a

nd

if s

o, n

ame

of

such

Dire

ctor

or

Man

ager

The

follo

win

g ta

ble

stat

es t

he d

etai

ls o

f em

ploy

ee w

orke

d w

ith

the

Com

pany

for

par

t of

the

yea

r:Sr

. N

oN

ame

of

empl

oyee

Des

igna

tion

Rem

uner

atio

n re

ceiv

ed (i

n R

s.)

Nat

ure

of

empl

oym

ent

Qua

lifica

tion

Dat

e of

co

mm

ence

men

t of

em

ploy

men

t

Expe

rien

ce

(in y

ears

)A

geLa

st

empl

oym

ent

held

by

such

em

ploy

ee

befo

re

join

ing

the

Com

pany

% o

f eq

uity

sh

ares

hel

d by

the

em

ploy

ee in

th

e Co

mpa

ny

Whe

ther

any

su

ch e

mpl

oyee

is

a re

lati

ve o

f an

y D

irect

or o

r M

anag

er o

f th

e Co

mpa

ny a

nd

if s

o, n

ame

of

such

Dire

ctor

or

Man

ager

On

beha

lf o

f th

e B

oard

of

Dire

ctor

s

Man

u Pa

rpia

(D

IN –

001

1833

3)Su

dars

han

Mog

asal

e (P

AN

– A

AX

PM59

23B

)Ch

airm

anM

anag

er &

CEO

Pla

ce: M

umba

iD

ate:

July

31,

201

7

27

The Annual Report

2016-17

Annexure VIForm No. MR-3

SECRETARIAL AUDIT REPORTFOR ThE FINANCIAL YEAR ENDED 31.03.2017.

[Pursuant to section 204(1) of the Companies Act, 2013 and rule No.9 of the Companies (Appointment and Remuneration Personnel) Rules, 2014]

SECRETARIAL AUDIT REPORTFOR ThE FINANCIAL YEAR ENDED 31.03.2017.

To,The Members,3D PLM Software Solutions Limited,Plant No.11, 3rd floor, Pirojshanagar,Vikhroli (West), Mumbai 400 079.

I have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by 3D PLM Software Solutions Limited (hereinafter called the company). Secretarial Audit was conducted in a manner that provided me a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing my opinion thereon.

Based on my verification of the books, papers, Minute Books, Statutory Registers, forms and returns filed and other records maintained by the company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, I hereby report that in my opinion, the company has during the audit period covering the financial year ended on 31st March, 2017 complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

I have examined the books, papers, Minute Books, Statutory Registers, forms and returns filed and other records maintained by 3D PLM Software Solutions Limited (“the Company”) for the financial year ended on 31st March, 2017 according to the provisions of:

(i) The Companies Act, 2013 (the Act) and the rules made thereunder;

(ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

(iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

(iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings;

(v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

(d) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999;

(e) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

(f) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(g) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and

(h) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

(vi) Other specific laws applicable to the company as given in detail below.

28

I/we have also examined compliance with the applicable clauses of the Secretarial Standards issued by The Institute of Company Secretaries of India.

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above, subject to the following observations:

1. The Companies Act, 2013 (the Act) and the rules made thereunder –

Board Meetings and General Meetings

The company has conducted 7 (seven) Board Meetings in course of the financial year, namely on 01.04.2016, 18.04.2016, 21.07.2016, 18.10.2016, 13.01.2017, 09.03.2017 and on 17.03.2017, after complying with the provisions of the Act.

The Board of Directors has constituted an Audit Committee, a Nomination and Remuneration Committee and a Corporate Social Responsibility Committee from amongst its members. The policy in respect of each of these Committees has been approved at the Meetings of the Board. The Audit Committee met on 01.04.2016, 18.04.2016, 21.07.2016, 18.10.2016 and on 13.01.2017.

It has also constituted a Closing Committee consisting of four directors, pursuant to the Composite Scheme of Arrangement and Amalgamation (the Scheme) approved by the Courts of Law, to remove any difficulties in implementing the Scheme. A meeting of the Closing Committee was held on March 2, 2017.

The company held its Annual General Meeting on 21.07.2016 and Extra-ordinary General Meetings on 25.04.2016, 21.07.2016 and 20.03.2017.

Other requirements of the aforesaid Act and Rules pertaining to these meetings have been complied with by the company.Necessary returns, required to be filed with regard to the matters taken up in these meetings, as per the provisions of the Companies Act, 2013 (the Act) and the rules made thereunder have been filed by it with the Ministry of Corporate Affairs.

The company has maintained proper Books of Accounts and records as required under the Act.

The transfer of the shares of the company has been effected in accordance with the provisions of the Act.

Corporate Social Responsibility

The company has earmarked an amount of 2% of its average net profits amounting to Rs. 1.47 crores during the financial year 2016-17, for its contribution towards Corporate Social Responsibility, in terms of Section 135 of the Companies Act, 2013. There was an unspent amount of Rs. 1.02 Crores brought forward from last financial year for CSR expenses. An amount of Rs. 1.36 crores has been disbursed by it to various eligible organizations.

2. The Securities Contracts (Regulation) Act, 1956 and the Securities Contracts (Regulation) Rules, 1957 deal with the regulation and the governance of Stock Exchanges and hence are not applicable to the company.

3. The Depositories Act, 1996 deals with regulation of transactions pertaining to securities between Depositories, Depository Participants, Issuers and Beneficial Owners. The company has 7 (seven) shareholders. At the Board Meeting held on 13.01.2017, the company passed a resolution to apply to National Stock Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) for admission of the shares in the Depository system. The shares have since been dematerialized.

4. Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings – It is given to understand by the company that it did not make any investment in a Joint Venture or in a Wholly Owned Subsidiary outside India in the course of the financial year ended on 31st March, 2017. It was seen from the books and records made available to me for my verification that it has not issued any securities to any foreign entity/entities during this period. No External Commercial Borrowings were made by it in course of that financial year. (The company has made an application to the Reserve Bank of India for allotment of Redeemable Preference Shares to non-resident shareholders, in exchange for equity shares held in the company, in pursuance of the Scheme.)

Hence, in my opinion, the provisions of the Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment and External Commercial Borrowings with particular reference to the year under review are not applicable to the company.

I have examined the applicability of the Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’)which have been mentioned in the earlier part of this report. I have to make the following observations:

29

The Annual Report

2016-17

1. The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011.

The company was a subsidiary of Geometric Limited, a public limited company listed on the Stock Exchange/s. For the purpose of this Act it was one of the ‘persons acting in concert’ (as defined in that Act), with Geometric Limited.

However, in course of the financial year, the High Court of Judicature, Bombay and the High Court, Delhi, in two separate Company Petitions have approved of a Composite Scheme of Arrangement and Amalgamation of the company. Due to coming into effect of this scheme, Geometric Limited no longer continues to hold any shares in the company and consequently, the company has effectively ceased to be a subsidiary of Geometric Limited. In view of this it is no longer a ‘person acting in concert’ with Geometric Limited.

I have tried to ascertain whether Geometric Limited and the company along with other ‘persons acting in concert’ have acquired 25% or more of listed securities in the course of the financial year ended on 31st March, 2017. I was given to understand that the company has not acquired any listed/quoted securities, during that financial year both when it was a subsidiary of Geometric Limited and even after it ceased to be its subsidiary. Hence, these Regulations do not apply to it.

2. The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992. These regulations apply only to a listed company. However, even then the company was a ‘connected person’ for the part of the year during which it was a subsidiary of a listed company as per Regulation 2(d). Every connected person is an ‘insider’ [Regulation 2(g)]. It is given to understand that the company was not in possession of any “unpublished price sensitive information” relating to the price of the securities of Geometric Limited, during that period.

For the purposes of these Regulations, “unpublished price sensitive information” means any information, relating to a company or its securities, directly or indirectly that is not generally available which upon becoming generally available, is likely to materially affect the price of the securities. Hence these Regulations are not applicable to the company.

3. Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 - These Regulations deal with public issues and hence are not applicable to the company. The company has not made any public issues during the year under review.

4. The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 – These Guidelines apply to any company whose shares are listed on any recognized stock exchange in India. As the securities of the company are not listed, in my opinion, the same do not apply to it.

5. The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 are not applicable to the company for the financial year under review as it has not made any:

(a) public issue of debt securities; and

(b) listed debt securities issued through public issue or on private placement basis on a recognized stock exchange.

6. The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 - These Regulations lay down the procedure for registration and regulation of the working of Registrars and Share Transfer Agents and as such do not apply to the company.

7. The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009. These regulations apply to delisting of equity shares of a company from all or any of the recognized stock exchanges where such shares are listed. As the shares of the company are not listed, these regulations do not apply to it.

8. The Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998 - These regulations are applicable to buy-back of shares or other specified securities of a company listed on a stock exchange. The company has confirmed that none of its securities were ever listed on any stock exchange. Hence, these Regulations do not apply to the company.

Applicability of other Acts and Laws.

I have examined the applicability of various other Acts and laws applicable to the company. I have to make the following observations with regard to the same:

Employees’ State Insurance Act, 1948 –This Act is only applicable to such of the employees who are drawing wages of less than Rs.21,000/- (excluding overtime) per month. As none of the employees of the company were drawing wages (excluding overtime) of less than Rs.21,000/- per month during the financial year, this Act does not apply to the company.

Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 -This Act is applicable to the company. The company is regular in depositing both the employers’ and employees contributions with the Provident Fund Authorities.

30

The Payment of Bonus Act, 1965 - The Act is only applicable to such of the employees who are drawing wages of less than Rs.21,000/-per month. As none of the employees of the company draw wages of less than Rs.21,000/-, this Act is not applicable to the company.

The Income Tax Act, 1961 – The company has confirmed that all sums required to be deducted in accordance with the provisions of The Income Tax Act, 1961, as amended up to date and other tax laws applicable to the company have been properly deducted and have been paid/ will be paid within the prescribed time limit to the credit of the Central Government, in accordance with Section 200 of the Income Tax Act, 1961.

The Industrial Disputes Act, 1947 - The company has confirmed that there has been no breach of provisions of this Act.

The Payment of Gratuity Act, 1972 – Earlier, the company had a Trust to administer funds for Gratuity and Superannuation payments, which was common for its employees and those of its holding company, Geometric Ltd. Subsequently, it set up a separate irrevocable trust for its own employees, called the ‘Employees Group Gratuity Cash Accumulation Scheme Trust’. This trust implements the requirements of the Act, as applicable to the company, in collaboration with the Life Insurance Corporation of India Ltd (LIC). The company pays LIC such amount of contribution estimated by LIC to secure the benefits to the employees. Disbursement of the same is made by LIC as and when it falls due. A similar trust has been formed for the employees of its subsidiary company 3D PLM Global Services Private Ltd.

The Maharashtra State Tax on Professions, Trades, Callings and Employments Act– The company has regularly made payments of the tax with the concerned authorities during the financial year ended 31st March, 2017.

The Karnataka Tax on Profession,Trades, Calling and Employment Act, 1976 - The company has regularly made payments of the tax with the concerned authorities during the financial year ended 31st March, 2017.

Service Tax (Chapter V of the Finance Act, 1994) – This Act is applicable to the services rendered by the company. The company has regularly deposited the amount of Service Tax with the concerned authorities on/before the respective due dates, during the financial year under audit.

Karnataka Shops and Commercial Establishments Act, 1961 – The company has an establishment in the State of Karnataka, and hence the Act applies to it. The company has renewed its registration under this Act during the financial year.

Bombay Shops and Establishments Act, 1948 – This Act applies to the areas in the State of Maharashtra specified in Schedule I of the Act. In this State, the company has three establishments, one at Airoli, Navi Mumbai, its corporate and registered office at Vikhroli, Mumbai city and the third at Pune Infotech Park, Hinjewadi, Pune and Bangalore.

The first two establishments are registered under this Act and have renewed their registration during the financial year under audit. However, as the last establishment falls outside the areas mentioned in Schedule I of the Act, the Act is not applicable to it.

Equal Remuneration Act, 1976 – It is given to understand that equal remuneration is paid to all employees for same work or work of similar nature and there is no discrimination between men and women while recruiting or in subsequent to recruitment, promotion, etc. Thus, this Act is not applicable to the company.

The Child Labour (Prohibition and Regulation) Act, 1986 – The company does not employ any person below the age of 14 (fourteen) years and hence this Act is not applicable to it.

Sexual harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 - The company has displayed the important provisions of the Act on its Notice Board. It has constituted an Internal Complaints Committee under the provisions of the Act. Regular meetings of the Committee were held in the financial year for redressal of the complaints covered under the Act.

Other compliances-

Superannuation Scheme – Though payment of superannuation benefits is not mandatory, the company has set up separate irrevocable trust for its own employees, called the ‘Employees Group Superannuation Cash Accumulation Scheme’. This trust oversees the payment of superannuation to the employees of the company.

Software Technology Parks Scheme

The establishments of the company at Airoli, Maharashtra and at Bangalore, Karnataka, are registered under the Software Technology Parks Scheme. It has made an application to the Software Technology Parks of India (S.T.P.I), a society set up by the Ministry of Electronics and Information Technology(MeitY), Government of India for implementation of the scheme. It has requested for extension of the registration which is due to expire on 30.04.2017, to enable it to continue to avail of the benefits under that scheme.

31

The Annual Report

2016-17

I further report that -

The Board of Directors of the Company is duly constituted with proper balance of Executive Directors, Women Directors, Non-Executive Directors and Independent Directors.The changes in the composition of the Board of Directors that took place during the period under review were carried out in compliance with the provisions of the Act.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent in advance to them, and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting. Whenever a meeting was called at a shorter notice than 7 (seven) days, the consent of all directors was obtained for giving less than seven days’ notice of the meeting concerned.

Majority decision of matters placed before the Board is carried through for approval. I am given to understand by the company that none of the members of the Board, who were present at the respective meetings, dissented on the matters.

I/we further report that there are adequate systems and processes in the company commensurate with the size and operations of the company to monitor and ensure compliance with applicable laws, rules, regulations and guidelines.

Major event/s

1. Two separate petitions were filed in respect of a Composite Scheme of Arrangement and Amalgamation of the company.

One petition was filed by Geometric Limited and the company in the High Court Bombay under its Ordinary Original Civil Jurisdiction (OOCJ) being Company Petition No.706 of 2016 connected with Company Summons for Direction No.532 of 2016. The other petition was filed by Geometric Limited, HCL Limited and the company in the High Court, Delhi being Company Petition No.991 of 2016.

According to the Order/judgment passed in each of these petitions, the Composite Scheme of Arrangement and Amalgamation has been approved by the courts.

The net effect of these Orders, as far as the company is concerned, is that 900,200 equity shares held by Geometric Limited in the company, constituting 58% of the Paid-up Share Capital of the company, have been cancelled pursuant to the provisions of Sections 100 to 103 of the Companies Act, 1956 and the corresponding provisions of the Companies Act, 2013. Consequently, the company is no longer a subsidiary of Geometric Limited, from the effective dates of the respective Orders.

2. Increase of the Authorized Share Capital of the company and consequent alteration in the Memorandum and Articles of Association. A new class of Preference Shares has been created.

This report is to be read with my letter of even date which is annexed as ‘Annexure A’ and forms an integral part of this report.

__________________SignatureA. J. GandhiName of Company Secretary in practiceFCS No:1632Certificate of Practice No: 2095

Place:MumbaiDate: April 25, 2017.

32

Annexure AAnnexure to the Secretarial Audit Report

ToThe members,3D PLM Software Solutions Ltd,

My report of even date is to be read along with this letter.

1) Maintenance of secretarial record is the responsibility of the management of the Company. My responsibility is to express an opinion on these secretarial records based on our audit.

2) I have followed the audit practices and processes as were appropriate to obtain reasonable assurance about the correctness of the contents of the Secretarial records. The verification was done on test basis to ensure that correct facts are reflected in secretarial records. I believe that the processes and practices, I have followed provide a reasonable basis for our opinion.

3) I have not verified the correctness and appropriateness of financial records and Books of Account of the Company.

4) Wherever required, I have obtained the Management representation about the compliance of laws, rules and regulations and happening of events etc.

5) The compliance of the provisions of Corporate and other applicable laws, rules, regulations, standards is the responsibility of management. My examination was limited to the verification of procedures on test basis.

6) The Secretarial Audit report is neither an assurance as to the future viability of the Company nor of the efficacy or effectiveness with which the management has conducted the affairs of the Company.

__________________SignatureA. J. GandhiName of Company Secretary in practiceFCS No:1632Certificate of Practice No: 2095

Place:MumbaiDate: April 25, 2017.

33

The Annual Report

2016-17

Annexure VII – Board’s Report

FORM NO. MGT 9Extract of Annual Return as on financial year ended on 31.03.2017

Pursuant to Section 92 (3) of the Companies Act, 2013 and rule 12(1) of the Company (Management & Administration) Rules, 2014.

I. REGISTRATION & OThER DETAILS:

1. CIN U72900MH2001PLC134244

2. Registration Date December 14, 2001

3. Name of the Company 3D PLM SOFTWARE SOLUTIONS LIMITED

4. Category/Sub-category of the Company Company limited by Shares/ Non-government Company

5. Address of the Registered office & contact details

Plant 11, 3rd Floor, Pirojshanagar, Vikhroli (West),Mumbai – 400 079Tel: 022 – 6705 6001, Fax: 022 – 6705 6891E-mail: [email protected]

6. Whether listed company YES. Listed w.e.f. May 5, 2017

7. Name, Address & contact details of the Registrar & Transfer Agent, if any.

Link Intime India Private Limited 247 Park, C-101 L.B.S. Marg Vikhroli (West), Mumbai 400083.Website: www.linkintime.co.in Phone: +91 22 49186000

II. PRINCIPAL BUSINESS ACTIVITIES OF ThE COMPANY:

S. No.

Name and Description of main products / services

NIC Code of the Product/service

% to total turnover of the company

1 To carry on business of software development either in form of services under contract or in the form of development in technologies and Provide IT enabled services such as support, call centre and the like and other services related to software in covering all areas like software particularly in the field of Product Lifecycle Management (PLM).

62011 100%

III. PARTICULARS OF hOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES:

Sr.No.

Name of the Company Country CIN / GLN holding /subsidiary/ associate

% ofsharesheld

Applicablesection

1. Dassault Systemes S.E. France - Holding 66.74% Section 2(46)

2. Dassault Systemes Americas Corp

USA - Holding* 33.26% Section 2(46)

3. 3D PLM Global Services Pvt. Ltd.

India U72900MH2014PTC259502 Subsidiary 100% Section 2(87)

34

IV. ShARE hOLDING PATTERN (Equity and Redeemable Preference Share Capital Breakup)

A) Category-wise Share holding:

Equity:

Category of Shareholders No. of Shares held % Change during

the year

[As on 31-March-2016] [As on 31-March-2017]

Demat Physical Total % ofTotal

Shares


Shares

A. Promoters

(1) Indian - Bodies Corp. - 900,200 900,200 58% - - - - -58.00%

(2) Foreigner - Bodies Corp. - 652,000 652,000 42% - 652,000 652,000 81.47% 39.47%

Total shareholding of Promoter (A) - 1,552,200 1,552,200 100% - 652,000 652,000 100% -

B. Public Shareholding - - - - - - - - -

(1) Residents - - - - - - - - -

(2) Non-Residents* - - - - 148,291 - 148,291 18.53% 18.53%2. Non-Institutions - - - - - - - - -C. Shares held by Custodian for GDRs & ADRs

- - - - -- - - -

Grand Total (A+B+C) - 1,552,200 1,552,200 100% 148,291 652,000 8,00,291 100% -

*Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), the Equity shares were allotted to the Non-resident Shareholders of Geometric Limited in the ratio of 1793:24. As per the said Scheme, the Equity shares have been compulsorily purchased by Dassault Systemes S.E. in April 2017.

Preference:

Category of Shareholders No. of Shares held % Change during

the year

[As on 31-March-2016] [As on 31-March-2017]


Shares


Shares

A. Promoters

(1) Indian - Bodies Corp. - - - - - - - - -

(2) Foreigner - Bodies Corp. - - - - - - - - -

Total shareholding of Promoter (A) - - - - - - - - -

B. Public Shareholding* - - - - 5,58,44,179 - 5,58,44,179 100% 100%

2. Non-Institutions - - - - - - - - -

C. Shares held by Custodian for GDRs & ADRs - - - - - - - - -

Grand Total (A+B+C) - - - - 5,58,44,179 - 5,58,44,179 100% 100%

*Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), the resident shareholders of Geometric Limited have been issued and allotted Redeemable Preference Share (RPS) on March 20, 2017 in the ratio of 1:1.

35

The Annual Report

2016-17

B) Shareholding of Promoters: Equity

SN Shareholder’s Name Shareholding of the Promoters % change in shareholding

during the year

[As on 31-March-2016] [As on 31-March-2017]No. of Shares

% of total Shares of the

company

%of Shares Pledged

/ encumbered to

total shares

No. of Shares

% of total Shares of

the company

%of Shares Pledged /

encumbered to total shares

1 Geometric Limited 900,200 58% - - - - -58.00%2 Dassault Systemes S.E. 385,800 25% - 385,800 48.21% - 23.21%3 Dassault Systemes

Americas, Corp266,200 17% - 266,200 33.26% - 16.26%

C) Change in Promoters’ Shareholding (please specify, if there is no change)

SN Particulars Shareholding at the beginning of the year

Cumulative Shareholding during the year

No. of shares % of totalshares of the

company

No. of shares % of totalshares of the

company1. At the beginning of the year 1,552,200 100% 1,552,200 100%

Date wise Increase / Decrease in Promoters Shareholding during the year specifying the reasons for increase / decrease (e.g. allotment /transfer / bonus/ sweat equity etc.) Cancellation of Shares held by Geometric Limited*

(900,200) 6,52,000

At the end of the year 6,52,000 81.47% 6,52,000 81.47%

*Post effectiveness of the High Court approved Scheme i.e. March 2, 2017, the 900,200 equity shares held by Geometric Limited in the Company were cancelled.

# Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), 148,291 Equity shares were allotted to the Non-resident Shareholders of Geometric Limited in the ratio of 1793:24. Hence, at the end of the year the percentage holding of the promoters was 81.47%. As per the said Scheme, the Equity shares have been compulsorily purchased by Dassault Systemes S.E. in April 2017.

D) Shareholding Pattern of top ten Shareholders: (Other than Directors, Promoters and holders of GDRs and ADRs): Equity Shares:

SN Name of Shareholder Shareholding Cumulative Shareholding during the year

No. of shares % of total shares of the company


1 MORGAN STANLEY ASIA (SINGAPORE) PTE.

Shareholding at the beginning of the year - - - -

Transactions during the year

Purchase* 17843 2.23 17843 2.23

Sale - - - -

Shareholding at the end of the year 17843 2.23 17843 2.23

2 COPTHALL MAURITIUS INVESTMENT LIMITED



Purchase* 14852 1.86 14852 1.86

Sale - - - -


36




3 SOCIETE GENERALE



Purchase* 14669 1.83 14669 1.83

Sale - - - -


4 CIMB BANK BERHAD



Purchase* 13944 1.74 13944 1.74

Sale - - - -


5 NOMURA SINGAPORE LIMITED



Purchase* 13208 1.65 13208 1.65

Sale - - - -


6 BNP PARIBAS ARBITRAGE



Purchase* 12421 1.55 12421 1.55

Sale - - - -


7 CITIGROUP GLOBAL MARKETS MAURITIUS PRIVATE LIMITEDShareholding at the beginning of the year

Transactions during the year - - - -

Purchase* 9960 1.24 9960 1.24

Sale - - - -

Shareholding at the end of the year 9960 1.24 9960 1.248 MORGAN STANLEY MAURITIUS COMPANY

LIMITEDShareholding at the beginning of the year - - - -


Purchase* 9208 1.15 9208 1.15

Sale - - - -


37

The Annual Report

2016-17

9 ACADIAN EMERGING MARKETS SMALL CAP EQUITY FUND LLCShareholding at the beginning of the year - - - -


Purchase* 7338 0.92 7338 0.92

Sale


10 CREDIT SUISSE (SINGAPORE) LIMITED



Purchase* 6562 0.82 6562 0.82

Sale - - - -


*Note: Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), the Equity shares were allotted to the Non-resident Shareholders of Geometric Limited in the ratio of 1793:24. As per the said Scheme, the Equity shares have been compulsorily purchased by Dassault Systemes S.E. in April 2017.

Preference Shares:




1. JHUNJHUNWALA RAKESH RADHESHYAM



Purchase* 8261250 14.7934 8261250 14.7934

Sale - - - -


2. GODREJ INVESTMENTS PVT LTD



Purchase* 7979008 14.288 7979008 14.288

Sale - - - -


3. GODREJ AND BOYCE MFG CO LTD



Purchase* 5637500 10.0951 5637500 10.0951

Sale - - - -


38




4. RELIANCE CAPITAL TRUSTEE CO. LTD-A/C RELIANCE ARBITRAGE ADVANTAGE FUNDShareholding at the beginning of the year - - - -


Purchase* 4033400 7.2226 4033400 7.2226

Sale - - - -





Purchase* 3382500 6.057 3382500 6.057

Sale - - - -





Purchase* 3155000 5.6496 3155000 5.6496

Sale - - - -


7. RAKESH RADHESHYAM JHUNJHUNWALA

Shareholding at the beginning of the year

Transactions during the year - - - -

Purchase* 3000000 5.3721 3000000 5.3721

Sale - - - -


8. KOTAK EQUITY SAVINGS FUND



Purchase* 2263520 4.0533 2263520 4.0533

Sale - - - -


9. JHUNJHUNWALA REKHA RAKESH



Purchase* 990000 1.7728 990000 1.7728

Sale - - -


39

The Annual Report

2016-17

10. IL & FS TRUST COMPANY LIMITED - FOREFRONT ALTERNATIVE INVESTMENT TRUST - FOREFRONT ALTERNATIVE EQUITY SCHEMEShareholding at the beginning of the year - - - -Transactions during the yearPurchase* 645000 1.1549 645000 1.1549Sale - - - -


*Note: Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), the resident shareholders of Geometric Limited have been issued and allotted Redeemable Preference Share (RPS) on March 20, 2017 in the ratio of 1:1.

E) Shareholding of Directors and Key Managerial Personnel: Redeemable Preference Shareholding

SN Name of Director and KMP Shareholding at the beginning of the year




1 Mr. Manu Parpia– Chairman



Purchase* 1241425 2.22% 1241425 2.22%

Sale - - - -

Shareholding at the end of the year 1241425 2.22% 1241425 2.22%

2 Mrs. Anita Ramachandran - Director



Purchase* 59789 0.11% 59789 0.11%

Sale - - - -

Shareholding at the end of the year 59789 0.11% 59789 0.11%

3 Mr. David De Muer - Director



Purchase - - - -

Sale - - - -

Shareholding at the end of the year - - - -

4 Mr. Dominique Florack - Director



Purchase - - - -

Sale - - - -


40

SN Name of Director and KMP Shareholding at the beginning of the year




5 Mr. Didier Gaillot - Director



Purchase - - - -

Sale - - - -


6 Mr. Varghese Thomas - Director



Purchase - - - -

Sale - - - -


7 Mr. Sudarshan Mogasale – Manager & CEO



Purchase* 48,904 0.09% 48,904 0.09%

Sale - - - -

Shareholding at the end of the year 48,904 0.09% 48,904 0.09%

8 Mr. Vishwanath Shet – Chief Financial Officer



Purchase* 27,572 0.05% 27,572 0.05%

Sale - - - -

Shareholding at the end of the year 27,572 0.05% 27,572 0.05%

9 Ms. Sunipa Ghosh – Company Secretary



Purchase - - - -

Sale - - - -


*Note: Pursuant to High Court approved composite scheme of arrangement and amalgamation (Scheme), the resident shareholders of Geometric Limited have been issued and allotted Redeemable Preference Share (RPS) on March 20, 2017 in the ratio of 1:1.

V. INDEBTEDNESS – The Company has not availed any loan during the year and is a debt-free company.

41

The Annual Report

2016-17

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL- None of the directors have been paid any remuneration during the year.

Remuneration to Manager & CEO, Chief Financial Officer (CFO) & Company Secretary (CS) are as follows:

S. No.

Particulars of Remuneration Sudarshan Mogasale

(Manager & CEO)

Vishwanath Shet

(Chief Financial Officer)

Sunipa Ghosh#(Company Secretary)

1. Gross salary(a) in Salary as per provisions contained section 17(1) of the Income-tax Act, 1961

8,857,161 4,410,867 555,863

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 5,013,000 3,127,000 0(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961

0 0 0

2. Stock Option (nos.)*i) Outstanding at the beginning of the year 30,000 10,000 0ii) Granted during the year 0 0 0iii) Exercised during the year 30,000 10,000 0

3. Sweat Equity 0 0 04. Variable Pay 3,662,753 1,205,163 05. Commission - as % of profit 0 0 0

Total (A) (Total of remuneration does not include the number of Stock Options)

17,532,914 8,743,030 555,863

Ceiling as per the Act 47,823,721

*Stock options held are granted by Geometric Limited, erstwhile holding Company of the Company

#Appointed on March 17, 2017

VII. PENALTIES / PUNIShMENT/ COMPOUNDING OF OFFENCES:

Type Section of the Companies Act

Brief Description

Details of Penalty / Punishment/

Compounding fees imposed

Authority [RD / NCLT/

COURT]

Appeal made, if any (give Details)

A. COMPANY

PenaltyN.A.Punishment

CompoundingB. DIRECTORSPenalty

N.A.PunishmentCompoundingC. OThER OFFICERS IN DEFAULTPenalty

N.A.PunishmentCompounding


Manu Parpia(DIN : 00118333)Director

Sudarshan Mogasale(PAN: AAXPM5923B)Manager and CEO


42

Annexure VIII – Board’s ReportParticulars as prescribed under section 134 (3) (m) of the Companies Act, 2013, read with the

Companies (Accounts) Rules, 2014.A. Conservation of Energy: (i) the steps taken or impact on conservation of energy: We are operating from three different locations and have successfully implemented power saving initiatives like VRF,

LED lights in all three locations. We have also implemented Power Saving Policy on Domain which automatically puts a PC in standby mode if the user is not using it. This way, we save a lot of electricity.

We have taken steps to improvise the “Power factor” which will help in Less consumption of power. Health/durability of the electrical equipment is enhanced. We are also implementing in phased manner Sun guard insulation – to prevent the heat transmitting Installation of double layered glass Effective insulation to the Air Handling Units (AHU) AF Data center old Pac M/c (Uniflare) has been replaced with Efficient Emerson make in June17. (ii) the capital investment on energy conservation equipment’s:

We have implemented the concept of virtualization of IT Assets to reduce Computer Hardware requirements. Before buying any computer hardware, we check whether that can be virtualized and accordingly take the purchase call. We always give the first preference to virtualization to conserve the energy.

B. Technology Absorption:

The disclosure of particulars with respect to Technology Absorption is given below:- i. Efforts made towards Technology Absorption: 3D PLM is an Offshore Development Center working exclusively for the Dassault Systemes Group of companies (3DS).

It works as an extension of the DS brands. The main focus is on building expertise in 3DS products so that higher productivity and quality can be delivered and product development cycles can be reduced. Towards this objective, training sessions, workshops, visits are organized within 3D PLM and between 3D PLM and 3DS.

ii. the benefits derived like product improvement, cost reduction, product development or import substitution: High Product quality and increased business potential. iii. In case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year): a. the details of technology imported: Not Applicable b. the year of import: as no imported c. whether the technology been fully absorbed;? technology is d. If not fully absorbed, areas where absorption put to use. has not taken place, and reasons thereof iv. No Expenditure incurred on Research and Development. v. Foreign Exchange Earnings and Outgo: The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the

year in terms of actual outflows: The Company is in the business of software exports. All efforts of the Company are geared to increase the business of

software exports in different products and markets.(Figures in Rs. Lakhs)

FY17 FY16Total Foreign Exchange used 71.15 68.07Total Foreign Exchange earned 36,795.65 30,038.49


Manu Parpia(DIN :00118333)

Sudarshan Mogasale(PAN: AAXPM5923B)

Director


Manager and CEO

43

The Annual Report

2016-17

INDEPENDENT AUDITOR’S REPORTTo the Members of 3D PLM Software Solutions Limited

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated Ind AS financial statements of 3D PLM Software Solutions Limited (hereinafter referred to as “the Holding Company”), its subsidiaries (the Holding Company and its subsidiaries together referred to as “the Group”), comprising of the consolidated Balance Sheet as at March 31, 2017, the consolidated Statement of Profit and Loss including other comprehensive income, the consolidated Cash Flow Statement, the consolidated Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information (hereinafter referred to as ‘the consolidated Ind AS financial statements’.

Management’s Responsibility for the Consolidated Financial Statements

The Holding Company’s Board of Directors is responsible for the preparation of these Ind AS consolidated financial statements in terms of the requirement of the Companies Act, 2013 (“the Act”) that give a true and fair view of the consolidated financial position, consolidated financial performance including other comprehensive income, consolidated cash flows and consolidated statement of changes in equity of the Group in accordance with accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act, read with Companies (Indian Accounting Standard) Rules, 2015. The respective Board of Directors of the companies included in the Group are responsible for maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Group and for preventing and detecting frauds and other irregularities; the selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the 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, which have been used for the purpose of preparation of the consolidated Ind AS financial statements by the Directors of the Holding Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated Ind AS financial statements based on our audit. While conducting the audit, we have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. 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 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 financial control relevant to the Holding Company’s preparation of the consolidated Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Holding Company’s Board of Directors, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence obtained by us and the audit evidence obtained by the other auditors in terms of their reports referred to in sub-paragraph (a) of the Other Matters paragraph below, is sufficient and appropriate to provide a basis for our audit opinion on the consolidated financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the aforesaid consolidated Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India of the consolidated state of affairs of the Group as at March 31, 2017, their consolidated profit including other comprehensive income, and their consolidated cash flows and consolidated statement of changes in equity for the year ended on that date.

CONSOlIDATED FINANCIAl STATEMENTS

44

Emphasis of Matter

We draw attention to the Note 5 to the standalone financial results regarding the accounting treatment described in the Composite Scheme of Arrangement and Amalgamation of the erstwhile Geometric Limited, HCL Technologies Limited, the Company and their respective shareholders and creditors approved by the Honourable Bombay High Court on December 2, 2016 and the Honourable Delhi High Court on January 18, 2017 (the Scheme).

The Company has accounted for the Scheme as per the accounting treatment described therein, which is different from that of the accounting treatment prescribed under applicable Indian Accounting standards (Ind AS). Had the effect of the Scheme been given according to the accounting treatment prescribed under Ind AS,

a) The redeemable preference shares would have been classified as current liability in accordance with Ind AS 32 and the Company would have accounted for dividend cost ` 87 Lacs from date of issuance till March 31, 2017 as finance cost and related liability in respect of Redeemable preference shares issued. Accordingly, current liability which would have been higher by ` 38,061 Lacs and equity would have been lower by ` 37,974 Lacs and accordingly profit before tax would have been lower by ` 87 Lacs.

b) The difference between consideration paid and fair value of net assets taken over and investments cancelled, instead of being accounted as goodwill as described in the Scheme, would have been adjusted against retained earnings being loss on cancellation of its own equity shares as per Ind AS 32 and accordingly, the retained earnings and goodwill would have been lower by ` 45,173 Lacs respectively.

Our opinion is not qualified in respect of this matter.

Report on Other legal and Regulatory Requirements

As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit of the aforesaid consolidated Ind AS financial statements;

(b) In our opinion proper books of account as required by law relating to preparation of the aforesaid consolidation of the financial statements have been kept so far as it appears from our examination of those books;

(c) The consolidated Balance Sheet, consolidated Statement of Profit and Loss including the Statement of Other Comprehensive Income, the consolidated Cash Flow Statement and consolidated Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid consolidated Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standard) Rules, 2015;

(e) On the basis of the written representations received from the directors of the Holding Company and its subsidiary as on March 31, 2017 taken on record by the Board of Directors of the Holding Company and its subsidiary, none of the directors of the Group’s companies, is disqualified as on March 31, 2017 from being appointed as a director in terms of Section 164 (2) of the Act;

(f) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The consolidated Ind AS financial statements disclose the impact of pending litigations on its consolidated financial position of the Group – Refer Note 33 to the consolidated financial statements;

ii. The Group did not have any material foreseeable losses in long-term contracts including derivative contracts;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Holding Company and its subsidiary company incorporated in India.

45

The Annual Report

2016-17

iv. The Holding Company and its subsidiary, have provided requisite disclosures in Note 40 to these consolidated Ind AS financial statements as to the holding of Specified Bank Notes on November 8, 2016 and December 30, 2016 as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on our audit procedures and relying on the management representation of the Holding Company regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that these disclosures are in accordance with the books of accounts maintained by the Group and as produced to us by the Management of the Holding Company.

For S.R. BATlIBOI & ASSOCIATES llPChartered Accountants

ICAI Firm Registration Number: 101049W/E300004

per Govind AhujaPartner

Membership Number: 048966Place of Signature : MumbaiDate : April 25, 2017

46

ANNEXURE 1 TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE CONSOlIDATED FINANCIAl STATEMENTS OF 3D PlM SOFTWARE SOlUTIONS lIMITED

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 (“the Act”)In conjunction with our audit of the consolidated financial statements of 3D PLM Software Solutions Limited as of and for the year ended March 31, 2017, we have audited the internal financial controls over financial reporting of 3D PLM Software Solutions Limited (hereinafter referred to as the “Holding Company”) and its subsidiary incorporated in India, as of that date.

Management’s Responsibility for Internal Financial Controls The respective Board of Directors of the Holding Company and its subsidiary company, incorporated in India, are responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the respective company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Act.

Auditor’s ResponsibilityOur responsibility is to express an opinion on the company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing, both, issued by Institute of Chartered Accountants of India, and deemed to be prescribed under section 143(10) of the Act, to the extent applicable to an audit of internal financial controls. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.

Our audit involves performing procedures to obtain audit evidence about the adequacy of the internal financial controls system over financial reporting and their operating effectiveness. Our audit of internal financial controls over financial reporting included obtaining an understanding of internal financial controls over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the internal financial controls system over financial reporting.

Meaning of Internal Financial Controls Over Financial Reporting A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent limitations of Internal Financial Controls Over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

47

The Annual Report

2016-17

OpinionIn our opinion, the Holding Company and its subsidiary company incorporated in India, have, maintained in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For S.R. BATlIBOI & ASSOCIATES llPChartered Accountants



Membership Number: 048966Place of Signature: MumbaiDate: April 25, 2017

48

Particulars Note No.

