Boston Education Director Report

Your Direcrors have pleasure in presenting the Twenty First Annual

Report on the business together with the audited financial statements

for the year ended March 31, 2001.



FINANCIAL RESULTS (Rs. in Lacs)

2000-2001 1999-2000



Income 2,459.93 1,622.14



Profit before Depreciation, Interest

and Tax 459.97 227.26



Interest & Finance Charges 24.04 39.03



Depreciation 139.61 82.65



Profit before Tax 296.32 105.58



Provision for Tax 26.00 12.80



Profit after Tax 270.32 92.78



Add/(Less) : Prior period adjustments/

Provision ror tax for earlier years (52.62) (12.05)



Credit balance taken over on amalgamation - 74.07



Surplus brought forward from the previous year 113.37 16.34



Profit available ror appropriation 331.07 171.14



Appropriation



Proposed Dividend - 6.37



Corporate Dividend Tax - 1.40



Transfer to General Reserve - 50.00



Balance carried to Balance Sheet 331.07 113.37



331.07 171.14



PERFORMANCE REVIEW



Business



The Company's education business performed exceedingly well. During the

year, the Company embarked upon going National as well as

International. The network of its training centres expanded to 185 as

against 115 at the beginning or the year. The Company signed up for

setting up Franchise Centres in Nepal and Gulf Countries. The Company's

premium course "SAE" (Software Application Engineering) continued to

evoke excellent response from Software Industry. In the later part of

the year, the Company opened its IT skill testing site eduportal

"testvarsity.com" and educational multi-media CDs. Both these have

commenced contributing to the revenues during the current financial

year. The Company also signed an Acquisition Agreement with M/s.

Infinity Software Inc., a Florida, U.S.A, based Company engaged in

on-site consulting business having a revenue base of US $1.5 million

for the year 2000. The Company also executed, though small, but

significant projects including highly commended "White House Project"

for University of North Carolina, U.S.A.



Revenue



Total income of the Company registered sharp jump to Rs. 2,459.93 lacs,

51.65% higher than last year. Education business continued to be major

contributor, having 98% share in the total revenue.



Profits



Profits after tax substantially increased by over 191 % to Rs. 270.32

lacs as against Rs. 92.77 lacs in the previous year. This has been

possible due to significant improvement in operating margins on account

of the Company attaining critical mass.



Dividend



With a view to conserve the resources by ploughing back the profits

into the business, your Directors have decided to skip the dividend for

the year 2000-01.



SHARE CAPITAE



Consequent upon issue ofnew Equity Shares to the shareholders or

erstwhile Boston Education & Software Technologies Pvt. Ltd. (BESTPL),

pursuant to the merger scheme, the Equity Share Capital of the Company

increased to Rs. 466.80 lacs , on April 11, 2000. The Company had also

issued, pursuant to the merger scheme, 9,000 new Equity Warrants of

Series "A" and 91,500 of Series "B" to the employees of BESTPL

entitling to the Equity Shares of the Company.



Members are aware that in the last year the Company had proposed a

Public Issue. In view of the adverse conditions prevailing in the

Capital Markets, the Directors have dropped the Public Issue proposal.

Instead, plans are being worked out, to raise funds, to meet the

working capital requirement and also to fund the new business

activities. The exact modality, the nature of instruments and the

quantum of funds to be raised, are being Finalised, which will be

subject to approval of the Members.



INDUSTRY/COMPANY OUTLOOK



Industry Scenario



Members arc aware that recent US slow down has severely affected the

Indian IT Industry. Further, closure ofDotcom Companies have rendered

programmers particularly in Java Programming, surplus. This has

resulted in almost drying up the demand ror professional courses such

as Java, E-commerce etc. Your Directors believe that this will result

in big shake out in the ITTrainmg Industry which will make surviving

quality brands and training centres, the major gainers. Further, on

U.S. coming out of recession coupled with Indian Software Companies

efforts in European Countries may even create bigger opportunities.



Company Outlook



Company's revenue currently is under severe pressure, in view of the

current down turn in the Industry. Company has initiated various

strategic measures to counter the recessionary effect, subject to

raising additional funds. Some of them are



- Addition of new IT training segments, i.e. Embedded technologies,



- Foray into IT enabled services, which will be recession free,



- Substantially expanding the business of development and sale of

Multi-media educational CDs.



