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TERA SOFTWARE LIMITED


# 8-2-293 / 82/ A/'t -t 07,

;nr

Plot No.'l 107, Road No.55,


Jubilee Hills, Hyderabad 500 033, Telangana, INDIA

TERA SOFT

Aedefnmg lT solutions

Date: 28.05.2016

The Secretary
BSE

Limited

Phiroze jeejeebhoy Towers


Dalal Street

Mumbai -

400 001

Scrip Code:533982
Scrip Name: Tera Software Limited

Dear Sir,

Sub: Financial Results for the FY ended

31st

March 2016.

This is to inform you that the meeting of the Board of Directors of our Company held on
28u May,20l6 has approved and considered the Audited Financial Results of the
Company for the Financial year ended 3L't March 2015.

Further, pursuant to Regulation 33 of the SEBI(Listing Obligations and Disclosure


Requirements)Regulation,2015, we are hereby enclosing the Audited Financial Resuls
for the Financial year ended 3L't March 2016 along with the Auditor's Report issued by
the Statutory Auditors and declaration with regard to Auditor's Report with unmodified
opinion.

Kindly take the same on your record.


Thanking you.
For
TERA

T.Gopichand
Vice Chairman
DIN:00107886

An ISO 9001 : 2008 Certified Company

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TERASOFTWARE tTD.

#8-2-293182lA/1107, Plot no 1107, Road no 55, Jubilee Hills, Hyderabad-33.


PART

. STATEMENT OF AUDITED FINANCIAL RESULTS FOR THE qUARTER & F]NANCIAI YEAR ENDED 31ST MARCH

3 Months
Ended for the

sl.

PARTICUI.ARS

No.

Current Year

Corresponding 3

Precedlng 3

Months Ended in
the Prevlous
months ended
Year

2016

(Rs. In |aKhs)

Year to date

figures

for

current year
ended

Year to date

figures for
prelous year
ended

31.O3.2016

31.12.2015

31.03.2015

31.03.2016

31.03.201s

Audited

Unaudited

Audited

Audited

Audited

lncome from operations

- 3,44L.52

a.

Net sales/income from operations


(Net of excise duty)

10,600.51

2,724.O5

b.

Other oDeratins income

596.38
11,196.89

104.18

140.82

985.47

2:7.67

2,828.23

3,s82.34

t7,235.46

9,126.99

8,409.55

L,615.45

1,6s0.94

L0,237.78

2,850.97

|.9s.72

(708.10

862.96

489.44

399.48

2,255.76

fotal lncome from operations (net)


2

L6,249.99

&799.38

Expenses
a.

Purchase of Traded Goods


Changes in inventories of finished goods, work-in-progress,

b.

and stock-in-trade

c.

Employee benefit expense

d.

)epreciation & amortisation expense

e.

Sonsultancy, Professional & Other Charges

)ther Expenses
fotal expenses

1734.671

s29.96

t,sL6.67

64.63

68.O7

24.83

269.85

630.74

830.82

452.42

572.84

t,977.42

1,496.10

629.97

392.90

446.00

1,641.90

1,(N0.96

LO,702.21

2,310.L9

3,094.09

L5,il2.04

&06s.40

)rofit/(Loss) from Operations before other income, finance


:osts and Exceptional ltems {1-2)
)ther lncome

494.67

518.05

488.24

t,593.42

1,061.59

L36.20

53.46

55.47

280.23

199.J0

)rofit/(Loss) from ordinary activities before finance costs and


:xceptional ltems (3+/-4)

630.87

571.51

:inance costs

198.41

t63.77

543.7L
222.69

1,873.65

697.81

1,2o0.59
719.69

432.46

407.73

321.O2

I,t75.84

540.90

432.46

407.73

32t.O2

t,L75.U

540.90

26.L9

(128.e3)

3.29

(303.781

(t27.96:

0.00
(1s3.16

{9.7s1

(0.s1,

(11.98)

(96.971

(90.s81

(49.991

305.49

266.82

227.34

77t.73

362.44

305.49

266.82

227.34

77t.73

362.44

r,257.L9

1,25L.t9

L,25L.19

t,25L.19

t,251.L9

6,46t.70

s,870.66

)roflt/(Loss) from ordinary activities after finance costs but


lefore exceptional ltems (5+/-6)

:xceotional ltems
Profit/Loss from Ordinary Activities before Tax (7+/-8)