As at March 31, 2017 March 31, 2016 April 01, 2015

ASSETSNon-current assetsProperty, plant and equipment 3 1,28,19,79,156 1,20,94,45,314 1,18,81,96,114 Capital work-in-progress 1,43,51,308 57,17,433 2,14,55,382 Other Intangible assets 4 1,12,263 1,83,566 3,06,172 Goodwill 5 4,51,72,90,829 - - Financial Assets Derivative Instruments 7 - - 5,65,08,871 Advances and Deposits 10 4,90,76,973 1,83,07,337 3,83,58,062 Deferred tax assets (net) - - - Prepayments 1,37,83,365 20,95,801 13,10,149 Other non-current assets 12 20,35,03,233 12,04,53,041 13,16,05,798

6,08,00,97,127 13,56,202,492 1,43,77,40,548 Current assetsFinancial Assets Investments 6 86,35,51,402 49,00,17,304 59,91,44,754 Trade Receivables 8 5,74,80,185 15,75,68,234 13,17,46,498 Derivative Instruments 7 20,23,44,341 1,36,94,574 36,79,51,826 Cash and cash equivalents 9 16,88,11,120 4,25,16,356 2,72,17,691 Advances and Deposits 10 34,260,519 3,73,13,121 41,43,634 Other current financial assets 11 27,33,735 24,27,139 18,37,395 Prepayments 74,39,501 91,52,670 95,15,389 Other current assets 12 16,53,98,344 12,52,76,707 8,91,64,634

1,50,20,19,147 87,79,66,105 1230721821 TOTAl ASSETS 7,58,21,16,274 2,23,41,68,597 26,68,462,369

EQUITY AND lIABIlITIESEquity 13Equity share capital 80,02,910 1,55,22,000 1,55,22,000 Preference share capital 37,97,404,172 Other Equity 14 Other Equity capital - 2,04,69,886 1,25,79,426 Retained Earnings 1,81,12,56,711 1,10,96,49,222 1,31,64,85,447 Securities Premium 1,05,59,19,702 30,40,39,845 30,40,39,845 Reserves representing unrealised gains/losses 13,34,87,750 48,37,495 25,85,98,106 Other Reserves 26,67,03,840 26,67,03,840 20,97,03,840 Equity attributable to equity holders 7,07,27,75,085 1,72,12,22,288 2,11,69,28,664

Non-current liabilitiesFinancial Liabilities 15 Derivative Instruments - 42,11,141 - Deferred Revenue 20 4,49,87,171 5,32,11,980 6,05,89,082 Deferred tax liabilities (Net) 3,89,67,947 1,13,85,964 16,17,29,113

8,39,55,118 6,88,09,085 22,23,18,195 Current liabilitiesFinancial Liabilities Trade and other payables 16 2,60,76,359 3,48,73,376 2,96,19,311 Other current liabilities 17 19,15,52,271 20,51,26,976 11,99,24,792 Deferred Revenue 20 5,95,22,676 6,38,94,681 5,71,90,293 Liabilities for current tax (Net) - 31,69,318 - Net employee defined benefit liabilities 18 8,78,25,748 9,52,10,777 9,11,33,601 Other current liabilities 19 6,04,09,017 4,18,62,096 3,13,47,513

42,53,86,071 44,41,37,224 32,92,15,510 TOTAl EQUITY AND lIABIlITIES 7,58,21,16,274 2,23,41,68,597 2,66,84,62,369 Significant Accounting Policies & Notes on Accounts 1 to 2The accompanying notes are an integral part of the financial statements.As per our report of even dateFor S.R. Batliboi & Associates llP For and on behalf of the Board of Directors ofChartered Accountants 3D PlM Software Solutions limitedICAI Firm registration number: 101049W/ E300004

per Govind Ahuja Manu Parpia Chandan Chowdhury Sudarshan MogasalePartner Director Director CEO & ManagerMembership No:48966

Vishwanath Shet Sunipa GhoshChief Financial Officer Company Secretary

Place : Mumbai Place : MumbaiDate : April 25, 2017 Date : April 25, 2017

CONSOlIDATED BAlANCE SHEET as at March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

49

The Annual Report

2016-17

ParticularsNotes Year Ended

March 31, 2017 March 31, 2016 RevenueRevenue From Operations 21 4,08,01,16,038 3,35,99,80,400 Other Income 22 17,95,53,945 34,24,12,315 Finance Income 23 41,77,190 33,13,550

4,26,38,47,173 3,70,57,06,265 ExpensesEmployee Benefits Expense 24 2,48,49,79,967 2,18,23,98,126 Depreciation and Amortisation Expense 25 25,64,98,454 23,07,94,453 Other Expenses 26 53,08,94,663 41,22,66,922 Finance Costs 27 20,62,858 14,75,267

3,27,44,35,942 2,82,69,34,768 Profit before tax 98,94,11,231 87,87,71,497

Tax expenseCurrent Tax 34,43,80,198 31,15,30,000 Deferred Tax (4,63,71,667) (2,13,47,871)Total tax expense 29,80,08,531 29,01,82,129

Profit for the year 69,14,02,700 58,85,89,368

Other comprehensive income :Other comprehensive income to be reclassified to profit or loss in subsequent periods: Net movement on cash flow hedges (19,48,95,099) 38,44,27,528 Income tax effect 6,62,44,844 (13,06,66,917)

(12,86,50,255) 25,37,60,611 Other comprehensive income not to be reclassified to profit or loss in subsequent periods: Re-measurement gains/ (losses) on defined benefit plans (1,54,59,459) (49,18,031) Income tax effect 52,54,670 16,71,639

(1,02,04,789) (32,46,392)Other comprehensive income for the year, net of tax (13,88,55,044) 25,05,14,219 Total comprehensive income for the period, net of tax 83,02,57,744 33,80,75,149 Earnings per equity shareBasic and Diluted [Nominal value of the shares Rs 10 (March 31, 2016 : Rs.10)] 452.64 379.20

The accompanying notes are an integral part of the financial statements.As per our report of even dateFor S.R. Batliboi & Associates llP For and on behalf of the Board of Directors ofChartered Accountants 3D PlM Software Solutions limitedICAI Firm registration number: 101049W/ E300004




CONSOlIDATED PROFIT & lOSS for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

50

a. Equity Share Capital Equity shares of INR 10 each issued, subscribed and fully paid

Number of shares

Amount

At April 01, 2015 15,52,200 1,55,22,000 At March 31, 2016 15,52,200 1,55,22,000

Issue of share capital (Refer note 5) 1,48,291 14,82,910 Shares cancelled (refer note 5) (9,00,200) (90,02,000)At March 31, 2017 8,00,291 80,02,910

b. Preference share capital Redeemable Preference shares of INR 68 each issued, subscribed and fully paid

Number of shares

Amount

At April 01, 2015 - - At March 31, 2016 - -

Issue of share capital (refer note 5) 5,58,44,179 3,79,74,04,172 At March 31, 2017 5,58,44,179 3,79,74,04,172

c. Other Equity

Reserves and Surplus Items of Other Comprehensive Income

Additional paid in capital

Securities premium reserve

Capital Redemption

reserve

Capital Reserve

General reserve

Retained Earnings

Effective portion of Cash Flow

HedgesBalance at April 01, 2015 2,04,69,886 30,40,39,845 10,00,000 9,99,954 20,77,03,886 1,31,64,85,447 25,85,98,106 Profit for the year - - - - - 58,85,89,368 - Other comprehensive income - - - - - 32,46,392 (25,37,60,611)Total comprehensive income for the year - - - - - 59,18,35,760 (25,37,60,611)Dividends including dividend tax - - - - - (74,16,71,985) - Transfer to general reserve - - - - 5,70,00,000 (5,70,00,000) - Balance at March 31, 2016 2,04,69,886 30,40,39,845 10,00,000 9,99,954 26,47,03,886 1,10,96,49,222 48,37,495

Balance at April 01, 2016 2,04,69,886 30,40,39,845 10,00,000 9,99,954 26,47,03,886 1,10,96,49,222 48,37,495 Share based payment cost 40,04,224 - - - - - - Addition on shares issued during the year - 75,18,79,857 - - - - - Profit for the year - - - - - 69,14,02,700 - Other Comprehensive Income (2,44,74,110) - - - - 1,02,04,789 12,86,50,255 Balance at March 31, 2017 - 1,05,59,19,702 10,00,000 9,99,954 26,47,03,886 1,81,12,56,711 13,34,87,750

STATEMENT OF CHANGES IN EQUITY for the period ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

51

The Annual Report

2016-17

Particulars As at

March 31, 2017 March 31, 2016

Operating activities

Profit before tax from continuing operations 98,94,11,231 87,87,71,497

Adjustment to reconcile profit before tax to net cash flows

Depreciation of property, plant and equipment 25,64,98,454 23,07,94,453

Acturial (gain)/loss on employee benefit plan 1,54,59,459 49,18,031

Employee stock option cost measured at fair value 40,04,223 78,90,460

Impact of discounts on security deposit

Finance Income (33,99,554) (23,44,882)

Rent Expense 35,22,492 22,45,791

Loss on disposal of property, plant and equipment - 14,14,032

Gain on disposal of property, plant and equipment (57,76,254) -

Gain on sale of investment (23,96,163) (21,25,330)

Finance income (7,77,636) (9,68,668)

Dividend Income (3,82,12,477) (2,42,54,066)

Net foreign exchange differences 60,80,932 2,87,73,858

1,22,44,14,707 1,12,51,15,176

Working capital adjustments:

Decrease/ (Increase) in Long Term Loans and Advances (3,19,87,769) 1,98,77,561

Decrease/ (Increase) in non-current assets (6,10,81,916) 1,29,85,650

Decrease / (Increase) in trade and other receivables and prepayments 5,12,27,039 (9,70,05,863)

Increase in Deferred Revenue (1,25,96,814) (6,72,714)

Increase in trade and other payables (1,19,69,687) 1,01,42,551

Increase/ (Decrease) in Other Current financial Liabilities (1,76,35,913) 8,63,45,317

Increase/ (Decrease) in employee benefit liabilities (73,85,029) 40,77,176

Increase/ (Decrease) in Other Current liabilities 1,85,46,921 1,05,14,583

1,15,15,31,539 1,17,13,79,437

Income tax paid (36,70,63,656) (31,01,93,575)

Net Cash Flow from operating activities (A) 78,44,67,883 86,11,85,862

Investing activities

Purchase of property, plant and equipment (33,75,30,113) (24,21,66,024)

Proceeds from sale of property, plant and equipment 59,01,910 34,25,762

Purchase of current investments (4,67,26,19,519) (3,96,56,64,467)

Proceeds from sale of current investments 4,30,10,28,740 4,07,61,16,784

Fixed Deposit Placed (15,00,000) (25,57,687)

Fixed Deposit Matured 39,91,553 23,26,867

Dividend Received 3,82,12,477 2,42,54,066

Interest Received (finance income) 4,71,040 3,78,924

Net cash flows from investing activities (B) (66,20,43,912) (10,38,85,775)

CONSOlIDATED CASH FlOW STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

52

Particulars As at

March 31, 2017 March 31, 2016

Financing activities:Dividend paid, including dividend tax - (74,16,71,985)Net cash (used in) financing activities (C) - (74,16,71,985)

Net Increase / (Decrease) In Cash And Cash Equivalents (A+B+C) 12,24,23,971 1,56,28,102 Effect of exchange difference on Cash and Cash Equivalents - (3,29,437)Cash and Cash equivalents at the beginning of the year 4,25,16,356 2,72,17,691 Cash and Cash equivalents takenover as per the scheme (Refer note 5) 38,70,793 - Cash and Cash equivalents at the end of the year 16,88,11,120 4,25,16,356

Components of cash and cash equivalents Remittance in Transit - 1,97,78,634 Balances with BanksIn Current Accounts 16,49,40,327 2,27,37,722 Restricted cash balances 38,70,793 - Cash and Cash equivalents at the end of the year 16,88,11,120 4,25,16,356 Summary of significant accounting policiesThe accompanying notes are an integral part of the financial statements.

As per our report of even dateFor S.R. Batliboi & Associates llP For and on behalf of the Board of Directors ofChartered Accountants 3D PlM Software Solutions limitedICAI Firm registration number: 101049W/ E300004




CONSOlIDATED CASH FlOW STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

53

The Annual Report

2016-17

Note to coNsolidated fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)

1. Corporate information

3D PLM Software Solutions Limited (“3DPLM” or ‘the Company’) along with its subsidiary 3D PLM Global Services Private Limited (‘3D GS’) collectively referred to as the “The Group” is engaged in product development, industrialisation, maintenance, documentation and market support for Product Lifecycle Management (PLM) softwares of Dassault Systemes and provides back end support to finance and sales business administration function of Dassault Systemes. The group also provides Software service, IT and Engineering services and all other related areas including design, development, testing, integration, migration, up gradation, support and maintenance as suppliers to Dassault Systèmes and Geometric. The Company is a public limited company domiciled in India and is incorporated under the provisions of the Companies Act, 1956. The consolidated financial statements (‘CFS’) comprise the financial statements of the Group for the year ended March 31, 2017. The registered office of the Company is located at Mumbai. These CFS were authorised for issue in accordance with a resolution of the directors on April 25, 2017.

1.2 Group information:

The subsidiaries considered in the preparation of the CFS and the shareholdings of the Company in these companies are as follows:

Name of the subsidiary company Principal activity Country of incorporation

% of equity interest March 31, 2017 March, 31,2016 April 01, 2015

3D PLM Global Services Private Limited Engineering Services India 100% 100% 100%

2 Significant accounting policies

2.1 Basis of Preparation

The Group’s CFS have been prepared in accordance with Indian Accounting Standards (‘Ind AS’) notified under the Companies (Indian Accounting Standards) Rules, 2015 under the provision of the Companies Act, 2013 ( the ‘Act’) and subsequent amendments thereof.

For all periods up to and including the year ended March 31, 2016, the Group prepared its CFS in accordance with the accounting standards notified under the section 133 of the Act, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (‘Indian GAAP’). These financial statements for the year ended

March 31, 2017 are the first Ind AS Financial Statements that the Group has prepared in accordance with Ind AS. Refer to Note 43 for information on how the Group adopted Ind AS.

These CFS have been prepared on the historical cost basis, except for certain financial instruments which are measured at fair values (Refer note 2.4 C) at the end of each reporting period. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Group presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

• Expectedtoberealisedorintendedtobesoldorconsumedinnormaloperatingcycle

• Cashorcashequivalentunlessrestrictedfrombeingexchangedorusedtosettlealiabilityforatleasttwelvemonths after the reporting period

All other assets are classified as non-current.

A liability is current when:

• Itisexpectedtobesettledinnormaloperatingcycleorduetobesettledwithintwelvemonthsafterthereportingperiod, or

• Thereisnounconditionalrighttodeferthesettlementoftheliabilityforatleasttwelvemonthsafterthereportingperiod

The Group classifies all other liabilities as non-current.

Deferred tax assets and liabilities are classified as non-current assets and liabilities.

The Group has identified twelve months as its operating cycle.

54


2.2 Basis of consolidation

i. Subsidiaries

The CFS comprise the financial statements of the Company and its subsidiaries as at 31 March 31, 2017. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Group controls an investee if and only if the Group has:

• Powerovertheinvestee(i.e.existingrightsthatgiveitthecurrentabilitytodirecttherelevantactivitiesofthe investee)

• Exposure,orrights,tovariablereturnsfromitsinvolvementwiththeinvestee,and

• Theabilitytouseitspowerovertheinvesteetoaffectitsreturns

The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the CFS from the date the Group gains control until the date the Group ceases to control the subsidiary.

CFS are prepared using uniform accounting policies for like transactions and other events in similar circumstances. If a member of the Group uses accounting policies other than those adopted in the CFS for like transactions and events in similar circumstances, appropriate adjustments are made to that group member’s financial statements in preparing the CFS to ensure conformity with the group’s accounting policies.

The financial statements of all entities used for the purpose of consolidation are drawn up to same reporting date as that of the parent company, i.e., year ended March 31.

ii. Consolidation procedure :

(a) Combine like items of assets, liabilities, equity, income, expenses and cash flows of the parent with those of its subsidiaries. For this purpose, income and expenses of the subsidiary are based on the amounts of the assets and liabilities recognised in the consolidated financial statements at the acquisition date.

(b) Offset (eliminate) the carrying amount of the parent’s investment in each subsidiary and the parent’s portion of equity

(c) Eliminate in full intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between entities of the Group (profits or losses resulting from intragroup transactions that are recognised in assets, such as inventory and fixed assets, are eliminated in full). Intragroup losses may indicate an impairment that requires recognition in the CFS. Ind AS 12 applies to temporary differences that arise from the elimination of profits and losses resulting from intragroup transactions.

2.3 Significant accounting judgements, estimates and assumptions

The preparation of the Group’s CFS requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Significant judgements:

In the process of applying the Group’s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the CFS:

Property, plant and equipment

Useful lives of tangible assets and intangible assets are based on the life prescribed in Schedule II of the Companies Act, 2013. In cases, where the useful lives are different from that prescribed in Schedule II, they are based on management estimate, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers’ warranties and maintenance support. Assumptions also need to be made, when the Group assesses, whether an asset may be capitalized and which components of the cost of the asset may be capitalised.

55

The Annual Report

2016-17


Estimates and assumptions

The preparation of these CFS in conformity with the recognition and measurement principles of Ind AS requires the management of the Group to make estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expense for the periods presented.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods are affected.

Recognition and measurement of defined benefit obligations

The obligation arising from defined benefit plan is determined on the basis of actuarial assumptions. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of discount rate, future salary increases and mortality rates. All assumptions are reviewed at each reporting date

The parameter most subject to change is the discount rate. In determining the appropriate discount rate for plans operated in India, the management considers the interest rates of government bonds in currencies consistent with the currencies of the post-employment benefit obligation. Future salary increases and gratuity increases are based on expected future inflation rates for the respective countries. The mortality rate is based on publicly available mortality tables for the specific countries. Those mortality tables tend to change only at interval in response to demographic changes.

Assessment of lease transactions

Management assess the contractual terms of the lease agreements to evaluate whether it is an operating lease or finance lease.

Recognition of deferred tax assets

A deferred tax asset is recognised for all the deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised. The management assumes that taxable profits will be available while recognising deferred tax assets.

Share based payments

The Group measures the grant date fair value of the options granted to employees using an option pricing model. Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them.

Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

2.4 Summary of significant accounting policies

A. Foreign Currencies

These CFS are presented in Indian rupees, which is also the Group’s functional currency.

Transactions and balances

Transactions in foreign currencies are translated into Indian rupees at the exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency spot rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in profit or loss

56


Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e., translation differences on items whose fair value gain or loss is recognised in OCI or profit or loss are also recognised in OCI or profit or loss, respectively).

B. Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duties collected on behalf of the government.

The specific recognition criteria described below must also be met before revenue is recognised.

Income from Services:

The Group recognizes revenue from time and material contracts when the related services are rendered to the customers. Revenue from annual maintenance and support engagements is recognized proportionately as services are rendered, which generally results in straight-line revenue recognition as services are performed continuously over the term of the arrangement.

Revenue on fixed price development projects is measured using the percentage of completion method of accounting. Performance is generally measured based upon the efforts incurred to date in relation to the total estimated efforts to the completion of the contract. The Group monitors estimates of total contract revenues and costs on a routine basis throughout the delivery period. The cumulative impact of any change in estimates of the contract revenues or costs is reflected in the period in which the changes become known. In the event that a loss is anticipated on a particular contract, provision is made for the estimated loss.

The Group grants volume discount to certain customers, which are computed based on a pre-determined percentage of the total revenues from those customers during a specified period, as per the terms of the contract. These discounts are earned only after the customer has provided a specified cumulative level of revenues in the specified period. The Group reports revenues net of discounts offered to customers.

Unbilled revenue represents amounts recognized for efforts incurred but not billed as at the balance sheet date. Advance billing and deferred revenue represents billing in excess of revenue recognized.

In cases where the Group acts as a principal, out of pocket expenses are recognised as revenue, with a corresponding expense. In other cases, out of pocket expenses are recognised net of reimbursements from clients.

Income from reimbursable assets:

Revenue from reimbursable assets is recognized over the useful life of the assets.

Dividend:

A dividend is recognized as revenue when the right to receive payment has been established, which is generally when shareholders approve the dividend

Interest:

For all debt instruments measured either at amortised cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortised cost of a financial liability.

C. Fair value measurement

The Group measures financial instruments, such as, derivatives at fair value at each balance sheet date.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

57

The Annual Report

2016-17


a) In the principal market for the asset or liability, or

b) In the absence of a principal market, in the most advantageous market for the asset or liability

The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest.

A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use.

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the CFS are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognised in the CFS on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

This note summaries accounting policy for fair value. Other fair value related disclosures are given in the relevant notes.

Disclosures for valuation methods, significant estimates and assumptions (Refer Note 2.3, 35 & 41)

Quantitative disclosures of fair value measurement hierarchy (Refer Note 36)

Financial instruments (including those carried at amortised cost) (Refer Notes 6 to 11, 15 to 17, 35, 36 & 41)

D. Financial Instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial instruments also include derivative contracts such as foreign currency foreign exchange forward contracts.

i Financial assets

Classification:

The Group classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss on the basis of its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset.

Initial recognition and measurement:

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention

58


in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement:

a. Non-derivative financial instruments

(i) Financial assets carried at amortised cost

A financial asset is subsequently measured at amortised cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

(ii) Financial assets at fair value through other comprehensive income

A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Group has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Group has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.

(iii) Financial assets at fair value through profit or loss

A financial asset which is not classified in any of the above categories are subsequently fair valued through profit or loss.

Derecognition:

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e. removed from the Group’s balance sheet) when:

a) The rights to receive cash flows from the asset have expired, or

b) The Group has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement. In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Group has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

Impairment of financial assets:

In accordance with Ind AS 109, the Group applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL at each reporting date, right from its initial recognition. For all other financial assets,

59

The Annual Report

2016-17


expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.

ECL impairment loss allowance (or reversal) recognized during the period is recognized as income/ expense in the consolidated statement of profit and loss. This amount is reflected under the head ‘other expenses’ in the consolidated statement of profit and loss.

As a practical expedient, the Group uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward looking estimates are analyses.

ii. Financial liabilities

Classification

The Group classifies all financial liabilities as subsequently measured at amortised cost, except for financial liabilities at fair value through profit or loss. Such liabilities, including derivatives that are liabilities, shall be subsequently measured at fair value.

Initial recognition and measurement

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial liabilities are recognised initially at fair value and, in the case of payables, net of directly attributable transaction costs. The Company’s financial liabilities include trade and other payables and derivative financial instruments.


Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value through profit and loss. For trade and other payable smaturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

Share capital

Ordinary shares:

Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity.

Derecognition

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

iii. Reclassification of financial assets

The Group determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Group’s senior management determines change in the business model as a result of external or internal changes which are significant to the Group’s operations. Such changes are evident to external parties. A change in the business model occurs when the Group either begins or ceases to perform an activity that is significant to its operations. If the Group reclassifies financial assets, it applies

60


the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Group does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.

E. Derivative financial instruments and hedge accounting

Initial recognition and subsequent measurement:

The Group uses derivative financial instruments, such as foreign exchange forward contracts to manage its exposure to foreign exchange risks on highly probable sale transactions. For contracts where hedge accounting is not followed, such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value through profit or loss account. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

Forward exchange contracts entered to hedge firm commitments or highly probable forecast revenues are recorded using the principles of hedge accounting as per Ind AS 109. Such forward exchange contracts which qualify for cash flow hedge accounting and where the conditions of Ind AS 109 have been met are initially measured at fair value and are re-measured at subsequent reporting dates. Changes in the fair value of these derivatives that are designated and effective as hedges of the future cash flows are recognized directly under shareholder’s funds in the cash flow hedging reserve and the ineffective portion is recognized immediately in the statement of profit and loss.

At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to which the Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The documentation includes the Group’s risk management objective and strategy for undertaking hedge, the hedging/economic relationship, the hedged item or transaction, the nature of the risk being hedged, hedge ratio and how the entity will assess the effectiveness of changes in the hedging instrument’s fair value in offsetting the exposure to changes in the hedged item’s fair value or cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in fair value or cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.

Hedges that meet the strict criteria for hedge accounting are accounted for as follows :

Cash flow hedges:

The effective portion of the gain and loss of the hedging instrument recognized in OCI in the cash flow hedge reserve, while any ineffective portion is recognized immediately in the statement of Profit and loss

Amounts recognized as OCI are transferred to Profit or Loss when hedged transaction affects profit or loss, such as when hedged financial expense or financial income is recognized or when forecast sale occurs. When the hedged item is the cost of a non financial asset or a non financial liability, the amounts recognized as OCI are transferred to te initial carrying amount of the non-financial asset or liability.

Hedge accounting is discontinued when the hedging instrument expires or is sold or terminated or exercised or no longer qualifies for hedge accounting. Cumulative gain or loss on the hedging instrument recognised in shareholders’ funds is transferred to statement of profit and loss when the forecasted transaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in shareholders’ funds is transferred to the statement of profit and loss.

F. Impairment of non financial assets

The Group assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.

61

The Annual Report

2016-17


In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining net selling price, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used.

The Group bases its impairment calculation on detailed budgets and forecast calculations which are prepared separately for each of the Group’s cash-generating units to which the individual assets are allocated. These budgets and forecast calculations are generally covering a period of five years. For longer periods, wherever applicable, a long term growth rate is calculated and applied to projected future cash flows after the fifth year.

After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life.

For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Group estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit and loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.

Goodwill is tested for impairment annually as at March 31, and when circumstances indicate that the carrying amount may be impaired.

G. leases

i Determining whether an arrangement contains a lease

The determination of whether an arrangement is (or contains) a lease is based on the substance of the arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

At inception or on reassessment of an arrangement that contains a lease, the Group separates payments and other consideration required by the arrangement into those for the lease and those for other elements.

ii Group as a lessee

Payments made under operating leases are recognised in the statement of profit or loss. Lease payments under an operating lease are recognised as an expense on a straight line basis over the lease term unless the payments to lessor are structured to increase in line with expected general inflation to compensate for the lessor’s expected inflationary cost increases.

iii Group as lessor

Leases in which the Group does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Rental income from operating lease is recognised on a straight-line basis over the term of the relevant lease.

H. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The Group has no obligation, other than the contribution payable to the provident fund. The Group recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

The Group operates a gratuity plan which is a defined benefit plan which requires contributions to be made to separately administered fund. The cost of providing benefits is determined using the Projected Unit Credit method carried out by an independent actuary at each period end. When the calculation results in a potential asset for the Group, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.

62


Remeasurements, comprising of actuarial gains and losses, the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability and the return on plan assets (excluding amounts included in net interest on the net defined benefit liability), are recognised immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI in the period in which they occur. Remeasurements are not reclassified to profit or loss in subsequent periods.

Past service costs are recognised in profit or loss on the earlier of:

The date of the plan amendment or curtailment, and

The date that the Group recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Group recognises the following changes in the net defined benefit obligation as an expense in the consolidated statement of profit and loss:

Service costs comprising current service costs, past-service costs, gains and losses on curtailments and non-routine settlements; and

Net interest expense or income

When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Group recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

The employee can carry-forward a portion of the unutilised accrued compensated absences and utilise it in future service periods or receive cash on termination of employment. Compensated absences are expected to occur within twelve months after the end of the period and are classified as a short term employee benefit. The Group records an obligation for such compensated absences in the period in which the employee renders the services. The Group accrues for liability in respect of compensated absences for the entire available leave balance standing to the credit of the employees at period end. The leave balance eligible for carry-forward is valued at gross compensation cost and the leave balance subject to encashment are accrued at basic pay.

I. Share based payments

Employees (including senior executives) of the Group receive remuneration in the form of share-based payments, whereby employees render services as consideration for stock options (equity-settled transactions) of Geometric Limited, Investor company.

Equity-settled transactions

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model.

That cost is recognised, together with a corresponding increase in share-based payment (SBP) reserves in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity instruments that will ultimately vest. The statement of profit and loss expense or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense.

In case where stock options are granted by Investor company without any recharge, the fair value of options is recognised as an expense with a credit to deemed equity contribution from investor

J. Taxes

i. Current income taxes

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date.

Current tax assets and liabilities are offset only if, the Group:

a) has a legally enforceable right to set off the recognised amounts; and

b) intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

63

The Annual Report

2016-17


ii. Deferred tax

Deferred tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred tax liabilities are recognised for all taxable temporary differences, except:

a) When the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss

b) In respect of taxable temporary differences associated with investments in subsidiaries, associates and interests in joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future

Deferred tax assets are recognised for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are re-assessed at each reporting date and are recognised to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss (either in other comprehensive income or in equity). Deferred tax items are recognised in correlation to the underlying transaction either in OCI or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Deferred tax assets include Minimum Alternative Tax (MAT) paid in accordance with the tax laws in India, which is likely to give future economic benefits in the form of availability of set off against future income tax liability. Accordingly, MAT is recognised as deferred tax asset in the balance sheet when the asset can be measured reliably and it is probable that the future economic benefit associated with the asset will be realised.

K. Property, plant and equipment

i. Recognition and measurement

Capital work in progress, property and equipment are stated at cost, net of accumulated depreciation and accumulated impairment losses, if any.

The cost of an item of property, plant and equipment comprises:

a) its purchase price, including import duties and non-refundable purchase taxes, after deducting trade discounts and rebates.

b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.

c) the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs either when the item is acquired

Income and expenses related to the incidental operations, not necessary to bring the item to the location and condition necessary for it to be capable of operating in the manner intended by management, are recognised in profit or loss.

64


If significant parts of an item of property, plant and equipment have different useful lives, then they are accounted for as separate items (major components) of property, plant and equipment. Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit or loss.

ii. Subsequent expenditure

Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Group.

iii. Depreciation

Depreciable amount for assets is the cost of an asset, or other amount substituted for cost, less its estimated residual value.

Depreciation is provided under the straight line method, based on useful lives of assets as estimated by the management or the useful lives of the assets as prescribed in Schedule II to the Act, whichever is lower. Depreciation is charged on a monthly pro-rata basis for assets purchased or sold during the year.

The estimated useful lives for different class of assets are as under:

Particulars / Asset type Years of useful lifeBuildings 28 yearsBuildings - Interiors 10 yearsComputer and accessories 3 yearsElectrical installation 8 yearsOffice equipments 5 yearsFurniture and fixtures 10 yearsVehicles 5 years

The Group, based on technical assessment made by technical expert and management estimate, depreciates certain items of building over estimated useful lives which are different from the useful life prescribed in Schedule II to the Companies Act, 2013. The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.

Leasehold land and leasehold improvements are amortised over the lease period.

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

iv. Intangible assets

Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Intangible assets like computer software that are acquired by the Group and have finite useful lifes are measured at cost less accumulated amortisation and any accumulated impairment losses.

Subsequent expenditure is capitalized only when it increases the future economic benefits embodied in the specific to which it relates.

Amortisation is calculated to write off the cost of intangible assets less their estimated residual values using the straight line method over their estimated useful lives, and is generally recognised in profit or loss.

Amortisation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the statement of profit or loss when the asset is derecognised.

Goodwill: Goodwill is not amortised but tested for impairment in accordance with the accounting policy stated in para G

above.

65

The Annual Report

2016-17


Computer software: ERP license and installation, is amortised on a straight-line basis over the period of license.

l. Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Group expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.

If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

M. Earnings per share

Basic earnings per share is calculated by dividing the profit for the year attributable to equity shareholders of the parent by the weighted average number of equity shares outstanding during the year.

Diluted earnings per share is calculated by dividing the profit attributable to equity holders of the parent by the weighted average number of equity shares outstanding during the year plus the weighted average number of equity shares that would be issued on conversion of all dilutive potential equity shares into equity shares.

N. Cash and cash equivalents

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and short-term deposits with an original maturity of three months or less, which are subject to an insignificant risk of changes in value.

For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Group’s cash management.

O. Dividend distribution to equity holders

The Group recognises a liability to make cash distributions to equity holders of the Group when the distribution is authorised and the distribution is no longer at the discretion of the Group. A distribution in case of final dividend is authorised when it is approved by the shareholders. A corresponding amount is accordingly recognised directly in equity. In case of interim dividend it is authorised when it is approved by the Board of Directors.

2.6 Recent accounting pronouncements

The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Group’s financial statements are disclosed below. The Group intends to adopt these standards, if applicable, when they become effective.

The Ministry of Corporate Affairs (MCA) has issued the Companies (Indian Accounting Standards) Amendment Rules, 2017 and has amended the following standard:

Amendments to Ind AS 7, Statement of Cash Flows

The amendments to Ind AS 7 requires an entity to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes. On initial application of the amendment, entities are not required to provide comparative information for preceding periods. These amendments are effective for annual periods beginning on or after April 1, 2017. Application of this amendments will not have any recognition and measurement impact. However, it will require additional disclosure in the financial statements.

Amendment to Ind AS 102

The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. The Group does not have any cash settled award as at March 31, 2017.

66


Not

e 3:

Pro

pert

y, p

lant

and

equ

ipm

ent

(All

amou

nts

in In

dian

Rup

ees

unle

ss o

ther

wis

e st

ated

)

leas

ehol

d la

ndle

aseh

old

Impr

ovem

ents

Build

ings

Build

ings

-I

nter

iors

Com

pute

rsEl

ectr

ical

In

stal

lati

ons

Offi

ce

Equi

pmen

tsFu

rnit

ure

and

Fixt

ures

Vehi

cles

Tota

l

Cost

or

valu

atio

nA

t A

pril

01, 2

015

36,

57,7

3,37

6 4

1,65

,636

29,2

7,86

,089

12,

29,6

0,92

7 1

8,95

,71,

560

5,5

4,17

,089

8,8

0,61

,191

6,7

3,79

,608

20,

80,6

381,

18,8

1,96

,114

Add

itio

ns -

4,3

6,32

,462

1,3

3,28

,743

- 1

1,94

,61,

261

41,

53,4

07 5

,14,

62,6

052,

23,1

0,80

7 -

25,

43,4

9,28

5D

ispo

sals

- -

- -

1,3

0,89

2 1

4,82

,455

3,2

2,09

128

,84,

283

20,

073

48,

39,7

94A

t M

arch

31,

201

636

,57,

73,3

76 4

,77,

98,0

9830

,61,

14,8

32 1

2,29

,60,

927

30,

89,0

1,92

9 5

,80,

88,0

4113

,92,

01,7

058,

68,0

6,13

2 2

0,60

,565

1,43

,77,

05,6

05A

ddit

ions

- 7

,36,

75,7

91 2

8,98

,886

- 1

6,58

,48,

699

20,

73,5

885,

77,0

0,61

82,

64,9

0,55

3 -

32,

86,8

8,13

5D

ispo

sals

- -

- -

- 1

,18,

575

- 7

,081

- 1

,25,

656

At

Mar

ch 3

1, 2

017

36,5

7,73

,376

12,

14,7

3,88

930

,90,

13,7

18 1

2,29

,60,

927

47,

47,5

0,62

8 6

,00,

43,0

5419

,69,

02,3

2311

,32,

89,6

04 2

0,60

,565

1,76

,62,

68,0

84D

epre

ciat

ion

and

impa

irm

ent

At

Apr

il 01

, 201

5 -

- -

- -

- -

- -

-De

prec

iatio

n ch

arge

for t

he y

ear

46,

05,3

30 8

1,47

,999

1,8

2,01

,385

- 1

2,23

,45,

050

1,7

4,86

,397

3,86

,78,

976

1,4

9,51

,996

20,

09,7

39 2

2,64

,26,

872

Impa

irm

ent

- -

- -

- -

18,3

3,41

9 -

- 1

8,33

,419

Dis

posa

ls -

- -

- -

- -

- -

-A

t M

arch

31,

201

6 4

6,05

,330

81,

47,9

99 1

,82,

01,3

85 -

12,

23,4

5,05

0 1

,74,

86,3

974,

05,1

2,39

5 1

,49,

51,9

96 2

0,09

,739

22,

82,6

0,29

1De

prec

iatio

n ch

arge

for t

he y

ear

46,

05,3

31 1

,14,

93,0

20 1

,38,

18,1

55 1

,88,

87,6

66 1

3,22

,21,

010

1,7

2,41

,025

4,21

,97,

486

1,5

5,14

,118

50,

826

25,

60,2

8,63

7D

ispo

sals

- -

- -

- -

- -

- -

Tran

sfer

- -

(1,7

2,12

,554

) 1

,72,

12,5

54 (7

,86,

566)

-9,

62,7

60(1

,76,

194)

- -

At

Mar

ch 3

1, 2

017

92,

10,6

61 1

,96,

41,0

19 1

,48,

06,9

86 3

,61,

00,2

20 2

5,37

,79,

494

3,4

7,27

,422

8,36

,72,

641

3,02

,89,

920

20,6

0,56

5 4

8,42

,88,

928

Net

boo

k va

lue

At

Mar

ch 3

1, 2

017

35,

65,6

2,71

5 1

0,18

,32,

870

29,4

2,06

,732

8,6

8,60

,707

22,

09,7

1,13

4 2

,53,

15,6

3211

,32,

29,6

828,

29,9

9,68

4 -

1,28

,19,

79,1

56A

t M

arch

31,

201

6 3

6,11

,68,

046

3,9

6,50

,099

28,7

9,13

,447

12,

29,6

0,92

7 1

8,65

,56,

879

4,0

6,01

,644

9,8

6,89

,310

7,18

,54,

136

50,

826

1,20

,94,

45,3

14A

t A

pril

01, 2

015

36,

57,7

3,37

6 4

1,65

,636

29,2

7,86

,089

12,

29,6

0,92

7 1

8,95

,71,

560

5,5

4,17

,089

8,80

,61,

191

6,73

,79,

608

20,

80,6

381,

18,8

1,96

,114

Not

e 4:

Inta

ngib

le a

sset

sCo

mpu

ter

Soft

war

eTo

tal

Cost

or v

alua

tion

At

Apr

il 01

, 201

5 3

,06,

172

3,0

6,17

2

Addi

tions

2

4,11

,555

2

4,11

,555

Disp

osal

s -

- At

Mar

ch 3

1, 2

016

27,

17,7

27

27,

17,7

27

Ad

ditio

ns

3,9

8,51

8 3

,98,

518

Di

spos

als

- -

At M

arch

31,

201

7 3

1,16

,245

3

1,16

,245

Am

orti

sati

on a

nd im

pairm

ent

At

Apr

il 01

, 201

5 -

-

Amor

tisat

ion

25,

34,1

61

25,

34,1

61

At M

arch

31,

201

6 2

5,34

,161

2

5,34

,161

Amor

tisat

ion

4,6

9,82

1 4

,69,

821

Di

spos

als

- -

At M

arch

31,

201

7 3

0,03

,982

3

0,03

,982

N

et b

ook

valu

e

At M

arch

31,

201

7 1

,12,

263

1,1

2,26

3

At M

arch

31,

201

6 1

,83,

566

1,8

3,56

6

At A

pril

01, 2

015

3,0

6,17

2 3

,06,

172

67

The Annual Report

2016-17


Not

e 3:

Pro

pert

y, p

lant

and

equ

ipm

ent

(All

amou

nts

in In

dian

Rup

ees

unle

ss o

ther

wis

e st

ated

)

leas

ehol

d la

ndle

aseh

old

Impr

ovem

ents

Build

ings

Build

ings

-I

nter

iors

Com

pute

rsEl

ectr

ical

In

stal

lati

ons

Offi

ce

Equi

pmen

tsFu

rnit

ure

and

Fixt

ures

Vehi

cles

Tota

l

Cost

or

valu

atio

nA

t A

pril

01, 2

015

36,

57,7

3,37

6 4

1,65

,636

29,2

7,86

,089

12,

29,6

0,92

7 1

8,95

,71,

560

5,5

4,17

,089

8,8

0,61

,191

6,7

3,79

,608

20,

80,6

381,

18,8

1,96

,114

Add

itio

ns -

4,3

6,32

,462

1,3

3,28

,743

- 1

1,94

,61,

261

41,

53,4

07 5

,14,

62,6

052,

23,1

0,80

7 -

25,

43,4

9,28

5D

ispo

sals

- -

- -

1,3

0,89

2 1

4,82

,455

3,2

2,09

128

,84,

283

20,

073

48,

39,7

94A

t M

arch

31,

201

636

,57,

73,3

76 4

,77,

98,0

9830

,61,

14,8

32 1

2,29

,60,

927

30,

89,0

1,92

9 5

,80,

88,0

4113

,92,

01,7

058,

68,0

6,13

2 2

0,60

,565

1,43

,77,

05,6

05A

ddit

ions

- 7

,36,

75,7

91 2

8,98

,886

- 1

6,58

,48,

699

20,

73,5

885,

77,0

0,61

82,

64,9

0,55

3 -

32,

86,8

8,13

5D

ispo

sals

- -

- -

- 1

,18,

575

- 7

,081

- 1

,25,

656

At

Mar

ch 3

1, 2

017

36,5

7,73

,376

12,

14,7

3,88

930

,90,

13,7

18 1

2,29

,60,

927

47,

47,5

0,62

8 6

,00,

43,0

5419

,69,

02,3

2311

,32,

89,6

04 2

0,60

,565

1,76

,62,

68,0

84D

epre

ciat

ion

and

impa

irm

ent

At

Apr

il 01

, 201

5 -

- -

- -

- -

- -

-De

prec

iatio

n ch

arge

for t

he y

ear

46,

05,3

30 8

1,47

,999

1,8

2,01

,385

- 1

2,23

,45,

050

1,7

4,86

,397

3,86

,78,

976

1,4

9,51

,996

20,

09,7

39 2

2,64

,26,

872

Impa

irm

ent

- -

- -

- -

18,3

3,41

9 -

- 1

8,33

,419

Dis

posa

ls -

- -

- -

- -

- -

-A

t M

arch

31,

201

6 4

6,05

,330

81,

47,9

99 1

,82,

01,3

85 -

12,

23,4

5,05

0 1

,74,

86,3

974,

05,1

2,39

5 1

,49,

51,9

96 2

0,09

,739

22,

82,6

0,29

1De

prec

iatio

n ch

arge

for t

he y

ear

46,

05,3

31 1

,14,

93,0

20 1

,38,

18,1

55 1

,88,

87,6

66 1

3,22

,21,

010

1,7

2,41

,025

4,21

,97,

486

1,5

5,14

,118

50,

826

25,

60,2

8,63

7D

ispo

sals

- -

- -

- -

- -

- -

Tran

sfer

- -

(1,7

2,12

,554

) 1

,72,

12,5

54 (7

,86,

566)

-9,

62,7

60(1

,76,

194)

- -

At

Mar

ch 3

1, 2

017

92,

10,6

61 1

,96,

41,0

19 1

,48,

06,9

86 3

,61,

00,2

20 2

5,37

,79,

494

3,4

7,27

,422

8,36

,72,

641

3,02

,89,

920

20,6

0,56

5 4

8,42

,88,

928

Net

boo

k va

lue

At

Mar

ch 3

1, 2

017

35,

65,6

2,71

5 1

0,18

,32,

870

29,4

2,06

,732

8,6

8,60

,707

22,

09,7

1,13

4 2

,53,

15,6

3211

,32,

29,6

828,

29,9

9,68

4 -

1,28

,19,

79,1

56A

t M

arch

31,

201

6 3

6,11

,68,

046

3,9

6,50

,099

28,7

9,13

,447

12,

29,6

0,92

7 1

8,65

,56,

879

4,0

6,01

,644

9,8

6,89

,310

7,18

,54,

136

50,

826

1,20

,94,

45,3

14A

t A

pril

01, 2

015

36,

57,7

3,37

6 4

1,65

,636

29,2

7,86

,089

12,

29,6

0,92

7 1

8,95

,71,

560

5,5

4,17

,089

8,80

,61,

191

6,73

,79,

608

20,

80,6

381,

18,8

1,96

,114

Not

e 4:

Inta

ngib

le a

sset

sCo

mpu

ter

Soft

war

eTo

tal

Cost

or v

alua

tion

At

Apr

il 01

, 201

5 3

,06,

172

3,0

6,17

2

Addi

tions

2

4,11

,555

2

4,11

,555

Disp

osal

s -

- At

Mar

ch 3

1, 2

016

27,

17,7

27

27,

17,7

27

Ad

ditio

ns

3,9

8,51

8 3

,98,

518

Di

spos

als

- -

At M

arch

31,

201

7 3

1,16

,245

3

1,16

,245

Am

orti

sati

on a

nd im

pairm

ent

At

Apr

il 01

, 201

5 -

-

Amor

tisat

ion

25,

34,1

61

25,

34,1

61

At M

arch

31,

201

6 2

5,34

,161

2

5,34

,161

Amor

tisat

ion

4,6

9,82

1 4

,69,

821

Di

spos

als

- -

At M

arch

31,

201

7 3

0,03

,982

3

0,03

,982

N

et b

ook

valu

e

At M

arch

31,

201

7 1

,12,

263

1,1

2,26

3

At M

arch

31,

201

6 1

,83,

566

1,8

3,56

6

At A

pril

01, 2

015

3,0

6,17

2 3

,06,

172

Note 5: Goodwill

Goodwill TotalCost or valuation At April 01, 2015 - - Additions - - At March 31, 2016 - - Additions (Refer note below) 4,51,72,90,829 4,51,72,90,829 At March 31, 2017 4,51,72,90,829 4,51,72,90,829

Amortisation and impairment At April 01, 2015 - - At March 31, 2016 - - Amortisation - - At March 31, 2017 - -

Net book value At March 31, 2017 4,51,72,90,829 4,51,72,90,829 At March 31, 2016 - - At April 01, 2015 - -

On April 01, 2016, the Board of Directors approved the Composite Scheme of Arrangement and Amalgamation between Geometric Limited (‘GL’ or ‘Transferor Company’), HCL Technologies Limited (‘HCL’) and 3DPLM Software Solutions Limited (‘3D PLM’ or ‘the Company’ or the Transferee) and their respective shareholders and creditors pursuant to the provisions of Sections 391 to 394 read with Section 100 of the Companies Act, 1956 or under Section 230 to 234 of the Companies Act, 2013 and other applicable provisions if any, of the Companies Act, 1956 and/or Companies Act, 2013 & the relevant provisions made thereunder (‘the Scheme’).

Pursuant to the scheme, the IT enabled engineering services, PLM services and engineering design productivity software tools of GL including its overseas subsidiaries (but excluding the shares held by GL in 3D PLM) (“Demerged Business Undertaking”) got transferred to HCL.

GL, comprising the shares held by it in 3D PLM and compliance related liability of unpaid dividend of Rs. 38,70,793 with related bank accounts of Rs. 38,70,793 (“Remaining Undertaking”) has been merged and amalgamated with 3D PLM. In consideration of the amalgamation, 3D PLM has issued and allotted to each resident shareholder of the Company 1 (one) fully paid up redeemable preference share of Rs.68 each (‘Redeemable Preference Shares’) in 3D PLM for every 1 (one) fully paid up equity share each of GL aggregating to 55,844,179 Redeemable Preference Shares. For the shares held by non-resident shareholders, the Company has issued and allotted 24 fully paid unlisted equity shares of Rs. 10 each of 3D PLM for every 1,793 fully paid up equity shares of Rs. 2 each of GL held by such shareholders aggregating to 148,291 equity shares. Subsequent to year end and pursuant to the scheme, the equity shares issued to non resident shareholders has been bought by Dassault Systemes SE.