The Company has also taken various steps to conserve its resources by

substantially reducing its overheads and achieving higher efficiency at

all levels.



RESEARCH AND DEVELOPMENT



The Company's technology team continuously is in the process of

developing new products and delivery methods to support the education

business. The Company could launch its two portals namely

"testvarsi.ty.com'and "eduunlimited.com" due to their aggressive

efforts. Having already developed and launched three titles of

educational multi-media CDs under the brand name Topper's Series, the

team is currently in the process of adding a few more new titles to its

range of products.



HUMAN RESOURCES



The Company gives paramount importance to its human capital. It has

been its continuous endeavour to recruit, train, and institute various

motivational practices for its employees to enhance their skills and

competencies. This helps achieving the organisational commitment and

value to its customers. As a part of this process, an incentive plan

has already been introduced to reward the best talents in the Company.

Further, the Company, currently is in the process of finalising an

innovative Employees Stock Option Scheme.



Particulars of the employees, required to be furnished pursuant to the

provisions of Section 217(2A) of the Companies Act, 1956, read with the

Companies (Particulars of Employees) Rules, 1975, as amended, is

annexed to this Report.



SUBSIDIARY COMPANY



The Company's Wholly Owned Subsidiary, Nexus Infotech Limited, incurred

loss of Rs. 10.93 lacs for the financial year ended March 31, 2001.

This has been mainly due to lack of software projects. This Company has

been exploring the opportunities to source projects for software

development.



A statement pursuant to Section 212 of thc Companies Act, 1956,

relating to the Subsidiary Company is enclosed.



FIXED DEPOSITS



The Company has not accepted any deposits from the public during the

year under review.



DIRECTORS



The Board, at its meeting held on September 22, 2000, appointed Mr.

Bipin RShah as an Additional Director of the Company. Mr. Bipin RShah

brings with him rich experience with Lever Group. He held the

Directorships of various companies of repute including MNCs. He is

currently the President of Indus Venture Management Limited. Mr. Bipin

R Shah, will hold office of Director upto the date of the forthcoming

Annual General Meeting and is eligible for re-appointment.



Dr. Arvind A Shah and Mr. Dipankar Mukhopadhyay retire from the Board

of Directors by rotation and being eligible, offer themselves for

re-appointment.



DIRECTORS' RESPONSIBILITY STATEMENT



Pursuant to the requirement under Section 217(2AA) of the Companies

Act, 1956 with respect to Directors' Responsibility Statement, it is

hereby confirmed :



(i) That in the preparation of the annual accounts, the applicable

accounting standards have been followed along with proper explanation

relating to material departures;



(ii) That the Directors have 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 at the end of the financial year and of the

profit or loss of the Company for the year under review;



(iii) That the Directors have taken proper and sufficient care for the

maintenance of adequate accounting records in accordance with the

provisions of this Act for safeguarding the assets of the company and

for preventing and detecting fraud and other irregularities;



(iv) That the Directors have prepared the accounts for the financial

year ended March 31, 2001 on a going concern' basis.



AUDITORS & AUDITORS' REPORT



The Auditors, M/s. Dcloitte Haskins and Sells, retire at the

forthcoming Annual General Meeting. They have consented to accept the

office, if re-appointed.



With regard to Auditors comments, under para 2(f) of their Report, in

connection with the excess remuneration paid to the Managing Director,

the Directors would like to inform the Members that the Company has

made representation to the Central Government for their approval.



CORPORATE GOVERNANCE



Although, currently the provisions of Clause 49 or the Listing

Agreement with the Stock Exchange, arc not applicable to your Company,

the Directors, have taken initiative to comply with and implement most

of the requirements of the Corporate Governance code.



FOREIGN EXCHANGE EARNINGS AND OUTGO



The details of foreign exchange earnings and outgo are mentioned in

under para 14 & 15 of Schedule 20, which form part of the Annual

Accounts.



CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION



The Company, being in the Software Industry consumes very low energy.

On an ongoing basis, the existing processes and techniques are being

reviewed to make the infrastructure most energy efficient. Company's

Technology Team continuously endeavour to develop new methods

ofsoftware educational products.



for and on behalf of the Board



Place: Mumbai, Dr. Arvind A Shah

Dated: July 20, 2001. Chairman