9
Tax expense

10

Current Period Tax


MAT Credit
Tax Expenses relating to Earlier years

Deferred Tax
Net ProfiV{Loss} from Ordinary Activities after Tax (9+/-10)
11

t2

Extraordinarv ltem (net oftax exoenses)

13

Net Profit/Loss for the period ILL+/-L2


2aid up equity share capital (Face Value Rs 10/- each)

L4

leserves excluding Revaluation reserve as per balance sheet


,revious accounting year

15

o1

Earning Per share (EPS)

16

a) Basic and diluted EPS before Extraordinary items for the

period, for the year to date and for the previous year (not to
be annualised)

2.44

2.L3

L.82

6.25

2.90

2.44

2.L3

L.82

6.25

2.90

b) Basic and diluted EPS after Extraordinary items for the

period, for the year to date and for the previous year (not to
be annualised)

The Board has recommended a dividend of L2% per equity share of Rs 10/- each aggregating to Rs 180.71 lakh including Dividend Distribution Tax
subject to approval of Members at the ensuring Annual General Meeting

For Tera Softwarc Limitied

Wp slo'iltd>
cial Officer

Chief Fin an

i.-

For Tua SoJ

VC and

PART

II

- SELECT INFORMATION FOR THE QUARTER

PARTICUTARS OF SHAREHOTDING

t7

Public shareholding

& FINANCIAT YEAR ENDED 31ST MARCH 2016

Numberofshares

66.00.873

66.10.873

66.87.691

66.00.873

66,87,691

52.76

52.84

53.45

52.76

53.45

Percentase of shareholdins
18

a.

Promoter and Promoter Group Shareholding


Pledged/Encumbered
- Number of Shares

b.

ln takhs)

(Rs.

5,82,420

5,82,420

5,48,700

5,82,420

5,48,700

- Percentage of shares (as a % of the total shareholding of


oromoter and oromoter grouo)

9.85

9.87

9.42

9.85

9.42

- Percentage of shares (as a % of the total share capital of the


:ompanv)

4.65

4.55

4.39

4.65

4.39

53,28,582

53,18,582

s2,75,484

53,28,582

s2,75,4U

90.15

90.13

90.58

90.15

90 s8

42.59

42.5t

42.t6

42.59

2.16

Non-encumbered
- Number of Shares
- Percentage of shares (as a % of the total shareholding of
cromoter and promoter group)

- Percentage of shares (as a % of the total share capital of the


:omoanv)

SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPIOYED


3 Months

sl.

Ended for

PARTICUIARS

No.

the

Current Year

Corresponding 3

Preceding 3

Months Ended in
months ended
the Previous
Year

Year to date

figures

for

current year
ended

Year to date

figures for
preious year
ended

31.03.2016

3t.L2.20Ls

31.03.201s

31.03.2016

31.03.2015

Audited

Unaudited

Audited

Audited

Audited

;egment Revenue

a.

ntesrated Solutions Division

b.

l-echnical Division

c,

)roiects Division

d.

)thers

e.

Jnallocated
Net sales/lncome from operations
Segment Results [Profit
each Seementl

(Loss) before Tax and interest

a.

lntearated Solutions Division

b.
c.

fechnical Division
)roiects Division

d.

Cthers

2,197.69

644.O7

497.67

2,468.88

t,672.83

8,s02.06

2,L84.t7

L,2L5.78

12,568.89

3,763,88

11,196.89

2,828.23

3,582.32

17.235.46

9,1 6.98

(1s1.31

(32.ls1

797.19

(4.30,

283.54

90.92

91.04

23.40

27t.13

L52.40

1,158.68

s75.91

472.O3

2,323.99

1,198.94

3,690.28

from

44.20

3s.07

40.10

L45.75

155.69

L,t42.49

669.84

732.73

2,736.58

1,790.58

i) lnterest

198.41

t63.77

222.69

697.81

719.69

ii) Un-allocable expenditure

603.62

tt6.72

204.38

997.44

573.30

Total
Less:

1,868.88

779.3L

1,91s.s2

Add: lnterest lncome


3

Total Profit/{Loss} Before Tax

Capital employed

92.00

18.38

15.36

432.46

407.73

321.O2

t34.48
L,t75.84

540.90

1,263.87

43.31

lSegment assets - Segment Liabilities)


a,

lntegrated Solutions Division

875.61

1,L67.71

L,263.87

875.61

b.

Technical Division

247.97

424.90

L,020.21

247.97

t,G:o.2L

c.

Projects Division

6,869.68

7,3L9.24

6 931.99

d.

f,thers

0.00

0.00

6931.99
0.00

6,869.68
0.00

0.00

e.