The redeemable preference shares issued by 3D PLM pursuant to the Scheme are in the process of getting listed on the Bombay Stock Exchange.

The Scheme is effective March 02, 2017 pursuant to the High Court Orders received for the same and other regulatory approval as required under applicable law. The Appointed Date of the Scheme is March 31, 2016.

The Company has recorded for the Scheme from the effective date as per the accounting treatment described therein; 1. Face value of 55,844,179 redeemable preference shares issued of Rs. 68/- each amounting to Rs. 3,79,74,04,172 is

credited to preference share capital and classified as equity in the standalone Ind AS financial statements. Accordingly, the Company has not recognised dividend payable to shareholders in the absence of its approval by the board and shareholders.

2. Face value of 148,291 equity shares issued of Rs. 10 each amounting to Rs. 14,82,910 has been credited to equity share capital and premium of Rs. 75,18,79,857 has been credited to securities premium.

68


3. The difference between consideration paid and the fair value of net assets taken over and investments cancelled amounting to Rs. 4,51,72,90,829 is accounted as Goodwill.

Had the Company accounted for the amalgamation as per applicable Ind AS, the redeemable preference shares issued amounting to Rs. 3,79,74,04,172 would have been accounted as current liability in accordance with Ind AS 32 and the Company would have accounted for dividend cost from date of issuance till March 2017 as finance cost and related liability relating to preference shares. Accordingly, the liability would have been higher by Rs. 3,80,61,43,404, equity would have been lower by Rs. 3,79,74,04,172 and profit before tax would have been lower by Rs. 87,39,232 (dividend). Further, difference between the assets over the liabilities after making the adjustments for issuance of redeemable preference shares and equity shares of Rs. 4,51,72,90,390 would have been adjusted against the Company’s retained earnings, being loss on cancellation of the Company’s own equity instruments in accordance with Ind AS 32.

Note 6: Current investments

As atMarch 31, 2017 March 31, 2016 April 01, 2015

No. of units Amounts ` No. of units Amounts ` No. of units Amounts `OTHER THAN TRADE, UNQUOTED, FULLY PAID UP (at fair value)Investments In Mutual FundsInvesco India Ultra Short Term Fund - Direct Plan Daily Dividend Re-Investment

50,532 5,14,90,600 - - - -

Axis Treasury Advantage Fund - Daily Dividend-Re-Investment

64,735 6,51,38,317 - - - -

Baroda Pioneer Liquid Fund - Plan B Daily Dividend- Re-Investment

- - - - 5,037 50,42,140

Birla Sunlife Cash Manager - Reg - Daily Dividend-Re-Investment

9,03,957 9,09,61,325 7,97,893 8,01,97,694 4,95,854 4,98,10,201

Birla Sunlife Treasury Optimizer - Regular -Mdr

- - - - 5,92,566 6,18,95,505

Bnp Paribas Overnight Fund - - 4,510 45,11,751 - - Bnp Paribas Overnight Fund Direct Plan-Daily Dividend

36,987 3,70,20,727 90,032 9,00,91,600 - -

BNP Paribas overnight fund Regular Daily Dividend Re-investment

39,971 4,00,07,875 - - - -

BNP Paribas Short Term Income Fund Direct Plan Daily Dividend - Re-Investment

20,43,958 2,05,48,930 - - - -

DSP Blackrock Ultra Short Term Fund- Regular Daily Dividend Re-Investment

97,69,627 9,85,12,035 - - 80,30,218 8,06,24,992

Franklin India Low Duration Fund- Mdr - - - - 19,47,936 2,04,53,716 Franklin India Saving Plus-Reg Daily Dividend-Re-Investment

- - - - 38,00,443 3,81,33,644

Franklin India Ultra Short Bond Fund - Super Institutional Daily Dividend

53,93,511 5,43,77,381 - - - -

HDFC Floating Rate Income Fund - Short Term - Wholesale - Daily Dividend-Re-Investments

- - 29,95,080 3,01,93,102 - -

Hdfc Liquid Fund-Dividend-Daily Re-investment

- - 9 8,930 53,94,801 5,50,17,258

Icici Fmp Series 78-95 D Plan K Cum - - 25,00,000 2,52,80,500 - -

69

The Annual Report

2016-17



No. of units Amounts ` No. of units Amounts ` No. of units Amounts `ICICI Prudential Banking & Psu Debt Fund- Regular Daily Dividend-Re-Investment

- - - - 35,48,285 3,57,23,783

ICICI Prudential Ultra Reg Daily Dividend-Re-Investment

- - - - 40,01,459 4,07,44,061

ICICI Prudential Savings Fund - Daily Dividend Re-Investment

9,01,910 9,14,77,167 - - - -

IDFC Cash Fund-Daily Dividend-(Regular Plan) - Reinvestment

49,937 5,00,20,450 - - - -

IDFC Money Manager Treasury Plan Regular Daily Dividend Re-investment

12,59,913 1,27,24,362 - - - -

Kotak Banking & Psu Debt Fund-Direct Plan Daily Dividend - Reinvestment

15,42,444 1,58,35,502 - - - -

Kotak Corporate Bond Fund Direct Monthly Dividend - Reinvestment

20,081 2,22,00,836 - - - -

L & T Banking And Psu Debt Fund - Weekly Dividend Re-Investment

23,85,217 2,49,52,946 - - - -

LIC Mf Savings Plus Fund - Regular Daily Dividend Plan - Reinvestment

39,08,112 3,97,10,719 - - - -

Reliance Liquid Fund - Cash Plan - Ddr- Reinvestment

37,736 4,20,43,722 - - - -

Reliance Liquid Fund - Cash Plan - Ddr- Reinvestment

- - 14,630 1,63,00,206 67,492 7,51,96,451

Reliance Medium Term Fund-Daily Dividend Plan

50,99,398 8,71,78,802 56,63,582 9,68,24,039 - -

Reliance Money Manager Fund - Direct - Daily Dividend-Re-Investment

- - - - 80,313 8,05,35,361

Reliance Quarterly Interval Fund - Series Ii-Growth Plan Growth Option

- - 9,78,186 2,02,34,178 - -

Religare Invesco Credit Opportunities Fund-Daily Dividend-Re-Investment

- - - - 35,697 3,57,06,892

Religare Invesco Medium Term Bond Fund - Monthly Dividend Re-Investment

- - 35,081 3,56,76,320 - -

Sundaram Select Debt Short Term Asset-Div-Quarterly

- - - - 18,25,984 2,02,60,750

Sundaram Ultra Short Term Fund R Daily Dividend-Re-Investment

19,27,838 1,93,49,706 60,20,452 6,04,27,282 - -

Uti Fixed Income Interval Fund Quarterly Interval Plan Iii Direct Plan Dividend

- 29,95,686 3,02,71,702 - -

86,35,51,402 49,00,17,304 59,91,44,754 Current 86,35,51,402 49,00,17,304 59,91,44,754 Non Current - - -

86,35,51,402 49,00,17,304 59,91,44,754

70


Note 7: Other financial assets - derivative instruments


Derivative instruments at fair value through OCICash Flow HedgesForeign exchange forward contracts 20,23,44,341 1,36,94,574 42,44,60,697

20,23,44,341 1,36,94,574 42,44,60,697 Current 20,23,44,341 1,36,94,574 36,79,51,826 Non Current - - 5,65,08,871

20,23,44,341 1,36,94,574 42,44,60,697

Financial assets at fair value through OCI Financial assets at fair value through OCI reflect the change in fair value of foreign exchange forward contracts, designated

as cash flow hedges to hedge highly probable future sales in USD and EURO. The Group is exposed to changes in the forex rates of USD and EURO on its forecast sales. The forward contracts are designated as cash flow hedges to offset the effect of price changes USD and EURO rates. The Group has hedged approximately 90% of its expected USD sales and 50% of its expected EURO sales for the next reporting period.

Note 8: Trade and other receivables (unsecured)


Trade receivablesReceivables from holding company (Refer Note 31) - 12,92,64,756 10,06,85,496 Receivables from other related parties (Refer Note 31) 3,74,24,545 1,91,12,914 2,97,70,592 Trade receivables outstanding for a period exceeding six months 10,95,394 - - Other receivables 1,89,60,246 91,90,564 12,90,410

5,74,80,185 15,75,68,234 13,17,46,498

No trade or other receivable are due from directors or other officers of the Group either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member. Trade receivables are non-interest bearing and are generally on terms of 30 days credit. There is no impairment allowance for trade and other receivables.

Note 9: Cash and cash equivalent


Balance with banks Current accounts 16,49,40,327 2,27,37,722 2,72,17,691 Restricted cash balance (Refer Note 5) 38,70,793 - - Remittance in transit - 1,97,78,634 - Cash on hand - - -

16,88,11,120 4,25,16,356 2,72,17,691 For the purpose of the statement of cash flows, cash and cash equivalents comprises the following:Balances with banks:– On current accounts 16,49,40,327 2,27,37,722 2,72,17,691 – Restricted cash balance (Refer Note 5) 38,70,793 - -

16,88,11,120 2,27,37,722 2,72,17,691

71

The Annual Report

2016-17


Note 10: Advances and deposits


AdvancesUnsecured, considered goodEmployees 15,95,890 15,17,280 24,66,036 Other Related Parties - 70,28,258 15,59,730

15,95,890 85,45,538 40,25,766 Unsecured , considered doubtfulDoubtful advances to employees 5,42,835 7,77,235 - Provision for doubtful advances to employees (5,42,835) (7,77,235) -

- - - Security DepositsShort term security deposit 2,77,89,629 2,60,18,717 1,17,868 Long term security deposit 4,65,71,973 1,11,84,650 2,87,17,329

7,43,61,602 3,72,03,367 2,88,35,197

Bank DepositsDeposits with maturity period more than 3 months but less than 12 months 48,75,000 27,48,866 - Deposits in Banks (with remaining maturity greater than twelve months) 25,05,000 71,22,687 96,40,733 [Pledged with bankers for obtaining bank guarantees Rs.16,90,000 (March 31, 2016: Rs 54,75,000; March 31, 2015: 68,80,000)]Current 3,42,60,519 3,73,13,121 41,43,634 Non Current 4,90,76,973 1,83,07,337 3,83,58,062

8,33,37,492 5,56,20,458 4,25,01,696

Short-term deposits with banks are made for varying periods, depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit rates.

Note 11: Other current assets


Interest accrued on fixed deposits with bank 27,33,735 24,27,139 18,37,395 27,33,735 24,27,139 18,37,395

Note 12: Non financial assetsAs at

March 31, 2017 March 31, 2016 April 01, 2015 CurrentAdvances recoverable in cash or in kind 7,87,53,657 4,96,87,611 4,21,45,381 Unbilled revenue 2,60,24,053 4,94,21,360 1,39,46,899 Other receivables 6,06,20,634 2,61,67,736 3,30,72,354

16,53,98,344 12,52,76,707 8,91,64,634 Non CurrentCapital advance 2,14,22,318 20,11,004 1,35,36,490 Advance income tax - net of provision for taxation 6,48,10,847 4,28,42,571 4,10,09,678 Fringe benefit tax 13,84,719 13,84,719 13,84,719 Balance with government authorities 11,58,85,349 7,42,14,747 7,56,74,911

20,35,03,233 12,04,53,041 13,16,05,798

72


Note 13: Share capital Authorised share capital:

Equity Shares Preference Shares

Nos. Amount Nos. Amount

At April 01, 2015 3,00,00,000 30,00,00,000 - -

Changes during the year - - - -

At March 31, 2016 3,00,00,000 30,00,00,000 - -

Increase / (decrease) during the year (1,10,00,000) (11,00,00,000) 5,76,50,000 7,38,60,00,000

At March 31, 2017 1,90,00,000 19,00,00,000 5,76,50,000 7,38,60,00,000

Issued, Subscribed and Paid Up : Equity shares of INR 10 each issued, subscribed and fully paid

Equity Shares

Nos. Amount

At April 01, 2015 15,52,200 1,55,22,000

Changes during the year - -

At March 31, 2016 15,52,200 1,55,22,000

Changes during the year

Cancelled (Refer Note 5) (9,00,200) (90,02,000)

Issued during the year (Refer Note 5) 1,48,291 14,82,910

At March 31, 2017 8,00,291 80,02,910

Redeemable Preference shares of Rs. 68 each issued and fully paid

Preference Shares

Nos. Amount

At April 01, 2015 - -

Changes during the year - -

At March 31, 2016 - -

Issued during the year (Refer Note 5) 5,58,44,179 3,79,74,04,172

At March 31, 2017 5,58,44,179 3,79,74,04,172

Pursuant to the Composite scheme of arrangement and amalgamation as explained in Note 5, the authorized capital of the Group now stands at INR 190,000,000

a. Terms/rights attached to equity shares 621,337 equity shares of the face value of Rs. 10 each fully paid carry a single voting right (1 vote for every single

share held)

72,965 Class ‘A’ equity shares of Rs.10 each fully paid have differential voting rights of 2 votes for every one such share held

105,989 Class ‘B’ equity shares of Rs. 10 each fully paid have differential voting rights of 2 votes for every one share held and one additional vote each on:

i. a change in control that has ocurred due to actions by any person regarded as a Dassault Systemes Competitor as defined in the Shareholder’s Agreement; or

ii. Upon issuance of the “Notice of Increase” as defined in the Shareholders Agreement.

Each equity share carries equal dividend rights irrespective of the class of shares to which it belongs.

73

The Annual Report

2016-17


The dividend proposed by the board of Directors is subject to approval of shareholders in the ensuing General Meeting

In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company.

The distribution will be in proportion to the number of equity shares held by the shareholders.

b. Terms/rights attached to preference shares 55,844,179 preference shares of the face value of Rs. 68 each fully paid carry a single voting right (1 vote for every

single share held)

The Redeemable Preference Share shall subject to the provisions of the Articles of Association of the Transferee Company and the Act confer the holders thereof a right to fixed preferential dividend of 7% per annum in priority to the equity shares subject to deduction of taxes at source if applicable. Dividend to be paid at each quarterly period i.e. 1.75% per quarter

The Redeemable Preference Shares are redeemable at par on the expiry of 15 (fifteen) months from the date of allotment. Provided however, up to a period of 15 days prior to the end of every successive period of 3 months from the date of allotment of the Redeemable Preference Shares (“Quarterly Redemption Period”), any holder of the Redeemable Preference Share shall have the right but not an obligation to request the Company for redemption of the Redeemable Preference Shares held by such person. Within a period of 15 days after the end of the Quarterly Redemption Period, the Company shall redeem the Redeemable Preference Shares that have been validly tendered for redemption during the Quarterly Redemption Period. In the event any holder of the Redeemable Preference Share does not request the Company to redeem the Redeemable Preference Shares held by such a person during the Quarterly Redemption Period, the Redeemable Preference Shares held by such person shall be redeemed within 30 days from the expiry of the said tenure of 15 months.

In the event of winding up of the Company, the holders of the Redeemable Preference Shares shall have a right to receive of the paid up capital and arrears of dividend, whether declared or not, upto the commencement of winding up, in priority to any paid up capital on the equity shares out of the surplus but shall not have any further rights to participate in the profits of the assets of the Company.

c. Shares held by Holding Company and percentage of holding:

March 31, 2017 March 31, 2016

Equity shares

Geometric limited

Number of shares held - 900,200

Percentage of holding 0% 58%

Dassault Systemes SE

Number of shares held 534,091 385,800


Dassault Systemes Americas Corp



800,291 1,552,200

74


d. Details of shareholders holding more than 5% shares in the company and shares held by holding company

March 31, 2017 March 31, 2016

(i) Equity Shares

Geometric Limited

Number of shares held - 900,200

Percentage of holding in the class 0% 66%

Dassault Systèmes SE






621,337 1,373,246

(ii) Class ‘A’ Equity Shares




72,965 72,965

(iii) Class ‘B’ Equity Shares




105,989 105,989

Note 14: Other equity

Additional paid in capital AmountAs at April 01, 2015 1,25,79,426Changes during the year 78,90,460At March 31, 2016 2,04,69,886Changes during the year 40,04,224Adjusted pursuant to the Scheme (Refer Note 5) (2,44,74,110)At March 31, 2017 -

Retained Earnings Amount

As at April 01, 2015 13,16,485,447

Changes during the year

Profits for the year 59,18,35,760

Dividend and dividend tax (74,16,71,985)

Transfer to General reserve (5,70,00,000)

At March 31, 2016 1,10,96,49,222

Profits for the year 70,16,07,489

At March 31, 2017 1,81,12,56,711

75

The Annual Report

2016-17


Securities premium account Amount At April 01, 2015 30,40,39,845 Changes during the year - At March 31, 2016 30,40,39,845 Additions on issuance of equity shares (Refer Note 5) 75,18,79,857 At March 31, 2017 1,05,59,19,702

Other reserves As atMarch 31, 2017 March 31, 2016 April 01, 2015

Capital reserve 9,99,954 9,99,954 9,99,954General reserve 26,47,03,886 26,47,03,886 20,77,03,886Capital redemption reserve 10,00,000 10,00,000 10,00,000Cash flow hedge reserve 13,34,87,750 48,37,495 25,85,98,106Total other reserves 40,01,91,590 27,15,41,335 46,83,01,946

Note 15: Other financial liabilities - derivative instrumentsAs at

March 31, 2017 March 31, 2016 April 01, 2015 Derivative instruments at fair value through OCICash Flow HedgesForeign exchange forward contracts - 42,11,141 -

- 42,11,141 - Current - - - Non Current - 42,11,141 -

- 42,11,141 -

Financial liabilities at fair value through OCI Financial liabilities at fair value through OCI reflect the change in fair value of foreign exchange forward contracts, designated

as cash flow hedges to hedge highly probable future sales in USD and EURO. The Group is exposed to changes in the forex rates of USD and EURO on its forecast sales. The forward contracts are designated as cash flow hedges to offset the effect of price changes USD and EURO rates. The Group has hedged approximately 90% of its expected USD sales and 50% of its expected EURO sales for the next reporting period.

Note 16: Trade and other payables (non-interest bearing)As at

March 31, 2017 March 31, 2016 April 01, 2015

Trade payables 2,30,94,687 69,29,231 2,93,56,232Other payables 29,81,672 41,75,302 2,63,079Payables to related parties (Refer Note 31) - 2,37,68,843 -

2,60,76,359 3,48,73,376 2,96,19,311

Note 17: Other financial liabilitiesAs at

March 31, 2017 March 31, 2016 April 01, 2015 Retention money 30,99,124 35,71,008 23,72,231Accrued expenses 15,83,97,604 13,34,77,262 9,11,43,380Capital creditors 2,53,76,463 2,51,86,048 2,63,29,181Deposits from vendors 1,80,000 1,60,000 80,000Unclaimed dividend 38,70,793 - - Advances from customers 6,28,287 4,27,32,658 -

19,15,52,271 20,51,26,976 11,99,24,792

76


Note 18: Net employee defined benefit liabilities


Provision for employee benefitsProvision for gratuity 2,41,63,072 3,60,17,446 4,83,30,031Provision for compensated absences 6,36,62,676 5,91,93,331 4,28,03,570

8,78,25,748 9,52,10,777 9,11,33,601

Note 19: Other current liabilities


Statutory liabilities 4,83,36,530 4,01,48,781 3,02,52,794Others payables 1,20,72,487 17,13,315 10,94,719

6,04,09,017 4,18,62,096 3,13,47,513

Note 20: Deferred revenue


Balance of deferred revenue at the beginning of the year 11,71,06,661 11,77,79,375 7,77,36,104Movement during the yearDeferred during the year 9,49,85,914 7,11,51,356 9,68,05,541Released to the statement of profit and loss (10,75,82,728) (7,18,24,070) (5,67,62,270)

10,45,09,847 11,71,06,661 11,77,79,375Current 5,95,22,676 6,38,94,681 5,71,90,293Non-Current 4,49,87,171 5,32,11,980 6,05,89,082

10,45,09,847 11,71,06,661 11,77,79,375

Note 21: Revenue from operations

March 31, 2017 March 31, 2016

Revenue from services 3,77,63,61,339 3,11,31,07,344

Other operating revenues

Leased income 30,37,54,699 24,68,73,056

4,08,01,16,038 3,35,99,80,400

The Group has a component of leased income from an arrangement of embedded lease which can be confirmed on the basis of following factors:

The entire facility of the Group alongwith specific assets are used to render services to its parent company, Dassault Systèmes SE (‘DS’) and its affiliates, though the same is not explicitly mentioned in the agreement

The output from this facility is only being used for providing services to DS and its affiliates and on a cost plus mark up basis, thereby fulfiling the criteria on the right to use the asset.

This arrangement contains a lease. Although the Master Sales Agreement is for an indefinite period, it can be cancelled by either party. Hence, lease is in the nature of operating lease

The disclosure of revenue is bifurcated into service income and lease income. The lease income is computed by adding an appropriate profit margin to the depreciation amount of the respective assets, rent, etc. and the balance has been disclosed as service income.

77

The Annual Report

2016-17


Note 22: Other income

March 31, 2017 March 31, 2016

Dividend income

Dividend income on current investments 3,82,12,477 2,42,54,066

Other non operating income

Lease rent received from a related party 6,53,789 6,53,789

Gain on sale of current investments (Net) 23,96,163 21,25,330

Foreign exchange difference (Net) 13,16,72,892 31,08,84,085

Gain on sale of assets (Net) 57,76,254 -

Miscellaneous income 8,42,370 44,95,045

17,95,53,945 34,24,12,315

Note 23: Finance income

March 31, 2017 March 31, 2016

Interest income

Interest on advances and deposits 7,38,973 9,27,280

Interest earned from loans to employees 38,663 41,388

Interest on unwinding of security deposit 33,99,554 23,44,882

41,77,190 33,13,550

Note 24: Employee benefits expense

March 31, 2017 March 31, 2016

Salaries, bonus and allowances 2,21,29,53,127 1,93,75,42,000

Contribution to provident and other funds 12,33,30,964 10,44,48,683

Share based payments to employees 40,04,223 78,90,460

Gratuity expense 4,56,22,531 4,22,81,927

Staff welfare expenses 9,90,69,122 9,02,35,056

2,48,49,79,967 2,18,23,98,126

Note 25: Depreciation and amortisation expense

March 31, 2017 March 31, 2016

Depreciation of tangible assets (Refer Note 3) 25,60,28,633 22,82,60,293

Amortization of intangible assets (Refer Note 4) 4,69,821 25,34,160

25,64,98,454 23,07,94,453

Note 26: Other expenses

March 31, 2017 March 31, 2016

Sub-contracting expenses 3,61,32,780 13,27,754

Facility Charges 5,67,75,218 5,61,64,554

Electricity expenses 7,87,47,316 7,66,92,761

Rates and taxes 55,93,937 52,04,953

Rent 10,88,57,649 7,78,07,502

IT recharge cost - 63,56,316

78


March 31, 2017 March 31, 2016

Repairs and maintenance - Computer and accessories 6,00,20,667 2,57,59,350

Repairs and maintenance - Buildings 40,34,802 85,33,742

Repairs and maintenance - Others 1,21,27,025 2,09,19,191

Insurance 44,99,679 40,71,739

Travelling and conveyance expenses 3,44,76,786 1,70,73,925

Equipment rental charges 1,25,77,968 73,24,924

Communication expenses 57,28,867 49,92,989

Legal and professional charges 1,34,93,522 2,93,04,184

Auditor’s remuneration 53,86,859 44,44,019

Staff recruitment expenses 49,38,598 44,93,177

Royalty expenses 58,50,263 11,02,892

Commission to non-executive directors 11,95,593 -

Directors’ sitting fees 2,52,500 2,55,000

Loss on sale of assets (Net) - 14,14,032

Bad debts written off 7,80,752 11,92,128

Provision for doubtful advances 5,42,571 3,39,928

Miscellaneous expenses 2,04,80,599 1,60,84,535

Corporate Social Responsibility expenses 1,35,60,565 40,60,000

Shared services costs 4,48,40,147 3,73,47,327

53,08,94,663 41,22,66,922

Payment to Auditors

March 31, 2017 March 31, 2016

As auditor

Audit fee 51,50,000 42,15,802

Other Capacity

Reimbursement of expenses 2,36,859 2,28,217

53,86,859 44,44,019

Details of CSR expenditure:

March 31, 2017 March 31, 2016

Gross amount required to be spent by the group during the year 1,46,73,902 1,42,64,741

Amount spent during the year (paid in cash)

i) Construction/acquisition of any asset - -

ii) On purposes other than (i) above 1,35,60,565 40,60,000

1,35,60,565 40,60,000

Note 27: Finance cost

March 31, 2017 March 31, 2016

Interest expense 2,13,570 10,504

Other borrowing cost 18,49,288 14,64,763

20,62,858 14,75,267

79

The Annual Report

2016-17


Note 28: Components of Other Comprehensive Income (OCI) The disaggregation of changes to OCI by each type of reserve in equity is shown below: During the year ended 31 March 2017

Cash flow hedge reserve

Retained earning

Total

Currency forward contracts (19,48,95,099) - (19,48,95,099)Reclassified to statement of profit or loss (Net of tax) 6,62,44,844 - 6,62,44,844 Re-measurement gains (losses) on defined benefit plans - (1,02,04,789) (1,02,04,789)

(12,86,50,255) (1,02,04,789) (13,88,55,044)

During the year ended 31 March 2016Cash flow

hedge reserveRetained earning

Total

Currency forward contracts 38,44,27,528 - 38,44,27,528 Reclassified to statement of profit or loss (Net of tax) (13,06,66,917) - (13,06,66,917)Re-measurement gains (losses) on defined benefit plans - (32,46,392) (32,46,392)

25,37,60,611 (32,46,392) 25,05,14,219

Note 29: Earnings per share (EPS) The following reflects the income and share data used in the basic and diluted EPS computations:

March 31, 2017 March 31, 2016 Profit attributable to equity holders:Continuing operations 69,14,02,700 58,85,89,368Profit attributable to equity holders of the parent adjusted for the effect of dilution 69,14,02,700 58,85,89,368Weighted average number of Equity shares for basic EPS*Effect of dilution:Weighted average number of Equity shares adjusted for the effect of dilution 15,27,480 15,52,200

15,27,480 15,52,200 * The weighted average number of shares takes into account the weighted average effect of changes in share during the

year on account of cancellation and issuance. There have been no other transactions involving Equity shares or potential Equity shares between the reporting date and the date of authorisation of these CFS.

Note 30: Gratuity and other post-employment benefit plans

a. Defined Contribution Plan

Contribution to defined contribution plan, recognised in the statement of profit and loss account under Employee cost, Contribution to provident and other funds, for the period are as under:

Particulars Year EndedMarch 31, 2017 March 31, 2016

Contribution to Provident Fund 9,56,40,038 8,25,84,762Contribution to Superannuation Fund 1,90,24,347 1,42,89,582Total 11,46,64,385 9,68,74,344

b. Defined Benefit Plan The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a

gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following table summarizes the components of net benefit expenses recognized in the statement of profit and loss, the funded status and amount recognized in the Balance Sheet.

80


Particulars As at As atMarch 31, 2017 March 31, 2016

GratuityI Reconciliation of opening and closing balances of Defined Benefit obligation Present Value of Defined Benefit obligation as at the beginning of the year 23,49,83,738 19,16,55,635

Acquisition Adjustments - 1,73,24,930 Interest Cost 1,74,33,478 1,48,46,776 Current Service Cost 4,42,20,448 3,98,27,566 Settlement cost / (credit) - (1,11,15,080) Benefits paid (1,28,33,419) (88,34,549) Net Actuarial Loss / (Gain) (1,08,54,402) (87,21,540) Present Value of Defined Benefit obligation as at the end of the year 27,29,49,843 23,49,83,738 II Reconciliation of fair value of plan assets Fair value of plan assets as at the beginning of the year 19,86,29,010 14,33,25,604 Acquisition Adjustments - 1,73,24,930 Interest Income 1,60,31,395 - Mortality Charges and Taxes (1872219) - Expected return on plan assets 68,14,558 1,37,38,865 Net Actuarial Gain / (Loss) - (38,03,509) Amount paid on settlement - (1,11,15,080) Employer’s contribution 3,60,17,446 4,83,30,031 Benefits paid (1,28,33,419) (88,34,549) Fair value of plan assets as at the end of the yearS 24,27,86,771 19,89,66,292 III Actual return on plan assets 68,14,558 99,35,356 IV Net Liability recognised in Balance Sheet Present Value of Defined Benefit obligation 27,29,49,843 23,49,83,738 Fair value of plan assets 24,27,86,771 19,89,66,292 Net liability recognised in Balance Sheet (3,01,63,072) 3,60,17,446 V Actuarial assumptions Mortality Table: I.A.l.M 2006-

08 UlTIMATEI.A.L.M 2006-08 ULTIMATE

Discount rate 7.60% to 7.90% P.A.

7.80% P.A.

Expected rate of return on Plan Assets 8.00% P.A. 8.00% P.A. Salary escalation 10% to

11.50% P.A.10% to

11.50% P.A. VI Expense recognised in the statement of Profit and loss Particulars Year Ended

March 31, 2017 Year Ended

March 31, 2016 Current Service Cost 4,42,20,448 3,98,27,566 Interest Cost - 1,48,46,776 Expected Return on Plan Asset 1,74,33,478 (1,37,38,865) Net Actuarial Loss / (Gain) - (49,18,031) Settlement (gain) / loss 2,06,579 - Total expenses recognised in the statement of Profit and Loss, under Employee

benefit expense 6,18,60,505 3,60,17,446

81

The Annual Report

2016-17


The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

Plan Assets:As At As At

March 31, 2017 March 31, 2016Investments with Insurer 100% 100%

A quantitative sensitivity analysis for the significant assumption as at March 31, 2017 is as shown below:

Sensitivity Analysis March 31, 2017 March 31, 2016Projected benefit obligation on current assumption 27,29,49,843 23,49,83,738 Delta effect of + 1% change in rate of discounting (2,22,44,006) (1,94,69,064)Delta effect of - 1% change in rate of discounting 2,58,50,718 2,26,76,610 Delta effect of + 1% change in rate of salary increase 1,10,02,494 1,00,32,839 Delta effect of - 1% change in rate of salary increase (1,10,82,604) (1,00,51,949)Delta effect of + 1% change in rate of employee turnover 8,55,956 3,15,921Delta effect of - 1% change in rate of employee turnover (12,08,933) (5,74,270)

The sensitivity analyses above have been determined based on a method that extrapolates the impact on define benefit obligation as a result of reasonable changes in key assumptions occurring at the end of reporting period.

The following payments are expected contributions to the defined benefit plan in future years:Within the next 12 months (next annual reporting period) 2,00,04,000 Between 2 and 5 years 11,39,66,000 Between 5 and 10 years 21,56,55,000 Beyond 10 years -

The average duration of the defined benefit plan obligation at the end of the reporting period is 10.5 years (March 31, 2016: 9.81 years).

82


Note 31: Related party disclosureNames of Related parties and their RelationshipHolding company Dassault Systemes SE

Fellow subsidiaries

3DVIA SASBioviaDassault Data ServicesDassault Systemes 3DExcite GmbHDassault Systemes ABDassault Systèmes Australia Pty LtdDassault Systemes Canada IncDassault Systemes España S.L.UDassault Systemes India Pvt. Ltd.Dassault Systemes IsraelDassault Systemes Italia, SrlDassault Systemes K.KDassault Systemes Korea Corp.DASSAULT SYSTEMES Middle EastDassault Systemes Russia Corp.Dassault Systemes Services, LLCDassault Systèmes Singapore Pte LtdDassault Systemes UKDASSAULT SYSTEMS K.K.Taiwan BranchDassault Systems SimuliaDS Americas CorpDS Deutschland GmbhDS Enovia CorpDS Innovation Tech. Korea LtdDS IT Co. Ltd.( Shangai)DS Simulia Corp.DS Singapore Pte. Ltd.DS Solidworks CorporationRealtime Technology AGSpatial Corporation

Entity with significant influence over the Company Geometric Limited (till March 2, 2017)GL- France Branch

Other related parties (Affiliates of Geometric Limited) Gapp JapanGeometric Americas Inc..Geometric Americas, Inc.SGeometric GMBHGeometric Korea BranchGeometric, SAS

Subsidiary 3D PLM Global Services Private LimitedOther related party Godrej and Boyce Manufacturing Company Limited.Key Management Personnel Sudarshan Mogasale (C.E.O. & Manager) – 3D PLM Software

Solutions LimitedMr. Vishwanath Shet (Chief Financial officer)Ms. Sunipa Ghosh (Company Secretary) (w.e.f. March 17, 2017)Patrick Derouin (C.E.O.) - 3D PLM Global Services Private LimitedManish Tambe (C.E.O. & Manager) – 3D PLM Global Services Private Limited

83

The Annual Report

2016-17


The following table provides the total amount of transactions that have been entered into with the related parties for the relevant financial year

Transactions and Related Parties Year Ended March 31, 2017 March 31, 2016

Holding company Interim Dividend Dassault Systèmes SE - 15,31,62,600Recovery of expenses Dassault Systèmes SE - 7,53,08,133Recovery of Hardware cost Dassault Systèmes SE 3,51,33,015 3,75,91,552Recovery of travel and others Dassault Systèmes SE 10,82,90,000 1,94,41,570Reimbursement of common cost Dassault Systèmes SE - 63,56,316Reimbursement of IT Cost Dassault Systèmes SE 3,10,57,272 -Reimbursement of Travel and Others Dassault Systèmes SE 71,60,590 - Revenue Dassault Systèmes SE 194,10,36,074 152,76,53,546Shared Services Cost Dassault Systèmes SE - 1,02,75,931

Fellow subsidiaries

Deferred Revenue Income Dassault Systemes K.K 33,72,525 -Interim Dividend DS Americas Corp - 10,56,81,400

Recovery of expenses

Dassault Systemes 3DExcite GmbH

- 30,90,964

Dassault Systemes India Pvt. Ltd.

- 2,28,098

Dassault Systemes Israel

- 7,02,642

Dassault Systemes K.K - 20,36,430Dassault Systemes Korea Corp

- 4,23,756

Dassault Systemes Services, LLC

- 14,662

Dassault Systemes Taiwan

- 78,973

DS Americas Corp - 1,22,14,943DS Canada Inc. - 32,54,107DS IT Co. Ltd.( Shangai) - 1,22,789DS Simulia Corp. - 22,20,158DS Solidworks Corporation

- 1,66,08,091

Spatial Corporation - 30,37,504

Recovery of Hardware cost

Biovia 6,62,883 -Dassault Data Services 2,93,208 -Dassault Systemes 3DExcite GmbH

9,22,466 1,17,60,164

Dassault Systemes Canada Inc

10,18,829 -


10,35,426 2,37,897

Dassault Systemes K.K 4,98,624 -DS Americas Corp 1,24,02,017 93,30,024DS Simulia Corp. 7,95,309 14,27,634DS Solidworks Corporation

53,38,662 31,25,908

Spatial Corporation 33,98,943 20,65,152

84



Recovery of travel and others

Biovia 1,56,33,092 -Dassault Data Services 65,87,874 1,50,273Dassault Systemes 3DExcite GmbH

44,22,563 23,28,360

Dassault Systemes AB 32,03,111 -Dassault Systemes Canada Inc

57,48,073 -


61,015 -


28,27,063 -

Dassault Systemes K.K 92,27,620 13,40,050Dassault Systemes Korea Corp

- 20,45,476

Dassault Systemes Korea Corp.

5,53,676 -


- 6,76,499

Dassault Systèmes Singapore Pte Ltd

4,57,148 -

Dassault Systemes UK 1,40,227 -Dassault Systems Innovati

4,84,873

DASSAULT SYSTEMS K.K.Taiwan Branch

4,09,430 -

DS Americas Corp 2,89,40,663 1,14,25,551DS Canada Inc. - 15,55,213DS Deutschland Gmbh 5,32,240 7,70,088DS Innovation Tech. Korea Ltd

1,60,036 -

DS IT Co. Ltd.( Shangai) 2,36,799 1,04,022DS Simulia Corp. 19,42,275 18,90,269DS Singapore Pte. Ltd. 2,05,547DS Solidworks Corporation

2,92,12,257 1,31,74,028

Spatial Corporation 39,09,355 1,69,368

Fellow subsidiaries Revenue

3DVIA SAS 37,39,292 -Biovia 51,08,705 -Dassault Data Services 3,12,82,671 1,23,22,925Dassault Systemes 3DExcite GmbH

12,86,87,716 8,57,81,509

Dassault Systemes AB 3,52,46,367 -Dassault Systèmes Australia Pty Ltd

3,09,38,884 -

Dassault Systemes Canada Inc

5,39,26,123 -

Dassault Systemes España S.L.U

52,50,355 48,62,254

85

The Annual Report

2016-17



Fellow subsidiariesRevenue


34,06,264 23,62,735


1,59,63,070 6,22,80,312

Dassault Systemes Italia,

- 3,86,074

Dassault Systemes Italia, Srl

58,20,252 -

Dassault Systemes K.K 6,65,45,898 2,56,76,907Dassault Systemes Korea Corp

- 1,81,22,109

Dassault Systemes Korea Corp.

3,48,893 -

DASSAULT SYSTEMES Middle East

18,66,785 -

Dassault Systemes Russia

- 3,85,478

Dassault Systemes Russia Corp.

18,01,734 -


1,66,33,421 8,22,10,006

Dassault Systemes Singapo

- 7,93,879

Dassault Systèmes Singapore Pte Ltd

37,18,780 -

Dassault Systemes Taiwan

- 1,60,275

Dassault Systemes UK 23,79,299 3,28,399DASSAULT SYSTEMS K.K.Taiwan Branch

10,73,745 -

Dassault Systems Simulia

803 -

DS Americas Corp 84,35,38,997 73,12,62,837DS Canada Inc. 6,90,70,812DS Deutschland Gmbh 1,96,98,848 59,80,392DS Enovia Corp 1,76,753 15,03,457DS IT Co. Ltd.( Shangai) 13,46,483 5,86,255DS Simulia Corp. 22,13,09,753 19,67,03,840DS Singapore Pte. Ltd. 6,26,732DS Solidworks Corporation

42,91,92,101 38,10,86,347

Gapp Japan - 56,66,097Realtime Technology AG

13,58,751 14,72,947

Spatial Corporation 8,37,87,879 7,29,81,024Royalty payable Dassault Data Services 58,50,263Shared Services Cost DS Canada Inc. - 13,95,245

86



Entity having significant influence in the company

Interim Dividend Geometric Limited - 35,73,79,400Recovery of expenses Geometric Limited - 1,19,733Recovery of travel and others Geometric Limited 24,15,948 16,31,803

GL- France Branch 4,07,655 -Reimbursement of common cost Geometric Limited - 89,26,184Reimbursement of Travel and Others Geometric Limited 25,44,121 1,71,664Rent Expenses Geometric Limited 99,145 1,13,260Rent Income Geometric Limited 5,99,306 6,53,789Revenue Geometric Limited 18,48,122 23,40,188SAP shared cost Geometric Limited 66,89,930Shared Services Cost Geometric Limited 4,26,86,142 3,73,47,327

Subsidiary

Common Shared cost 3D PLM Global Services Private Limited

7,27,601 -

3D PLM Software Solutions Limited

7,27,601 -

Increase in Preference share Capital 3D PLM Software Solutions Limited

- 6,90,00,000

Interco-Shared Services Cost 3D PLM Global Services Private Limited

35,81,152 -


35,81,152 -

Interest on loan (Expense) 3D PLM Software Solutions Limited

- 23,41,935

Interest on loan (Income) 3D PLM Global Services Private Limited

- 23,41,935

Investment in subsidiary 3D PLM Global Services Private Limited

- 6,90,00,000

Loan given to subsidiary 3D PLM Global Services Private Limited

- 4,00,00,000

Loan repaid by subsidiary 3D PLM Global Services Private Limited

- 4,00,00,000

Loan repaid to Holding Company 3D PLM Software Solutions Limited

- 4,00,00,000

Loan taken from Holding Company 3D PLM Software Solutions Limited

- 4,00,00,000

Recovery of expenses 3D PLM Global Services Private Limited

- 10,88,438


- 18,475

Recovery of travel and others 3D PLM Global Services Private Limited

- 8,00,405


- 8,76,307

Reimbursement of common cost 3D PLM Software Solutions Limited

- 7,87,521

Reimbursement of Travel and Others 3D PLM Global Services Private Limited

- 8,94,782


- 11,01,322

Shared Services Cost 3D PLM Software Solutions Limited

- 29,47,817

Shared Services-Income 3D PLM Global Services Private Limited

- 29,47,817

87

The Annual Report

2016-17



Other related parties

Capital Advance Godrej and Boyce Manufacturing Company Limited

- 39,82,134

Deferred Revenue Income Gapp Japan 21,26,456 -Geometric Americas Inc.. 1,06,72,577 -

Other Expenses Godrej and Boyce Manufacturing Company Limited

64,609 7,36,599

Purchase of Fixed asset Godrej and Boyce Manufacturing Company Limited

1,28,900 1,98,55,001

Recovery of travel and others Gapp Japan 27,37,534 -Geometric Americas Inc. 36,72,542 40,65,641Geometric Asia Pacific Pte. Ltd

- 2,42,323

Geometric Canada Branch

- 12,806

Geometric GMBH 17,95,419 5,18,034Geometric Korea Branch 24,436 -Geometric, SAS 8,36,262 -

Reimbursement of Travel and Others Geometric Americas Inc. - 10,90,926Geometric GMBH 61,311 -

Rent Expenses Godrej and Boyce Manufacturing Company Limited

84,375 1,12,502

Rent Income Godrej and Boyce Manufacturing Company Limited

- 7,80,752

Revenue Gapp Japan 1,50,17,371 -Geometric Americas Inc.. 6,29,60,632 1,92,70,510Geometric Asia Pacific Pte. Ltd

- 44,33,010

Geometric GMBH - 1,19,21,156Geometric, SAS 1,71,51,464 2,86,02,732

Security Deposit recovered Godrej and Boyce Manufacturing Company Limited

- 1,17,868

Terms and conditions of transactions with related parties

The transactions with the related parties are made on terms equivalent to those that prevail in arm s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2017, the Group has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2016: INR Nil, April 01, 2015 : INR Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

loan to the subsidiary

The Company had granted a loan to its subsidiary 3D PLM Global Services Private Limited in the last financial year for set up and preliminary expenses of the subsidiary. The loan was squared off within a year. Interest on loan was 11%.

88


Compensation of key management personnel of the Group

The amounts disclosed in the table are the amounts recognised as an expense during the reporting period related to key management personnel

Name of the key management personnel Year EndedMarch 31, 2017 March 31, 2016

Sudarshan Mogasale 90,07,161 81,46,004Vishwanath Shet 44,10,867 41,60,060Sunipa Ghosh 5,55,863 -Patrick Derouin 53,14,460 -Manish Tambe 54,70,494 26,96,687

C. Outstanding Balances As on As on

March 31, 2017 March 31, 2016Holding company:

Trade ReceivablesDassault Systemes SE - 12,92,64,755

Other ReceivablesDassault Systemes SE - 52,52,975

Unbilled RevenueDassault Systemes SE 61,71,519 1,06,11,908

Fellow Subsidiaries :Trade Receivables

Biovia 47,23,430 48,23,294Dassault Data Services Suresness - 7,18,949Dassault Systemes India Private Limited 9,49,957 -DS Americas Corp 42,63,504 -Dassault Systemes Middle East FZ-LL 7,43,955 -Dassault Systemes España - 1,77,245Spatial Corporation 15,80,269 -Dassault Systemes 3DExcite GmbH 2,00,94,562 73,50,944Dassault Systemes Canada Inc. - 53,23,421Dassault Systemes Italia, - 2,54,490Dassault Systemes Singapore Pte. Ltd. 2,30,636 2,08,373DS Singapore Pte. Ltd. 1,88,212 2,56,199Processia Solutions Corp 25,51,316 -Dassault Systemes K.K Taiwan 10,24,601 -Dassault Systemes Russia 20,44,896 -3Dvia Sas 15,25,949 -DS IT Co. Ltd.( Shangai) 11,49,967 -

Other ReceivablesDassault Systemes 3DExcite GmbH 1,89,186 16,75,272Dassault Systemes Canada Inc. - 2,98,417DS IT Co. Ltd.( Shangai) 1,07,851 1,53,635DS Americas Corp 1,70,273 -

89

The Annual Report

2016-17



March 31, 2017 March 31, 2016Dassault Systemes K.K Taiwan 3,97,129 -Dassault Systemes India Private Limited 70,167 -Biovia 1,60,87,243 -Dassault Systemes Simulia Corp. - 1,66,698

Trade Payables and Other LiabilitiesDassault Systemes Americas Corp.0 - 2,13,61,278

Unbilled RevenueBiovia 3,44,417 -Dassault Systemes Service, LLC - 94,19,845Dassault Systemes Canada Inc - 9,01,245Dassault Systemes Korea Corp - 3,74,769Dassault Systemes 3DExcite GmbH - 27,24,540Dassault Data Services 6,54,437 10,65,744Dassault Systemes España 73,644 8,90,026Dassault Systemes Italia, 1,55,580 -Dassault Systemes K.K. 36,27,214 4,52,695DASSAULT SYSTEMES Middle East FZ-LL 11,13,141 -DS SolidWorks Corporation 29,214 79,182Dassault Systemes (Shanghai) Information Technology Co. Ltd. - 1,65,375Ds Americas Corp. 93,45,792 50,96,348Dassault Systemes UK Ltd. - 68,796Dassault Systemes Russia Corp. - 3,85,478Dassault Systemes Singapore - 1,65,375Dassault Systemes Israel - 5,69,938DS Deutschland Gmbh 10,45,728 -Processia Solutions Corp 65,523Spatial Corporation 3,46,456 -Dassault Systemes AB 30,51,386 -3DVIA SAS - -

Advance receivedDassault Systemes India Private Limited - 1,17,215Dassault Systemes 3DExcite GmbH - 1,21,83,950Dassault Systemes Americas Corp - 32,86,959Dassault Systemes Canada Software Inc. - 30,19,814Dassault Systemes Service, LLC - 2,18,96,091

Entity with significant influence over the Group:Advances Receivable

Geometric Limited - 39,40,653

Unbilled Revenue Geometric Limited - 12,27,442

Trade ReceivablesGeometric Limited 7,44,747 12,74,095

90



March 31, 2017 March 31, 2016Other Payables


Other ReceivablesGeometric Ltd. 4,942 -Gl-France Branch 25,700 -

Other related parties (Affiliates of Geometric limited) :Advances Receivable

Geometric Americas Inc. - 24,56,602Geometric Asia Pacific Pte. Limited. - 2,42,391Geometric Europe, GMBH - 3,88,611

Unbilled RevenueGeometric Americas Inc. - 82,20,124Geometric Asia Pacific Pte. Limited - 11,66,061Geometric SAS - 58,36,470

Trade ReceivablesGeometric Asia Pacific Pte. Limited - 72,34,918Gapp Japan 43,11,509 -Geometric, SAS 1,08,89,720 6,81,552Geometric Americas, Inc. 2,15,612 -

Trade PayablesGeomtric Europe, Gmbh 56,670 -

Other PayablesGeometric Americas Inc. - 10,73,745

Other receivablesGapp Japan 16,97,683 -Geometric Americas, Inc.S 47,95,584 -Geometric China, Inc 6,450 -Geometric, Sas 77,571 -

Advances receivedGeometric Americas Inc. - 16,00,342

Other related parties :Advances Receivable

Godrej and Boyce Manufacturing Company Limited 10,781 -

DepositsGodrej and Boyce Manufacturing Company Limited 56,250 56,250

Other receivablesGodrej and Boyce Manufacturing Company Limited - 8,78,346

91

The Annual Report

2016-17


Note 32 : Segment reporting

A Primary segments

Based on the “management approach” as defined in Ind AS 108 - Operating Segments, the Chief Operating Decision Maker evaluates the Group’s performance and allocates resources based on an analysis of various performance indicators by business segments. Accordingly, information has been presented in to two key business segments comprising R&D and Software services. The accounting principles used in the preparation of the financial statements are consistently applied to record revenue and expenditure in individual segments.

1. 3D PLM Software Solutions Limited doing business in R&D

2. 3D PLM Global Services Private Limited doing business of software services

Particulars Year endedMarch 31, 2017 March 31, 2016

Segment RevenueR&D services 349,49,67,509 300,50,97,395Software Services 58,51,48,529 35,48,83,005Total Revenue 408,01,16,038 335,99,80,400

Segment profitR&D services 69,74,56,942 49,65,68,748Software Services 11,02,86,012 3,79,52,151Total 80,77,42,954 53,45,20,899

(a) Finance Cost 20,62,858 14,75,267(b) Other unallocable expense net of unallocable income (18,37,31,135) (34,57,25,865)

Profit/(loss) from Ordinary Activities before Tax 98,94,11,231 87,87,71,497

Particulars As atMarch 31, 2017 March 31, 2016

Segment AssetsR&D services 7,27,15,15,483 1,99,08,96,584Software Services 31,06,00,791 24,32,72,011Total assets 7,58,21,16,274 2,23,41,68,595

Segment LiabilitiesR&D services 44,72,56,464 39,99,84,594Software Services 6,20,84,725 11,29,61,713Total liabilities 50,93,41,189 51,29,46,307

B Secondary geographical segments revenue

The following table shows the distribution of the Group’s revenue by Geographical Market.

Particulars Year endedMarch 31, 2017 March 31, 2016

Asia Pacific 12,40,53,555 5,58,24,010Europe 2,19,90,03,614 1,67,93,11,933India 60,35,828 47,02,923Middle East 1,78,29,854 6,22,80,312US 1,73,31,93,187 1,55,78,61,222

4,08,01,16,038 3,35,99,80,400

92


Note 33: Hedging activities and derivatives

Derivative financial instruments:

The Group holds derivative financial instruments such as foreign currency forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures on highly probable forecast transaction of sales. The counter party for these contracts is generally a bank. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.

The following table gives details in respect of outstanding foreign exchange forward contracts:

Particulars As ofMarch 31, 2017 March 31, 2016

Derivative designated as cash flow hedgeForward contractsin Euro 9,11,25,720 (1,11,14,109)in USD 11,12,18,622 2,05,97,541

The foreign exchange forward contracts mature within 12 months. The table below analyzes the derivative financial instruments into relevant maturity groupings based on the remaining period as of the balance sheet date:Particulars As of

March 31, 2017 March 31, 2016Not later than one month 1,83,65,899 29,11,241Later than one month and not later than three months 3,59,81,856 37,35,837Later than three months and not later than one year 14,79,96,587 70,47,496

20,23,44,342 1,36,94,574

During the year ended March 31, 2017, the Group has designated certain foreign exchange forward contracts as cash flow hedges to mitigate the risk of foreign exchange exposure on highly probable forecast revenue transactions. The related hedge transactions for balance in cash flow hedging reserve are expected to occur and reclassified to revenue in the statement of profit or loss within 12 months.

Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments to ensure that an economic relationship exists between the hedged item and hedging instrument, including whether the hedging instrument is expected to offset changes in cash flows of hedged items.

If the hedge ratio for risk management purposes is no longer optimal but the risk management objective remains unchanged and the hedge continues to qualify for hedge accounting, the hedge relationship will be rebalanced by adjusting either the volume of the hedging instrument or the volume of the hedged item so that the hedge ratio aligns with the ratio used for risk management purposes. Any hedge ineffectiveness is calculated and accounted for in profit or loss at the time of the hedge relationship rebalancing.

Note 34 : Commitments and contingencies

a. leases

The Group has taken equipment, cars, furniture and various office premises, under operating lease arrangements for terms ranging from 1 to 5 years.

These are generally renewable by mutual consent. There are no specific restrictions imposed by the lease arrangements except that the leased premises cannot be sub leased any further in case of certain premises. There are escalation clauses in agreements with some parties. There are no sub leases.

Operating lease Year EndedMarch 31, 2017 March 31, 2016

Lease payments 12,07,90,080 8,36,21,366

93

The Annual Report

2016-17


Future minimum rentals payable under non-cancellable operating leases as at March 31 are as follows:

Operating lease As atMarch 31, 2017 March 31, 2016

Minimum Lease PaymentsNot later than one year 5,83,28,309 7,76,70,218Later than one year but not later than five years 67,50,84,824 9,11,83,529

b. Commitments

Estimated amount of contracts remaining to be executed, net of advances to the extent not provided for Rs. 6,06,05,628 (March 31, 2016 Rs.2,49,54,502).

c. Contingent liabilities

Particulars March 31, 2017 March 31, 2016Income Tax Demand (TDS)* 2,40,26,838 2,40,26,838Income Tax Demand* 5,74,54,926 5,65,21,960VAT Demand* 1,18,21,506 1,18,21,506Claims against the Group not acknowledged as debts** - 50,00,000

* Pending the settlement of the dispute and based on management estimate of likelihood of outcome, the Group has not provided these amounts in books.

**The Group filed a civil suit against an employee in India in 2008 claiming damages of Rs. 57,80,00,000 for data theft of intellectual property. Against this, the employee has filed counter claim of Rs. 50,00,000 in 2009 towards wrongful removal and mental agony. In the current year, the Group and ex- employee have mutually agreed to drop charges and have withdrawn the case without any claims from either party.

d. Financial guarantees

Bank guarantees are issued in favour of Offices of Customs and Central Excise, to avail Customs duty exemptions for import of goods Rs 63,90,000 (March 31, 2016: Rs. 57,90,000)

Note 35 : Fair values

Set out below, is a comparison by class of the carrying amounts and fair value of the Group s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:

The carrying value and fair value of financial instruments by categories as of March 31, 2017 were as follows:

Carrying amount Fair valueFinancial assetsInvestments in mutual funds 86,35,51,396 86,35,51,396Derivatives in effective hedges 20,23,44,341 20,23,44,341Total 1,06,58,95,737 1,06,58,95,737

The carrying value and fair value of financial instruments by categories as of March 31, 2016 were as follows:Carrying amount Fair value

Financial assetsInvestments in mutual funds 49,00,17,302 49,00,17,302Derivatives in effective hedges 1,36,94,574 1,36,94,574Total 50,37,11,876 50,37,11,876

94


The carrying value and fair value of financial instruments by categories as of April 01, 2015 were as follows:Carrying amount Fair value

Financial assetsInvestments in mutual funds 59,91,44,754 59,91,44,754Derivatives in effective hedges 42,44,60,697 42,44,60,697Total 1,02,36,05,451 1,02,36,05,451

The management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

The fair value of the financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

Note 36: Fair value hierarchyThe following table provides the fair value measurement hierarchy of the Group’s assets and liabilities.Quantitative disclosures fair value measurement hierarchy for assets:

Fair value measurement usingAs at March 31, 2017 As at March 31, 2016 As at April 1, 2015

Fair value Quoted prices in active

markets

Significant observable

inputs


markets


inputs


markets


inputs

(level 1) (level 2) (level 1) (level 2) (level 1) (level 2)Financial AssetsInvestment in liquid mutual fund units

86,35,51,396 86,35,51,396 - 49,00,17,302 49,00,17,302 59,91,44,754 59,91,44,754 -

Derivative financial instruments - foreign currency forward contracts

20,23,44,341 - 20,23,44,341 1,36,94,574 - 1,36,94,574 42,44,60,697 - 42,44,60,697

Financial liabilitiesDerivative financial instruments - foreign currency forward contracts

- - - 42,11,141 - 42,11,141 - - -

Note 37 : Income tax The major components of income tax expense for the years ended March 31, 2017 and March 31, 2016 are: Statement of profit and loss:

March 31, 2017 March 31, 2016Current income tax:Current income tax charge 34,43,80,198 31,15,30,000 Deferred tax:Relating to origination and reversal of temporary differences (4,63,71,667) (2,13,47,871)Income tax expense reported in the statement of profit or loss 29,80,08,531 290,182,129

OCI sectionDeferred tax related to items recognised in OCI during in the year:

March 31, 2017 March 31, 2016Net loss/(gain) on revaluation of cash flow hedges 6,62,44,844 (13,06,66,917)Net loss/(gain) on remeasurements of defined benefit plans 52,54,670 16,71,639 Income tax charged to OCI 7,14,99,514 (12,89,95,278)

95

The Annual Report

2016-17


Reconciliation of tax expense and the accounting profit multiplied by India’s domestic tax rate for March 31, 2017 and March 31, 2016

March 31, 2017 March 31, 2016Accounting profit before income tax 98,94,11,231 87,87,71,497 At India’s statutory income tax rate of 34.61% (March 31, 2016: 34.61%) 34,24,35,227 30,41,42,815 Non-deductible expenses for tax purposes:Income exempt from tax (2,12,06,696) (44,96,036)At the effective income tax rate of 34.61% (March 31, 2016: 34.61%) 32,12,28,531 29,96,46,779 MAT Credit adjusted 2,32,20,000 94,64,650

29,80,08,531 29,01,82,129 Income tax expense reported in the statement of profit and loss 29,80,08,531 290,182,129

Deferred tax Deferred tax relates to the following:

Balance Sheet Statement of profit and lossMarch 31,

2017March 31,

2016April 1, 2015 March 31,

2017March 31,

2016Deferred Tax AssetsDepreciation 3,06,83,577 3,66,00,388 4,30,92,535 (59,16,811) (64,92,147)Fair value gain on financial instruments 6,87,73,672 25,30,909 13,33,23,702 (2,082) (1,25,876)

Deferred Tax liabilitiesEffect of expenses debited to P&L in current year but allowed for tax purpose in following years

(2,37,53,431) (1,82,69,379) (1,46,87,124) (1,07,38,721) (52,53,894)

Effect of rent straight lining (59,88,002) (11,303) - (59,76,699) (11,303)Tax credit arising on Minimum Alternate Tax

(3,07,47,869) (94,64,650) - (2,37,37,355) (94,64,650)

Net deferred tax assets/(liabilities) 3,89,67,947 1,13,85,965 16,17,29,113 (4,63,71,668) (2,13,47,870)

Note 38 : Share based payments

Under the Employee Stock Options Scheme 2013-Employees, stock options of the parent were granted to certain employees of the Group. In most cases, the exercise price of the share options is equal to the market price of the underlying shares on the date of grant.

The vesting conditions are as follows :

1. 20% of the options at the end of the first year

2. 30% of the options at the end of the second year

3. 50% of the options at the end of the third year

Vested options shall be exercisable within a priod of five years from the date of the grant, provided the employee is in employment of the Group on the date of the vesting of the stock options and should not be serving his notice period.

The fair value of the share options is estimated at the grant date using using the Black-Scholes-Merton option-pricing model, taking into account the terms and conditions upon which the share options were granted.

There are no cash settlement alternatives. The Group does not have a past practice of cash settlement for these share options.

96


The expense recognised for employee services received during the year is shown in the following table:

Year endedMarch 31, 2017 March 31, 2016

Expense arising from equity-settled share-based payment transactions 40,04,224 78,90,460 Expense arising from cash-settled share-based payment transactions - - Total expense arising from share based payment transactions 40,04,224 78,90,460

Note 39 : Capital management

For the purpose of the Group’s capital management, capital includes issued equity capital, convertible preference shares, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Group’s capital management is to maximise the shareholder value.

The capital structure is governed by policies approved by the Board of Directors and is monitored by various metrics. The Company maintains focus on capital efficiency without incurring material indebtedness and have negative working capital and positive free cash flows. The Company manages its capital structure and makes adjustments in the light of changes in economic environment and the requirements of the financial covenants. The Company has no borrowings.

No changes were made in the objectives, policies or processes for managing capital during the years ended March 31, 2017 and March 31, 2016.

Note 40 : Disclosure on Specified bank notes

During the year, the Group had specified bank notes or other denomination notes as defined in the MCA notification G.S.R. 308(E) dated March 31, 2017. The details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December 30, 2016, the denomination wise SBNs and other notes as per the notification is given below:

Particulars Specified Bank Notes* Other notes TotalClosing cash in hand as on November 8, 2016 19000 380 19,380Add : Receipts for permitted transactions - - 20,657 Less : Paid for permitted transactions - - 33,877 Less : Deposited in bank accounts - 6,160 6,160 Closing cash in hand as on December 30, 2016 - - -

Note 41 : Financial risk management

The Group is exposed to market risk, credit risk and liquidity risk which may impact the fair value of its financial instruments. The Group has a risk management policy to manage & mitigate these risks.

The Group’s risk management policy aims to reduce volatility in financial statements while maintaining balance between providing predictability in the Group’s business plan along with reasonable participation in market movement.

Market risk

The Company operates internationally and a major portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales and services in the United States and European Union, and purchases from overseas suppliers in various foreign currencies. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures to cover 50% of Euro sales and 90% of USD sales. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future.

Consequently, the results of the Company’s operations are adversely affected as the ruppee appreciates/depreciates against these currencies to the extent not hedged.

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenue or expense is denominated in a foreign currency).

97

The Annual Report

2016-17


The Group manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12-month period for hedges of forecasted sales.

When a derivative is entered into for the purpose of being a hedge, the Group negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable that is denominated in the foreign currency.

At March 31, 2017, the Group hedged 90% of its expected USD sales (March 31, 2016: 90%, April 1, 2015: 90%) and 50% of its expected EURO sales (March 31, 2016: 90%, April 1, 2015: 90%), for 12 months period. Those hedged sales were highly probable at the reporting date. This foreign currency risk is hedged by using foreign currency forward contracts.

Foreign currency sensitivity

The following tables demonstrate the sensitivity to a reasonably possible change in USD and EUR exchange rates, with all other variables held constant. The impact on the Group’s profit before tax is due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives. The Group’s exposure to foreign currency changes for all other currencies is not material.

Change in USD rate

Effect on profit before tax

Change in EUR rate


March 31, 2017 5% 1,28,30,178 5% 7,27,60,725-5% (1,28,30,178) -5% (7,27,60,725)

March 31, 2016 5% 1,52,24,416 5% 1,12,27,957-5% (1,52,24,416) -5% (1,12,27,957)

Credit risk

Financial instruments that potentially subject the Group to concentration of credit risk consist principally of cash and bank balances, inter-corporate deposits, trade receivables, unbilled revenue, finance lease receivables, investment securities and derivative instruments. The cash resources of the Group are invested with mutual funds, banks, financial institutions and corporations after an evaluation of the credit risk. By their nature, all such financial instruments involve risks, including the credit risk of non-performance by counterparties.

The customers of the Group are primarily group companies based in the United States of America and Europe and accordingly, trade receivables and other receivables are concentrated in the respective countries. The Group periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivables.

The carrying amount of financial assets represents the maximum credit exposure.

liquidity risk

Liquidity risk is the risk that the Group will encounter difficulty in meeting its obligations associated with financial liabilities. The investment philosophy of the Group is capital preservation and liquidity in preference to returns. The Group consistently generates sufficient cash flows from operations and has access to multiple sources of funding to meet the financial obligations and maintain adequate liquidity for use.

98

Not

e 42

: St

atut

ory

Gro

up I

nfor

mat

ion

Nam

e of

the

ent

ity

in t

he g

roup

Net

Ass

ets,

i.e.

, tot

al a

sset

s m

inus

tot

al li

abili

ties

Shar

e in

pro

fit

and

loss

Shar

e in

oth

er C

ompr

ehen

sive

in

com

eA

s %

of

cons

olid

ated

ne

t as

sets

INR

As

% o

f co

nsol

idat

ed

profi

t &

loss

INR

As

% o

f co

nsol

idat

ed

othe

r co

mpr

ehen

sive

in

com

e

INR

Pare

nt 3D P

LM S

oftw

are

Solu

tion

s Li

mit

edB

alan

ce a

s at

Mar

ch 3

1, 2

017

97%

6,92

,33,

59,0

0384

% 5

7,95

,35,

900

95%

13,

24,7

2,00

0B

alan

ce a

s at

Mar

ch 3

1, 2

016

93%

1,69

,00,

56,0

5194

% 5

5,23

,00,

576

100%

(24,

96,3

7,81

1)

Subs

idia

ries

Indi

an 3D P

LM G

loba

l Ser

vice

s P

riva

te L

imit

edB

alan

ce a

s at

Mar

ch 3

1, 2

017

3% 2

4,85

,16,

066

16%

11,

18,6

6,78

45%

63,

83,0

44B

alan

ce a

s at

Mar

ch 3

1, 2

016

7% 1

3,02

,66,

238

6% 3

,62,

88,7

930%

(8,7

6,40

8)

Tota

l Bal

ance

as

at M

arch

31,

201

710

0%7,

17,1

8,75

,069

100%

69,

14,0

2,68

410

0% 1

3,88

,55,

044

Bal

ance

as

at M

arch

31,

201

610

0%1,

82,0

3,22

,289

100%

58,

85,8

9,36

910

0% (2

5,05

,14,

219)

NOT

E TO

CON

SOlI

DATE

D FI

NAN

CIAl

STA

TEM

ENTS

as a

t and

for t

he y

ear e

nded

Mar

ch 3

1, 2

017

(All

amou

nts

in In

dian

Rup

ees

unle

ss o

ther

wis

e st

ated

)

99

The Annual Report

2016-17

Note to coNsolidated fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)43. Equity and profit reconciliation

First-time adoption in Ind AS

These CFS, for the year ended March 31, 2017, are the first Ind AS CFS that the Group has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2016, the Group prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Group has prepared its CFS which comply with Ind AS applicable for periods ended on March 31, 2017, together with the comparative period data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies. In preparing these CFS, the Group’s opening balance sheet was prepared as at April 01, 2015, the Group’s date of transition to Ind AS. This note explains the principal adjustments made by the Group in restating its Indian GAAP financial statements, including the balance sheet as at April 01, 2015 and the financial statements as at and for the year ended March 31, 2016.

Exemptions applied:

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Group has applied the following exemptions:

a) Ind AS 101 permits a first-time adopter to elect to continue with the carrying value of its property, plant and equipment as recognised in the financial statements as at the date of the transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can be used for intangible assets covered by Ind AS 38. Since there is no change in the functional currency, the Group has elected to measure all of its property, plant and equipment and intangible assets at carrying value as per Indian GAAP.

b) Hedge accounting:

The Group uses derivative financial instruments in form of forward currency contracts to hedge its foreign currency risks. Under Indian GAAP, the Group used principles of AS -30 on hedge accounting The Group has designated various economic hedges and applied economic hedge accounting principles to avoid profit or loss mismatch. All the hedges designated under Indian GAAP are of types which qualify for hedge accounting in accordance with Ind AS 109 also. Moreover, the Group, before the date of transition to Ind AS, has designated a transaction as hedge and also meets all the conditions for hedge accounting in Ind AS 109. Consequently, the Group continues to apply hedge accounting after the date of transition to Ind AS.

c) Ind AS 102 has not been applied to equity instruments in share-based payment transactions that vested before April 01, 2015.

d) Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. However, the Group has used Ind AS 101 exemption and assessed all arrangements based for embedded leases based on conditions in place as at the date of transition.

e) The estimates at April 01, 2015 and at March 31, 2016 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

a) Fair value through other comprehensive income (‘FVTOCI’) – mutual funds

b) FVTOCI – cash flow hedges

The estimates used by the Group to present these amounts in accordance with Ind AS reflect conditions at April 01, 2015, the date of transition to Ind AS and as of March 31, 2016.

100


Reconciliations: The following reconciliations help to understand the effect of significant differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101:Reconciliation of equity as Indian GAAP and and per Ind AS for April 1, 2015

As atMarch 31, 2016 April 01, 2015

Total net worth as per as on April 01, 2015 as per Indian GAAP 1,72,30,65,920 2,24,88,63,718

Share based compensation cost as per fair value i (2,04,69,886) (1,25,79,426)Effect of measuring investments at fair value through profit and loss ii 9,75,780 17,76,242 Effect of fair value adjustment of security deposits iii Finance Income 75,29,105 51,84,223 Rent Expense (78,17,608) (55,71,817)Effective portion of gains and loss on cash flow hedge instruments iv (5,69,664) (9,00,702)Deferred tax effect of Ind AS adjustments as above (39,977) (1,65,853)Net profit/equity as per Ind AS 1,70,26,73,670 2,23,66,06,385 Other comprehensive income (net of tax) 1,85,48,618 (11,96,77,721)Total net worth as on April 1 2015 as per Ind AS 1,72,12,22,288 2,11,69,28,664

(i) Share based compensation

As per Ind AS 102, in case of share-based payment transactions among group entities, the entity providing the goods or services shall recognise the share based transaction cost as an expense with a corresponding increase in deemed equity contribution from parent. Under previous GAAP, no such costs were recognised in the books.

(ii) Fair value through Profit & Loss (FVTPL)

Under Ind AS, financial assets and financial liabilities designated at fair value through profit and loss (FVTPL) are fair valued at each reporting date with changes in fair value recognized in the statement of profit and loss. Under previous GAAP, they are measured at lower of cost with provision for diminution in value other than temporary.

(iii) Security Deposits

Under the previous GAAP, interest free lease security deposits are recorded at their transaction value. Under Ind AS, all financial assets are required to be recognised at fair value. Accordingly, the Company has fair valued these security deposits under Ind AS 109 using effective interest rate method. Accordingly, adjustments mainly consists of amortization of deferred lease income / expense on security deposits given and accepted.

(iv) Cash flow hedge

As per Ind AS 109, the cash flow hedges that meet the qualifying criteria, are initially measured at fair value and are re-measured at mark to market at subsequent reporting dates. The effective portion of the cumulative gain or loss on cash flow hedges is recognised in the hedging reserve account until the forecasted transaction materializes. Ineffective portion of the gain or loss on ineffective cash flow hedges is recognized in the income statement.

101

The Annual Report

2016-17


Reconciliation between Profit as previously reported and total comprehensive income as per Ind AS for the year ended March 31, 2017

Description Year Ended March 31,

2016 Profit under previous GAAP 59,99,70,677 Share based compensation cost as per fair value (78,90,460)Acturial gain / (loss) on employee defined benefit plan recognised in Other Comprehensive Income (49,18,031)Effect of measuring investments at fair value through profit and loss (8,00,462)Effect of exchange difference on translation of long-term loans - Effect of fair value adjustment of security deposits Finance Income 23,44,882 Rent Expense (22,45,791)Effective portion of gains and loss on cash flow hedge instruments 3,31,038 Deferred tax effect of Ind AS adjustments as above 17,97,515 Net profit for the year as per Ind AS 58,85,89,368 Other comprehensive income (net of tax) (25,05,14,219)Total comprehensive Income as at reporting date 33,80,75,149

As per our report of even dateFor S.R. Batliboi & Associates llP For and on behalf of the Board of Directors ofChartered Accountants 3D PlM Software Solutions limitedICAI Firm registration number: 101049W/ E300004




102

INDEPENDENT AUDITOR’S REPORTTo the Members of 3D PLM Software Solutions Limited

Report on the Standalone Ind AS Financial StatementsWe have audited the accompanying standalone Ind AS financial statements of 3D PLM Software Solutions Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Ind AS financial statementsThe Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these standalone Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Accounting Standards specified under section 133 of the Act, read with the Companies (Indian Accounting Standards) Rules, 2015. This responsibility includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these standalone Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the standalone Ind AS financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the standalone Ind AS financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the standalone Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the standalone Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the standalone Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the standalone Ind AS financial statements.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the standalone Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Emphasis of MatterWe draw attention to the Note 5 to the standalone financial results regarding the accounting treatment described in the Composite Scheme of Arrangement and Amalgamation of the erstwhile Geometric Limited, HCL Technologies Limited, the Company and their respective shareholders and creditors approved by the Honourable Bombay High Court on December 2, 2016 and the Honourable Delhi High Court on January 18, 2017 (the Scheme).

The Company has accounted for the Scheme as per the accounting treatment described therein, which is different from that of the accounting treatment prescribed under applicable Indian Accounting standards (Ind AS). Had the effect of the Scheme been given according to the accounting treatment prescribed under Ind AS,

a) The redeemable preference shares would have been classified as current liability in accordance with Ind AS 32 and the Company would have accounted for dividend cost Rs. 87 Lacs from date of issuance till March 31, 2017 as finance cost and related liability in respect of Redeemable preference shares issued. Accordingly, current liability which would have been higher by Rs. 38,061 Lacs and equity would have been lower by Rs. 37,974 Lacs and accordingly profit before tax would have been lower by Rs. 87 Lacs.

STANDAlONE FINANcIAl STATEMENTS

103

The Annual Report

2016-17

b) The difference between consideration paid and fair value of net assets taken over and investments cancelled, instead of being accounted as goodwill as described in the Scheme, would have been adjusted against retained earnings being loss on cancellation of its own equity shares as per Ind AS 32 and accordingly, the retained earnings and goodwill would have been lower by Rs. 45,173 Lacs respectively.

Our opinion is not qualified in respect of this matter.

Report on Other legal and Regulatory Requirements

1. As required by the Companies (Auditor’s report) Order, 2016 (“the Order”) issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act, we report that:

(a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit;

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

(c) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid standalone Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015;

(e) The matter described under the Emphasis of Matter paragraph above, in our opinion, may not have an adverse effect on the functioning of the Company;

(f) On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, from being appointed as a director in terms of section 164 (2) of the Act;

(g) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure 2” to this report; and

(h) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company has disclosed the impact of pending litigations on its financial position in its standalone Ind AS financial statements – Refer Note 35 to the standalone Ind AS financial statements;

ii. The Company did not have any long-term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv. The Company has provided requisite disclosures in Note 41 to these standalone Ind AS financial statements as to the holding of Specified Bank Notes on November 8, 2016 and December 30, 2016 as well as dealings in Specified Bank Notes during the period from November 8, 2016 to December 30, 2016. Based on our audit procedures and relying on the management representation regarding the holding and nature of cash transactions, including Specified Bank Notes, we report that these disclosures are in accordance with the books of accounts maintained by the Company and as produced to us by the Management.

For S.R. BATLIBOI & ASSOCIATES LLPChartered Accountants




104

Annexure 1 to the Independent Auditor’s ReportRe: 3D PlM Software Solutions limited (‘the company’)

Referred to in Paragraph 1 under the heading “Report on other legal and regulatory requirements” of 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) Fixed assets have been physically verified by the management during the year and material discrepancies were identified on such verification. These have been properly dealt with in the books of accounts

(c) According to information and explanations given by the management, the title deeds of immovable properties are held in the name of the Company.

(ii) The Company’s business does not involve inventories and, accordingly, the requirements under paragraph 3 (ii) of the Order are not applicable to the Company.

(iii) (a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a), (b) and (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, provisions of section 186 of the Act in respect of loan given and investment made in subsidiary have been complied with by the Company. There are no other guarantees, securities or loans in respect of which provisions of section 185 and 186 of the Act are applicable.

(v) The Company has not accepted any deposits within the meaning of Sections 73 to 76 of the Act and the Companies (Acceptance of Deposits) Rules, 2014 (as amended). Accordingly, the provisions of clause 3(v) of the Order are not applicable.

(vi) To the best of our knowledge and as explained, the Central Government has not specified the maintenance of cost records under clause 148 (1) of the Act, for the services of the Company.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income-tax, service tax, value added tax, cess and other material statutory dues applicable to it. The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales-tax are not applicable to the Company.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales-tax are not applicable to the Company

(c) According to the information and explanation given to us, there are no dues of sales-tax, service tax and value added tax which have not been deposited on account of any dispute. According to the records of the Company, details of income tax dues, which have not been deposited on account of a dispute, are as under:

Name of the statute Nature of dues Amount Assessment year

Forum where dispute is pending

Income Tax Act, 1961 Tax deducted at source 17,641,590 AY:- 2008-09 CIT (A)Income Tax Act, 1961 Tax deducted at source 5,250,926 AY:- 2008-09 CIT (A)Income Tax Act, 1961 Income tax 643,933 AY:- 2007-08 Bombay High CourtIncome Tax Act, 1961 Income tax 344,030 AY:- 2010-11 CIT(A)Income Tax Act, 1961 Income tax 75,967,290 AY:- 2012-13 Appeal to be filed with CIT (A)Income Tax Act, 1961 Income tax 480,114 AY:- 1998-99 DCITIncome Tax Act, 1961 Income tax 291,954 AY:- 2000-01 Income tax officerIncome Tax Act, 1961 Income Tax 7,742,167 AY:- 2005-06 ITATIncome Tax Act, 1961 Income Tax 2,772,592 AY:- 2006-07 DCITIncome Tax Act, 1961 Income Tax 5,950,202 AY:- 2007-08 Rectification filed with DCITIncome Tax Act, 1961 Income Tax 12,733,656 AY:- 2008-09 DCITIncome Tax Act, 1961 Income Tax 10,929,173 AY:- 2009-10 ITATIncome Tax Act, 1961 Income Tax 683,011 AY:- 2010-11 DCITIncome Tax Act, 1961 Income Tax 23,014,674 AY:- 2011-12 DCITIncome Tax Act, 1961 Income Tax 10,570,090 AY:- 2013-14 CIT(A)Income Tax Act, 1961 Income Tax 122,938,220 AY:- 2014-15 CIT(A)

105

The Annual Report

2016-17

The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales- tax are not applicable to the Company.

(viii) The Company has neither issued any debentures nor availed any loan from banks, financial institutions or government. Therefore, the provisions of clause 3(viii) of the Order are not applicable to the Company.

(ix) According to the information and explanations given by the management, the Company has not raised any money way of initial public offer or further public offer or debt instruments and term loans hence, reporting under clause 3 (ix) of the Order are not applicable to the Company and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud by the Company or no fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.

(xi) According to the information and explanations given by the management, we report that the managerial remuneration has been paid or provided in accordance with the requisite approvals mandated by the provisions of section 197 read with Schedule V to the Act.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the Order are not applicable to the Company and hence not commented upon.

(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the Company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence not commented upon.

(xv) According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him.

(xvi) According to information and explanation given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.

For S.R. BATLIBOI & ASSOCIATES LLPChartered AccountantsICAI Firm Registration Number: 101049W/E300004

per Govind AhujaPartnerMembership Number: 048966

Place of Signature: MumbaiDate: April 25, 2017

106

ANNEXURE 2 TO THE INDEPENDENT AUDITOR’S REPORT OF EVEN DATE ON THE STANDAlONE FINANcIAl STATEMENTS OF 3D PlM SOFTWARE SOlUTIONS lIMITED

Report on the Internal Financial controls under clause (i) of Sub-section 3 of Section 143 of the companies Act, 2013 (“the Act”)

To the Members of 3D PLM Software Solutions Limited

We have audited the internal financial controls over financial reporting of 3D PLM Software Solutions Limited (“the Company”) as of March 31, 2017 in conjunction with our audit of the standalone Ind AS financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial controls

The Company’s Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s Responsibility

Our responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.



Meaning of Internal Financial controls Over Financial Reporting

A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent limitations of Internal Financial controls Over Financial Reporting

Because of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

107

The Annual Report

2016-17

Opinion

In our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.

For S.R. BATLIBOI & ASSOCIATES LLPChartered AccountantsICAI Firm Registration Number: 101049W/E300004

per Govind AhujaPartnerMembership Number: 048966

Place of Signature: MumbaiDate: April 25, 2017

108

Note No. As at March 31, 2017 March 31, 2016 April 01, 2015

ASSETSNon-current assetsProperty, plant and equipment 3 1,19,98,32,472 1,11,25,97,488 1,18,12,36,235Capital work-in-progress 1,35,91,444 49,13,139 2,05,94,871Other Intangible assets 4 80,500 - 11,99,89Goodwill 5 4,51,72,90,829 - -Financial Assets

Non-current Investments 6 9,91,00,000 9,91,00,000 30100000Derivative Instruments 8 - - 56508871Advances and Deposits 11 4,00,19,543 1,13,04,287 38358062

Prepayments 1,16,25,673 8,480 1310149Other non-current assets 13 18,70,33,105 11,43,53,638 125711637

6,06,85,73,566 1,34,22,77,032 1453939814current assetsFinancial Assets

Investments 7 81,08,19,161 48,55,05,553 59,91,44,754Trade Receivables 9 1,96,08,969 13,15,21,120 12,98,19,252Derivative Instruments 8 19,34,96,963 1,36,94,574 36,79,51,826Cash and cash equivalents 10 14,34,89,390 1,89,00,086 1,22,16,366Advances and Deposits 11 3,41,45,510 3,48,19,159 41,43,634Other current financial assets 12 27,33,735 24,27,139 18,37,395

Prepayments 56,96,792 78,35,655 95,15,389Other current assets 13 11,98,88,804 6,29,79,894 8,72,65,959

1,32,98,79,324 75,76,83,180 1,21,18,94,575TOTAl ASSETS 7,39,84,52,890 2,09,99,60,212 2,66,58,34,389

EQUITY AND lIABIlITIESEquity 14Equity share capital 80,02,910 1,55,22,000 1,55,22,000Preference share capital 3,79,74,04,172 - -Other Equity 15

Other Equity capital - 2,04,69,886 1,25,79,426Retained Earnings 1,66,76,80,784 107,84,82,985 1,32,07,31,594Securities Premium 1,05,59,19,702 30,40,39,845 30,40,39,845Reserves representing unrealised gains/losses 12,76,47,595 48,37,495 25,85,98,106Other Reserves 26,67,03,840 26,67,03,840 20,97,03,840

Equity attributable to equity holders 6,92,33,59,003 1,69,00,56,051 2,12,11,74,811

Non-current liabilitiesFinancial Liabilities

Derivative Instruments 16 - 42,11,141 -Deferred Revenue 19 4,42,55,889 5,21,49,930 6,05,89,082Deferred tax liabilities (Net) 6,67,51,188 2,08,73,301 16,17,29,113

11,10,07,077 7,72,34,372 22,23,18,195current liabilitiesFinancial Liabilities

Trade and other payables 17 2,49,46,857 3,25,04,961 2,94,92,066Other current liabilities 18 14,65,29,968 11,53,26,685 11,44,49,535

Deferred Revenue 19 5,79,65,371 5,99,81,678 5,71,90,293Liabilities for current tax (Net) - 31,69,318 -Net employee defined benefit liabilities 20 8,03,93,656 8,66,97,152 9,07,58,155Other current liabilities 21 5,42,50,958 3,49,89,995 3,04,51,334

36,40,86,810 33,26,69,789 32,23,41,383TOTAl EQUITY AND lIABIlITIES 7,39,84,52,890 2,09,99,60,212 2,66,58,34,389

The accompanying notes are an integral part of the financial statements.As per our report of even date

For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors ofChartered Accountants 3D PLM Software Solutions LimitedICAI Firm registration number: 101049W/ E300004




BAlANcE SHEET as at March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

109

The Annual Report

2016-17

STATEMENT OF PROFIT AND lOSS for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

Notes Year Ended March 31, 2017 March 31, 2016

RevenueRevenue From Operations 22 3,49,49,67,510 3,00,50,97,395Other Income 23 18,82,60,034 34,60,35,404Finance Income 24 ,35,63,780 52,88,802

3,68,67,91,324 3,35,64,21,601ExpensesEmployee Benefits Expense 25 2,20,65,10,775 1,98,25,11,889Depreciation and Amortisation Expense 26 22,88,07,082 20,84,51,182Other Expenses 27 37,19,70,713 32,24,12,519Finance Costs 28 15,84,971 12,57,250

2,80,88,73,541 2,51,46,32,840

Profit before tax 87,79,17,783 84,17,88,761

Tax expenseCurrent Tax 32,07,16,741 30,18,00,000 Deferred Tax (2,23,34,858) (1,23,11,815)Total tax expense 29,83,81,883 28,94,88,185


Other comprehensive income :Other comprehensive income to be reclassified to profit or loss in subsequent periods:Net movement on cash flow hedges (18,60,47,721) 38,44,27,528 Income tax effect 6,32,37,620 (13,06,66,917)

(12,28,10,101) 25,37,60,611 Other comprehensive income not to be reclassified to profit or loss in subsequent periods:Re-measurement gains/ (losses) on defined benefit plans (1,46,37,023) (62,45,720)Income tax effect 49,75,124 21,22,920

(96,61,899) (41,22,800)Other comprehensive income for the year, net of tax (13,24,72,000) 24,96,37,811 Total comprehensive income for the period, net of tax 71,20,07,900 30,26,62,765 Earnings per equity shareBasic and Diluted [Nominal value of the shares Rs 10 (March 31, 2016 : Rs.10)] 379.41 355.82

The accompanying notes are an integral part of the financial statements.