Unallocable

4,106.03

2,790.33

2,205.80

4.106.03

2,205.80

t2,099.28

Lt,702.17

tL,42t.86

L2.O99.28

17,421.86

Total

3 months

Particulars

ended
{31-03-2016)

}.

INVESTOR COMPLAINTS

)ending at the beginning of the quarter

leceived during the quarter

)isposed of during the quarter

lemaining unresolved at the end of the quarter

Previous quarter's segment results regroup^ed whereever necessary

For Teru Software Limited

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Ufti alEu",,,/tu'r

Chtef F in a

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For Tcra S

VC and f,Ianaging

Direebrr

ItF

I
I

STATEMENT OF ASSETS AND LIABILITIES

As at 31 March 2015

As at 31 March 2016

(iii)Capital work-in-progress

Notes:
1

The above results have been reviewed by the audit committee Meeting held on 27th May 2016 and approved by the Board of Directors of the Company
at their meeting held on 28th May 2016.

Previous period /year figures have been regrouped

reclassified whelever necessary


for and

Ehalf of the Board

Place: Hyderabad

(T.Gopichand)

Date : 28th May 2016

V,C.& Managing Direclol

Fot Tero Sof*are Limited

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TERA SOFTWARE LIMITED


# 8-2-293/82/4t1107,

Plot No.1

.l07,

Road No.55,

Jubilee Hills, Hyderabad 500 033, Telangana, INDIA

TERn"S,p"r,J"

(Rs. ln !akh)

BALANCE SHEET

Note

Particulars

No

As at 31 March 2015

As at 31 March 2015

Equitv and Liabilities

(1)

Shareholders'funds
(a) Share capital

t,251.L9

(b) Reserves and surplus

6.46',J..70

L,25t.19
s.870.66
20.67

7,712.89

l2l

Non-current liabilities
(a) Long-term borrowings
(b) Other Long term liabilities
(c) Long-term provisions

43.24

477.70

(3)

20.67
752.82

to.26

L9.47

4,284.45

7,121.85

783.75

540.41

Currentliabilities
(a) Short-term borrowings

(b) Trade payables


(c) Other current liabilities

(d) Short-term provisions

10

4,O82.t9

4,284.45
7,289.L9
1,117.32
488.13

Total Liabilities

2,944.77
981.49
288.72
L3,179.O9

9,297,t7

2t.432.39

16.202.77

Assets

(1)

Non-current assets
(a) Fixed assets

(i)Tangible assets
(ii)Capital work-in-progress

lL

(b) Long-term loans and advances

L2

(c) Other non-current assets

13

(b) Deferred tax Asset (Net)

(2)

Current assets
(a) lnventories
(b)Trade receivables
(c) Cash and cash equivalents
(d) Short-term loans and advances
(e) Other current assets

L4
15
16

t7
18

1,383.47

1,L82.73
220.09
L,402.82
213.93
1)1 46

2LL.7t
1,595.18
618.23
136.30

1,938.2t

2,349.71

1s3.39

243.97

74.75
72,253.59
580.77
618.38
81.60

809.42
15,039.13
2,906.68
473.88
111.68

Total Assets

19,340.79

13,609.09

2,-.432.39

16,202.77

fui?rnc

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VC and

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sol

ISO 9001 : 2008 Certified Company

Tel: +91 -40-23547447

ctN-172200TG

994P1C01 8391

8, Fax: +91-40-2354-7449, E-mail: info@terasoftware.com

wwwterasoftware.com

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TERA SOFTWARE LIMITED


# 8-2-293/82/A/1107,

Plot No.l.l07, Road No.55,

'I

Jubilee Hills, Hyderabad -

500 033, Telangana, INDIA

TERA SOFT
BedefDing

,f Solutions

(Rs.ln Iakh)

STATEMENT OF PROFIT and LOSS


Particulars
For the Year

Note No

3l

ended
March 2015

For the Year

ended
31 March 2015

INCOME
Revenue from operations
Other income

L7,235.46
280.23

I,t26.99

17.515.69

9.325.99

LO,237.78

LL

2,255.76
697.81
269.85

2,850.97
529.96
L,5L6.67
7L9.69
630.74

24

3,673.32

2,537.06

15.339.85

8.785.09

1,175.84

540.90

303.78

127.96

L9

20

Total Revenue

199.00

Expenses

(1) Purchases of Stock-in-Trade


(2) Changes in inventories of Stock-in-Trade
(3) Employee benefits expense
(4) Finance costs
(5) Depreciation & amortization expense
(5) other expenses