As per our report of even date





110

STATEMENT OF cHANgES IN EQUITY for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

a. Equity Share capital

Equity shares of INR 10 each issued, subscribed and fully paid Number of

shares Amount

At April 01, 2015 15,52,200 1,55,22,000 At March 31, 2016 15,52,200 1,55,22,000

Issue of share capital (Refer note 5) 1,48,291 14,82,910 Shares cancelled (refer note 5) (9,00,200) (90,02,000)At March 31, 2017 8,00,291 80,02,910

b. Redeemable Preference Share capital

Redeemable Preference shares of INR 68 each issued, subscribed and fully paid Number of

shares Amount

At April 01, 2015 - - At March 31, 2016 - -

Issue of share capital (refer note 5) 55,84,41,79 3,79,74,04,172 At March 31, 2017 5,58,44,179 3,79,74,04,172

c. Other Equity

Reserves and Surplus Items of other comprehensive income

Additional paid in capital

Securities premium

capital Redemption

reserve

capital Reserve

general reserve

Retained Earnings

Effective portion of cash Flow

HedgesBalance at April 01, 2015 2,04,69,886 30,40,39,845 10,00,000 9,99,954 20,77,03,886 1,32,07,31,594 25,85,98,106 Profit for the year - - - - - 55,23,00,576 - Other comprehensive income

- - - - - 41,22,800 (25,37,60,611)

Total comprehensive income for the year

- - - - - 55,64,23,376 (25,37,60,611)

Dividends including dividend tax

- - - - - (74,16,71,985) -

Transfer to general reserve - - - - 5,70,00,000 (5,70,00,000) - Balance at March 31, 2016 2,04,69,886 30,40,39,845 10,00,000 9,99,954 26,47,03,886 1,07,84,82,985 48,37,495 Balance at April 01, 2016 2,04,69,886 30,40,39,845 10,00,000 9,99,954 26,47,03,886 1,07,84,82,985 48,37,495 Share based payment cost 40,04,224 - - - - - - Addition on shares issued during the year

75,18,79,857

Profit For the year 57,95,35,900 Other Comprehensive Income

(2,44,74,110) - - - - 9661899 12,28,10,101

Balance at March 31, 2017 - 1,05,59,19,702 10,00,000 9,99,954 26,47,03,886 1,66,76,80,784 12,76,47,596

111

The Annual Report

2016-17

As at March 31, 2017 March 31, 2016

Operating activitiesProfit before tax from continuing operations 87,79,17,783 84,17,88,761Adjustment to reconcile profit before tax to net cash flowsDepreciation of property, plant and equipment 22,88,07,082 20,84,51,182Acturial (gain)/loss on employee benefit plan 1,46,37,023 62,45,720Employee stock option cost measured at fair value 40,04,224 78,90,460Impact of discounts on security deposit Finance income 27,86,965 19,84,678 Rent expense 28,39,367 18,18,839Loss on disposal of property, plant and equipment 14,14,032Gain on disposal of property, plant and equipment 57,76,254 Gain on sale of investment 23,76,725 21,26,626Finance income 7,76,815 9,62,189Dividend Income 3,71,74,278 2,30,30,212Net foreign exchange differences 60,92,898 2,87,73,858

1,08,54,07,340 1,06,82,79,147

Working capital adjustments:Decrease/ (Increase) in Long Term Loans and Advances 3,05,45,978 2,65,20,407Decrease/ (Increase) in non-current assets 5,41,10,602 1,35,57,999Decrease in trade and other receivables and prepayments 4,50,64,105 61,62,607Increase in Deferred Revenue 99,10,348 56,47,767(Decrease)/ Increase in trade and other payables 1,07,30,774 79,01,381Increase/ (Decrease) in Other Current financial Liabilities 2,78,94,183 12,97,228(Decrease) in employee benefit liabilities 63,03,496 40,61,003Increase in Other Current liabilities 1,92,60,963 45,38,661

1,06,60,25,393 1,10,36,28,990Income tax paid 34,24,54,924 30,08,30,682Net cash Flow from operating activities (A) 72,35,70,469 80,27,98,308

Investing activitiesPurchase of property, plant and equipment 32,54,88,235 12,66,76,122Proceeds from sale of property, plant and equipment 59,01,910 34,25,762Investment in Subsidiary 6,90,00,000Purchase of current investments 4,17,40,81,303 3,55,08,30,217Proceeds from sale of current investments 3,85,06,79,620 3,66,57,95,574Fixed deposit placed 15,00,000 25,57,687Fixed deposit matured 39,91,553 23,26,867Dividend received 3,71,74,278 2,30,30,212Interest received (finance income) 4,70,219 3,72,445Net cash flows from investing activities (B) 60,28,51,958 5,41,13,166

cASH FlOW STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

112

cASH FlOW STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

As at March 31, 2017 March 31, 2016

Financing activities:Dividend paid, including dividend tax - 74,16,71,985Net cash (used in) financing activities (c) - 74,16,71,985

Net increase in cash and cash equivalents (A+B+c) 12,07,18,511 70,13,157Effect of exchange difference on Cash and Cash Equivalents - 3,29,437Cash and Cash equivalents at the beginning of the year 1,89,00,086 1,22,16,366Cash and Cash equivalents takenover as per the Scheme 38,70,793 -Cash and Cash equivalents at the end of the year 14,34,89,390 1,89,00,086

components of cash and cash equivalents

Balances with BanksIn Current Accounts 13,57,47,804 1,89,00,086Restricted cash balance 38,70,793 -Cash and Cash equivalents at the end of the year 13,96,18,597 1,89,00,086Summary of significant accounting policiesThe accompanying notes are an integral part of the financial statements.






113

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)1 corporate information

3D PLM Software Solutions Limited (‘the Company’) is a public limited company domiciled in India and is incorporated on Dec 14, 2001 under the provisions of the Companies Act, 1956. The Company is engaged in product development, industrialisation, maintenance, documentation and market support for Product Lifecycle Management (PLM) softwares of Dassault Systemes (‘the Holding company’) and provides back end support to finance and sales business administration function of Dassault Systemes.

The registered office of the Company is located at Mumbai.

These financial statements were authorised for issue in accordance with a resolution of the directors on April 25, 2017.


2.1 Statement of compliance and basis of preparation

The Company’s financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) notified under the Companies (Indian Accounting Standards) Rules, 2015 under the provision of the Companies Act, 2013 ( the ‘Act’)

For all periods up to and including the year ended 31 March 2015, the Company prepared its financial statements in accordance with the accounting standards notified under the section 133 of the Act, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (‘Indian GAAP’). These financial statements for the year ended March 31, 2017 are the first Ind AS Financial Statements that the Company has prepared in accordance with Ind AS. Refer to Note 43 for information on how the Company adopted Ind AS.

These financial statements have been prepared on the historical cost basis, except for certain financial instruments which are measured at fair values (refer note 2.3C) at the end of each reporting period. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

• Expected to be realised or intended to be sold or consumed in normal operating cycle

• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period



• It is expected to be settled in normal operating cycle or due to be settled within twelve months after the reporting period, or

• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

The Company classifies all other liabilities as non-current.


The Company has identified twelve months as its operating cycle.


The preparation of the Company’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

114

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) Significant judgements:

In the process of applying the Company’s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the financial statements:

• Property, plant and equipment

Useful lives of tangible assets and intangible assets are based on the life prescribed in Schedule II of the Companies Act, 2013. In cases, where the useful lives are different from that prescribed in Schedule II, they are based on management estimate, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers’ warranties and maintenance support. Assumptions also need to be made, when the Company assesses, whether an asset may be capitalized and which components of the cost of the asset may be capitalised.

• Estimates and assumptions

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expense for the periods presented.

• Recognition and measurement of defined benefit obligations

The obligation arising from defined benefit plan is determined on the basis of actuarial assumptions. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of discount rate, future salary increases and mortality rates. All assumptions are reviewed at each reporting date.


• Assessment of lease transactions


• Recognition of deferred tax assets


• Share based payments

The Company measures the grant date fair value of the options granted to employees using an option pricing model. Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them.

• Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

115

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) 2.3 Summary of significant accounting policies

A. Foreign currencies

These financial statements are presented in Indian rupees, which is also the Company’s functional currency.









The Company recognizes revenue from time and material contracts when the related services are rendered to the customers. Revenue from annual maintenance and support engagements is recognized proportionately as services are rendered, which generally results in straight-line revenue recognition as services are performed continuously over the term of the arrangement.

Revenue on fixed price development projects is measured using the percentage of completion method of accounting. Performance is generally measured based upon the efforts incurred to date in relation to the total estimated efforts to the completion of the contract. The Company monitors estimates of total contract revenues and costs on a routine basis throughout the delivery period. The cumulative impact of any change in estimates of the contract revenues or costs is reflected in the period in which the changes become known. In the event that a loss is anticipated on a particular contract, provision is made for the estimated loss.


In cases where Company acts as a principal, out of pocket expenses are recognised as revenue, with a corresponding expense. In other cases, out of pocket expenses are recognised net of reimbursements from clients.



Dividend:

A dividend is recognized as revenue when the right to receive payment has been established, which is generally when the shareholders approve the dividend.

Interest:

For all debt instruments measured either at amortised cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the

116

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)

estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortised cost of a financial liability.

c. Fair value measurement

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.






The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities

• Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

• Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.


For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.


• Disclosures for valuation methods, significant estimates and assumptions (Refer Note 2.2, 36 & 42 )

• Quantitative disclosures of fair value measurement hierarchy (Refer Note 37)

• Financial instruments (including those carried at amortised cost) (Refer Note 6 to 12, 16 to 18, 36, 37 & 42)



117

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) i Financial assets

Classification :

The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss on the basis of its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset.

Initial recognition and measurement :

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.






A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Company has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.



(iv) Investment in subsidiaries

Investment in subsidiaries is carried at cost in the separate financial statements.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company’s balance sheet) when:


b) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the

118


risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL at each reporting date, right from its initial recognition. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.


As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward looking estimates are analyses.


Classification

The Company classifies all financial liabilities as subsequently measured at amortised cost, except for financial liabilities at fair value through profit or loss. Such liabilities, including derivatives that are liabilities, shall be subsequently measured at fair value.




Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value through profit and loss. For trade and other payable smaturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

Share capital Ordinary shares: Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new

ordinary shares and share options are recognized as a deduction from equity.

119

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) Derecognition



The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company’s senior management determines change in the business model as a result of external or internal changes which are significant to the Company’s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.


Initial recognition and subsequent measurement

The Company uses derivative financial instruments, such as foreign exchange forward contracts to manage its exposure to foreign exchange risks on highly probable sale transactions. For contracts where hedge accounting is not followed, such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value through profit or loss account. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.


At the inception of a hedge relationship, the Company formally designates and documents the hedge relationship to which the Company wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The documentation includes the Company’s risk management objective and strategy for undertaking hedge, the hedging/economic relationship, the hedged item or transaction, the nature of the risk being hedged, hedge ratio and how the entity will assess the effectiveness of changes in the hedging instrument’s fair value in offsetting the exposure to changes in the hedged item’s fair value or cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in fair value or cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.


Cash flow hedges


Amounts recognized as OCI are transferred to Profit or Loss when hedged transaction affects profit or loss, such as when hedged financial expense or financial income is recognized or when forecast sale occurs. When the hedged item is the cost of a non financial asset or a non financial liability, the amounts recognized as OCI are transferred to the initial carrying amount of the non-financial asset or liability.

120

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) Hedge accounting is discontinued when the hedging instrument expires or is sold or terminated or exercised

or no longer qualifies for hedge accounting. Cumulative gain or loss on the hedging instrument recognised in shareholders’ funds is transferred to statement of profit and loss when the forecasted transaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in shareholders’ funds is transferred to the statement of profit and loss.


The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.


The Company bases its impairment calculation on detailed budgets and forecast calculations which are prepared separately for each of the Company’s cash-generating units to which the individual assets are allocated. These budgets and forecast calculations are generally covering a period of five years. For longer periods, wherever applicable, a long term growth rate is calculated and applied to projected future cash flows after the fifth year.


For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit and loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.


g. leases



At inception or on reassessment of an arrangement that contains a lease, the Company separates payments and other consideration required by the arrangement into those for the lease and those for other elements.

ii Company as a lessee


iii Company as lessor

Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Rental income from operating lease is recognised on a straight-line basis over the term of the relevant lease.

121

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) H. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation, other than the contribution payable to the provident fund. The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

The Company operates a gratuity plan which is a defined benefit plan which requires contributions to be made to separately administered fund. The cost of providing benefits is determined using the Projected Unit Credit method carried out by an independent actuary at each period end. When the calculation results in a potential asset for the Company, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.




The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company recognises the following changes in the net defined benefit obligation as an expense in the consolidated statement of profit and loss:



When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Company recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

The employee can carry-forward a portion of the unutilised accrued compensated absences and utilise it in future service periods or receive cash on termination of employment. Compensated absences are expected to occur within twelve months after the end of the period and are classified as a short term employee benefit. The Company records an obligation for such compensated absences in the period in which the employee renders the services. The Company accrues for liability in respect of compensated absences for the entire available leave balance standing to the credit of the employees at period end. The leave balance eligible for carry-forward is valued at gross compensation cost and the leave balance subject to encashment are accrued at basic pay.

I. Share based payments

Employees (including senior executives) of the Company receive remuneration in the form of share-based payments, whereby employees render services as consideration for stock options (equity-settled transactions) of Geometric Limited, Investor company.

Equity-settled transactions

The cost of equity-settled transactions is determined by the fair value at the date when the grant is made using an appropriate valuation model.

That cost is recognised, together with a corresponding increase in share-based payment (SBP) reserves in equity, over the period in which the performance and/or service conditions are fulfilled in employee benefits expense. The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity instruments that will ultimately vest. The statement of profit and loss expense or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period and is recognised in employee benefits expense.

In case where stock options are granted by Investor company without any recharge, the fair value of options is recognised as an expense with a credit to deemed equity contribution from investor

122

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) J. Taxes

i. current income taxes


Current tax assets and liabilities are offset only if, the Company:



ii. Deferred tax











K. Property, plant and equipment





123

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be

capable of operating in the manner intended by management.





Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

iii. Depreciation




Particulars / Asset type Years of useful lifeBuildings 28 yearsBuildings - Interiors 10 yearsComputers 3 yearsElectrical installations 8 yearsOffice equipments 5 yearsFurniture and fixtures 10 yearsVehicles 5 years

The Company, based on technical assessment made by technical expert and management estimate, depreciates certain items of building over estimated useful lives which are different from the useful life prescribed in Schedule II to the Companies Act, 2013. The management believes that these estimated useful lives are realistic, reflect fair approximation of the period over which the assets are likely to be used.




Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Intangible assets like computer software that are acquired by the Company and have finite useful lifes are measured at cost less accumulated amortisation and any accumulated impairment losses.





124

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) Goodwill:

Goodwill is not amortised but tested for impairment in accordance with the accounting policy stated in para F above.

Computer software:

ERP license and installation, is amortised on a straight-line basis over the period of license.

l. Provisions Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past

event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.


M. Earnings per share



N. cash and cash equivalents


For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Company’s cash management.

O. Dividend distribution to equity holders The Company recognises a liability to make cash distributions to equity holders of the Company when the distribution

is authorised and the distribution is no longer at the discretion of the Company. A distribution in case of final dividend is authorised when it is approved by the shareholders. A corresponding amount is accordingly recognised directly in equity. In case of interim dividend it is authorised when it is approved by the Board of Directors.


The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.


Amendments to Ind AS 7, Statement of cash Flows



The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. The Company does not have any cash settled award as at March 31, 2017.

125

The Annual Report

2016-17


Not

e 3

: Pro

pert

y, p

lant

and

equ

ipm

ent

leas

ehol

d la

ndle

aseh

old

Impr

ovem

ents

Build

ings

Build

ings

-I

nter

iors

com

pute

rsEl

ectr

ical

In

stal

lati

ons

Offi

ce

Equi

pmen

tsFu

rnit

ure

and

Fixt

ures

Vehi

cles

Tota

l

cost

or

valu

atio

nA

t A

pril

01, 2

015

36,

57,7

3,37

6 2

,29,

046

29,

27,8

6,08

9 1

2,29

,60,

927

18,

71,1

6,55

8 5

,54,

17,0

89 8

,74,

92,9

04 6

,73,

79,6

08 2

0,80

,638

1,18

,12,

36,2

35A

ddit

ions

- -

1,3

3,28

,743

- 1

0,22

,04,

337

41,

53,4

07 1

,54,

32,5

46 9

2,04

,445

- 1

4,43

,23,

478

Dis

posa

ls -

- -

- 1

,30,

892

14,

82,4

55 3

,22,

091

28,

84,2

83 2

0,07

3 4

8,39

,794

At M

arch

31,

201

6 3

6,57

,73,

376

2,2

9,04

6 3

0,61

,14,

832

12,

29,6

0,92

7 2

8,91

,90,

003

5,8

0,88

,041

10,

26,0

3,35

9 7

,36,

99,7

70 2

0,60

,565

1,32

,07,

19,9

19A

ddit

ions

- 7

,32,

40,7

29 2

8,98

,886

- 1

5,99

,91,

496

20,

73,5

88 5

,18,

62,8

50 2

,58,

58,6

75 -

31,

59,2

6,22

4D

ispo

sals

- -

- -

- 1

,18,

575

- 7

,081

- 1

,25,

656

At M

arch

31,

201

7 3

6,57

,73,

376

7,3

4,69

,775

30,

90,1

3,71

8 1

2,29

,60,

927

44,

91,8

1,49

9 6

,00,

43,0

54 1

5,44

,66,

209

9,9

5,51

,364

20,

60,5

651,

63,6

5,20

,487

Dep

reci

atio

n an

d im

pair

men

tA

t A

pril

01, 2

015

- -

- -

- -

- -

- -

Dep

reci

atio

n ch

arge

for t

he y

ear

46,

05,3

30 1

,40,

197

9,8

8,83

1 1

,72,

12,5

54 1

1,63

,28,

580

1,7

4,86

,397

3,5

3,45

,417

1,4

0,05

,386

20,

09,7

39 2

0,81

,22,

431

Dis

posa

ls -

- -

- -

- -

- -

-At

Mar

ch 3

1, 2

016

46,

05,3

30 1

,40,

197

9,8

8,83

1 1

,72,

12,5

54 1

1,63

,28,

580

1,7

4,86

,397

3,5

3,45

,417

1,4

0,05

,386

20,

09,7

39 2

0,81

,22,

431

Dep

reci

atio

n ch

arge

for t

he y

ear

46,

05,3

31 1

3,51

,620

1,3

8,18

,155

1,8

8,87

,666

12,

46,8

7,39

8 1

,72,

41,0

25 3

,37,

54,2

36 1

,41,

69,3

27 5

0,82

6 2

2,85

,65,

584

Dis

posa

ls -

- -

- -

- -

- -

-At

Mar

ch 3

1, 2

017

92,

10,6

61 1

4,91

,817

1,4

8,06

,986

3,6

1,00

,220

24,

10,1

5,97

8 3

,47,

27,4

22 6

,90,

99,6

53 2

,81,

74,7

13 2

0,60

,565

43,

66,8

8,01

5

Net

boo

k va

lue

At M

arch

31,

201

7 3

5,65

,62,

715

7,1

9,77

,958

29,

42,0

6,73

2 8

,68,

60,7

07 2

0,81

,65,

521

2,5

3,15

,632

8,5

3,66

,556

7,1

3,76

,651

-1,

19,9

8,32

,472

At M

arch

31,

201

6 3

6,11

,68,

046

88,

849

30,

51,2

6,00

1 1

0,57

,48,

373

17,

28,6

1,42

3 4

,06,

01,6

44 6

,72,

57,9

42 5

,96,

94,3

84 5

0,82

61,

11,2

5,97

,488

At A

pril

01, 2

015

36,

57,7

3,37

6 2

,29,

046

29,

27,8

6,08

9 1

2,29

,60,

927

18,

71,1

6,55

8 5

,54,

17,0

89 8

,74,

92,9

04 6

,73,

79,6

08 2

0,80

,638

1,18

,12,

36,2

35

126

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 4 : Intangible assets

Computer Software

Total

cost or valuationAt April 01, 2015 1,19,989 1,19,989Additions 2,08,760 2,08,760At March 31, 2016 3,28,749 3,28,749Additions 3,22,000 3,22,000Disposals - -At March 31, 2017 6,50,749 6,50,749

Amortisation and impairmentAt April 01, 2015 - -Amortisation 3,28,749 3,28,749At March 31, 2016 3,28,749 3,28,749Amortisation 2,41,500 2,41,500Disposals - -At March 31, 2017 5,70,249 5,70,249

Net book valueAt March 31, 2017 80,500 80,500At March 31, 2016 - -At April 01, 2015 1,19,989 1,19,989

Note 5 : goodwillGoodwill Total

cost or valuationAt April 01, 2015 - -Additions - -At March 31, 2016 - -Additions (Refer Note below) 4,51,72,90,829 4,51,72,90,829Disposals - -At March 31, 2017 4,51,72,90,829 4,51,72,90,829

Amortisation and impairmentAt April 01, 2015 - -Amortisation - -At March 31, 2016 - -Amortisation - -At March 31, 2017 - -

Net book valueAt March 31, 2017 4,51,72,90,829 4,51,72,90,829At March 31, 2016 - -At April 01, 2015 - -

Note: On April 01, 2016, the Board of Directors approved the Composite Scheme of Arrangement and Amalgamation between Geometric Limited (‘GL’ or ‘Transferor Company’ ), HCL Technologies Limited (‘HCL’) and 3DPLM Software Solutions Limited (‘3D PLM’ or ‘the Company’ or the Transferee) and their respective shareholders and creditors pursuant

127

The Annual Report

2016-17


to the provisions of Sections 391 to 394 read with Section 100 of the Companies Act, 1956 or under Section 230 to 234 of the Companies Act, 2013 and other applicable provisions if any, of the Companies Act, 1956 and/or Companies Act, 2013 & the relevant provisions made thereunder (‘the Scheme’).

Pursuant to the scheme, the IT enabled engineering services, PLM services and engineering design productivity software tools of GL including its overseas subsidiaries (but excluding the shares held by GL in 3D PLM) (“”Demerged Business Undertaking””) got transferred to HCL.

GL, comprising the shares held by it in 3D PLM (“Remaining Undertaking”) has been merged and amalgamated with 3D PLM. In consideration of the amalgamation, 3D PLM has issued and allotted to each resident shareholder of the Company 1 (one) fully paid up redeemable preference share of Rs.68 each (‘Redeemable Preference Shares’) in 3D PLM for every 1 (one) fully paid up equity share each of GL aggregating to 55,844,179 Redeemable Preference Shares. For the shares held by non-resident shareholders, the Company has issued and allotted 24 fully paid unlisted equity shares of Rs. 10 each of 3D PLM for every 1,793 fully paid up equity shares of Rs. 2 each of GL held by such shareholders aggregating to 148,291 equity shares. Subsequent to year end and pursuant to the scheme, the equity shares issued to non resident shareholders has been bought by Dassault Systemes SE.

The redeemable preference shares issued by 3D PLM pursuant to the Scheme are in the process of getting listed on the Bombay Stock Exchange.

The Scheme is effective March 02, 2017 pursuant to the High Court Orders received for the same and other regulatory approval as required under applicable law. The Appointed Date of the Scheme is March 31, 2016.

The Company has recorded for the Scheme from the effective date as per the accounting treatment described therein;

1. Face value of 5,58,44,179 redeemable preference shares issued of Rs. 68/- each amounting to Rs. 3,79,74,04,172 is credited to preference share capital and classified as equity in the standalone Ind AS financial statements. Accordingly, the Company has not recognised dividend payable to shareholders in the absence of its approval by the board and shareholders.

2. Face value of 148,291 equity shares issued of Rs. 10 each amounting to Rs. 14,82,910 has been credited to equity share capital and premium of Rs. 75,18,79,857 has been credited to securities premium.

3. The difference between consideration paid and the fair value of net assets taken over and investments cancelled amounting to Rs. 4,51,72,90,829 is accounted as Goodwill.

Had the Company accounted for the amalgamation as per applicable Ind AS, the redeemable preference shares issued amounting to Rs. 3,79,74,04,172 would have been accounted as current liability in accordance with Ind AS 32 and the Company would have accounted for dividend cost from date of issuance till March 2017 as finance cost and related liability relating to preference shares. Accordingly, the liability would have been higher by Rs. 3,80,61,43,404, equity would have been lower by Rs. 3,79,74,04,172 and profit before tax would have been lower by Rs. 87,39,232 (dividend). Further, difference between the assets over the liabilities after making the adjustments for issuance of redeemable preference shares and equity shares of Rs. 4,51,72,90,390 would have been adjusted against the Company’s retained earnings, being loss on cancellation of the Company’s own equity instruments in accordance with Ind AS 32.

I Financial assets at fair value through profit or loss :

Note 6: Non-current investments

As at March 31, 2017 March 31, 2016 April01, 2015

Unquoted, fully paid30,10,000 (March 31, 2016: 30,10,000; March 31, 2015: 30,10,000) Equity shares of 3D PLM Global Services Private Limited of face value Rs.10 each

3,01,00,000 3,01,00,000 3,01,00,000

69,00,000 (March 31, 2016 : 69,00,000; March 31, 2015: NIL) Preference Shares of 3D PLM Global Services Private Limited of face value Rs. 10 each

6,90,00,000 6,90,00,000 -

9,91,00,000 9,91,00,000 3,01,00,000

128

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 7: current investments

March 31, 2017 March 31, 2016 April 01, 2015 No. of units

Amounts Rs.

No. of units

Amounts Rs.

No. of units

Amounts Rs.

OTHER THAN TRADE, UNQUOTED, FULLY PAID UP (at fair value)Investments In Mutual FundsInvesco India Ultra Short Term Fund - Direct Plan Daily Dividend Re-Investment

50,532 5,14,90,600 - - - -

Axis Treasury Advantage Fund - Daily Dividend-Re-Investment 64,735 6,51,38,317 - - - -Baroda Pioneer Liquid Fund - Plan B Daily Dividend- Re-Investment - - - - 5,037 50,42,140Birla Sunlife Cash Manager - Reg - Daily Dividend-Re-Investment 9,03,957 9,09,61,321 7,97,893 8,01,97,694 4,95,854 4,98,10,201Birla Sunlife Treasury Optimizer - Regular -Mdr - - - - 5,92,566 6,18,95,505BNP Paribas Overnight Fund Direct Plan-Daily Dividend 36,987 3,70,20,727 90,032 9,00,91,600 - -BNP Paribas Short Term Income Fund Direct Plan Daily Dividend - Re-Investment

20,43,958 2,05,48,930 - - - -

DSP Blackrock Ultra Short Term Fund- Regular Daily Dividend Re-Invstement

97,69,627 9,85,12,035 - - 80,30,218 8,06,24,992

Franklin India Low Duration Fund- Mdr - - - - 19,47,936 2,04,53,716Franklin India Saving Plus-Reg Daily Dividend-Re-Investment - - - - 38,00,443 3,81,33,644Franklin India Ultra Short Bond Fund - Super InstitUTIonal Daily Dividend

53,93,511 5,43,77,381 - - - -

HDFC Floating Rate Income Fund - Short Term - Wholesale - Daily Dividend-Re-Investments

- - 29,95,080 3,01,93,102 - -

HDFC Liquid Fund-Dividend-Daily Reinvest - - 9 8,930 53,94,801 5,50,17,258ICICI Fmp Series 78-95 D Plan K Cum - - 25,00,000 2,52,80,500 - -ICICI Prudential Banking & Psu Debt Fund- Regular Daily Dividend-Re-Investment

- - - - 35,48,285 3,57,23,783

ICICI Prudential Ultra Reg Daily Dividend-Re-Investment - - - - 40,01,459 4,07,44,061ICICI Prudential Savings Fund - Daily Dividend Re-Investment 9,01,910 9,14,77,167 - - - -Idfc Cash Fund-Daily Dividend-(Regular Plan) - Reinvestment 49,937 5,00,20,450 - - - -Kotak Banking & Psu Debt Fund-Direct Plan Daily Dividend - Reinvestment

15,42,444 1,58,35,502 - - - -

Kotak Corporate Bond Fund Direct Monthly Dividend - Reinvestment 20,081 2,22,00,836 - - - -L & T Banking And Psu Debt Fund - Weekly Dividend Re-Investment 23,85,217 2,49,52,946 - - - -LIC Mf Savings Plus Fund - Regular Daily Dividend Plan - Reinvestment

39,08,112 3,97,10,719 - - - -

Reliance Liquid Fund - Cash Plan - Daily Dividend-Re-Investment 37,736 4,20,43,722 14,630 1,63,00,206 67,492 7,51,96,451Reliance Medium Term Fund-Daily Dividend Plan 50,99,398 8,71,78,802 56,63,582 9,68,24,039 - -Reliance Money Manager Fund - Direct -Daily Dividend-Re-Investment - - - - 80,313 8,05,35,361Reliance Quarterly Interval Fund - Series Ii-Growth Plan Growth Option - - 9,78,186 2,02,34,178 - -Religare Invesco Credit Opportunities Fund-Daily Dividend-Re-Investment

- - - - 35,697 3,57,06,892

Religare Invesco Medium Term Bond Fund - Monthly Dividend Re-Investment

- - 35,081 3,56,76,320 - -

Sundaram Select Debt Short Term Asset-Div-Quarterly - - - - 18,25,984 2,02,60,750Sundaram Ultra Short Term Fund R Daily Dividend-Re-Investment 19,27,838 1,93,49,706 60,20,452 6,04,27,282 - -UTI Fixed Income Interval Fund Quarterly Interval Plan Iii Direct Plan Dividend

- - 29,95,686 3,02,71,702 - -

81,08,19,161 48,55,05,553 59,91,44,754

Current 81,08,19,161 48,55,05,553 59,91,44,754Non Current - - -

81,08,19,161 48,55,05,553 59,91,44,754

129

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 8: Other financial assets - derivative instruments


Derivative instruments at fair value through OCICash Flow HedgesForeign exchange forward contracts 19,34,96,963 1,36,94,574 42,44,60,697

19,34,96,963 1,36,94,574 42,44,60,697

Current 19,34,96,963 1,36,94,574 36,79,51,826Non current - - 5,65,08,871

19,34,96,963 13,69,45,74 42,44,60,697

Financial assets at fair value through OcI Financial assets at fair value through OCI reflect the change in fair value of foreign exchange forward contracts, designated

as cash flow hedges to hedge highly probable future sales in USD and EURO. The Company is exposed to changes in the forex rates of USD and EURO on its forecast sales. The forward contracts are designated as cash flow hedges to offset the effect of price changes USD and EURO rates. The Company has hedged approximately 90% of its expected USD sales and 50% of its expected EURO sales for the next reporting period.

Note 9: Trade and other receivables (Unsecured)


Trade receivablesReceivables from holding company (Note 32) - 11,52,23,285 10,00,48,660Receivables from other related parties (Note 32) 1,85,13,575 1,62,97,835 2,97,70,592Trade receivables outstanding for a period exceeding six months 10,95,394 - -

1,96,08,969 13,15,21,120 12,98,19,252

No trade or other receivable are due from directors or other officers of the Company either severally or jointly with any other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member.Trade receivables are non-interest bearing and are generally on terms of 30 days credit. There is no impairment allowance for trade and other receivables.

Note 10: cash and cash equivalent


Balance with banksCurrent accounts 13,96,18,597 1,89,00,086 1,22,16,366Restricted cash balance (Refer Note 5) 38,70,793 - -

Cash on hand - - - 14,34,89,390 1,89,00,086 1,22,16,366

For the purpose of the statement of cash flows, cash and cash equivalents comprises the following:Balances with banks:– On current accounts 13,96,18,597 1,89,00,086 1,22,16,366– Restricted cash balance 38,70,793 - -

14,34,89,390 1,89,00,086 1,22,16,366

Cash at banks earns interest at floating rates based on daily bank deposit rates.

130

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 11: Advances and deposits


AdvancesUnsecured, considered goodEmployees 14,80,881 14,10,613 24,66,036Other Related Parties - 46,40,963 15,59,730

14,80,881 60,51,576 40,25,766

Unsecured , considered doubtfulDoubtful advances to employees 4,35,038 7,77,235 -Provision for doubtful advances to employees (4,35,038) (7,77,235) -

- - -

Security DepositsShort term security deposit 2,77,89,629 2,60,18,717 1,17,868Long term term security deposit 3,75,14,543 41,81,600 2,87,17,329

6,53,04,172 3,02,00,317 2,88,35,197

Bank DepositsDeposits in banks (with maturity period more than 3 months but less than 12 months)

48,75,000 27,48,866 -

Deposits in Banks (with remaining maturity greater than twelve months)

25,05,000 71,22,687 96,40,733

[Pledged with bankers for obtaining bank guarantees Rs.1,690,000 (March 31, 2016: Rs 5,475,000; March 31, 2015: 6,880,000)]

Current 3,41,45,510 3,48,19,159 41,43,634Non Current 4,00,19,543 1,13,04,287 3,83,58,062

7,41,65,053 4,61,23,446 4,25,01,696

Short-term deposits are made for varying periods, depending on the immediate cash requirements of the Company, and earn interest at the respective short-term deposit rates.

Note 12: Other current assets


Interest accrued on fixed deposits with bank 27,33,735 24,27,139 18,37,395 27,33,735 24,27,139 18,37,395

Note 13: Non-financial assets


currentAdvances recoverable in cash or in kind - current 6,89,96,784 4,24,92,341 4,17,81,879Unbilled Revenue 18,11,691 9,72,395 1,24,11,726Other Receivables 4,90,80,329 1,95,15,158 3,30,72,354

11,98,88,804 6,29,79,894 8,72,65,959Non currentCapital Advances 2,13,80,626 20,11,004 78,45,510Advance income tax - net of provision for taxation 6,17,78,543 4,32,09,678 4,10,09,678Fringe benefit tax 13,84,719 13,84,719 13,84,719Balance with government authorities 10,24,89,217 6,77,48,237 7,54,71,730

18,70,33,105 11,43,53,638 12,57,11,637

131

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 14: Share capital

Authorised share capital:Equity Shares Preference Shares

Nos. Amount Nos. AmountAt April 01, 2015 3,00,00,000 30,00,00,000 - -Changes during the year - - - -At March 31, 2016 3,00,00,000 30,00,00,000 - -Increase / (decrease) during the year (1,10,00,000) (11,00,00,000) 5,76,50,000 7,38,60,00,000At March 31, 2017 1,90,00,000 19,00,00,000 5,76,50,000 7,38,60,00,000

Issued, Subscribed and Paid Up :Equity shares of INR 10 each issued, subscribed and fully paid

Equity SharesNos. Amount

At April 01, 2015 15,52,200 1,55,22,000Changes during the year - -At March 31, 2016 15,52,200 1,55,22,000Changes during the yearCancelled (Refer Note 5) (9,00,200) (90,02,000)Issued during the year (Refer Note 5) 1,48,291 14,82,910At March 31, 2017 8,00,291 80,02,910

Redeemable Preference shares of Rs. 68 each issued and fully paidPreference Shares

Nos. AmountAt April 01, 2015 - -Changes during the year - -At March 31, 2016 - -Issued during the year (Refer Note 5) 5,58,44,179 3,79,74,04,172At March 31, 2017 5,58,44,179 3,79,74,04,172

Pursuant to the Composite scheme of arrangement and amalgamation as explained in Note 5, the authorized capital of the Company now stands at INR 19,00,00,000

a. Terms/rights attached to equity shares

621,337 equity shares of the face value of Rs. 10 each fully paid carry a single voting right (1 vote for every single share held)

72,965 Class ‘A’ equity shares of Rs.10 each fully paid have differential voting rights of 2 votes for every one such share held

105,989 Class ‘B’ equity shares of Rs. 10 each fully paid have differential voting rights of 2 votes for every one share held and one additional vote each on:

i. a change in control that has ocurred due to actions by any person regarded as a Dassault Systemes Competitor as defined in the Shareholder’s Agreement; or

ii. Upon issuance of the “Notice of Increase” as defined in the Shareholders Agreement.

Each equity share carries equal dividend rights irrespective of the class of shares to which it belongs.

The dividend proposed by the board of Directors is subject to approval of shareholders in the ensuing General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company.

The distribution will be in proportion to the number of equity shares held by the shareholders.

132

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) b. Terms/rights attached to preference shares

55,844,179 preference shares of the face value of Rs. 68 each fully paid carry a single voting right (1 vote for every single share held)

The Redeemable Preference Share shall subject to the provisions of the Articles of Association of the Transferee Company and the Act confer the holders thereof a right to fixed preferential dividend of 7% per annum in priority to the equity shares subject to deduction of taxes at source if applicable. Dividend to be paid at each quarterly period i.e. 1.75% per quarter

The Redeemable Preference Shares are redeemable at par on the expiry of 15 (fifteen) months from the date of allotment. Provided however, up to a period of 15 days prior to the end of every successive period of 3 months from the date of allotment of the Redeemable Preference Shares (“Quarterly Redemption Period”), any holder of the Redeemable Preference Share shall have the right but not an obligation to request the Company for redemption of the Redeemable Preference Shares held by such person. Within a period of 15 days after the end of the Quarterly Redemption Period, the Company shall redeem the Redeemable Preference Shares that have been validly tendered for redemption during the Quarterly Redemption Period. In the event any holder of the Redeemable Preference Share does not request the Company to redeem the Redeemable Preference Shares held by such a person during the Quarterly Redemption Period, the Redeemable Preference Shares held by such person shall be redeemed within 30 days from the expiry of the said tenure of 15 months.

In the event of winding up of the Company, the holders of the Redeemable Preference Shares shall have a right to receive of the paid up capital and arrears of dividend, whether declared or not, upto the commencement of winding up, in priority to any paid up capital on the equity shares out of the surplus but shall not have any further rights to participate in the profits of the assets of the Company.

c. Shares held by Holding company and percentage of holding:

Equity shares March 31, 2017 March 31, 2016Geometric LimitedNumber of shares held - 900,200Percentage of holding 0% 58%

Dassault Systèmes SENumber of shares held 534,091 385,800Percentage of holding 67% 25%

Dassault Systemes Americas CorpNumber of shares held 266,200 266,200Percentage of holding 33% 17%

800,291 1,552,200

133

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) d. Details of shareholders holding more than 5% shares in the company and shares held by holding company

March 31, 2017 March 31, 2016(i) Equity Shares

Geometric LimitedNumber of shares held - 900,200Percentage of holding in the class 0% 66%

Dassault Systèmes SENumber of shares held 534,091 385,800Percentage of holding in the class 86% 28%

Dassault Systemes Americas CorpNumber of shares held 87,246 87,246Percentage of holding in the class 14% 6%

621,337 1,373,246(ii) class ‘A’ Equity Shares


72,965 72,965(iii) class ‘B’ Equity Shares


105,989 105,989

Note 15: Other equity

Additional paid in capital Amount in Rs.As at April 01, 2015 1,25,79,426Changes during the year 78,90,460At March 31, 2016 2,04,69,886Changes during the year 40,04,224Adjusted pursuant to the Scheme (Refer Note 5) (2,44,74,110)At March 31, 2017 -

Retained Earnings Amount in Rs.As at April 01, 2015 1,32,07,31,594Changes during the yearProfits for the year 55,64,23,376Dividend and dividend tax (74,16,71,985)Transfer to General reserve (5,70,00,000)At March 31, 2016 1,07,84,82,985Profits for the year 58,91,97,799At March 31, 2017 1,66,76,80,784

Securities premium account Amount in Rs.At April 01, 2015 30,40,39,845Changes during the year -At March 31, 2016 30,40,39,845Additions on issuance of equity shares (Refer Note 5) 75,18,79,857At March 31, 2017 1,05,59,19,702

134


Other reserves March 31, 2017 March 31, 2016 April 01, 2015

Capital reserve 9,99,954 9,99,954 9,99,954

General reserve 26,47,03,886 26,47,03,886 20,77,03,886

Capital Redemption Reserve 10,00,000 10,00,000 10,00,000

Cash flow hedge reserve 12,76,47,595 48,37,495 25,85,98,106

Total other reserves 39,43,51,435 27,15,41,335 46,83,01,946

Note 16: Other financial liabilities - derivative instruments


Derivative instruments at fair value through OCICash Flow HedgesForeign exchange forward contracts - 42,11,141 -

- 42,11,141 -

Current - - - Non Current - 42,11,141 -

- 42,11,141 -

Financial assets at fair value through OcI

Financial liabilities at fair value through OCI reflect the change in fair value of foreign exchange forward contracts, designated as cash flow hedges to hedge highly probable future sales in USD and EURO. The Company is exposed to changes in the forex rates of USD and EURO on its forecast sales. The forward contracts are designated as cash flow hedges to offset the effect of price changes USD and EURO rates. The Company has hedged approximately 90% of its expected USD sales and 50% of its expected EURO sales for the next reporting period.

Note 17: Trade and other payables (non-interest bearing)


Trade payables 2,22,63,611 2,81,61,135 2,92,28,987 Other payablesPayables to related parties (Refer Note 32) - 34,81,310 - Others 26,83,246 8,62,516 2,63,079

2,49,46,857 3,25,04,961 2,94,92,066

Note 18: Other financial liabilities


Retention money 30,08,224 12,36,145 21,80,809 Accrued expenses 11,42,18,309 8,81,16,205 8,91,77,056 Capital creditors 2,46,24,355 2,51,86,048 2,30,11,670 Deposits from vendors 1,80,000 1,60,000 80,000 Unclaimed dividends 38,70,793 - - Advances from customers 6,28,287 6,28,287 -

14,65,29,968 11,53,26,685 11,44,49,535

All the financial liabilities are carried at amortised costs

135

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 19: Deferred revenue


Balance of deferred revenue at the beginning of the year 11,21,31,608 11,77,79,375 7,77,36,104

Movement during the yearDeferred during the year 6,09,53,177 6,03,70,590 9,68,05,541 Released to the statement of profit and loss (7,08,63,525) (6,60,18,357) (5,67,62,270)

10,22,21,260 11,21,31,608 11,77,79,375

Current 5,79,65,371 5,99,81,678 5,71,90,293 Non-Current 4,42,55,889 5,21,49,930 6,05,89,082

10,22,21,260 11,21,31,608 11,77,79,375

Note 20: Net employee defined benefits liabilities


Provision for employee benefitsProvision for gratuity 2,16,07,265 3,15,00,374 4,80,16,922 Provision for compensated absences 5,87,86,391 5,51,96,778 4,27,41,233

8,03,93,656 8,66,97,152 9,07,58,155

Note 21: Other current liabilities


Statutory liabilities 4,24,96,119 3,40,80,974 2,96,47,294 Others payables 1,17,54,839 9,09,021 8,04,040

5,42,50,958 3,49,89,995 3,04,51,334

Note 22: Revenue from operations

March 31, 2017 March 31, 2016Revenue from services 31,91,212,811 2,75,82,24,339Other operating revenuesLeased income 30,37,54,699 24,68,73,056

3,49,49,67,510 3,00,50,97,395

The Company has a component of leased income from an arrangement of embedded lease which can be confirmed on the basis of following factors:

The entire facility of the Company alongwith specific assets are used to render services to its Parrnt company, Dassault Systèmes SE (‘DS’) and its affiliates, though the same is not explicitly mentioned in the agreement

The output from this facility is only being used for providing services to DS and its affiliates and on a cost plus mark up basis, thereby fulfiling the criteria on the right to use the asset.

This arrangement contains a lease. Although the Master Sales Agreement is for an indefinite period, it can be cancelled by either party. Hence, lease is in the nature of operating lease

The disclosure of revenue is bifurcated into service income and lease income. The lease income is computed by adding an appropriate profit margin to the depreciation amount of the respective assets, rent, etc. and the balance has been disclosed as service income.