27
22
23

Total Expenses
Profit before tax
[ess: Tax expense
(1) Current tax / MAT
Less: MAT Credit

(2)

Tax Expenses relating

to Earlier

Years

(3) Deferred tax


Profit

(toss) (after tax) for the year from continuing

(734.671

9.75

0.s1

90.58

49.99

77t.73

362.44

771.73

362.44

6.25
6.25

2.90
2.90

operations
Profit

(Lossl (after tax) for the vear

Earnings per equity share

(1) Basic
(2) Diluted

For Tcra Sq

VC anil

An ISO 9001 : 2008 Certified Company


Tel:+91 -40-23547447

ct N-172200TG't 994PLC0't 8391

/ 8, Fax: +91-40-2354-7449,

E-mail: info@terasoftware.com
www.terasoftware.com

NARVEN ASSOCIATES
CHARTERED ACCOUNTANTS

302, 303, Lingapur House,


Himayat Nagar, Hyderabad - 29.
Tet : 2322 0927, 2322 4660
Partner : O4O-2322 6063
e-mail : narven@rediffmail.com

lndependent Auditor's Report

To the Members

of

TERA SOFTWARE LIMITEI)


Report on the Financial Statements
We have audited the accompanying financial statements of Tera Software Limited ("the Comp&trY"),
which comprise the Balance Sheet, as at March 31,2016, statement of profit and loss, statement of
Cash FIow for the year then ended, and notes to financial statements including a summary of
significant accounting policies and other explanatory information.
Management's Responsibility for the Financial Statements
Management is responsible for the matters stated in Section 134(5) of the Companies Act, 2013 ("the
Act") with respect to the preparation of these financial statements that give a true and fair view of the
financial position, financial performance and cash flows of the Company in accordance with the
accounting principles generally accepted in India, including the Accounting Standards specified under

Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014. 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 inegularities; selection and application of appropriate accounting policies; making
judgments and estimates that are reasonable and prudent; and design, implementation and
maintenance of adequate internal financial controls, that were operating effectively for ensuring the
accuracy and completeness ofthe accounting records, relevant to the preparation and presentation of
the financial statements that give a true and fair view and are free from material misstatement,
whether due to fraud or error.

Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the Standards on Auditing issued by Institute of Chartered
Accountants India. Those Standards require that we comply with ethical requirements and plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and the


disclosures in the financial statements. The procedures selected depend on the auditor's judgment,
including the assessment of the risks of material misstatement of the financial statements, whether due
to fraud or error. In making those risk assessments, the auditor considers internal financial control
relevant to the Company's preparation of the financial statements that give a true and fair view in
order to design audit procedure$ that are appropriate in the circumstances. An audit also includes

evaluating the appropriateness of the accounting policies used and the reasonableness of the
overall presentation
accounting edtimates made by the Company's Directors, as well as
of the financial statements.
d.

tx

Er

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion on the financial statements.

Opinion

In our opinion and to the best of our information and according to the explanations given to us, the
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 31,2016, its profits and its cash flows for the year ended on that
date;

Report on Other Legal and Regulatory Requirements


Report) Order, 2016 ("the Order") issued by the
CentraiGovernment of India in terms of sub-section (11) of section 143 of the Act, we give in
the Annexure A statement on the matters specified in the paragraph 3 and 4 of the Order, to the

1. As required by the Companies (Auditor's


extent applicable.

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)

ln our opinion proper books of account

as required by law have been kept by the


Company so far as appears from our examination of those books;

c) The Balance Sheet, the statement of Profit and loss and Cash Flow Statement dealt with
by this Report are in agreement with the books of account;
d)

In our opinion, the aforesaid Balance Sheet, the statement of Profit and loss and Cash
Flow Statement comply with the Accounting Standards specified under Section 133 of the
Companies Act, read with Rule 7 of the Companies (Accounts) Rules, 2014.

e)

On the basis of written representations received from the directors as on March 31,2016,
and taken on record by the Board of Directors, none of the directors is disqualified as on
March 31,2016, from being appointed as a director in terms of Section 164(2) of the Act.

with respect to the adequacy of the internal financial controls over financial reporting of
the Company and the operating effectiveness ofsuch controls, refer to our separate report
in "Anneiure B?'' and

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g)

with respect to the other'matters to be included in the Auditor's Report in accordance


with Rule I I 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:
pending litigations on its financial

ll.

lll.