136

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 23: Other income

March 31, 2017 March 31, 2016Dividend incomeDividend income on current investments 3,71,74,278 2,30,30,212

Other non operating incomeLease rent received from a related party 6,53,789 6,53,789Gain on sale of current investments (Net) 23,76,725 21,26,626Foreign exchange difference (Net) 13,78,69,726 31,27,81,915Gain on sale of assets (Net) 57,76,254 -Miscellaneous income 8,28,110 44,95,045Shared service income 35,81,152 29,47,817

18,82,60,034 34,60,35,404

Note 24: Finance income

March 31, 2017 March 31, 2016Interest incomeInterest on advances and deposits 7,38,973 9,27,280Interest on loan to subsidiaries - 23,41,935Interest earned from loans to employees 37,842 34,909Interest on unwinding of security deposit 27,86,965 19,84,678

35,63,780 52,88,802

Note 25: Employee benefits expense

March 31, 2017 March 31, 2016Salaries, bonus and allowances 1,96,28,71,968 1,75,79,25,826Contribution to provident and other funds 10,92,55,644 9,50,31,462Share based payments to employees 40,04,224 78,90,460Gratuity expense 4,12,44,288 3,90,67,572Staff welfare expenses 8,91,34,651 8,25,96,569

2,20,65,10,775 1,98,25,11,889

Note 26: Depreciation and amortisation expense

March 31, 2017 March 31, 2016Depreciation of tangible assets (Refer Note 3) 22,85,65,582 20,81,22,434Amortization of intangible assets (Refer Note 4) 2,41,500 3,28,748

22,88,07,082 20,84,51,182

Note 27: Other expenses

March 31, 2017 March 31, 2016Sub-contracting expenses 14,86,598 55,000Facility charges 4,66,56,900 5,16,98,814Electricity expenses 7,03,00,254 6,69,44,737Rates and taxes 52,64,555 48,14,152Rent 8,43,48,790 5,15,39,814Repairs and maintenance - Computer and accessories 2,89,94,565 2,26,69,514Repairs and maintenance - Buildings 40,31,885 85,33,742

137

The Annual Report

2016-17


March 31, 2017 March 31, 2016Repairs and maintenance - Others 1,20,27,044 2,08,97,668Insurance 42,39,071 40,42,121Travelling and conveyance expenses 2,18,25,449 1,55,66,329Equipment rental charges 27,64,846 33,03,342Communication expenses 28,67,039 35,03,824Legal and professional charges 1,45,26,286 1,40,65,242Auditor’s remuneration 45,96,769 37,84,840Staff recruitment expenses 42,63,892 37,60,822Commission to non-executive directors 11,95,593 -Directors’ sitting fees 2,52,500 2,55,000Loss on sale of assets (Net) - 14,14,032Bad debts written off - 11,92,128Provision for doubtful advances 13,23,323 3,39,928Miscellaneous expenses 1,29,76,448 1,31,81,428Corporate social responsibility expenses 1,35,60,565 40,60,000Shared services costs 3,44,68,341 2,67,90,042

37,19,70,713 32,24,12,519

Payment to auditorsMarch 31, 2017 March 31, 2016

As auditorAudit fee 44,00,000 36,15,802

Other capacityReimbursement of expenses 1,96,769 1,69,038

45,96,769 37,84,840

Details of CSR expenditure:March 31, 2017 March 31, 2016

Gross amount required to be spent by the Company during the year 1,46,73,902 1,42,64,741Amount spent during the year (paid in cash)i) Construction/acquisition of any assetii) On purposes other than (i) above 1,35,60,565 40,60,000

1,35,60,565 40,60,000

Note 28: Finance cost

March 31, 2017 March 31, 2016Interest expense 2,13,570 117Other borrowing cost 13,71,401 12,57,133

15,84,971 12,57,250

138

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 29: components of other comprehensive income (OcI)

The disaggregation of changes to OCI by each type of reserve in equity is shown below:

During the year ended March 31, 2017cash flow

hedge reserveRetained earnings

Total

Currency forward contracts (18,60,47,721) - (18,60,47,721)

Reclassified to statement of profit or loss 6,32,37,620 - 6,32,37,620

Re-measurement gains (losses) on defined benefit plans - (96,61,899) (96,61,899)

(12,28,10,101) (96,61,899) (13,24,72,000)

During the year ended March 31, 2016cash flow

hedge reserveRetained earnings

Total

Currency forward contracts 38,44,27,528 - 38,44,27,528

Reclassified to statement of profit or loss (13,06,66,917) - (13,06,66,917)

Re-measurement gains (losses) on defined benefit plans - (41,22,800) (41,22,800)

25,37,60,611 (41,22,800) 24,96,37,811

Note 30: Earnings per share (EPS)

The following reflects the income and share data used in the basic and diluted EPS computations:

March 31, 2017 March 31, 2016

Profit attributable to equity holders:

Continuing operations 5,79,535,900 55,23,00,576

Profit attributable to equity holders adjusted for the effect of dilution 57,95,35,900 55,23,00,576

Weighted average number of Equity shares for basic EPS* 15,27,480 15,52,200

15,27,480 15,52,200

* The weighted average number of shares takes into account the weighted average effect of changes in share during the year on account of cancellation and issuance. There have been no other transactions involving Equity shares or potential Equity shares between the reporting date and the date of authorisation of these financial statements.

139

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 31: gratuity and other post-employment benefit plans a. Defined contribution Plan


Year Ended Year EndedMarch 31, 2017 March 31, 2016

Contribution to Provident Fund 8,43,48,037 7,48,55,023Contribution to Superannuation Fund 1,72,80,595 1,32,67,419Total 10,16,28,632 8,81,22,442

b. Defined Benefit Plan The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service

gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.


As at As atMarch 31, 2017 March 31, 2016

gratuityI Reconciliation of opening and closing balances of Defined Benefit obligation

Present Value of Defined Benefit obligation as at the beginning of the year 21,28,04,454 19,06,95,981 Interest Cost 1,57,90,693 1,40,96,251 Current Service Cost 4,00,47,274 3,66,31,463 Settlement cost / (credit) - (1,11,15,080)Benefits paid (1,00,64,349) (88,34,549)Net Actuarial Loss / (Gain) (1,05,09,674) (86,69,612)Present Value of Defined Benefit obligation as at the end of the year 24,80,68,398 21,28,04,454

II Reconciliation of fair value of plan assetsFair value of plan assets as at the beginning of the year 18,13,04,080 14,26,79,059 Inerest Income 1,45,93,679 - Mortality Charges and Taxes (16,19,951) - Expected return on plan assets 57,47,300 1,29,81,620 Net Actuarial Gain / (Loss) - (24,23,892)Amount paid on settlement - (1,11,15,080)Employer’s contribution 3,15,00,374 4,80,16,922 Benefits paid (1,00,64,349) (88,34,549)Fair value of plan assets as at the end of the year 22,14,61,133 18,13,04,080

III Actual return on plan assets 57,47,300 1,05,57,728

IV Net Liability recognised in Balance Sheet Present Value of Defined Benefit obligation 24,80,68,398 21,28,04,454 Fair value of plan assets 22,14,61,133 18,13,04,080 Net liability recognised in Balance Sheet (2,66,07,265) 3,15,00,374

140


As at As atMarch 31, 2017 March 31, 2016

V Actuarial assumptionsI.A.l.M 2006-08 UlTIMATE

I.A.L.M 2006-08 ULTIMATEMortality Table:

Discount rate 7.1% P.A. 7.80% P.A. Expected rate of return on Plan Assets 7.60% P.A. 8.00% P.A. Withdrawal rate 9% 9%Salary escalation 10.50% to

12.50% P.A.10% to 11.50%

P.A.

VI Expense recognised in the statement of Profit and LossParticulars Year Ended Year Ended

March 31, 2017 March 31, 2016Current Service Cost 4,00,47,274 3,66,31,463 Net interest ( Income)/ Expense 11,97,014 - Interest Cost - 1,40,96,251 Expected Return on Plan Asset - (1,29,81,620)Net Actuarial Loss / (Gain) - (62,45,720)Total expenses recognised in the statement of Profit and Loss, under employee benefits expense

4,12,44,288 3,15,00,374





Sensitivity Analysis March 31, 2017 March 31, 2016Projected benefit obligation on current assumption 24,80,68,398 21,28,04,454 Delta effect of + 1% change in rate of discounting (2,03,98,768) (1,78,76,834)Delta effect of - 1% change in rate of discounting 2,37,30,801 2,08,49,417 Delta effect of + 1% change in rate of salary increase 99,14,683 90,21,373 Delta effect of - 1% change in rate of salary increase (1,00,08,270) (90,43,223)Delta effect of + 1% change in rate of employee turnover (12,15,628) (5,38,108)Delta effect of - 1% change in rate of employee turnover 8,75,778 2,96,524

The following payments are expected contributions to the defined benefit plan in future years: Within the next 12 months (next annual reporting period) 2,00,04,000 Between 2 and 5 years 11,39,66,000 Between 5 and 10 years 21,56,55,000 Beyond 10 years -


141

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 32: Related party disclosure

A. Names of Related parties and their Relationship

Holding Company Dassault Systemes SE

Fellow subsidiaries

BioviaDassault Data ServicesDassault Systemes 3DExcite GmbHDassault Systèmes Australia Pty LtdDassault Systemes Canada IncDassault Systemes India Pvt. Ltd.Dassault Systemes IsraelDassault Systemes Italia, SrlDassault Systemes K.KDassault Systemes Russia Corp.Dassault Systèmes Singapore Pte LtdDassault Systemes UKDS Americas CorpDS Deutschland GmbhDS Enovia CorpDS Innovation Tech. Korea LtdDS IT Co. Ltd.( Shangai)DS Simulia Corp.DS Solidworks CorporationRealtime Technology AGSpatial Corporation

Entity with significant influence over the Company Geometric Limited (till March 2, 2017)GL- France Branch

Other related parties (Affiliates of Geometric Limited) Geometric Americas Inc. (till March 2, 2017)Geometric Korea Branch (till March 2, 2017)Geometric, SAS (till March 2, 2017)

Subsidiary 3D PLM Global Services Private Limited

Other related party Godrej and Boyce Manufacturing Company Limited

Key Management Personnel Mr. Sudarshan Mogasale (C.E.O. & Manager)Mr. Vishwanath Shet (Chief Financial officer)Ms. Sunipa Ghosh (Company Secretary) (wef March 17, 2017)

142

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) B. Transactions with related parties

Nature of relationship Nature of transaction Name of the related party Year EndedMarch 31, 2017 March 31, 2016

Holding Company Interim Dividend Dassault Systèmes SE - 15,31,62,600 Recovery of expenses Dassault Systèmes SE - 7,53,08,133 Recovery of Hardware cost Dassault Systèmes SE 3,51,33,015 3,74,96,158 Recovery of travel and others Dassault Systèmes SE 10,36,43,120 1,83,27,602 Revenue Dassault Systèmes SE 1,81,45,69,939 1,41,69,99,623

Fellow subsidiaries Interim Dividend DS Americas Corp - 10,56,81,400 Recovery of expenses Dassault Systemes 3DExcite GmbH - 18,77,799

Dassault Systemes India Pvt. Ltd. - 2,28,098 Dassault Systemes Israel - 7,02,642 Dassault Systemes K.K - 18,90,494 Dassault Systemes Korea Corp - 4,23,756 Dassault Systemes Services, LLC - 14,662 Dassault Systemes Taiwan - 78,973 DS Americas Corp - 1,22,14,943 DS Canada Inc. - 32,54,107 DS IT Co. Ltd.( Shangai) - 1,22,789 DS Simulia Corp. - 22,20,158 DS Solidworks Corporation - 1,66,08,091 Spatial Corporation - 30,37,504

Recovery of Hardware cost Biovia 6,62,883 - Dassault Data Services 2,93,208 - Dassault Systemes 3DExcite GmbH - 88,96,394 Dassault Systemes Canada Inc 10,18,829 - Dassault Systemes Israel 10,35,426 2,37,897 DS Americas Corp 1,24,02,017 93,30,024 DS Simulia Corp. 7,95,309 14,27,634 DS Solidworks Corporation 53,38,662 31,25,908 Spatial Corporation 33,98,943 20,65,152


Biovia 1,56,33,092 - Dassault Data Services 54,91,213 1,50,273 Dassault Systemes 3DExcite GmbH 15,05,159 1,79,005 Dassault Systemes Canada Inc 44,31,836 - Dassault Systemes India Pvt. Ltd. 61,015 - Dassault Systemes Israel 28,27,063 - Dassault Systemes K.K 27,48,540 8,12,503 Dassault Systemes Korea Corp - (0)Dassault Systèmes Singapore Pte Ltd 4,57,148 - Dassault Systems Innovati - 4,84,873 DS Americas Corp 2,86,69,340 1,10,37,454 DS Canada Inc. - 15,55,213 DS Deutschland Gmbh 5,32,240 7,70,088 DS Innovation Tech. Korea Ltd 1,60,036 - DS IT Co. Ltd.( Shangai) 2,36,799 1,04,022 DS Simulia Corp. 19,42,275 18,90,269 DS Solidworks Corporation 2,92,12,257 1,31,74,028 Spatial Corporation 39,09,355 1,69,368

143

The Annual Report

2016-17



Fellow subsidiaries Revenue Biovia 51,08,705 - Dassault Data Services 1,31,63,789 36,40,441 Dassault Systemes 3DExcite GmbH 8,38,24,101 5,59,52,281 Dassault Systèmes Australia Pty Ltd 3,09,38,884 - Dassault Systemes Canada Inc 5,01,25,814 - Dassault Systemes España S.L.U - 7,89,735 Dassault Systemes India Pvt. Ltd. 34,06,264 12,47,903 Dassault Systemes Israel 1,20,51,197 6,17,10,374 Dassault Systemes Italia, - 3,86,074 Dassault Systemes Italia, Srl 18,31,036 - Dassault Systemes K.K 1,51,70,881 1,76,64,958 Dassault Systemes Korea Corp - 44,69,388 Dassault Systemes Russia - 3,85,478 Dassault Systemes Russia Corp. 18,01,734 - Dassault Systemes Services, LLC - 1,18,57,128 Dassault Systemes Singapo - 7,93,879 Dassault Systèmes Singapore Pte Ltd 30,40,709 - Dassault Systemes Taiwan - 1,60,275 Dassault Systemes UK 18,28,331 2,59,603 DS Americas Corp 72,02,47,199 70,78,48,808 DS Canada Inc. - 6,18,93,438 DS Deutschland Gmbh 72,12,438 47,04,141 DS Enovia Corp 1,76,753 15,03,457 DS IT Co. Ltd.( Shangai) 13,46,483 5,86,255 DS Simulia Corp. 21,91,75,157 19,67,03,840 DS Solidworks Corporation 42,91,92,101 38,10,86,347 Realtime Technology AG 13,58,751 14,72,947 Spatial Corporation 7,93,97,242 7,29,81,024


Interim Dividend Geometric Limited - 35,73,79,400 Recovery of expenses Geometric Limited - 1,19,733 Recovery of travel and others Geometric Limited 24,15,948 10,33,815

GL- France Branch 26,556 - Reimbursement of common cost


Reimbursement of Travel and Others

Geometric Limited 21,17,707 1,56,167

Rent Expenses Geometric Limited 99,145 1,13,260 Rent Income Geometric Limited 5,99,306 6,53,789 SAP shared cost Geometric Limited 51,93,399 - Shared Services Cost Geometric Limited 3,38,36,609 2,67,90,042

Subsidiary Common Shared cost 3D PLM Global Services Private Limited 7,27,601 - Recovery of shared service costs 3D PLM Global Services Private Limited 35,81,152 29,47,817 Interest earned on loan 3D PLM Global Services Private Limited - 23,41,935 Investment made 3D PLM Global Services Private Limited - 6,90,00,000 Loans given 3D PLM Global Services Private Limited - 4,00,00,000 Loans repaid 3D PLM Global Services Private Limited - 4,00,00,000 Recovery of expenses 3D PLM Global Services Private Limited - 10,88,438 Recovery of travel and others 3D PLM Global Services Private Limited - 8,00,405 Reimbursement of Travel and Others

3D PLM Global Services Private Limited - 8,94,782

144



Other related parties Other Expenses Godrej and Boyce Manufacturing Company Limited

64,459 5,72,623

Purchase of Fixed asset Godrej and Boyce Manufacturing Company Limited

19,400 83,87,276


Geometric Americas Inc.. 3,27,344 36,92,827 Geometric Asia Pacific Pte. Ltd - 2,42,323 Geometric Canada Branch - 12,806 Geometric GMBH - 5,18,034 Geometric Korea Branch 5,058 - Geometric, SAS 8,26,432 -

Reimbursement of Travel and Others

Geometric Americas Inc.. - 10,90,926

Rent Expenses Godrej and Boyce Manufacturing Company Limited

84,375 1,12,502

Rent Income Godrej and Boyce Manufacturing Company Limited

- 7,80,752

Security Deposit recovered Godrej and Boyce Manufacturing Company Limited

- 1,17,868


The company has entered into a Master sales agreement with its Holding Company Dassault Systemes SE to provide services to the parent and its other subsidiairies on a cost plus mark up model. The contract is for an indefinite period but cancellable by either party by given one month’s notice.

The transactions with the related parties are made on terms equivalent to those that prevail in arm s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2017, the Group has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2016: INR Nil, April 01, 2015 : INR Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

loan to the subsidiary

The Company had granted a loan to its newly formed subsidiary 3d PLM Global Services Private Limited in the last financial year for set up and preliminary expenses of the subsidiary. The loan was squared off within a year. Interest on loan was 11%.

compensation of key management personnel of the company


Nature of transaction Year Ended March 31, 2017 March 31, 2016

Sudarshan Mogasale 90,07,161 81,46,004Vishwanath Shet 44,10,867 41,60,060Sunipa Ghosh 5,55,863 -

145

The Annual Report

2016-17


c. Outstanding Balances As on

March 31, 2017 March 31, 2016 Holding company :

Trade Receivables Dassault Systemes SE - 11,52,23,285

Other Receivables Dassault Systemes SE - 45,99,465

Unbilled Revenue Dassault Systemes SE 10,94,075 1,61,804

Fellow Subsidiaries :Trade Receivables Biovia 47,23,430 - Dassault Data Services Suresness - 21,85,461 Dassault Systemes India Private Limited 9,49,957 7,18,949 DS Americas Corp 39,13,533 - Dassault Systemes 3DExcite GmbH 65,96,550 73,50,944 Dassault Systemes Canada Inc. - 53,23,421 Dassault Systemes Italia, - 2,54,490 Dassault Systemes Singapore 2,30,636 2,08,373 Dassault Systemes UK Ltd. - 2,56,199 Dassault Systemes Russia 20,44,896 - DS IT Co. Ltd.( Shangai) 11,49,967 -

Other Receivables Dassault Systemes 3DExcite GmbH - 1,45,199 Dassault Systemes Canada Inc. - 2,98,417 DS IT Co. Ltd.( Shangai) 1,07,851 - DS Americas Corp 1,70,273 - Dassault Systemes India Private Limited 70,167 1,53,635 Biovia 1,60,87,243 1,66,698 Dassault Data Services Suresness - 1,50,374

Unbilled Revenue Biovia 3,44,417 - Dassault Data Services 48,204 - Dassault Systemes K.K. 14,567 - DS SolidWorks Corporation 29,214 79,182 Dassault Systemes (Shanghai) Information Technology Co. Ltd. - 1,65,375 Ds Americas Corp. 2,52,000 15,181 Dassault Systemes Russia Corp. - 3,85,478 Dassault Systemes Singapore - 1,65,375 Spatial Corporation 29,214 -

Trade Payables and Other Liabilities Dassault Systemes Americas Corp. - 2,13,61,278

146


c. Outstanding Balances As on

March 31, 2017 March 31, 2016

Entity with significant influence over the company :

Advances Receivable


Geometric Limited- France Branch - 1,55,338

Other Payables


Other Receivables

Gl-France Branch 25,700 -

Other related parties (Affiliates of geometric limited) :

Advances Receivable

Geometric Americas Inc. - 24,56,602

Geometric Asia Pacific Pte. Limited. - 2,35,801

Geometric Europe, GMBH - 3,88,611

Geometric China, Inc - 6,591

Advances Payable

Geometric Americas Inc. - 10,73,745

Other receivables

Geometric Americas, Inc. 52,637 -

Geometric China, Inc 6,450 -

Geometric, Sas 69,212 -

Deposits

Godrej and Boyce Manufacturing Company Limited 56,250 56,250

Other related parties :

Advances Receivable

Godrej and Boyce Manufacturing Company Limited 10,781 -

Other Receivable

Godrej and Boyce Manufacturing Company Limited - 8,78,346

147

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 33: Segment reporting

Since the segment information as per Ind AS 108 is provided on the basis of consolidated financial statements, separate segment information based on standalone financial statements is not provided

Note 34: Hedging activities and derivatives

Derivative financial instruments:

The Company holds derivative financial instruments such as foreign currency forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures on highly probable forecast transaction of sales. The counter party for these contracts is generally a bank. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.



Derivative designated as cash flow hedgeForward contractsin Euro 8,71,39,533 (1,11,14,109)in USD 10,63,57,430 2,05,97,541(Note : The numbers in bracket denote a liability)

The foreign exchange forward contracts plotted below mature within 12 months. The table below analyzes the derivative financial instruments into relevant maturity groupings based on the remaining period as of the balance sheet date:Particulars As of

March 31, 2017 March 31, 2016Not later than one month 1,72,91,188 29,11,241Later than one month and not later than three months 3,42,81,312 37,35,837Later than three months and not later than one year 14,19,24,463 70,47,496

19,34,96,963 1,36,94,574

During the year ended March 31, 2017, the Company has designated certain foreign exchange forward contracts as cash flow hedges to mitigate the risk of foreign exchange exposure on highly probable forecast revenue transactions. The related hedge transactions for balance in cash flow hedging reserve are expected to occur and reclassified to revenue in the statement of profit or loss within 12 months.



Note 35: commitments and contingencies

a. leases

Operating lease (for assets taken on lease)

The Company has taken equipment, cars, furniture and various office premises, under operating lease arrangements for terms ranging from 1 to 5 years.

148

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) These are generally renewable by mutual consent. There are no specific restrictions imposed by the lease arrangements

except that the leased premises cannot be sub leased any further in case of certain premises. There are escalation clauses in agreements with some parties. There are no sub leases.

Lease payments recognised for the year are Rs. 8,69,61,355 (March 31, 2016: Rs 5,57,31,313).


Particulars As at As at March 31, 2017 March 31, 2016

Minimum Lease PaymentsWithin one year 2,31,21,141 4,48,98,945 After one year but not more than 5 years 239,819,847 64,01,756

26,29,40,988 5,13,00,701

b. commitments Estimated amount of contracts remaining to be executed, net of advances to the extent not provided for Rs. 6,06,05,628/-

(March 31, 2016: Rs.2,49,54,502).

c. contingent liabilities

Particulars March 31, 2017 March 31, 2016Income Tax Demand (TDS)* 2,40,26,838 2,40,26,838Income Tax Demand* 5,74,54,926 5,65,21,960VAT Demand* 1,18,21,506 1,18,21,506Claims against the Company not acknowledged as debts** - 50,00,000

* Pending the settlement of the dispute and based on management estimate of likelihood of outcome, the Company has not provided these amounts in books.

**The Company filed a civil suit against an employee in India in 2008 claiming damages of Rs. 57,80,00,000 for data theft of intellectual property. Against this, the employee has filed counter claim of Rs. 50,00,000 in 2009 towards wrongful removal and mental agony. In the current year, the Company and ex- employee have mutually agreed to drop charges and have withdrawn the case without any claims from either party.

d. Financial guarantees Bank guarantees are issued in favour of Offices of Customs and Central Excise, to avail Customs duty exemptions for

import of goods Rs 63,90,000 (March 31, 2016: Rs. 57,90,000)

Note 36: Fair values Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments, other

than those with carrying amounts that are reasonable approximations of fair values: The carrying value and fair value of financial instruments by categories as of March 31, 2017 were as follows:

carrying amount Fair valueFinancial assetsInvestments in mutual funds 81,08,19,161 81,08,19,161 Derivatives in effective hedges 19,34,96,963 19,34,96,963 Total 1,00,43,16,124 1,00,43,16,124


carrying amount Fair valueFinancial assetsInvestments in mutual funds 48,55,05,553 48,55,05,553 Derivatives in effective hedges 1,36,94,574 1,36,94,574 Total 49,92,00,127 49,92,00,127

149

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) The carrying value and fair value of financial instruments by categories as of April 01, 2015 were as follows:

carrying amount Fair valueFinancial assetsInvestments in mutual funds 59,91,44,754 59,91,44,754 Derivatives in effective hedges 42,44,60,697 42,44,60,697 Total 1,02,36,05,451 1,02,36,05,451

The management assessed that cash and cash equivalents, trade receivables, trade payables and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.


Note 37: Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company’s assets and liabilities.

Quantitative disclosures fair value measurement hierarchy for assets:



markets


inputs


markets


inputs


markets


inputs

(level 1) (level 2) (level 1) (level 2) (level 1) (level 2)Financial AssetsInvestment in liquid mutual fund units

81,08,19,161 81,08,19,161 - 48,55,05,553 48,55,05,553 59,91,44,754 59,91,44,754 -

Derivative financial instruments - foreign currency forward contracts

19,34,96,963 - 19,34,96,963 1,36,94,574 - 1,36,94,574 42,44,60,697 - 42,44,60,697

Financial liabilitiesDerivative financial instruments - foreign currency forward contracts

- - - 42,11,141 - 42,11,141 - - -

Note 38 : Income tax The major components of income tax expense for the years ended March 31, 2017 and March 31, 2016 are: Statement of profit and loss:

March 31, 2017 March 31, 2016current income tax:Current income tax charge 32,07,16,741 30,18,00,000 Deferred tax:Relating to origination and reversal of temporary differences (2,23,34,858) (1,23,11,815)Income tax expense reported in the statement of profit or loss 29,83,81,883 28,94,88,185

150


OCI sectionDeferred tax related to items recognised in OCI during in the year:

March 31, 2017 March 31, 2016Net (gain)/loss on revaluation of cash flow hedges 6,32,37,620 (13,06,66,917)Net loss/(gain) on remeasurements of defined benefit plans 49,75,124 21,22,920Income tax charged to OcI 6,82,12,744 (12,85,43,997)Reconciliation of tax expense and the accounting profit multiplied by India’s domestic tax rate for March 31, 2017 and March 31, 2016

March 31, 2017 March 31, 2016Accounting profit before income tax 87,79,17,783 84,17,88,761At India’s statutory income tax rate of 34.61% (March 31, 2016: 34.61%) 30,38,47,345 29,13,43,090Non-deductible expenses for tax purposes:Income exempt from tax (54,65,462) (18,54,905)At the effective income tax rate of 34.61% (March 31, 2016: 34.61%) 29,83,81,883 28,94,88,185 Income tax expense reported in the statement of profit and loss 29,83,81,883 28,94,88,185



2017March 31,

2016April 1, 2015 March 31,

2017March 31,

2016Deferred Tax AssetsDepreciation 3,06,83,577 3,66,00,388 4,30,92,535 (59,16,811) (64,92,147)Fair value gain on financial instruments 6,58,09,044 25,53,596 13,33,23,702 17,827 (1,03,189)

Deferred Tax liabilitiesEffect of expenses debited to P&L in current year but allowed for tax purpose in following years

(2,37,53,431) (1,82,69,380) (1,46,87,124) (1,04,59,176) (57,05,176)

Effect of rent straight lining (59,88,002) (11,303) - (5,976,699) (11,303)Net deferred tax assets/(liabilities) 6,67,51,188 2,08,73,301 16,17,29,113 (2,23,34,859) (1,23,11,815)

Note 39 : Share based payments

Under the Employee Stock Options Scheme 2013-Employees, stock options of the parent were granted to certain employees of the Company. In most cases, the exercise price of the share options is equal to the market price of the underlying shares on the date of grant.

The vesting conditions are as follows :

1. 20% of the options at the end of the first year

2. 30% of the options at the end of the second year

3. 50% of the options at the end of the third year

Vested options shall be exercisable within a priod of five years from the date of the grant, provided the employee is in employment of the Company on the date of the vesting of the stock options and should not be serving his notice period.

The fair value of the share options is estimated at the grant date using using the Black-Scholes-Merton option-pricing model, taking into account the terms and conditions upon which the share options were granted.

There are no cash settlement alternatives. The Company does not have a past practice of cash settlement for these share options.

151

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) The expense recognised for employee services received during the year is shown in the following table:

Year endedMarch 31, 2017 March 31, 2016

Expense arising from equity-settled share-based payment transactions 40,04,224 78,90,460Expense arising from cash-settled share-based payment transactions - -Total expense arising from share based payment transactions 40,04,224 78,90,460

Note 40 : capital management

For the purpose of the Company’s capital management, capital includes issued equity capital, convertible preference shares, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company’s capital management is to maximise the shareholder value.



Note 41 : Disclosure on Specified bank notes

During the year, the Company had specified bank notes or other denomination notes as defined in the MCA notification G.S.R. 308(E) dated March 31, 2017. The details of Specified Bank Notes (SBN) held and transacted during the period from November 8, 2016 to December, 30 2016, the denomination wise SBNs and other notes as per the notification is given below:

Particulars Specified Bank Notes* Other notes Totalclosing cash in hand as on November 8, 2016 19000 380 19,380Add : Receipts for permitted transactions - - 20,657 Less : Paid for permitted transactions - - 33,877 Less : Deposited in bank accounts - 6,160 6,160 closing cash in hand as on December 30, 2016 - - -


The Group is exposed to market risk, credit risk and liquidity risk which may impact the fair value of its financial instruments. The Group has a risk management policy to manage & mitigate these risks.

The Group’s risk management policy aims to reduce volatility in financial statements while maintaining balance between providing predictability in the Group’s business plan along with reasonable participation in market movement.

Market risk

The Company operates internationally and a major portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales and services in the United States and elsewhere, and purchases from overseas suppliers in various foreign currencies. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future.


152



Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Group’s exposure to the risk of changes in foreign exchange rates relates primarily to the Group’s operating activities (when revenue or expense is denominated in a foreign currency).

The Group manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12-month period for hedges of forecasted sales.

When a derivative is entered into for the purpose of being a hedge, the Group negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable that is denominated in the foreign currency.

At March 31, 2017, the Group hedged 90% of its expected USD sales (March 31, 2016: 90%, April 1, 2015: 90%) and 50% of its expected EURO sales (March 31, 2016: 90%, April 1, 2015: 90%), for 12 months period. Those hedged sales were highly probable at the reporting date. This foreign currency risk is hedged by using foreign currency forward contracts.


The following tables demonstrate the sensitivity to a reasonably possible change in USD and EUR exchange rates, with all other variables held constant. The impact on the Group’s profit before tax is due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives. The Group’s exposure to foreign currency changes for all other currencies is not material.

change in USD rate


change in EUR rate


March 31, 2017 5% 45,46,719 5% 6,41,58,075 -5% (45,46,719) -5% (6,41,58,075)

March 31, 2016 5% 56,99,805 5% 35,28,994 -5% (56,99,805) -5% (35,28,994)

credit risk

Financial instruments that potentially subject the Group to concentration of credit risk consist principally of cash and bank balances, inter-corporate deposits, trade receivables, unbilled revenue, finance lease receivables, investment securities and derivative instruments. The cash resources of the Group are invested with mutual funds, banks, financial institutions and corporations after an evaluation of the credit risk. By their nature, all such financial instruments involve risks, including the credit risk of non-performance by counterparties.

The customers of the Group are primarily corporations based in the United States of America and Europe and accordingly, trade receivables and finance lease receivables are concentrated in the respective countries. The Group periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivables.


liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with financial liabilities. The investment philosophy of the Company is capital preservation and liquidity in preference to returns. The Company consistently generates sufficient cash flows from operations and has access to multiple sources of funding to meet the financial obligations and maintain adequate liquidity for use.

153

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Note 43 : Equity and profit reconciliation


These SFS, for the year ended March 31, 2017, are the first Ind AS SFS that the Company has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared its SFS which comply with Ind AS applicable for periods ended on March 31, 2017, together with the comparative period data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies. In preparing these SFS, the Company’s opening balance sheet was prepared as at April 01, 2015, the Company’s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 01, 2015 and the financial statements as at and for the year ended March 31, 2016.

Exemptions applied:

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

a) Ind AS 101 permits a first-time adopter to elect to continue with the carrying value of its property, plant and equipment as recognised in the financial statements as at the date of the transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can be used for intangible assets covered by Ind AS 38.

Since there is no change in the functional currecny, the Company has elected to measure all of its property, plant and equipment and intangible assets at carrying value as per Indian GAAP.


The Company uses derivative financial instruments in form of forward currency contracts to hedge its foreign currency risks. Under Indian GAAP, the Company used principles of AS -30 on hedge accounting The Company has designated various economic hedges and applied economic hedge accounting principles to avoid profit or loss mismatch. All the hedges designated under Indian GAAP are of types which qualify for hedge accounting in accordance with Ind AS 109 also. Moreover, the Company, before the date of transition to Ind AS, has designated a transaction as hedge and also meets all the conditions for hedge accounting in Ind AS 109. Consequently, the Company continues to apply hedge accounting after the date of transition to Ind AS.


d) Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. However, the Company has used Ind AS 101 exemption and assessed all arrangements based for embedded leases based on conditions in place as at the date of transition.




The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 01, 2015, the date of transition to Ind AS and as of March 31, 2016.

154

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated) Reconciliations: The following reconciliations help to understand the effect of significant differences arising from the

transition from Previous GAAP to Ind AS in accordance with Ind AS 101:

Reconciliation of equity as Indian GAAP and and per Ind AS for for April 1, 2015

Particulars Notes As at March 31, 2016 March 31, 2015

Total net worth as per as on April 01, 2015 as per Indian GAAP 1,69,18,55,622 2,25,31,09,865

Share based compensation cost as per fair value i (2,04,69,886) (1,25,79,426)Effect of measuring investments at fair value through profit and loss ii 9,75,780 17,76,242Effect of exchange difference on translation of long-term loans - -Effect of fair value adjustment of security deposits iii

Finance Income 71,68,901 51,84,223Rent Expense (73,90,656) (55,71,817)

Effective portion of gains and loss on cash flow hedge instruments iv (5,69,664) (9,00,702)Net profit/equity as per Ind AS 1,67,15,07,433 2,24,08,52,532Other comprehensive income (net of tax) 1,85,48,618 (11,96,77,721)Total net worth as on April 1 2015 as per Ind AS 1,69,00,56,051 2,12,11,74,811

(i) Share based compensation

As per Ind AS 102, in case of share-based payment transactions among group entities, the entity providing the goods or services shall recognise the share based transaction cost as an expense with a corresponding increase in deemed equity contribution from parent. Under previous GAAP, no such costs were recognised in the books.

(ii) Fair value through Profit & Loss (FVTPL)

Under Ind AS, financial assets and financial liabilities designated at fair value through profit and loss (FVTPL) are fair valued at each reporting date with changes in fair value recognized in the statement of profit and loss. Under previous GAAP, they are measured at lower of cost with provision for diminution in value other than temporary.

(iii) Security Deposits


(iv) Cash flow hedge

As per Ind AS 109, the cash flow hedges that meet the qualifying criteria, are initially measured at fair value and are re-measured at mark to market at subsequent reporting dates. The effective portion of the cumulative gain or loss on cash flow hedges is recognised in the hedging reserve account until the forecasted transaction materializes. Ineffective portion of the gain or loss on ineffective cash flow hedges is recognized in the income statement.

155

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017(All amounts in Indian Rupees unless otherwise stated)Reconciliation between Profit as previously reported and total comprehensive income as per Ind AS for the year ended March 31, 2017

Description Year Ended March 31,

2016 Profit under previous GAAP 56,45,14,232 Share based compensation cost as per fair value (78,90,460)Acturial gain / (loss) on employee defined benefit plan recognised in Other Comprehensive Income (62,45,720)Effect of measuring investments at fair value through profit and loss (8,00,462)Effect of fair value adjustment of security deposits Finance Income 19,84,678 Rent Expense (18,18,839)Effective portion of gains and loss on cash flow hedge instruments 3,31,038 Deferred tax effect of Ind AS adjustments as above 22,26,109 Net profit/equity as per Ind AS 55,23,00,576 Other comprehensive income (net of tax) (24,96,37,811)Total comprehensive Income as at reporting date 30,26,62,765






156

3D PLM GLobaL ServiceS Private LiMiteDrePort of the boarD of DirectorS

tothe Members,3D PLM Global Services Private Limited

Your Directors have pleasure in presenting the Third Annual Report of the Company together with the Audited Statement of Accounts for the year ended March 31, 2017.

i. fiNaNciaL StateMeNt aND reSULtS:

1. financial results:

Your Company’s financial performance for the year under review has been encouraging and is summarised below:

(All amounts in millions unless otherwise stated)Particular’s fY17 fY16Net Sales 585.15 354.88Total Income from Operations 585.15 354.88Total Expenses other than Depreciation & Finance Cost 441.58 292.69Profit from operations before other income, finance cost & exceptional items 143.57 62.20Depreciation 27.69 22.34Profit from operations before other income, finance cost & exceptional items 115.88 39.85Foreign Exchange Gain/ (Loss) (5.59) (1.90)Other Income 1.69 1.59Profit before finance cost & exceptional items 111.97 39.54Finance Cost 0.48 2.56Profit after finance cost but before exceptional items 111.49 36.98Exceptional Items - -Profit Before Tax 111.49 36.98Tax Expense (0.37) 0.69Net Profit for the period 111.87 36.29

Available for appropriation - -

Surplus carried forward 111.87 36.29

Note: Figures for previous year have been regrouped.

2. operations (Nature of business):

The operations of your company is in the field of Software Services, IT and Engineering services and all other related areas including design, development, testing, integration, migration, upgrade, support and maintenance. Main objective of the company is to be scalable & efficient service provider for Dassault Systèmes, and its C&SI and VS Partners by way of becoming Global Delivery Centre for Services on Dassault Systèmes products and deliver high quality of work at optimum cost. The core purpose of the organization is in order to accelerate, ease and ensure the deployment of Dassault Systèmes’ 3DEXPERIENCE platform.

3. report on Performance of Subsidiaries, associates and Joint venture companies:

During the year under review, your Company did not have any subsidiary, associate and joint venture company.

4. Dividend:

With a view to conserve resources, your Directors have thought it prudent not to recommend any dividend for the financial year under review.

5. transfer to reserves:

The Board of Directors has not recommended transfer of any amount of profit to reserves during the year under review. Hence, the entire amount of profit for the year under review has been carried forward to the Statement of Profit and Loss.

157

The Annual Report

2016-17

6. State of the company’s affairs:

During this second financial year of the company, we have achieved a turnover of Rs. 58.51 crores and made a profit of Rs. 11.19 crores. This was possible mainly due to the aggressive strategy to penetrate the market coupled with faster ramp up of the recruitment, training and infrastructure. The company launched new service offerings, won some new customers in Partners category and also started services around some new brands of Dassault Systemes. The company is well supported by Dassault Systemes VS Channel organization for marketing and business development from VS Partners. The company engaged on some of the key projects on 3DEXPERIENCE Platform implementation, upgrade and migrations. The company also launched the working prototype of an online platform that will allow it to deliver few services (like remote installation) online in future.

During the year company has added 83 permanent employees (net additions). It had non-desired employee turnover of 15.2% for the full year.

Your directors are very hopeful for the bright future of the company and continue to grow the business in the years to come.

7. Share capital:

During the year under review, the Company has not issued any fresh share capital.

As on March 31, 2017, the subscribed capital of the Company is Rs. 3,01,00,000 [Rupees Three Crores and One Lakh only] divided into 30,10,000 [Thirty Lakhs and Ten Thousand) Equity Shares and paid-up capital is Rs. 6,90,00,000 [Rupees Six Crores and Ninety Lakhs only] divided into 69,00,000 [Sixty-nine Lakhs] 6.5% Redeemable Preference Shares of Rs. 10/- each.

8. revision of financial Statement:

There was no revision of the financial statements for the year under review.

9. Deposits:

The Company has not accepted or renewed any amount falling within the purview of provisions of Section 73 of the Companies Act 2013 (“the Act”) read with the Companies (Acceptance of Deposit) Rules, 2014 during the year under review. Hence, the requirement for furnishing of details of deposits which are not in compliance with the Chapter V of the Act is not applicable.

10. Disclosures under Section 134(3)(l) of the companies act, 2013:

Except as disclosed elsewhere in this report, no material changes and commitments which could affect the Company’s financial position have occurred between the end of the financial year of the Company and date of this report.

11. Disclosure of orders passed by regulators or courts or tribunal:

No orders have been passed by any Regulator or Court or Tribunal which can have impact on the going concern status and the Company’s operations in future.

12. Particular of contracts or arrangement with related Parties:

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm’s length basis. During the year, the Company had not entered into any contract / arrangement / transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

13. Particulars of Loans, Guarantees and investment and Securities:

The Company has not taken any loans during the year under review.

14. Disclosure under Section 43(a)(ii) of the companies act, 2013:

The Company has not issued during the Financial year under review any shares with differential rights and hence no information as per provisions of Section 43(a)(ii) of the Act read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

158

15. Disclosure under Section 54(1)(D) of the companies act, 2013:

The Company has not issued any sweat equity shares during the year under review and hence no information as per provisions of Section 54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

16. Disclosure under Section 62(1)(b) of the companies act, 2013:

The Company has not issued any equity shares under Employees Stock Option Scheme during the year under review and hence no information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) of the Companies (Share Capital and Debenture) Rules, 2014 is furnished.

17. Disclosure under Section 67(3) of the companies act, 2013:

During the year under review, there were no instances of non-exercising of voting rights in respect of shares purchased directly by employees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014 is furnished.

ii. MatterS reLateD to DirectorS aND KeY MaNaGeriaL PerSoNNeL

1. board of Directors & Key Managerial Personnel:

In terms of Section 152 of the Companies Act, 2013, Mr. Manu Parpia retires by rotation and being eligible, offers himself for re-appointment at the ensuing Annual General Meeting. Your Directors recommend this appointment.

During the year under review, Mr. Rene LoNegro, Director of the Company resigned from his Directorship with effect from January 4, 2017, due to pre-occupation with his other commitments.

Mr. Eric Leveugle was appointed by the Board as Additional Director with effect from March 15, 2017.

Mr. Patrick Derouin was appointed as Additional Director of the Company with effect from February 7, 2017. However, Mr. Patrick Derouin resigned as Chief Executive Officer of the Company.

Mr. Manish Tambe who was appointed as Manager and Chief Operating Officer, for a period upto 3 years, with effect from May 4, 2015 was appointed as Manager & Chief Executive Officer with effect from January 1, 2017, pursuant to provisions of Section 196, 197 and other applicable provisions if any, of the Companies Act, 2013, in accordance with resolution passed on January 20, 2017.

We have received a letter from the shareholder of the Company, 3D PLM Software Solutions Ltd. along with requisite deposit amounts recommending Mr. Eric Leveugle and Mr. Patrick Derouin for confirmation as Directors of the Company at the ensuing Annual General Meeting.

The aforesaid appointments of the Additional Directors shall be placed before the shareholders for confirmation as Directors of the Company at the ensuing Annual General Meeting, as stated in the Notice for the Annual General Meeting, appended herewith.