The Company has disolosed the impact of


position in its financial statements.
The Company has made provision, as required under the applicable law or
accounting standards, for material foreseeable losses, if any, on long-term
conhacts. The Company does not have any derivative contracts and
There has been no delay in transferring amounts, required to be hansfered, to
the Investor Education and Protection Fmd by the Company.

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For NARVEN ASSOCIATES


Charterod Accountants

Firm Regn. No:0059055

Date: 28-05-2016
t-

?-

Place: Hydorabad

Partner
Memborship No: 025995

'..

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NARVEN ASSOCIATES
HARTE RE D ACCO

Continuation Sheet

NTI\NTS

Annexure -A to the Audit Report


The annexure referred to in Independent Auditor's Report to the members
financial statements for the year ended 31 March 20l6,we report that:

i.

(a) The Company has maintained proper records showing


details and situation of fixed assets.

of the company on the

full particulars including quantitative

(b) As per the information and explanations given to us the fixed assets of the company have been
physically verified by the management during the year in regular intervals. In our opinion the
frequency of verification of the fixed assets by the management is reasonable having regard to the
size of the company and the nature of its assets.

(c) According to the information and explanations given to us and on the basis of our
examination of the records of the company, the title deeds of the immovable properties are held in
the name of the company.
ll.

The inventory has been physically verified by the management at reasonable intervals and in
our opinion, the frequency of verification is reasonable. No material discrepancies were noticed
on physical verification between the physical stocks and the book stocks.

lll,

During the year the Company has not granted any loans, secured or unsecured to Companies,
firms or other parties listed in the register maintained Under Section 189 of the Companies Act.
Consequently clauses (iii)(a), (iiixb) and (iii)(c) of the companies (Auditor's Report) order, 2016
are not applicable to the company.

lv.

In our opinion and according to the information and explanations given to us, no

loans,

investment and guarantees have been provided to the parities covered under section 185 and 186
the company has complied with the provisions of section 185 and 186 of the Act, with respect to
the loans and investments made.
v.

vl.

vl1.

The company has not accepted any deposits from the public and consequently the directives
issued by the Reserve Bank of India, the provisions of sections 73 to 76 or any other relevant
provisions of the Companies Act and the rules framed there under are not applicable to the
company. Conseqdently no order has been passed by Company Law Board or National Company
Law Tribunal or Reserve Bank Of India or any court or any other tribunal, on compliance or non
-compliance of the same. Accoidingly, clause (v) of the order is not applicable

In

respect of the company, the Central Government of India has not prescribed for the
maintenance of cost records under sub-section (l) of Section 148 of the Companies Act.
Accordingly clause vi of the order is not applicable.

(a) According to the information and

explanations

examination of the books of accounts, the Company has

on the basis of our


regular in depositing with

!g us, and

i'=

appropriate authorities undisputed statutory dues including Employees' State Insurance, Provident
Fund,Income-tax, Sales-tax, Service-tax, Customs duty, Excise duty, Cess and any other material
statutory dues as applicable to it except in case of Vat of Rs.19,26,720 is outstanding.
S.no

Amount

Nature of Dues

Period

to

the

which

amount

relates

Value Added Tax

Value Added Tax

9,63,360
4,01,400

2014-15

2015-16

(b) According to the information and explanations given to us, there are no material dues payable
in respect of income tax, service tax, customs duty, excise duty and cess which have not been
deposited on account of any dispute other than the following:

Name of the
Statute

Nature of
the dues

Amount

no.

(Rs)

Period to which
the amount relates

Forum where dispute is


pending

AP

VATAct,

Value
Added Tax
Value
Added Tax
Value
Added Tax
Sales Tax

3,39,455

2007-08

High Court of AP

14,30,252

2006-07

High Court of AP

14,30,252

2005-06

High Court of AP

28,60,507

2004-0s

High Court of AP

Sales Tax

35,80,063

2003-04

High Court of AP

Sales Tax

14,30,253

2002-03

High Court of AP

Value

84,76,222

200s-06

Deputy Commissioner
(Appeals), Kerala

Value
Added Tax

61,50,244

2006-07

Deputy Commissioner
(Appeals), Kerala

Value
Added Tax

7,42,446

2007-08

Deputy Commissioner
(Appeals), Kerala

Value
Added Tax

8,52,280

2008-09

Deputy Commissioner
(Appeals), Kerala

The Kerala

Value

4,66,474

2009-10

VAT Rules,

Added Tax

Deputy Commissioner
(Appeals), Kerala

s.

2005

VATAct,

AP

AP VAT Act,

2005
2005
4

APGST Act,

APGST Act,

1957
1957
6

APGST Act,

The Kerala
VAT Rules,

1957

Added Tax

2005

The Kerala

VAT Rules,
2005

The Kerala
VAT Rules,

200s

l0

The Kerala

VAT Rules,

2005

l1

2005

vlll.

In our opinion and according to the information and explanation and given to us, the company has
not defaulted in repayment of loans or borrowings availed from financial institution, banks and
government. During the year the company has not issued

tr

lx.

The company did not raise the money by way of any initial public offer or further public offer
(including debt instruments) and term loans during the year. Accordingly, paragraph 3(ix) of the
order is not applicable.

According to the information and explanations given to us, no material fraud by the company or
on the company by its ofTicers or employees has been noticed or reported during the course of our
audit.

xl.

According to the information and explanations given to us, the company has paid / provided for
managerial remuneration in accordance with the requisite approvals mandated by the provisions
of sections 197 read with Schedule V to the Act.

xll.

In our opinion and according to the information and explanations given to us, the company is not
in Nidhi Company. Accordingly, paragraph 3(xii) of the order is not applicable.

xllt.

According to the information and explanations given to us, and based on our examination of the
records of the company, transactions with the related parties are in compliance with sections 177
and 188 of the Act where applicable and details of such transactions have been disclosed in the
financial statements as required by the applicable accounting standards.

xlv.

According to the information and explanations given to us and based on our examination of the
records of the company, the company has not made any preferential allotrnent or private
placement of shares or fully or partly convertible debentures during the year.

xv.

According to the information and explanations given to us and based on our examination of the
records of the company, the company has not entered into non cash transactions with directors or
persons connected with him. Accordingly, paragraph 3(xv) of the order is not applicable.

xvl.

The company is not required to be registered under section 45-IA of the Reserve Bank of India
Act 1934.

FoTNARVEN ASSOCIATES
Chartered Accountants
FRN:005905S

Place: Hyderabad

G.V.Ramana

Date: 28-05-2016
Membership No.025995

NARVEN ASSOCIATES

Continuation Sheet ....

CHARTERED ACCOUNTANTS

Annexure - B to the Auditors' Report


Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the
Companies Act' 2013 ("the Act")
We have audited the internal financial controls over financial reporting of Tera Software Limited
(,.the Company") as of 31 March 2016 in conjunction with our audit of the financial statements of the
Company for the year ended on that date.
Managementos 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 ('ICAI'). 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 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,20l3.
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, issued by ICAI and deemed to be prescribed 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.

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 ofinternal control based on the assessed
risk. The procedures selected depend on the auditor's judgment, including the assessment of the risks
of material misstatement of the financial statements, whether due to fraud or error.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion on the Company's internal financial controls system over financial reporting'

l1

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:

(l) 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 authorizations of
management and directors of the company; and
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company's assets that could have a material effect on the
financial statements.

(3) Provide

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.
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 3l March 2016, based on the intemal 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.

FoTNARVEN ASSOCIATES
Chartered Accountants

Membership No.:025995
Place: Hyderabad

Date: 28-05.2016

t1

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J!

IIII

TERA SOFTWARE LIMITED

ffiffir

aI

# 8-2-293t82tAt1107,
Plot No.1 107, Road No.55,
Jubilee Hills, Hyderabad -

-.rffi!

500 033, Telangana, INDIA

TERA SOFT
Fedefning

,r Soluti@s

DECLARATION
Pursuant to Regulation 33(3)(d) of SEBI(Listing obligations and Disclosure
Requirements) Re gulations,20l5

It is hereby declared and confirmed that Auditor's Report on Annual Financial of the
Company is wittr urunodified opinion.

This declaration is furnished pursuant to Regulation 33(3)(d) of the SEBlpisting


obligations and Disclosure Requirements)Regulations,2ll5 as amended by the
SEBI(Listing obligations and Disclosure Requirements)(Amendment)Regulations,20L6
vide Notification NRO / GN / 201,6-17 / 001' dated 25 .05 .201'6 .
For Tera

T.Gopichand
Vice Chairman &

Director

cr N -172200TG I 994P1C01 8391

An lSO 9001 : 2008 Certified Company


t-fel: +91 -40-29547447

8, Fax: +91-40-2354-7449, E-mail: info@terasoftware.com

www.terasoftware.com