2. Disclosure Statement on declaration given by independent Directors:

The Company currently does not have any Independent Directors on its Board.

3. Disclosures related to board, committees and Policies:

a. board Meetings:

Board meetings were held on April 18, 2016, July 19, 2016, October 19, 2016 and January 20, 2017. The necessary quorum was present at all the meetings.

Corporate Social Responsibility Committee

In terms of Section 135 of the Companies Act, 2013, every company with a net profit of Rs. 5 Crores [Rs. 50 million] or more during any financial year is required to constitute a Corporate Social Responsibility Committee consisting of three directors (one of whom shall be an independent Director).

Your company had a net profit of Rs. 11.19 Crores for the year ended March 31, 2017 and is now mandated to constitute the Corporate Social Responsibility Committee and undertake Corporate Social Responsibilities during the financial year 2017-18.

159

The Annual Report

2016-17

The scope of the Committee includes:

a. Formulate and recommend to the Board a CSR Policy and activities to be undertaken b. Recommend the amount of expenditure to be incurred on the activities c. Monitor the CSR Policy from time to time

The Corporate Social Responsibility Committee is constituted with the following Directors as members:

1. Mr. Manu Parpia

2. Mr. Sudarshan Mogasale

3. Mr. Jean Balleidier

b. risk Management Policy:

The Board of Directors of the Company has designed Risk Management Policy and Guidelines to avoid events, situations or circumstances which may lead to negative consequences on the Company’s businesses, and define a structured approach to manage uncertainty and to make use of these in their decision making pertaining to all business divisions and corporate functions. Key business risks and their mitigation are considered in the annual/strategic business plans and in periodic management reviews.

c. internal control Systems:

Adequate internal control systems commensurate with the nature of the Company’s business and size and complexity of its operations are in place has been operating satisfactorily. Internal control systems comprising of policies and procedures are designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedure, applicable laws and regulations and that all assets and resources are acquired economically, used efficiently and adequately protected.

d. fraud reporting:

During the year under review no instances of fraud were reported by the Statutory Auditors of the Company.

e. Directors responsibility Statement:

The Board of Directors of the Company confirms that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) 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 of the state of affairs of the Company for the financial year ending on March 31, 2017 and of the profit of the Company for the year ended on that period;

c) 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;

d) the directors had prepared the annual accounts on a going concern basis;

e) the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f) 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.

iii. aUDitorS aND rePortS:

The matters related to Auditors and their Reports are as under:

1. observations of Statutory auditors on accounts for the year ended March 31, 2017:

The observations made by the Statutory Auditors in their report for the financial year ended March 31, 2017 read with the explanatory notes therein are self-explanatory and therefore, do not call for any further explanation or comments from the Board under Section 134(3) of the Companies Act, 2013.

160

2. ratification of appointment of auditors:

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Companies (Audit and Auditors) Rules, 2014, M/s. S. R. Batliboi & Associates LLP, Chartered Accountants, the Statutory Auditors of the Company have been appointed for a term of 5 years at the First Annual General Meeting held on July 15, 2015. However, their appointment as Statutory Auditors of the Company shall be required to be ratified by the Members at the ensuing (Third) Annual General Meeting. The Company has received a certificate from the said Auditors confirming that their appointment, if ratified, would be within the prescribed limit under Section 139 of the Companies Act, 2013 and that they are not disqualified to act as the Auditors and are eligible to continue to hold office as Statutory Auditors of the Company. Your Directors recommend the ratification of appointment of M/s. S. R. Batliboi & Associates LLP, Chartered Accountants as the Statutory Auditors of the Company.

Necessary resolution for ratification of appointment of the said Auditors is included in the Notice of Annual General Meeting for seeking approval of members.

iv. other DiScLoSUreS

Other disclosures as per provisions of Section 134 of the Act read with Companies (Accounts) Rules, 2014 are furnished as under:

1. conservation of energy, technology absorption and foreign exchange earnings and outgo:

The particulars as required under the provisions of Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 in respect of conservation of energy, technology absorption, foreign exchange earnings and outgo etc. are furnished in annexure i which forms part of this Report.

2. extract of annual return:

Pursuant to the provisions of Section 134(3)(a) of the Companies Act, 2013, Extract of the Annual Return for the financial year ended March 31, 2017 made under the provisions of Section 92(3) of the Act is attached as annexure ii-MGt-9 which forms part of this Report.

3. Sexual harassment:

The Company has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace and has also established Investigation and Redressal Committee, as stipulated by The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and rules thereunder. During the year under review, no complaints in relation to such harassment at workplace have been reported.

v. acKNoWLeDGeMeNtS:

Your Directors take this opportunity to thank the employees, customers, shareholders, suppliers, bankers, business partners/associates, financial institutions, various regulatory authorities and Central and State Governments for their consistent support and encouragement to the Company.

on behalf of the board of DirectorsMaNU ParPia SUDarShaN MoGaSaLechairman DirectorDiN: 00118333 DiN: 02273753

July 19, 2017Mumbai

ciN: U72900MH2014PTC259502

registered office:Plant 11, 3rd Floor Pirojshanagar,Vikhroli (West), Mumbai 400079tel No.: 022 2518 9205 fax No.: 022 6705 6891e-mail: [email protected]: www.3dplmglobal.com

161

The Annual Report

2016-17

annexure i to the board reportParticulars as prescribed under section 134 (3) (m) of the companies act, 2013,

read with the companies (accounts) rules, 2014.

a. conservation of energy:

(i) Steps taken or impact on conservation of energy:

The Company’s operations are not energy-intensive. However, significant measures are taken to reduce energy consumption by adopting various measures for optimal utilization of electricity by stringent control on area of utilization, using energy efficient computers, using energy efficient equipment, using natural lighting, additionally stringent control on air-conditioning by putting VFD and VRF’s and lighting during the off working hours and days.

Further all the lights in the offices are LED base. This is as per GO Green initiative that we have taken. This will help in further efficiency of the premises.

(ii) Steps taken by the company for utilizing alternate sources of energy:

a. Workstation/ computers are programmed to go into sleep mode at a certain time every evening. b. Lighting and other power consuming equipment are reduced by the Maintenance team at a certain time every evening.

(iii) capital investment on energy conservation equipment:

We are going to implement the concept of virtualization of IT Assets to reduce Computer Hardware requirements, as soon as it becomes financially viable for us. We have not implemented virtualization as of now because the volume of servers is quite less. We will definitely explore this possibility as and when needed in future.

b. technology absorption:

The disclosure of particulars with respect to Technology Absorption is given below:-

(i) efforts made towards technology absorption:

Our aim is to become a Global Delivery Centre for Services on Dassault Systèmes products and deliver high quality of work. Therefore the main focus is on building expertise in DS products and so that good quality services are delivered. Towards this objective we provide training, conduct workshops on latest technologies for our employees, in cooperation with Dassault Systèmes.

(ii) the benefits derived like product improvement, cost reduction, product development or import substitution:

Since our company is a new entrant, it is too early to comment on the same.

(iii) in case of imported technology (imported during the last 3 years reckoned from the beginning of the financial year):

a. the details of technology imported: Not Applicable

b. the year of import: as no imported

c. whether the technology been fully absorbed: technology is

d. If not fully absorbed, areas where absorption put to use. has not taken place, and reasons thereof

(iv) No expenditure incurred on research and Development.

c. foreign exchange earnings and outgo:

the foreign exchange earned in terms of actual inflows during the year and the foreign exchange outgo during the year in terms of actual outflows:

The Company is in the business of software services exports. All efforts of the Company are geared to increase the business of software services exports in different products and markets.

(in Rs. Lakhs)

fY17 fY16Total Foreign Exchange used 239.74 199.96Total Foreign Exchange earned 5158.91 3,512.89

162

annexure ii – board’s report

forM No. MGt 9extract of annual return as on financial year ended on 31.03.2017

Pursuant to Section 92 (3) of the companies act, 2013 and rule 12(1) of the company (Management & administration) rules, 2014.

i. reGiStratioN & other DetaiLS:

1. CIN U72900MH2014PTC2595022. Registration Date November 19, 20143. Name of the Company 3D PLM GLOBAL SERVICES PRIVATE LIMITED4. Category/Sub-category of the Company Private Limited Company/ Non-government company5. Address of the Registered office & contact details Plant 11, 3rd Floor, Pirojshanagar, Vikhroli (West),

Mumbai – 400 079

6. Whether listed company No7. Name, Address & contact details of the Registrar & Transfer

Agent, if any. Not applicable

ii. PriNciPaL bUSiNeSS activitieS of the coMPaNY:

S. No.

Name and Description of main products / services Nic code of the Product/service

% to total turnover of the company

1 Providing software services, IT and Engineering services and all other related areas including design, development, testing, integration, migration, upgrade, support and maintenance

62011 100%

iii. ParticULarS of hoLDiNG, SUbSiDiarY aND aSSociate coMPaNieS:

Sr.No.

Name ofthe company

country ciN / GLN holding /subsidiary/ associate

% ofsharesheld

applicablesection

1. 3D PLM Software Solutions Limited

India U72900MH2001PLC134244 Holding 100% Section 2(46)

163

The Annual Report

2016-17

iv. Share hoLDiNG PatterN

a) category-wise Share holding: (equity Share capital breakup as percentage of total equity)

category of Shareholders No. of Shares held % change during

the year

as on 31-March-2016 as on 31-March-2017Demat Physical total % of

total Shares

Demat Physical total % oftotal

Shares

a. Promoters

(1) Indian - Bodies Corp. - 3,010,000 3,010,000 100% - 3,010,000 3,010,000 100% 0

(2) Foreigner - Bodies Corp. - - -

total shareholding of Promoter (a)

- 3,010,000 3,010,000 100% - 3,010,000 3,010,000 100% 0

b. Public Shareholding - - - - - - - - -

2. Non-institutions - - - - - - - - -c. Shares held by custodian for GDrs & aDrs

- - - - - - - - -

Grand total (a+b+c) - 3,010,000 3,010,000 100% - 3,010,000 3,010,000 100% 0

b) category-wise Share holding: (Preference Share capital breakup as percentage of total Preference capital)

category of Shareholders No. of Shares held % change during

the year

as on 31-March-2016 as on 31-March-2017Demat Physical total % of

total Shares

Demat Physical total % of

total Shares

a. Promoters

(1) Indian - Bodies Corp. - 6,900,000 6,900,000 100% - 6,900,000 6,900,000 100% -

(2) Foreigner - Bodies Corp. - -

total shareholding of Promoter (a)

- 6,900,000 6,900,000 100% - 6,900,000 6,900,000 100% -

b. Public Shareholding - - - - - - - - -

2. Non-institutions - - - - - - - - -c. Shares held by custodian for GDrs & aDrs

- - - - - - - - -

Grand total (a+b+c) - 6,900,000 6,900,000 100% - 6,900,000 6,900,000 100% 0

c) Shareholding of Promoters:

SN Shareholder’s Name

type ofshares

Shareholding by the Promoters % change in shareholding

during the year

as on 31-March-2016 as on 31-March-2017No. ofShares


company

%of SharesPledged /

encumberedto total shares

No. ofShares

% of total Shares of

the company

%of SharesPledged /


1 3D PLM Software Solutions Ltd.

Equity Shares*

3,010,000 100% - 3,010,000 100% - 0

totaL 3,010,000 100% 3,010,000 100% - 0

* for compliance purpose 1 shares held by Mr. Manu Parpia as a registered holder.

164

SN Shareholder’s Name type of shares

Shareholding by the Promoters % change in shareholding

during the year

as on 31-March-2016 as on 31-March-2017No. ofShares


company

% of SharesPledged /


No. ofShares


company

%of SharesPledged /


1 3D PLM Software Solutions Ltd

Preference Shares

6,900,000 100% - 6,900,000 100% - 0

TOTAL 6,900,000 100% - 6,900,000 100% - 0

D) change in Promoters’ Shareholding: there were no changes in the promoters’ shareholding for both equity and preference shares during the year under review.

SN Particulars Shareholding at the beginning of the year

cumulative Shareholding during the year



1. at the beginning of the year - - - -

transactions during the year

Allotment of Preference Shares - - - -at the end of the year - - - -

e) Shareholding Pattern of top ten Shareholders: (other than Directors, Promoters and holders of GDrs and aDrs): No other shareholders

v. iNDebteDNeSS – The Company has not availed any loan during the year and is a debt-free company.

vi. reMUNeratioN of DirectorS aND KeY MaNaGeriaL PerSoNNeL-

None of the Directors and Company Secretary have been paid any remuneration during the year.

Remuneration to Manager as below:

SN. Particulars of remuneration Manish tambe(Manager)

1 Gross salary

(a) in Salary as per provisions contained section 17(1) of the Income-tax Act, 1961 5,320,494.24(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 3,373,200.00(c) Profits in lieu of salary under section 17(3) Income- tax Act, 1961

2 Stock Option (nos.)*i) Outstanding as on April 1, 2016ii) Granted during the yeariii) Exercised during the yeariv) Balance as on March 31, 2017

17,500NIL

17,500NIL

3 Sweat Equity -4 Variable Pay 1,038,471.675 Commission - as % of profit

Total (A) (total of remuneration does not include the number of Stock options) 9,732,165.91

* Stock options held were granted by erstwhile Geometric Limited, earlier holding Company of the 3D PLM Software Solutions Ltd.

165

The Annual Report

2016-17

vii. PeNaLtieS / PUNiShMeNt/ coMPoUNDiNG of offeNceS:

type Section of the companies act

brief Description

Details of Penalty / Punishment/

compounding fees imposed

authority [rD / NcLt/

coUrt]

appeal made, if any (give Details)

a. coMPaNYPenalty

N.A.PunishmentCompoundingb. DirectorSPenalty

N.A.PunishmentCompoundingc. other officerS iN DefaULtPenalty

N.A.PunishmentCompounding

on behalf of the board of Directors

MaNU ParPia SUDarShaN MoGaSaLe chairman Director DiN: 00118333 DiN: 02273753

July 19, 2017 Mumbai

166

INDEPENDENT AUDITOR’S REPORTTo the Members of 3D PLM Global Services Private Limited

Report on the Ind AS Financial StatementsWe have audited the accompanying Ind AS financial statements of 3D PLM Global Services Private Limited (“the Company”), which comprise the Balance Sheet as at March 31, 2017, the Statement of Profit and Loss, including the statement of Other Comprehensive Income, the Cash Flow Statement and the Statement of Changes in Equity for the year then ended, and a summary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial StatementsThe Company’s Board of Directors is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 (“the Act”) with respect to the preparation of these Ind AS financial statements that give a true and fair view of the state of affairs (financial position), profit or loss (financial performance including other comprehensive income), cash flows and changes in equity of the Company in accordance with accounting principles generally accepted in India, including the Indian Accounting Standards (Ind AS) specified under section 133 of the Act., read with Companies (Indian Accounting Standards) Rules, 2015, as amended by notification number G.S.R 111(E) dated 16 February 2015. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and the design, implementation and maintenance of adequate internal financial control that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Ind AS financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these Ind AS financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made thereunder. We conducted our audit of the Ind AS financial statements in accordance with the Standards on Auditing, issued by the Institute of Chartered Accountants of India, as specified under Section 143(10) of the Act. 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 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 Ind AS financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company’s preparation of the Ind AS financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the Company’s Directors, as well as evaluating the overall presentation of the Ind AS financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Ind AS financial statements.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the Ind AS financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India, of the state of affairs of the Company as at March 31, 2017, its profit including other comprehensive income, its cash flows and the changes in equity for the year ended on that date.

Report on Other Legal and Regulatory Requirements1. As required by the Companies (Auditor’s report) Order, 2016 (“the Order”) issued by the Central Government of India in

terms of sub-section (11) of section 143 of the Act, we give in the Annexure 1 a statement on the matters specified in paragraphs 3 and 4 of the Order.

2. As required by section 143 (3) of the Act, we report that: (a) We have sought and obtained all the information and explanations which to the best of our knowledge and belief were

necessary for the purpose of our audit;

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

STANDALONE FINANcIAL STATEMENTS

167

The Annual Report

2016-17

(c) The Balance Sheet, Statement of Profit and Loss including the Statement of Other Comprehensive Income, the Cash Flow Statement and Statement of Changes in Equity dealt with by this Report are in agreement with the books of account;

(d) In our opinion, the aforesaid Ind AS financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Companies (Indian Accounting Standards) Rules, 2015;

(e) On the basis of written representations received from the directors as on March 31, 2017, and taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2017, from being appointed as a director in terms of section 164 (2) of the Act;

(f) With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to our separate Report in “Annexure 2” to this report;

(g) With respect to the other matters to be included in the Auditor’s Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us:

i. The Company does not have any pending litigations which would impact its financial position;

ii. The Company did not have any long term contracts including derivative contracts for which there were any material foreseeable losses;

iii. There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company.

iv. As per books of accounts of the Company and as represented by the management of the Company, the Company did not have cash balance as on November 8, 2016 and December 30, 2016 and has no cash dealings during this period

For S.R. BATLIBOI & ASSOcIATES LLPChartered Accountants




168

ANNExURE 1 TO ThE INDEPENDENT AUDITOR’S REPORT

Re: 3D PLM Global Services Private Limited (‘the company’)

Referred to in Paragraph 1 under the heading “Report on other legal and regulatory requirements” of 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) All fixed assets have not been physically verified by the management during the year but there is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. No material discrepancies were noticed on such verification.

(c) According to the information and explanations given by the management, there are no immovable properties owned by the Company and accordingly, the requirements under paragraph 3(i)(c) of the Order are not applicable to the Company.

(ii) The Company’s business does not involve inventories and, accordingly, the requirements under paragraph 3 (ii) of the Order are not applicable to the Company.

(iii) (a) According to the information and explanations given to us, the Company has not granted any loans, secured or unsecured to companies, firms, limited liability partnerships or other parties covered in the register maintained under section 189 of the Act. Accordingly, the provisions of clause 3 (iii) (a) to (c) of the Order are not applicable to the Company and hence not commented upon.

(iv) In our opinion and according to the information and explanations given to us, there are no loans, investments, guarantees, and securities given in respect of which provisions of section 185 and 186 of the Companies Act 2013 are applicable and hence not commented upon.

(v) The Company has not accepted any deposits from the public.

(vi) To the best of our knowledge and as explained, the Central Government has not specified the maintenance of cost records under clause 148 (1) of the Act, for the services of the Company.

(vii) (a) The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, income-tax, service tax, value added tax, cess and other material statutory dues applicable to it. The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales-tax are not applicable to the Company.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, income-tax, service tax, value added tax, cess and other material statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales-tax are not applicable to the Company

(c) According to the information and explanation given to us, there are no dues of income tax, sales-tax, service tax and value added tax which have not been deposited on account of any dispute. The provisions relating to employees’ state insurance, duty of excise, duty of customs and sales- tax are not applicable to the Company.

(viii) The Company has neither issued any debentures nor availed any loan from banks, financial institutions or government. Therefore, the provisions of clause 3(viii) of the Order are not applicable to the Company.

(ix) According to the information and explanations given by the management, the Company has not raised any money way of initial public offer or further public offer or debt instruments and term loans hence, reporting under clause 3 (ix) of the Order are not applicable to the Company and hence not commented upon.

(x) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud by the Company or no fraud on the Company by the officers and employees of the Company has been noticed or reported during the year.

(xi) The Company is not a public Company. Therefore, the provisions of section 197 read with Schedule V of the Act are not applicable to the company and hence reporting under clause 3(xi) are not applicable and hence not commented upon.

(xii) In our opinion, the Company is not a nidhi company. Therefore, the provisions of clause 3(xii) of the Order are not applicable to the Company and hence not commented upon.

169

The Annual Report

2016-17

(xiii) According to the information and explanations given by the management, transactions with the related parties are in compliance with section 177 and 188 of Companies Act, 2013 where applicable and the details have been disclosed in the notes to the financial statements, as required by the applicable accounting standards.

(xiv) According to the information and explanations given to us and on an overall examination of the balance sheet, the company has not made any preferential allotment or private placement of shares or fully or partly convertible debentures during the year under review and hence not commented upon.

(xv) According to the information and explanations given by the management, the Company has not entered into any non-cash transactions with directors or persons connected with him.

(xvi) According to information and explanation given to us, the provisions of section 45-IA of the Reserve Bank of India Act, 1934 are not applicable to the Company.





170

ANNExURE 2 TO ThE INDEPENDENT AUDITOR’S REPORT

Re: 3D PLM Global Services Private Limited (‘the company’)

Report on the Internal Financial controls under clause (i) of Sub-section 3 of Section 143 of the companies Act, 2013 (“the Act”)

To the Members of 3D PLM Global Services Private Limited

We have audited the internal financial controls over financial reporting of 3D PLM Global Services Private Limited (“the Company”) as of March 31, 2017 in conjunction with our audit of the financial statements of the Company for the year ended on that date.

Management’s Responsibility for Internal Financial controlsThe Company’s Management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Company’s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013.

Auditor’s ResponsibilityOur responsibility is to express an opinion on the Company’s internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the “Guidance Note”) and the Standards on Auditing as specified under section 143(10) of the Companies Act, 2013, to the extent applicable to an audit of internal financial controls, both applicable to an audit of Internal Financial Controls and, both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether adequate internal financial controls over financial reporting was established and maintained and if such controls operated effectively in all material respects.



Meaning of Internal Financial controls over Financial Reporting A company’s internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Inherent Limitations of Internal Financial controls over Financial ReportingBecause of the inherent limitations of internal financial controls over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may occur and not be detected. Also, projections of any evaluation of the internal financial controls over financial reporting to future periods are subject to the risk that the internal financial control over financial reporting may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

171

The Annual Report

2016-17

OpinionIn our opinion, the Company has, in all material respects, an adequate internal financial controls system over financial reporting and such internal financial controls over financial reporting were operating effectively as at March 31, 2017, based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India.





172

BALANcE ShEET as at March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

Particulars Note No.


ASSETSNon-current assetsProperty, plant and equipment 3 8,21,46,686 9,68,47,826 69,59,879Capital work-in-progress 7,59,864 8,04,294 8,60,511Other Intangible assets 4 31,763 1,83,566 1,86,183Financial Assets Advances and Deposits 9 90,57,430 70,03,050 - Deferred tax assets (net) 2,77,83,241 94,87,338 - Prepayments 21,57,692 20,87,321 - Other non-current assets 10 1,64,70,128 64,66,510 58,94,161

13,84,06,804 12,28,79,905 1,39,00,734current assetsFinancial Assets Investments 5 5,27,32,224 45,11,746 - Trade Receivables 7 3,78,71,215 2,60,47,114 19,27,246 Derivative Instruments 6 88,47,378 - - Cash and cash equivalents 8 2,53,21,730 2,36,16,270 1,50,01,325 Advances and Deposits 9 1,69,190 25,59,085 - Prepayments 17,42,709 13,17,015 - Other current assets 10 4,55,09,541 6,22,96,813 18,98,675

17,21,93,987 12,03,48,043 1,88,27,246TOTAL ASSETS 31,06,00,791 24,32,27,948 3,27,27,980

EQUITY AND LIABILITIESEquity Equity share capital 11 3,01,00,000 3,01,00,000 3,01,00,000Preference share capital 6,90,00,000 6,90,00,000 - Other Equity 12 Retained Earnings 14,35,75,912 3,11,66,238 4,246,147 Reserves representing unrealised gains/losses 58,40,154 - - Equity attributable to equity holders 24,85,16,066 13,02,66,238 2,58,53,853Non-current liabilitiesFinancial Liabilities Derivative Instruments - - - Deferred Revenue 15 7,31,282 10,62,048 - Liabilities for current tax (Net) - 3,67,107 -

7,31,282 14,29,155 - current liabilitiesFinancial Liabilities Trade and other payables 13 11,83,684 24,33,538 1,27,245 Other current liabilities 14 4,50,22,303 8,98,00,291 54,75,257Deferred Revenue 15 15,57,305 39,13,003 - Net employee defined benefit liabilities 16 74,32,092 85,13,625 3,75,446Other current liabilities 17 61,58,059 68,72,098 8,96,179

6,13,53,443 11,15,32,555 68,74,127TOTAL EQUITY AND LIABILITIES 31,06,00,791 24,32,27,948 3,27,27,980



For S.R. Batliboi & Associates LLP For and on behalf of the Board of Directors ofChartered Accountants 3D PLM Global Services Private LimitedICAI Firm registration number: 101049W/ E300004

per Govind Ahuja Manu Parpia Sudarshan MogasalePartner Director DirectorMembership No:48966Place : Mumbai Place : MumbaiDate : April 24, 2017 Date : April 24, 2017

173

The Annual Report

2016-17

STATEMENT OF PROFIT AND LOSS for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

Particulars Notes Year Ended March 31, 2017 March 31, 2016

RevenueRevenue From Operations 18 58,51,48,529 35,48,83,005Other Income 19 10,71,897 12,23,854Finance Income 20 6,13,410 3,66,683

58,68,33,836 35,64,73,542ExpensesEmployee Benefits Expense 21 27,84,69,191 19,98,86,237Depreciation and Amortisation Expense 22 2,76,91,373 2,23,43,271Other Expenses 23 16,87,01,953 9,47,01,346Finance Costs 24 4,77,887 25,59,952

47,53,40,404 31,94,90,806Profit before tax 11,14,93,432 3,69,82,736

Tax expenseCurrent Tax 2,36,63,457 97,30,000Deferred Tax (2,40,36,809) (90,36,057)Total tax expense 373,352 6,93,943


Other comprehensive income :Other comprehensive income to be reclassified to profit or loss in subsequent periods:Net movement on cash flow hedges (88,47,378) - Income tax effect 30,07,224 -

(58,40,154) - Other comprehensive income not to be reclassified to profit or loss in subsequent periods:Re-measurement gains/ (losses) on defined benefit plans (8,22,436) 13,27,689 Income tax effect 2,79,546 (4,51,281)

(5,42,890) 8,76,408 Other comprehensive income for the year, net of tax (63,83,044) 8,76,408 Total comprehensive income for the period, net of tax 11,82,49,828 3,54,12,385 Earnings per equity shareBasic and Diluted [Nominal value of the shares Rs 10 (March 31, 2016 : Rs.10)] 37.17 12.06





174

STATEMENT OF chANGES IN EQUITY for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

a. Equity Share capital

Equity shares of INR 10 each issued, subscribed and fully paid Number of

shares Amount

At April 01, 2015 30,10,000 3,01,00,000At March 31, 2016 30,10,000 3,01,00,000

Issue of share capital - -At March 31, 2017 30,10,000 3,01,00,000

b. Redeemable Preference Share capital

Redeemable Preference shares of INR 10 each issued, subscribed and fully paid Number of

shares Amount

At April 01, 2015 - - At March 31, 2016 69,00,000 6,90,00,000

Issue of share capital - -At March 31, 2017 69,00,000 6,90,00,000

c. Other Equity

Items of Other comprehensive IncomeRetained Earnings Effective portion of

cash Flow hedgesBalance at April 01, 2015 (42,46,147) -Profit For the year 3,62,88,793Other Comprehensive Income (876,408) -Total Comprehensive Income for the year 3,54,12,385 -Balance at March 31, 2016 3,11,66,238 -

Balance at April 01, 2016 3,11,66,238 -Profit For the year 11,18,66,784Other Comprehensive Income 5,42,890 58,40,154Total Comprehensive Income for the year 11,24,09,674 58,40,154Balance at March 31, 2017 14,35,75,912 58,40,154

175

The Annual Report

2016-17

cASh FLOw STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

Particulars As at

March 31, 2017 March 31, 2016Operating activitiesProfit Before Tax from continuing operations 11,14,93,432 3,69,82,736Adjustment to reconcile profit before tax to net cash flowsDepreciation of property, plant and equipment 2,74,63,052 2,01,37,859Depreciation and impairment of intangible assets 2,28,321 22,05,412Acturial (gain)/loss on employee benefit plan 8,22,436 (13,27,689)Impact of discounts on security deposit Finance income (6,12,589) (3,60,204) Rent expense 6,83,125 4,26,952Loss on sale of Investment - 1,296Gain on sale of investment (19,438) -Finance income (821) (6,479)Dividend Income (10,38,199) (12,23,854)Net foreign exchange differences (11,966) -

13,90,07,353 5,68,36,029

working capital adjustments:Decrease/ (Increase) in Long Term Loans and Advances (14,41,791) (66,42,846)Decrease/ (Increase) in non-current assets (69,71,314) (5,72,349)Decrease / (Increase) Increase in trade and other receivables and prepayments 61,73,876 (9,09,08,379)Increase in Deferred Revenue (26,86,464) 49,75,051Increase in trade and other payables (12,49,854) 23,06,293Increase/ (Decrease) in Other Current financial Liabilities (4,55,30,096) 8,76,42,545Increase/ (Decrease) in employee benefits (10,81,533) 81,38,179Increase/ (Decrease) in Other Current liabilities (7,14,039) 59,75,919

8,55,06,138 6,77,50,442Income Taxes Paid (2,46,08,732) (93,62,893)Net cash Flow from operating activities (A) 6,08,97,406 5,83,87,549

cash Flow From/ (Used In) Investing ActivitiesPurchase of property, plant and equipment (1,20,41,890) (11,54,89,896)Purchase of current investments (49,85,38,196) (41,48,34,251)Proceeds from sale of current investments 45,03,49,120 41,03,21,210Fixed Deposit PlacedFixed Deposit MaturedDividend Received 10,38,199 12,23,854Interest Received (finance income) 821 6,479Net cash flows from investing activities (B) (5,91,91,946) (11,87,72,604)

176

cASh FLOw STATEMENT for the year ended March 31, 2017(All amounts in Indian Rupees unless otherwise stated)

Particulars As at

March 31, 2017 March 31, 2016Financing activities:Proceeds from Issuance of equity share capital 6,90,00,000Net cash (used in) financing activities (c) - 6,90,00,000

Net Increase / (Decrease) In cash And cash Equivalents (A+B+c) 17,05,460 86,14,945Cash and Cash equivalents at the beginning of the year 2,36,16,270 1,50,01,325Cash and Cash equivalents at the end of the year 2,53,21,730 2,36,16,270

components of cash and cash equivalents

Remittance in Transit - 1,97,78,634Balances with BanksIn Current Accounts 2,53,21,730 38,37,636Cash and Cash equivalents at the end of the year 2,53,21,730 2,36,16,270Summary of significant accounting policies




177

The Annual Report

2016-17

Notes to fiNaNcial statemeNts as at and for the year ended march 31, 2017

(All amounts in Indian Rupees unless otherwise stated)

1 corporate information

The Company is engaged in product development, industrialisation, maintenance, documentation and market support for Product Lifecycle Management (PLM) softwares of Dassault Systemes (‘the Holding company’) and provides Software service, IT and Engineering services and all other related areas including design, development, testing, integration, migration, up gradation, support and maintenance as suppliers to Dassault Systemes and Geometric Limited and other customers.

The Company is a private company domiciled in India and is incorporated under the provisions of the Companies Act, 1956. The registered office of the Company is located at Mumbai.

These financial statements were authorised for issue in accordance with a resolution of the directors on April 24, 2017.


2.1 Basis of Preparation

The Company’s financial statements have been prepared in accordance with Indian Accounting Standards (‘Ind AS’) notified under the Companies (Indian Accounting Standards) Rules, 2015 under the provision of the Companies Act, 2013 ( the ‘Act’) and subsequent amendments thereof.

For all periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with the accounting standards notified under the section 133 of the Act, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (‘Indian GAAP’). These financial statements for the year ended

March 31, 2017 are the first Ind AS Financial Statements that the Company has prepared in accordance with Ind AS. Refer to Note 37 for information on how the Company adopted Ind AS.

These financial statements have been prepared on the historical cost basis, except for certain financial instruments which are measured at fair values (Refer note 2.3 C) at the end of each reporting period. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

The Company presents assets and liabilities in the balance sheet based on current/ non-current classification. An asset is treated as current when it is:

• Expected to be realised or intended to be sold or consumed in normal operating cycle

• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period



• It is expected to be settled in normal operating cycle or due to be settled within twelve months after the reporting period, or

• There is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting period

The Company classifies all other liabilities as non-current.


The Company has identified twelve months as its operating cycle.


The preparation of the Company’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

178



Significant judgements:

In the process of applying the Company’s accounting policies, management has made the following judgements, which have the most significant effect on the amounts recognised in the financial statements:

• Property, plant and equipment

Useful lives of tangible assets and intangible assets are based on the life prescribed in Schedule II of the Companies Act, 2013. In cases, where the useful lives are different from that prescribed in Schedule II, they are based on management estimate, taking into account the nature of the asset, the estimated usage of the asset, the operating conditions of the asset, past history of replacement, anticipated technological changes, manufacturers’ warranties and maintenance support. Assumptions also need to be made, when the Company assesses, whether an asset may be capitalized and which components of the cost of the asset may be capitalised.

• Estimates and assumptions

The preparation of these financial statements in conformity with the recognition and measurement principles of Ind AS requires the management of the Company to make estimates and assumptions that affect the reported balances of assets and liabilities, disclosures relating to contingent liabilities as at the date of the financial statements and the reported amounts of income and expense for the periods presented.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and future periods are affected.

• Recognition and measurement of defined benefit obligations

The obligation arising from defined benefit plan is determined on the basis of actuarial assumptions. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of discount rate, future salary increases and mortality rates. All assumptions are reviewed at each reporting date.


• Assessment of lease transactions


• Recognition of deferred tax assets


• Share based payments

The Company measures the grant date fair value of the options granted to employees using an option pricing model. Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which is dependent on the terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the expected life of the share option, volatility and dividend yield and making assumptions about them.

• Fair value measurement of financial instruments

When the fair values of financial assets and financial liabilities recorded in the balance sheet cannot be measured based on quoted prices in active markets, their fair value is measured using valuation techniques including the discounted cash flow (DCF) model. The inputs to these models are taken from observable markets where possible,

179

The Annual Report

2016-17



but where this is not feasible, a degree of judgement is required in establishing fair values. Judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

2.3 Summary of significant accounting policies

A. Foreign currencies

These financial statements are presented in Indian rupees, which is also the Company’s functional currency.









The Company recognizes revenue from time and material contracts when the related services are rendered to the customers. Revenue from annual maintenance and support engagements is recognized proportionately as services are rendered, which generally results in straight-line revenue recognition as services are performed continuously over the term of the arrangement.

Revenue on fixed price development projects is measured using the percentage of completion method of accounting. Performance is generally measured based upon the efforts incurred to date in relation to the total estimated efforts to the completion of the contract. The Company monitors estimates of total contract revenues and costs on a routine basis throughout the delivery period. The cumulative impact of any change in estimates of the contract revenues or costs is reflected in the period in which the changes become known. In the event that a loss is anticipated on a particular contract, provision is made for the estimated loss.

The Company grants volume discount to certain customers, which are computed based on a pre-determined percentage of the total revenues from those customers during a specified period, as per the terms of the contract. These discounts are earned only after the customer has provided a specified cumulative level of revenues in the specified period. The Company reports revenues net of discounts offered to customers.


In cases where Company acts as a principal, out of pocket expenses are recognised as revenue, with a corresponding expense. In other cases, out of pocket expenses are recognised net of reimbursements from clients.



180



Dividend:

A dividend is recognized as revenue when the right to receive payment has been established, which is generally when shareholders approve the dividend.

Interest:

For all debt instruments measured either at amortised cost or at fair value through other comprehensive income, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the gross carrying amount of the financial asset or to the amortised cost of a financial liability.

c. Fair value measurement

The Company measures financial instruments, such as, derivatives at fair value at each balance sheet date.






The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1: Quoted (unadjusted) market prices in active markets for identical assets or liabilities

• Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable

• Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For assets and liabilities that are recognised in the financial statements on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.


For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.


• Disclosures for valuation methods, significant estimates and assumptions (Refer Notes 2.2, 32 and 36)

181

The Annual Report

2016-17



• Quantitative disclosures of fair value measurement hierarchy (Refer Note 33)

• Financial instruments (including those carried at amortised cost) (Refer Notes 5 to 9, 13, 14, 32, 33 and 36)



i Financial assets

Classification :

The Company classifies financial assets as subsequently measured at amortised cost, fair value through other comprehensive income or fair value through profit or loss on the basis of its business model for managing the financial assets and the contractual cash flow characteristics of the financial asset.

Initial recognition and measurement :

All financial assets are recognised initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.






A financial asset is subsequently measured at fair value through other comprehensive income if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The Company has made an irrevocable election for its investments which are classified as equity instruments to present the subsequent changes in fair value in other comprehensive income based on its business model. Further, in cases where the Company has made an irrevocable election based on its business model, for its investments which are classified as equity instruments, the subsequent changes in fair value are recognized in other comprehensive income.



(iv) Investment in subsidiaries

Investment in subsidiaries is carried at cost in the separate financial statements.

Derecognition

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar financial assets) is primarily derecognised (i.e. removed from the Company’s balance sheet) when:


182



b) The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognise the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.

Impairment of financial assets

In accordance with Ind AS 109, the Company applies expected credit loss (ECL) model for measurement and recognition of impairment loss on the financial assets which are not fair valued through profit or loss. Loss allowance for trade receivables with no significant financing component is measured at an amount equal to lifetime ECL at each reporting date, right from its initial recognition. For all other financial assets, expected credit losses are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. If, in a subsequent period, credit quality of the instrument improves such that there is no longer a significant increase in credit risk since initial recognition, then the entity reverts to recognising impairment loss allowance based on 12-month ECL.


As a practical expedient, the Company uses a provision matrix to determine impairment loss allowance on portfolio of its trade receivables. The provision matrix is based on its historically observed default rates over the expected life of the trade receivables and is adjusted for forward-looking estimates. At every reporting date, the historical observed default rates are updated and changes in the forward looking estimates are analyses.


Classification

The Company classifies all financial liabilities as subsequently measured at amortised cost, except for financial liabilities at fair value through profit or loss. Such liabilities, including derivatives that are liabilities, shall be subsequently measured at fair value.




Financial liabilities are subsequently carried at amortized cost using the effective interest method, except for contingent consideration recognized in a business combination which is subsequently measured at fair value

183

The Annual Report

2016-17



through profit and loss. For trade and other payable smaturing within one year from the Balance Sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.

Share capital

Ordinary shares:

Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new ordinary shares and share options are recognized as a deduction from equity.

Derecognition



The Company determines classification of financial assets and liabilities on initial recognition. After initial recognition, no reclassification is made for financial assets which are equity instruments and financial liabilities. For financial assets which are debt instruments, a reclassification is made only if there is a change in the business model for managing those assets. Changes to the business model are expected to be infrequent. The Company’s senior management determines change in the business model as a result of external or internal changes which are significant to the Company’s operations. Such changes are evident to external parties. A change in the business model occurs when the Company either begins or ceases to perform an activity that is significant to its operations. If the Company reclassifies financial assets, it applies the reclassification prospectively from the reclassification date which is the first day of the immediately next reporting period following the change in business model. The Company does not restate any previously recognised gains, losses (including impairment gains or losses) or interest.


Initial recognition and subsequent measurement

The Company uses derivative financial instruments, such as foreign exchange forward contracts to manage its exposure to foreign exchange risks on highly probable sale transactions. For contracts where hedge accounting is not followed, such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value through profit or loss account. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.


At the inception of a hedge relationship, the Company formally designates and documents the hedge relationship to which the Company wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. The documentation includes the Company’s risk management objective and strategy for undertaking hedge, the hedging/economic relationship, the hedged item or transaction, the nature of the risk being hedged, hedge ratio and how the entity will assess the effectiveness of changes in the hedging instrument’s fair value in offsetting the exposure to changes in the hedged item’s fair value or cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in fair value or cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.

184




Cash flow hedges


Amounts recognized as OCI are transferred to Profit or Loss when hedged transaction affects profit or loss, such as when hedged financial expense or financial income is recognized or when forecast sale occurs. When the hedged item is the cost of a non financial asset or a non financial liability, the amounts recognized as OCI are transferred to te initial carrying amount of the non-financial asset or liability.

Hedge accounting is discontinued when the hedging instrument expires or is sold or terminated or exercised or no longer qualifies for hedge accounting. Cumulative gain or loss on the hedging instrument recognised in shareholders’ funds is transferred to statement of profit and loss when the forecasted transaction occurs. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognised in shareholders’ funds is transferred to the statement of profit and loss.


The Company assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount.


The Company bases its impairment calculation on detailed budgets and forecast calculations which are prepared separately for each of the Company’s cash-generating units to which the individual assets are allocated. These budgets and forecast calculations are generally covering a period of five years. For longer periods, wherever applicable, a long term growth rate is calculated and applied to projected future cash flows after the fifth year.


For assets excluding goodwill, an assessment is made at each reporting date to determine whether there is an indication that previously recognised impairment losses no longer exist or have decreased. If such indication exists, the Company estimates the asset’s or CGU’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of profit and loss unless the asset is carried at a revalued amount, in which case, the reversal is treated as a revaluation increase.


G. Leases



185

The Annual Report

2016-17



At inception or on reassessment of an arrangement that contains a lease, the Company separates payments and other consideration required by the arrangement into those for the lease and those for other elements.

ii Company as a lessee


iii Company as lessor

Leases in which the Company does not transfer substantially all the risks and rewards of ownership of an asset are classified as operating leases. Rental income from operating lease is recognised on a straight-line basis over the term of the relevant lease.

h. Retirement and other employee benefits

Retirement benefit in the form of provident fund is a defined contribution scheme. The Company has no obligation, other than the contribution payable to the provident fund. The Company recognizes contribution payable to the provident fund scheme as an expense, when an employee renders the related service.

The Company operates a gratuity plan which is a defined benefit plan which requires contributions to be made to separately administered fund. The cost of providing benefits is determined using the Projected Unit Credit method carried out by an independent actuary at each period end. When the calculation results in a potential asset for the Company, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements.




The date that the Company recognises related restructuring costs

Net interest is calculated by applying the discount rate to the net defined benefit liability or asset. The Company recognises the following changes in the net defined benefit obligation as an expense in the consolidated statement of profit and loss:



When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Company recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs.

The employee can carry-forward a portion of the unutilised accrued compensated absences and utilise it in future service periods or receive cash on termination of employment. Compensated absences are expected to occur within twelve months after the end of the period and are classified as a short term employee benefit. The Company records an obligation for such compensated absences in the period in which the employee renders the services. The Company accrues for liability in respect of compensated absences for the entire available leave balance standing to the credit of the employees at period end. The leave balance eligible for carry-forward is valued at gross compensation cost and the leave balance subject to encashment are accrued at basic pay.

186



I. Taxes

i. current income taxes


Current tax assets and liabilities are offset only if, the Company:



ii. Deferred tax











J. Property, plant and equipment



187

The Annual Report

2016-17





b) any costs directly attributable to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by management.





Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company.

iii. Depreciation




Particulars / Asset type Years of useful lifeComputers 3 yearsElectrical installations 8 yearsOffice equipments 5 yearsFurniture and fixtures 10 years

The Company, based on technical assessment made by technical expert and management estimate, depreciates certain items of building over estimated useful lives which are different from the useful life prescribed in Schedule II to the Companies Act, 2013. The management believes that these estimated useful lives are realistic and reflect fair approximation of the period over which the assets are likely to be used.




Intangible assets acquired separately are measured on initial recognition at cost. Following initial recognition, intangible assets are carried at cost less any accumulated amortisation and accumulated impairment losses. Intangible assets like computer software that are acquired by the Company and have finite useful lifes are measured at cost less accumulated amortisation and any accumulated impairment losses.




188




Computer software:

ERP license and installation, is amortised on a straight-line basis over the period of license.

K. Provisions

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. When the Company expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented in the statement of profit and loss net of any reimbursement.


L. Earnings per share



M. cash and cash equivalents


For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of cash and short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered an integral part of the Company’s cash management.


The amendments to standards that are issued, but not yet effective, up to the date of issuance of the Company’s financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.


Amendments to Ind AS 7, Statement of cash Flows



The amendment to Ind AS 102 provides specific guidance to measurement of cash-settled awards, modification of cash-settled awards and awards that include a net settlement feature in respect of withholding taxes. The Company does not have any cash settled award as at March 31, 2017.

189

The Annual Report

2016-17



Note 3 : Property, plant and equipment

Leasehold Improvements

computers Office Equipments

Furniture and Fixtures

Total

cost or valuationAt April 01, 2015 39,36,590 24,55,002 5,68,287 - 69,59,879Additions 4,36,32,462 1,72,56,924 3,60,30,059 1,31,06,362 11,00,25,807Disposals - - - - -At March 31, 2016 4,75,69,052 1,97,11,926 3,65,98,346 1,31,06,362 11,69,85,686Additions 4,35,061 58,57,204 58,37,767 6,31,878 1,27,61,910Disposals - - - - -At March 31, 2017 4,80,04,113 2,55,69,130 4,24,36,113 1,37,38,240 12,97,47,596

Depreciation and impairmentAt April 01, 2015 - - - - -Depreciation charge for the year 80,07,802 52,29,904 42,96,319 7,70,416 1,83,04,441Impairment - - 18,33,419 - 18,33,419Disposals - - - - -At March 31, 2016 80,07,802 52,29,904 61,29,738 7,70,416 2,01,37,860Depreciation charge for the year 1,01,41,399 75,33,611 84,43,250 13,44,790 2,74,63,050Disposals - - - - -At March 31, 2017 1,81,49,201 1,27,63,515 1,45,72,988 21,15,206 4,76,00,910

Net book valueAt March 31, 2017 2,98,54,912 1,28,05,615 2,78,63,125 1,16,23,034 8,21,46,686At March 31, 2016 3,95,61,250 1,44,82,022 3,04,68,608 1,23,35,946 9,68,47,826At April 01, 2015 39,36,590 24,55,002 5,68,287 - 69,59,879

Note 4 : Intangible assets

computer Softwarecost or valuationAt April 01, 2015 1,86,183Additions 22,02,795Disposals -At March 31, 2016 23,88,978Additions 76,518Disposals -At March 31, 2017 24,65,496

Amortisation and impairmentAt April 01, 2015 -Amortisation 22,05,412Disposals -At March 31, 2016 22,05,412Amortisation 2,28,321Disposals -At March 31, 2017 24,33,733

Net book valueAt March 31, 2017 31,763At March 31, 2016 1,83,566At April 01, 2015 1,86,183

190



Note 5: current investments


No. of units

Amounts Rs.

No. of units

Amounts Rs.

No. of units

Amounts Rs.

OTHER THAN TRADE, UNQUOTED, FULLY PAID UP (at fair value)Investments In Mutual FundsBNP Paribas Overnight Fund - - 4,510 45,11,745 - -IDFC Money Manager Treasury Plan Regular Daily Dividend Re-investment

12,59,913 1,27,24,362 - - - -

BNP Paribas overnight fund Regular Daily Dividend Re-investment

39,971 4,00,07,876 - - - -

5,27,32,238 45,11,745 -

Current 5,27,32,238 45,11,745 -Non Current - - -

5,27,32,238 45,11,745 -

Note 6: Other financial assets - derivative instruments


Derivative instruments at fair value through OCICash Flow HedgesForeign exchange forward contracts 88,47,378 - -

88,47,378 - -

Current 88,47,378 - -Non Current - - -

88,47,378 - -

Financial assets at fair value through OcI

Financial assets at fair value through OCI reflect the change in fair value of foreign exchange forward contracts, designated as cash flow hedges to hedge highly probable future sales in USD and EURO. The Company is exposed to changes in the forex rates of USD and EURO on its forecast sales. The forward contracts are designated as cash flow hedges to offset the effect of price changes USD and EURO rates. The Company has hedged approximately 90% of its expected USD sales and 50% of its expected EURO sales for the next reporting period.

Note 7: Trade and other receivables (Unsecured)


Trade receivablesReceivables from ultimate holding company (Refer note 28) - 1,40,41,471 6,36,836Receivables from other related parties (Refer note 28) 1,89,10,970 28,15,079 -Trade receivables outstanding for a period exceeding six months - - -Other receivables 1,89,60,245 91,90,564 12,90,410

3,78,71,215 2,60,47,114 19,27,246 No trade or other receivable are due from directors or other officers of the company either severally or jointly with any

other person. Nor any trade or other receivable are due from firms or private companies respectively in which any director is a partner, a director or a member. Trade receivables are non-interest bearing and are generally on terms of 30 days credit. There is no impairment allowance for trade and other receivables.

191

The Annual Report

2016-17



Note 8 : cash and cash equivalent


Balance with banksCurrent Accounts 2,53,21,730 38,37,636 1,50,01,325Remittance in transit - 1,97,78,634 -

2,53,21,730 2,36,16,270 1,50,01,325.00For the purpose of the statement of cash flows, cash and cash equivalents comprises the following:Balances with banks:– On current accounts 2,53,21,730 38,37,636 1,50,01,325.00

2,53,21,730 38,37,636 1,50,01,325.00Less – Bank overdraft - - -

2,53,21,730 38,37,636 1,50,01,325.00

Note 9 : Advances and deposits


AdvancesUnsecured, considered goodEmployees 1,69,190 1,71,790 -Other Related Parties - 23,87,295 -

1,69,190 25,59,085 -Unsecured , considered doubtfulDoubtful advances to employees 1,07,797 - -Provision for doubtful advances to employees (1,07,797) - -

- - -Security DepositsShort term security deposit - - -Long term term security deposit 90,57,430 70,03,050 -

90,57,430 70,03,050 -

Current 1,69,190 25,59,085 -Non Current 90,57,430 70,03,050 -

92,26,620 95,62,135 -

Note 10 : Non financial assets


currentAdvances recoverable in cash or in kind - current 97,56,873 71,95,270 3,63,502Unbilled Revenue 2,42,12,362 4,84,48,965 15,35,173Other Receivables 1,15,40,306 66,52,578 -

4,55,09,541 6,22,96,813 18,98,675.00Non currentCapital advance 41,692 - 56,90,980Advance income tax - net of provision for taxation 30,32,304 - -Balance with government authorities 1,33,96,132 64,66,510 2,03,181

1,64,70,128 64,66,510 58,94,161

192



Note 11 : Share capital Authorised share capital:

Equity Shares Preference SharesNos. Amount Nos. Amount

At April 01, 2015 30,10,000 3,01,00,000 2,00,00,000 20,00,00,000Changes during the year - - - -At March 31, 2016 30,10,000 3,01,00,000 2,00,00,000 20,00,00,000Increase / (decrease) during the year - - - -At March 31, 2017 30,10,000 3,01,00,000 2,00,00,000 20,00,00,000

Issued, subscribed and fully paid-up shares: Equity shares of INR 10 each issued, subscribed and fully paid

Equity SharesNos. Amount

At April 01, 2015 30,10,000 3,01,00,000Changes during the year - -At March 31, 2016 30,10,000 3,01,00,000Issued during the year - -At March 31, 2017 30,10,000 3,01,00,000

Equity component of Redeemable Preference shares of Rs. 10 each issued and fully paidPreference Shares

Nos. AmountAt April 01, 2015 - -Changes during the year 69,00,000 6,90,00,000At March 31, 2016 69,00,000 6,90,00,000Issued during the year - -At March 31, 2017 69,00,000 6,90,00,000

b. Terms/rights attached to the shares of the company

Terms/rights attached to equity shares

The Company has only one class of equity shares having par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.”

Terms/rights attached to preference shares

The company has issued 6,900,000 Non-Cumulative Preference share (NCPS) of Rs.10 each fully paid-up. NCPS carry non-cumulative dividend @ 6.5% p.a. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting. The holder of NCPS is not entitled to vote. Shares issued to them are redeemable within a period of 5 years after the expiry of 3 years from the date of issue.

In the event of liquidation of the company before redemption of equity shares, the holders of NCPS will have priority over equity shares in the payment of dividend and repayment of capital.

193

The Annual Report

2016-17



c. Shares held by holding company and percentage of holding:

Equity Shares March 31, 2017 March 31, 20163D PLM Software Solutions Limited (Holding Company)Number of shares held 30,10,000 30,10,000Percentage of holding in the class 100% 100%

30,10,000 30,10,000

Equity Shares March 31, 2017 March 31, 20163D PLM Software Solutions Limited (Holding Company)Number of shares held 69,00,000 -Percentage of holding in the class 100% -

69,00,000 -

Note 12 : Other equity

Retained Earnings Amount in Rs.As at April 01, 2015 (42,46,147)Changes during the yearProfit during the year 3,54,12,385At March 31, 2016 3,11,66,238Profits for the year 11,24,09,674At March 31, 2017 14,35,75,912

Other reserves March 31, 2017 March 31, 2016 April 01, 2015INR Lacs INR Lacs INR Lacs

Cash flow hedge reserve 58,40,154 - -Total other reserves 58,40,154 - -

Note 13 : Trade and other payables (non-interest bearing)


Trade Payables 8,31,077 25,36,939 1,27,245Other PayablesOthers 3,52,607 (1,03,401) -

11,83,684 24,33,538 1,27,245

Note 14 : Other financial liabilities


Retention Money 90,900 23,34,863 1,91,422Accrued Expenses 4,41,79,295 4,53,61,057 19,66,324Capital Creditors 7,52,108 - 33,17,511Advances from customers - 4,21,04,371 -

4,50,22,303 8,98,00,291 54,75,257

194



Note 15 : Deferred Revenue


Balance of Deferred Revenue at the beginning of the year 49,75,051 - -

Movement during the yearDeferred during the year 3,40,32,735 1,07,80,763 -Released to the statement of profit and loss (3,67,19,199) (58,05,712) -

22,88,587 49,75,051 -

Current 15,57,305 39,13,003 -Non-Current 7,31,282 10,62,048 -

22,88,587 49,75,051 -

Note 16 : Net employee defined benefits liabilities


Provision for employee benefitsProvision for gratuity - current 25,55,807 45,17,072 3,13,109Provision for compensated absences - current 48,76,285 39,96,553 62,337

74,32,092 85,13,625 3,75,446

Note 17 : Other current liabilities


Statutory Liabilities 58,40,411 60,67,807 6,05,500Others Payables 3,17,648 8,04,291 2,90,679

61,58,059 68,72,098 8,96,179

Note 18 : Revenue from operations

Year Ended March 31, 2017 March 31,2016

Revenue from services 58,51,48,529 35,48,83,005 58,51,48,529 35,48,83,005

Note 19 : Other income

March 31, 2017 March 31, 2016Dividend incomeDividend income on current investments 10,38,199 12,23,854

Other non operating incomeGain on sale of current investments (Net) 19,438 - Miscellaneous income 14,260 -

10,71,897 12,23,854

Note 20 : Finance income

March 31, 2017 March 31, 2016Interest incomeInterest earned from loans to employees 821 6,479 Interest on unwinding of security deposit 6,12,589 3,60,204

6,13,410 3,66,683

195

The Annual Report

2016-17



Note 21 : Employee benefit expenses

March 31, 2017 March 31,2016Salaries, bonus and allowances 25,00,81,157 17,96,16,174Contribution to provident and other funds 1,40,75,320 94,17,221Gratuity expenses 43,78,243 32,14,355Staff welfare expenses 99,34,471 76,38,487

27,84,69,191 19,98,86,237

Note 22 : Depreciation and amortization expense

March 31, 2017 March 31,2016Depreciation of tangible assets (Refer note 3) 2,74,63,052 2,01,37,859Amortization of intangible assets (Refer note 4) 2,28,321 22,05,412

2,76,91,373 2,23,43,271

Note 23 : Other Expenses

March 31, 2017 March 31,2016Sub-contracting expenses 3,46,46,181 12,72,754Facility Charges 1,01,18,318 44,65,740Electricity expenses 84,47,062 97,48,024Rates and taxes 3,29,382 3,90,801Rent 2,45,08,859 2,62,67,688IT recharge cost 2,32,33,289 63,56,316Repairs and maintenance - Computer and accessories 77,92,813 30,89,836Repairs and maintenance - Buildings 2,917 -Repairs and maintenance - Others 99,981 21,523Insurance 2,60,608 29,618Travelling and conveyance expenses 1,26,51,339 15,07,596Equipment rental charges 98,13,122 40,21,582Communication expenses 28,61,827 14,89,165Legal and professional charges (10,32,764) 1,52,38,942Auditor’s remuneration 7,90,090 6,59,179Staff recruitment expenses 6,74,706 7,32,355Royalty expenses 58,50,263 11,02,892Loss on sale of investments - 1,296Loss on exchange differences 61,96,834 18,97,830Miscellaneous expenses 75,04,168 29,03,107Reimbursement of shared services costs from subsidiaries 1,39,52,957 1,35,05,102

16,87,01,953 9,47,01,346

Payment to AuditorsMarch 31, 2017 March 31,2016

As auditorAudit fee 7,50,000 6,00,000

Other CapacityReimbursement of expenses 40,090 59,179

7,90,090 6,59,179

Note 24 : Finance cost

March 31, 2017 March 31,2016Interest Expense - 23,52,322Other borrowing cost 4,77,887 2,07,630

4,77,887 25,59,952

196



Note 25 : components of Other comprehensive Income (OcI) The disaggregation of changes to OCI by each type of reserve in equity is shown below:

During the year ended 31 March 2017

cash flow hedge reserve

Retained earning Total

Currency forward contracts (88,47,378) (88,47,378)Reclassified to statement of profit or loss 30,07,224 30,07,224Re-measurement gains (losses) on defined benefit plans (5,42,890 (5,42,890)

(58,40,154) (5,42,890) (63,83,044)

During the year ended 31 March 2016cash flow hedge

reserveRetained earning Total

Re-measurement gains (losses) on defined benefit plans 8,76,408 8,76,408 - 8,76,408 8,76,408

Note 26 : Earnings per share (EPS) The following reflects the income and share data used in the basic and diluted EPS computations:

March 31, 2017 March 31, 2016Profit attributable to equity holders:Continuing operations 11,18,66,784 3,62,88,793Profit attributable to equity holders of the parent adjusted for the effect of dilution 11,18,66,784 3,62,88,793

Weighted average number of Equity shares for basic EPS*Effect of dilution:Share optionsConvertible preference sharesWeighted average number of Equity shares adjusted for the effect of dilution 30,10,000 30,10,000

30,10,000 30,10,000

* The weighted average number of shares takes into account the weighted average effect of changes in share during the year on account of cancellation and issuance. There have been no other transactions involving Equity shares or potential Equity shares between the reporting date and the date of authorisation of these financial statements.

197

The Annual Report

2016-17



Note 27 : Gratuity and other post-employment benefit plans

a. Defined contribution Plan


Particulars Year Ended Year EndedMarch 31, 2017 March 31, 2016

Contribution to Provident Fund 1,12,92,001 77,29,739Contribution to Superannuation Fund 17,43,752 10,22,163Total 1,30,35,753 87,51,902

b. Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.



GratuityI Reconciliation of opening and closing balances of Defined Benefit obligation

Present Value of Defined Benefit obligation as at the beginning of the period/year

2,21,79,284 9,59,654

Acquisition Adjustments - 1,73,24,930Interest Cost 16,42,785 7,50,525Current Service Cost 41,73,174 31,96,103Settlement cost / (credit) - -Benefits paid (27,69,070) -Net Actuarial Loss / (Gain) (3,44,728) (51,928)Present Value of Defined Benefit obligation as at the end of the year 2,48,81,445 2,21,79,284

II Reconciliation of fair value of plan assetsFair value of plan assets as at the beginning of the year 1,73,24,930 6,46,545Acquisition Adjustments - 1,73,24,930Interest Income 14,37,716Mortality Charges and Taxes (2,52,268)Expected return on plan assets 10,67,258 7,57,245Net Actuarial Gain / (Loss) - (13,79,617)Amount paid on settlement - -Employer’s contribution 45,17,072 3,13,109Benefits paid (27,69,070) -Fair value of plan assets as at the end of the year 2,13,25,638 1,76,62,212

III Actual return on plan assets 10,67,258 (6,22,372)IV Net Liability recognised in Balance Sheet

Present Value of Defined Benefit obligation 2,48,81,445 2,21,79,284Fair value of plan assets 2,13,25,638 1,76,62,212Net liability recognised in Balance Sheet (35,55,807) 45,17,072

198




V Actuarial assumptionsI.A.L.M 2006-08 ULTIMATE

I.A.L.M 2006-08 ULTIMATEMortality Table:

Discount rate 7.1% P.A 7.80% P.A. Expected rate of return on Plan Assets 7.90% P.A. 8.00% P.A. Salary escalation 9.00% to

11.00% P.A.10% to 11.50%

P.A.

VI Expense recognised in the statement of Profit and LossParticulars Year Ended Year Ended

March 31, 2017 March 31, 2016Current Service Cost 41,73,174 31,96,103Acquisition (gain)/Loss - -Net interest ( Income)/ Expense 2,05,069Interest Cost - 7,50,525Expected Return on Plan Asset - (7,57,245)Net Actuarial Loss / (Gain) - 13,27,689Settlement (gain) / loss - -Total expenses recognised in the statement of Profit and Loss, under Employee benefit expense

43,78,243 45,17,072





Sensitivity Analysis March 31, 2017 March 31, 2016Projected benefit obligation on current assumption 2,48,81,445 2,21,79,284 Delta effect of + 1% change in rate of discounting 2,30,36,207 2,05,87,054 Delta effect of - 1% change in rate of discounting 2,70,01,362 2,40,06,477 Delta effect of + 1% change in rate of salary increase 2,59,69,256 2,31,90,750 Delta effect of - 1% change in rate of salary increase 2,38,07,111 2,11,70,558

The following payments are expected contributions to the defined benefit plan in future years: Within the next 12 months (next annual reporting period) 23,63,000 Between 2 and 5 years 1,23,10,000 Between 5 and 10 years 2,43,71,000


199

The Annual Report

2016-17



Note 28: Related party disclosure Names of Related parties and their Relationship

Utlimate holding company Dassault Systemes SE

Holding Company 3D PLM Software Solutions Limited

Fellow subsidiaries

3DVIA SASDassault Data ServicesDassault Systemes 3DExcite GmbHDassault Systemes ABDassault Systemes Canada IncDassault Systemes España S.L.UDassault Systemes IsraelDassault Systemes Italia, SrlDassault Systemes K.KDassault Systemes Korea Corp.DASSAULT SYSTEMES Middle EastDassault Systemes Services, LLCDassault Systèmes Singapore Pte LtdDassault Systemes UKDASSAULT SYSTEMS K.K.Taiwan BranchDassault Systems SimuliaDS Americas CorpDS Deutschland GmbhDS Simulia Corp.DS Singapore Pte. Ltd.Spatial Corporation

Entity with significant influence over the Company Geometric Limited (till March 2, 2017)GL- France Branch (till March 2, 2017)

Other related parties (Affiliates of Geometric Limited) Gapp Japan (till March 2, 2017)Geometric Americas Inc.. (till March 2, 2017)Geometric Americas, Inc.S (till March 2, 2017)Geometric GMBH (till March 2, 2017)Geometric Korea Branch (till March 2, 2017)Geometric, SAS (till March 2, 2017)

Other related party Godrej and Boyce Manufacturing Company Limited.

Key Management Personnel Patrick Derouin (C.E.O.) Manish Tambe (C.E.O. & Manager)

200



The following transactions were carried out with related parties during the year ended March 2017 and March 2016

Transactions and Related Parties Year EndedMarch 31, 2017 March 31, 2016

Ultimate holding company

Recovery of Hardware cost Dassault Systèmes SE - 95,394 Recovery of travel and others Dassault Systèmes SE 46,46,879 11,13,968 Reimbursement of common cost Dassault Systèmes SE - 63,56,316 Reimbursement of IT Cost Dassault Systèmes SE 3,10,57,272 - Reimbursement of Travel and Others Dassault Systèmes SE 71,60,590 - Revenue Dassault Systèmes SE 12,64,66,135 11,06,53,922 Shared Services Cost Dassault Systèmes SE - 1,02,75,931

Fellow subsidiaries

Deferred Revenue Income Dassault Systemes K.K 33,72,525 -Recovery of expenses Dassault Systemes 3DExcite GmbH - 12,13,165

Dassault Systemes K.K - 1,45,936 Recovery of Hardware cost Dassault Systemes 3DExcite GmbH 9,22,466 28,63,770

Dassault Systemes K.K 4,98,624 - Recovery of travel and others Dassault Data Services 10,96,661 -

Dassault Systemes 3DExcite GmbH 29,17,403 21,49,355 Dassault Systemes AB 32,03,111 - Dassault Systemes Canada Inc 13,16,237 - Dassault Systemes K.K 64,79,080 5,27,547 Dassault Systemes Korea Corp - 20,45,476 Dassault Systemes Korea Corp. 5,53,676 -Dassault Systemes Services, LLC - 6,76,499 Dassault Systemes UK 1,40,227 -DASSAULT SYSTEMS K.K.Taiwan Branch 4,09,430 -DS Americas Corp 2,71,323 3,88,097 DS Singapore Pte. Ltd. 2,05,547 -

Revenue 3DVIA SAS 37,39,292 -Dassault Data Services 1,81,18,882 86,82,484 Dassault Systemes 3DExcite GmbH 4,48,63,615 2,98,29,228 Dassault Systemes AB 3,52,46,367 -Dassault Systemes Canada Inc 38,00,309 -Dassault Systemes España S.L.U 52,50,355 40,72,519 Dassault Systemes India Pvt. Ltd. - 11,14,832 Dassault Systemes Israel 39,11,872 5,69,938 Dassault Systemes Italia, Srl 39,89,216 -Dassault Systemes K.K 5,13,75,017 80,11,949 Dassault Systemes Korea Corp - 1,36,52,721 Dassault Systemes Korea Corp. 3,48,893 -DASSAULT SYSTEMES Middle East 18,66,785 -Dassault Systemes Services, LLC 1,66,33,421 7,03,52,879 Dassault Systèmes Singapore Pte Ltd 6,78,070 -Dassault Systemes UK 5,50,968 68,796 DASSAULT SYSTEMS K.K.Taiwan Branch 10,73,745 -Dassault Systems Simulia 803 -

201

The Annual Report

2016-17



Transactions and Related Parties Year EndedMarch 31, 2017 March 31, 2016

DS Americas Corp 12,32,91,798 2,34,14,030 DS Canada Inc. - 71,77,374 DS Deutschland Gmbh 1,24,86,410 12,76,251 DS Simulia Corp. 21,34,596 -DS Singapore Pte. Ltd. 6,26,732 -Gapp Japan - 56,66,097 Spatial Corporation 43,90,637 -

Royalty payable Dassault Data Services 58,50,263 -Shared Services Cost DS Canada Inc. - 13,95,245


Recovery of travel and others Geometric Limited - 5,97,988 GL- France Branch 3,81,099 -

Reimbursement of common cost Geometric Limited - 14,57,096 Reimbursement of Travel and Others Geometric Limited 4,26,414 15,497 Revenue Geometric Limited 18,48,122 23,40,188 SAP shared cost Geometric Limited 14,96,531 -Shared Services Cost Geometric Limited 88,49,533 1,05,57,285

Holding company Common Shared cost 3D PLM Software Solutions Limited 7,27,601 -Increase in Preference share Capital 3D PLM Software Solutions Limited - 6,90,00,000 Interco-Shared Services Cost 3D PLM Software Solutions Limited 35,81,152 -Interest on loan (Expense) 3D PLM Software Solutions Limited - 23,41,935 Loan repaid to Holding Company 3D PLM Software Solutions Limited - 4,00,00,000 Loan taken from Holding Company 3D PLM Software Solutions Limited - 4,00,00,000 Recovery of expenses 3D PLM Software Solutions Limited - 18,475 Recovery of travel and others 3D PLM Software Solutions Limited - 8,76,307 Reimbursement of common cost 3D PLM Software Solutions Limited - 7,87,521 Reimbursement of Travel and Others 3D PLM Software Solutions Limited - 11,01,322 Shared Services Cost 3D PLM Software Solutions Limited - 29,47,817

Other related parties

Capital Advance Godrej & Boyce Mfg. Co. Ltd., - 39,82,134 Deferred Revenue Income Gapp Japan 21,26,456 -

Geometric Americas Inc.. 1,06,72,577 -Other Expenses Godrej & Boyce Mfg. Co. Ltd., 150 1,63,976 Purchase of Fixed asset Godrej & Boyce Mfg. Co. Ltd., 1,09,500 1,14,67,725 Recovery of travel and others Gapp Japan 27,37,534 -

Geometric Americas Inc.. 33,45,198 3,72,814 Geometric GMBH 17,95,419 -Geometric Korea Branch 19,378 -Geometric, SAS 9,830 -

Reimbursement of Travel and Others Geometric GMBH 61,311 -Revenue Gapp Japan 1,50,17,371 -

Geometric Americas Inc.. 6,29,60,632 1,92,70,510 Geometric Asia Pacific Pte. Ltd - 44,33,010 Geometric GMBH - 1,19,21,156 Geometric, SAS 1,71,51,464 2,86,02,732

Nature of transaction Year Ended March 31, 2017 March 31, 2016

Managerial Remuneration: Key Management PersonnelPatrick Derouin 5314460 - Manish Tambe 5470494 26,96,687

202




The transactions with the related parties are made on terms equivalent to those that prevail in arm s length transactions. Outstanding balances at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended March 31, 2017, the Company has not recorded any impairment of receivables relating to amounts owed by related parties (March 31, 2016: INR Nil, April 01, 2015 : INR Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.

Loan from holding company

The Company had borrowed a loan from its Parent Company in the last financial year for set up and preliminary expenses of the subsidiary. The loan was squared off within a year. Interest on loan was 11%.

compensation of key management personnel of the company


Name of the key management personnel Year Ended March 31, 2017 March 31, 2016

Patrick Derouin 53,14,460 - Manish Tambe 54,70,494 26,96,687

c. Outstanding Balances

As on March 31, 2017 March 31, 2016

Utlimate holding company :Trade Receivables Dassault Systemes SE - 1,40,41,471

Other Receivables Dassault Systemes SE - 6,53,510

Unbilled Revenue Dassault Systemes SE 50,77,444 1,04,50,104

Fellow Subsidiaries :Trade Receivables Dassault Data Services Suresness - 26,37,834 Dassault Systemes España - 1,77,245 Ds Americas Corp 3,49,971 - Spatial Corporation 15,80,269 - Dassault Systemes 3DExcite GmbH 1,34,98,012 - DASSAULT SYSTEMES Middle East FZ-LL 7,43,955 - Dassault Systemes Singapore Pte. Ltd. 1,88,212 - Dassault Systemes K.K Taiwan 10,24,601 - Processia Solutions Corp 25,51,316 - 3Dvia Sas 15,25,949 -

Other Receivables Dassault Systemes 3DExcite GmbH 1,89,186 15,30,073 Dassault Systemes K.K Taiwan 3,97,129 -

203

The Annual Report

2016-17




Unbilled Revenue Dassault Systemes Service, LLC - 94,19,845 Dassault Systemes Canada Inc - 9,01,245 Dassault Systemes Korea Corp - 3,74,769 Dassault Systemes 3DExcite GmbH - 27,24,540 Dassault Data Services 6,06,233 10,65,744 Dassault Systemes España 73,644 8,90,026 Dassault Systemes K.K. 36,12,647 4,52,695 DASSAULT SYSTEMES Middle East FZ-LL 11,13,141 - Ds Americas Corp. 90,93,792 50,81,167 Dassault Systemes UK Ltd. - 68,796 Dassault Systemes Israel - 5,69,938 DS Deutschland Gmbh 10,45,728 - Processia Solutions Corp 65,523 - Spatial Corporation 3,17,243 - Dassault Systemes Italia, 1,55,580 - Dassault Systemes AB 30,51,386 -

Advance received Dassault Systemes India Private Limited - 1,17,215 Dassault Systemes 3DExcite GmbH - 1,21,83,950 Dassault Systemes Americas Corp - 32,86,959 Dassault Systemes Canada Software Inc. - 30,19,814 Dassault Systemes Service, LLC - 2,18,96,091

Entity with significant influence over the company :Advances Receivable


Unbilled RevenueGeometric Limited - 12,27,442

Trade ReceivablesGeometric Limited 7,44,747 12,74,095

Other ReceivablesGeometric Ltd. 4,942 -

Other related parties (Affiliates of Geometric Limited) :

Unbilled RevenueGeometric Americas Inc. - 82,20,124Geometric Asia Pacific Pte. Limited - 11,66,061Geometric SAS - 58,36,470

204




Trade ReceivablesGapp Japan 43,11,509Geometric Asia Pacific Pte. Limited 72,34,918Geometric, SAS 2,15,612 6,81,552Geometric Americas, Inc. 1,08,89,720

Trade PayablesGeomtric Europe, Gmbh 56,670 -

Other receivablesGeometric, SAS 8,359 -Geometric Americas, Inc. 47,42,947 -Gapp Japan 16,97,683 -

Advances received Geometric Americas Inc. - 16,00,342

Note 29 : Segment reportingSince the segment information as per Ind AS 108 is provided on the basis of consolidated financial statements, separate segment information based on standalone financial statements is not provided

Note 30: hedging activities and derivatives Derivative financial instruments:

The Company holds derivative financial instruments such as foreign currency forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures on highly probable forecast transaction of sales. The counter party for these contracts is generally a bank. These derivative financial instruments are valued based on quoted prices for similar assets and liabilities in active markets or inputs that are directly or indirectly observable in the marketplace.



Derivative designated as cash flow hedge Forward contracts in Euro 39,86,187 - in USD 48,61,192 -

The foreign exchange forward contracts plotted below mature within 12 months. The table below analyzes the derivative financial instruments into relevant maturity groupings based on the remaining period as of the balance sheet date:


Not later than one month 10,74,710 -Later than one month and not later than three months 17,00,543 -Later than three months and not later than one year 60,72,125 -

88,47,378 -

During the year ended March 31, 2017, the Company has designated certain foreign exchange forward contracts as cash flow hedges to mitigate the risk of foreign exchange exposure on highly probable forecast revenue transactions. The related

205

The Annual Report

2016-17



hedge transactions for balance in cash flow hedging reserve are expected to occur and reclassified to revenue in the statement of profit or loss within 12 months.



Note 31 : commitments and contingencies a. Leases

Operating lease (for assets taken on lease)

The Group has taken equipment, cars, furniture and various office premises, under operating lease arrangements for terms ranging from 1 to 5 years. These are generally renewable by mutual consent. There are no specific restrictions imposed by the lease arrangements except that the leased premises cannot be sub leased any further in case of certain premises. There are escalation clauses in agreements with some parties. There are no sub leases.


Operating Lease As at As atMarch 31, 2017 March 31, 2016

Within one year 3,52,07,168 3,27,71,273After one year but not more than 5 years 43,52,64,977 8,47,81,773

47,04,72,145 11,75,53,046

b. commitments

Estimated amount of contracts remaining to be executed, net of advances to the extent not provided for Rs . 698,302 (March 31, 2016: Rs. 4,518,628)

Note 32 : Fair values

Set out below, is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments, other than those with carrying amounts that are reasonable approximations of fair values:


carrying amount Fair valueFinancial assetsInvestments in mutual funds 5,27,32,224 5,27,32,224Derivatives in effective hedges 88,47,378 88,47,378Total 6,15,79,602 6,15,79,602

The carrying value and fair value of financial instruments by categories as of March 31, 2016 were as follows:carrying amount Fair value

Financial assetsInvestments in mutual funds 45,11,746 45,11,746Derivatives in effective hedges - -Total 45,11,746 45,11,746

206



The carrying value and fair value of financial instruments by categories as of April 01, 2015 were as follows:carrying amount Fair value

Financial assetsInvestments in mutual funds - -Derivatives in effective hedges - -Total - -

The management assessed that cash and cash equivalents, trade receivables, trade payables, bank overdrafts and other current liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.


Note 33: Fair value hierarchy

The following table provides the fair value measurement hierarchy of the Company’s assets and liabilities.

Quantitative disclosures fair value measurement hierarchy for assets:



markets


inputs


markets


inputs


markets


inputs

(Level 1) (Level 2) (Level 1) (Level 2) (Level 1) (Level 2)

Financial AssetsInvestment in liquid mutual fund units 5,27,32,237 5,27,32,237 - 45,11,749 45,11,749 - - - -Derivative financial instruments - foreign currency forward and option contracts

88,47,378 - 88,47,378 - - - - - -

Note 34 : Income tax

The major components of income tax expense for the years ended March 31, 2017 and March 31, 2016 are:

Statement of profit and loss:

March 31, 2017 March 31, 2016current income tax:Current income tax charge 2,36,63,457 97,30,000 Deferred tax:Relating to origination and reversal of temporary differences (2,40,36,809) (90,36,057)Income tax expense reported in the statement of profit or loss (3,73,352) 6,93,943

OCI section Deferred tax related to items recognised in OCI during in the year:

March 31, 2017 March 31, 2016Net (gain)/loss on revaluation of cash flow hedges 30,07,224 -Net loss/(gain) on remeasurements of defined benefit plans 2,79,546 (4,51,281)Income tax charged to OCI 32,86,770 (4,51,281)

207

The Annual Report

2016-17



Reconciliation of tax expense and the accounting profit multiplied by India’s domestic tax rate for March 31, 2017 and March 31, 2016

March 31, 2017 March 31, 2016Accounting profit before income tax 11,14,93,432 3,69,82,736 At India’s statutory income tax rate of 34.61% (March 31, 2016: 34.61%) 3,85,87,877 1,27,99,725 Non-deductible expenses for tax purposes:Income exempt from tax (2,29,20,546) (1,21,05,782)At the effective income tax rate of 34.61% (March 31, 2016: 34.61%) 1,56,67,331 6,93,943 Income tax expense reported in the statement of profit and loss (3,73,352) 6,93,943



2017March 31,

2016April 1, 2015 March 31,

2017March 31,

2016Depreciation 30,07,224 - - - -Deferred tax on actuarial Gain /Loss - - - (2,79,545) 4,51,281Deferred tax on Ind AS adjustments (42,596) (22,688) - (19,908) (22,688)

29,64,628 (22,688) - (2,99,453) 4,28,593Less : Adjusted MAT Credit 3,07,47,869 94,64,650 - 2,37,37,355 94,64,650

(2,77,83,241) (94,87,338) - (2,40,36,808) (90,36,057)

Note 35 : capital management

For the purpose of the Company’s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company’s capital management is to maximise the shareholder value.




The Company is exposed to market risk, credit risk and liquidity risk which may impact the fair value of its financial instruments. The Company has a risk management policy to manage & mitigate these risks.

The Company’s risk management policy aims to reduce volatility in financial statements while maintaining balance between providing predictability in the Company’s business plan along with reasonable participation in market movement.

Market risk

The Company operates internationally and a major portion of the business is transacted in several currencies and consequently the Company is exposed to foreign exchange risk through its sales and services in the United States and European Union, and purchases from overseas suppliers in various foreign currencies. The Company holds derivative financial instruments such as foreign exchange forward contracts to mitigate the risk of changes in exchange rates on foreign currency exposures to cover its Euro sales and USD sales. The exchange rate between the rupee and foreign currencies has changed substantially in recent years and may fluctuate substantially in the future.


208




Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates relates primarily to the Company’s operating activities (when revenue or expense is denominated in a foreign currency).

The Company manages its foreign currency risk by hedging transactions that are expected to occur within a maximum 12-month period for hedges of forecasted sales.

When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable that is denominated in the foreign currency.

At March 31, 2017, the Group hedged 90% of its expected USD sales (March 31, 2016: NIL, April 1, 2015: NIL) and 50% of its expected EURO sales (March 31, 2016: NIL, April 1, 2015: NIL), for 12 months period. Those hedged sales were highly probable at the reporting date. This foreign currency risk is hedged by using foreign currency forward contracts.


The following tables demonstrate the sensitivity to a reasonably possible change in USD and EUR exchange rates, with all other variables held constant. The impact on the Company’s profit before tax is due to changes in the fair value of monetary assets and liabilities including non-designated foreign currency derivatives. The Company’s exposure to foreign currency changes for all other currencies is not material.

change in USD rate


change in EUR rate


March 31, 2017 5% 82,83,458 5% 86,02,650 -5% (82,83,458) -5% (86,02,650)

March 31, 2016 5% 95,24,611 5% 76,98,962 -5% (95,24,611) -5% (76,98,962)

credit risk Financial instruments that potentially subject the Company to concentration of credit risk consist principally of cash and

bank balances, trade receivables, unbilled revenue, investment securities and derivative instruments. The cash resources of the Company are invested with mutual funds, and banks after an evaluation of the credit risk. By their nature, all such financial instruments involve risks, including the credit risk of non-performance by counterparties.

The customers of the Company are primarily group companies based in the United States of America and Europe and accordingly, trade receivables and other receivables are concentrated in the respective countries. The Company periodically assesses the financial reliability of customers, taking into account the financial condition, current economic trends, analysis of historical bad debts and ageing of accounts receivables.


Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting its obligations associated with financial liabilities. The investment philosophy of the Company is capital preservation and liquidity in preference to returns. The Company consistently generates sufficient cash flows from operations and has access to multiple sources of funding to meet the financial obligations and maintain adequate liquidity for use.

209

The Annual Report

2016-17



Note 37: Equity and profit reconciliation


These financial statements, for the year ended March 31, 2017, are the first Ind AS SFS that the Company has prepared in accordance with Ind AS. For periods up to and including the year ended March 31, 2016, the Company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the Company has prepared its financial statements which comply with Ind AS applicable for periods ended on March 31, 2017, together with the comparative period data as at and for the year ended March 31, 2016, as described in the summary of significant accounting policies. In preparing these financial statements, the Company’s opening balance sheet was prepared as at April 01, 2015, the Company’s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at April 01, 2015 and the financial statements as at and for the year ended March 31, 2016.

Exemptions applied:

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

a) Ind AS 101 permits a first-time adopter to elect to continue with the carrying value of its property, plant and equipment as recognised in the financial statements as at the date of the transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. This exemption can be used for intangible assets covered by Ind AS 38. Since there is no change in the functional currency, the Company has elected to measure all of its property, plant and equipment and intangible assets at carrying value as per Indian GAAP.


The Company uses derivative financial instruments in form of forward currency contracts to hedge its foreign currency risks. Under Indian GAAP, the Company used principles of AS -30 on hedge accounting. The Company has designated various economic hedges and applied economic hedge accounting principles to avoid profit or loss mismatch. All the hedges designated under Indian GAAP are of types which qualify for hedge accounting in accordance with Ind AS 109 also. Moreover, the Company, before the date of transition to Ind AS, has designated a transaction as hedge and also meets all the conditions for hedge accounting in Ind AS 109. Consequently, the Company continues to apply hedge accounting after the date of transition to Ind AS.


d) Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. However, the Company has used Ind AS 101 exemption and assessed all arrangements based for embedded leases based on conditions in place as at the date of transition.




The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 01, 2015, the date of transition to Ind AS and as of March 31, 2016.

210



Reconciliations: The following reconciliations help to understand the effect of significant differences arising from the transition from Previous GAAP to Ind AS in accordance with Ind AS 101:

Reconciliation of equity as Indian GAAP and per Ind AS for April 1, 2015

Particulars Notes As at March 31, 2016 March 31, 2015

Total net worth as per as on April 01, 2015 as per Indian GAAP 13,03,10,298 2,58,53,853

Effect of fair value adjustment of security deposits i Finance Income 3,60,204 - Rent Expense (4,26,952) -

Deferred tax effect of Ind AS adjustments as above 22,688 -Net profit/equity as per Ind AS 13,02,66,238 2,58,53,853Other comprehensive income (net of tax) - -Total net worth as on April 01, 2015 as per Ind AS 13,02,66,238 2,58,53,853

(i) Security Deposits


Reconciliation between Profit as previously reported and total comprehensive income as per Ind AS for the year ended March 31, 2017

Description Year Ended March 31, 2016

Profit under previous GAAP 3,54,56,445

Acturial gain / (loss) on employee defined benefit plan recognised in Other Comprehensive Income 13,27,689Effect of fair value adjustment of security deposits

Finance Income 3,60,204 Rent Expense (4,26,952)

Deferred tax effect of Ind AS adjustments as above (4,28,593)Net profit/equity as per Ind AS 3,62,88,793Other comprehensive income (net of tax) (8,76,408)Total comprehensive Income as at reporting date 3,54,12,385



per Govind Ahuja Manu Parpia Sudarshan MogasalePartner Director DirectorMembership No:48966


211

The Annual Report

2016-17

LOcATION OF OFFIcES OF cOMPANY & ADDRESS OF cORRESPONDENcE (INcLUDING SUBSIDIARY):




Plot No. 4, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

Plot No. 15/B, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

No. 45, 22nd Cross, 5th Main Road, 3rd Block, Between South end & Jayanagar Metro station,

Jayanagar, Bengaluru 560011

SUBSIDIARIES (DIREcT SUBSIDIARY)3D PLM Global Services Pvt. Ltd.


Quibix Technologies Pvt Ltd (SEZ), Block No IT9, 4th Floor, Plot No 2,

Rajiv Gandhi Infotech Park, Phase-I, Hinjewadi, Pune 411 057.

Annual Report2016-17

Registered Office



• Plot No. 4, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

• Plot No. 15/B, Pune Infotech Park, M.I.D.C. Hinjewadi, Taluka Mulshi, Pune 411 057

3D PLM

Software Solutions Lim

ited | Annual R

eport -2016-17

Corporate Offices

Mumbai

Pune

Tel.: +91-22-6705 6001Fax: +91-22-6705 6891Website: www.3dplmsoftware.com Email: [email protected]

Contact Details

prin

t@pa

rkso

nsgr

aphi

cs.c

om

Date post:	22-Mar-2018
Category:	Documents
Upload:	voxuyen
View:	214 times
Download:	2 times

3D PLM Software Solutions Limited | Registered Ofﬁce...

Documents