DIRECTOR'S REPORT To The Members Mangal Credit and Fincorp Limited Your directors have pleasure in presenting the 53rd Annual Report of the Company for the year ended 31st March 2015. REVIEW OF OPERATIONS During the year under review, the finance division has performed well. Accordingly, the Company has achieved total revenue of Rs.1381.77 Lacs and net profit after after tax is Rs.92.77 lacs for the current year against the previous year total revenue of Rs.1205.56 lacs and net profit after tax Rs.87.14. DIVIDEND Your Directors are pleased to recommend a dividend of paise. 0.50 per Equity Share (i.e. 5%) for the year ended, 31st March, 2015. There will be no deduction of tax at source. The provision for dividend payable is accounted on 1408815 Nos. equity shares. FIXED DEPOSITS The Company has not accepted any fixed deposits and is not holding any fixed deposits accepted at the close of the financial year under review. DIRECTORS AND KEY MANAGERIAL PERSONNEL Your Board comprises of efficient and able directors who have vast experience in this line of business. Mrs. Neeta Maloo retires at the ensuing Annual General Meeting by rotation and being eligible, offers them selves for re-appointment as Director. During the year under review, Mr. Labhchand Maloo, Non Executive Director and Mr. Atul Jain, Independent Director of the Company had resigned from the Board on 19th April, 2014 and 30th December, 2014 respectively. The brief details of all members of Board are annexed to this report. The following persons are Key Managerial Personnel of the Company 1. Mr. Sandeep Maloo - Managing Director & Chief Financial Officer 2. Mr. Meghraj Jain - Managing Director 3. Mrs.Neeta Maloo - Director 4. Mr. Ajitkumar Sohanlal Jain - Whole Time Director Remuneration and other details of Key Managerial Personnel for the year ended 31st March, 2015 are stated in the extract of the Annual Return. DIRECTORS' RESPONSIBILITY STATEMENT Pursuant to Section 134 (3) (c) of the Companies Act, 2013, your Directors state that: • In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; • 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 as at 31st March, 2015 and the profit for the year ended on that date; • The directors have taken proper and sufficient care of the 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 fraud and other irregularities; • The directors have prepared the annual accounts on a going concern basis: • 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; • The Directors had deviced proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating efficiently. POLICY ON SEXUAL HARASSMENT OF WOMEN AT WORK PLACE Pursuant to provisions of Sexual Harassment of women at work place (Prosecution, Prohibition and Redressal) Act, 2013 and rules made there under, Company has adopted a policy with effect from 14th February, 2015. PARTICULARS OF EMPLOYEES There are no employees of the category specified in under Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 AUDITORS AND AUDIT REPORT M/s. MGB & Co. LLP, Chartered Accountants, (FRN: 101169W/W-100035) who are the Statutory Auditor of the Company; hold the office until the conclusion of the ensuring Annual General Meeting. It is proposed to re-appoint them to examine and audit the accounts of the Company for four years to hold the office from the conclusion of this AGM till the conclusion of the Fifty Seventh Annual General Meeting subject to ratification of their appointment at every Annual General Meeting. The Company has received the Certificate under Section 139(1) of the Companies Act, 2013 read with Companies (Audit and Auditors), Rules, 2014 from the Auditor. AUDITORS OBSERVATIONS/COMMENTS The director's report, corporate governance report, Secretarial audit report, management discussion analysis have addressed most of the issues and observations and the comments of the Auditors are self-explanatory. 1. Para No. 2 of Matter of Emphasis of Auditor's Report on Standalone Financial Statement relating to Note No. 28 of Standalone Financial Statement & Para No. 2 of Matter of Emphasis of Auditor's Report on Consolidated Financial Statement relating to Note No. 33 of Consolidate Financial Statement describing fact of search and seizure proceedings u/s 132 of the Income Tax Act, 1961. Your director clarify that the matter is self explanatory. 2. Para No. 3 Matter of Empahsis of Auditor's Report on Consolidate Finanaical Statement relating to Note No. 32 of Consolidated Financial Statement with regards to the provisional attachment of funds upheld by the Enforcement Directorate (ED), involving balance of one of subsidiary lying in trading account with India Infoline Limited. The matter is sub judice. The attachment order is also contested by the company in the Tribunal. The subsidiary company is confident that the outcome of the case will have no adverse impact on that company and its functioning. AUDIT COMMITTEE The Composition of Audit Committee was changed from time to time. The present composition of Audit Committee consists of the following members: Mr. Sunil Ramachandran Nair - Chairman Mr. Sandeep Maloo - Member Mr. Ramasubramanian Shankaran - Member Mr. Atul Jain - Member (Resigned on 30/12/2014) The above composition of the Audit Committee, interalia, consists of independent Directors viz., Mr. Sunil Ramachandran Nair and Mr. Sandeep Maloo who forms the majority. The Company has established a vigil mechanism to oversee through the committee, the genuine concerns expressed by the employees and other Directors. The Company has also provided adequate safeguards against victimization of employees and Directors who express their concerns. The Company has also provided direct access to the Chairman of the Audit Committee on reporting issues concerning the interests of the company employees and the Company. The more details of the Audit Committee are stated under Corporate Governance Report. STAKEHOLDERS RELATIONSHIP COMMITTEE The Share Transfer Committee constituted was renamed as The Share Transfer and Investors Grievances Committee. To comply with the requirements of the Companies Act, 2013 and the listing agreement with the Stock Exchanges, the name of the Committee was further changed to Stakeholders Relationship Committee. The Composition of Committee is as under: Mr. Sunil Ramachandran Nair Mr. Sandeep Maloo Mr. Atul Jain (Resigned on 30th December, 2014) Mr. Pankaj Dinesh Jain REMUNERATION COMMITTEE Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Companies (Meetings of Board and its Powers) Rules, 2014 framed there under, every listed company and prescribed class of companies, shall constitute Remuneration Committee (RC) of the Board consisting of 3 or more non -executive directors out of which not less than V shall be independent director. The Composition of RC was changed from time to time. The present composition of RC consists of the following members: Mr. Sandeep Maloo Mr. Sunil Ramachandran Nair Mr. Atul Jain (Resigned on 30th December, 2014) Mr. Ramasubramanian Shankaran The above composition of the Nomination and Mr. Sunil Ramachandran Nair and Mr. Sandeep Maloo, who forms the majority. The Remuneration Committee have formulated a policy as prescribed under the Act which, interalia, includes criteria for determining qualification, positive attributes and independence of a director and recommended to the Board for adoption of the Policy. The Policy also covers recommendation to the Board on the remuneration to the Board of Independent Directors, Key Managerial Personnel and other employees. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE Corporate Social Responsibility is not applicable. Hence, the company has not made any provisions for Corporate Social Responsibility. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in Form MGT 9 is annexed herewith as "Annexure A". SECRETARIAL AUDIT: Pursuant to the provisions of Section 204 of the Companies Act, 2013 and rules made there under, M/s Vijay Kumar Tiwari & Associates, Company Secretaries in Whole-time practice (ACS no. 33084, C P No.12220), was appointed to conduct Secretarial Audit for the year ended 31st March, 2015. M/s Vijay Kumar Tiwari & Associates, Practising Company Secretaries has submitted Report on the Secretarial Audit which is attached as Annexure B and forms a part of this report. There are some Qualifications or observations or remarks made by the Secretarial Auditor in the Report. COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND DISCHARGE OF THEIR DUTIES The Company has a Policy relating to appointment of Directors, payment of Managerial remuneration, Directors' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 and under the provisions of Listing Agreement. PERFORMANCE EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration and Compliance Committees, which covers various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board Culture, execution and performance of specific duties, obligations and governance. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process. RELATED PARTY TRANSACTIONS All the related party transactions that were entered into during the financial year were on an arm's length basis and were in the ordinary course of business. All Related Party Transactions are placed before the Audit Committee and Board for approval. The details are attached as mentioned herein Formatting part of Notes on Accounts Annexure "A1". CORPORATE GOVERNANCE The Company believes that Corporate Governance is a way of business life rather than legal compulsion. Your Directors re-affirm their commitment to the Corporate Governance standards prescribed by Securities and Exchange Board of India (SEBI) codified as Clause 49 of the Listing Agreement with Stock Exchanges. Corporate Governance Report as well as Corporate Governance compliance certificate by Secretarial Auditors is set out in separate Annexure to this report marked as Annexure on secretarial audit report. Management Discussion Analysis Report forms a part of Directors Report and marked as Annexure C. NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEAR UNDER REVIEW The Company had 9 (Nine) Board meetings during the financial year under review. The details of the Board meetings and the attendance of the Directors are provided in the Corporate Governance Report. INVESTOR SERVICES As the members are aware, your company's shares are tradable compulsorily in electronic form and your company has established connectivity with both the depositories viz. National Securities Depository Ltd. (NSDL) and Central Depository Services (India) Ltd. (CDSL). In view of the numerous advantages offered by the Depository system, members are requested to avail of the facility of de-materialization of Company's shares on either of the Depositories as aforesaid. WHOLLY OWNED SUBSIDIARY The Company has Satco Commodities Private Limited as wholly owned subsidiary company. HUMAN RESOURCES Your Company considers people as one of the most valuable resources. It believes in the theme that success of any organization depends upon the engagement and motivation level of employees. All employees are committed to their work and proactively participate in their area of operations. The Company's HR philosophy is to motivate and create an efficient work force as manpower is a vital resource contributing towards development and achievement of organisational excellence. INTERNAL CONTROLS The Company has an adequate system of internal checks on its day to day affairs, which acts as a internal control system commensurate with its size and the nature of its business. The internal controls system of the Company are monitored and evaluated and reviewed by Management and Audit Committee of the Board of Directors. Auditor's observations in confirmation to policy in force has also been received. STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY Pursuant to the requirement of Clause 49 of the Listing Agreement, the Company has constituted a Risk Management Committee. Business Risk Evaluation and Management is an ongoing process within the Organization. The Company has a robust risk management framework to identify, monitor and minimize risk as also identify business opportunities. The objectives and scope of the Risk Management Committee broadly comprises: • Oversight of risk management performed by the executive management; • Reviewing the Risk Management Policy and Framework in line with Local legal requirements and SEBI guidelines • Reviewing risks and evaluate treatment including initiating mitigation actions and ownership as per a pre-defined cycles. • Defining framework for identification, assessment, monitoring, mitigation and reporting of risk. Within its overall scope as aforesaid, the Committee shall review risk trends, exposure, potential impact analysis and mitigation plan. The Risk management committee was constituted as on 14.02.2015 ACKNOWLEDGEMENTS The Board wishes to place on record their appreciation for the sincere efforts of the Director, employees and the co-operation extended by the Bankers, Shareholders, clients & associates for their continue support towards the conduct of the Company. For Mangal Credit and Fincorp Limited Sd/- (Mr. Meghraj Jain) Chairman & Managing Director DIN: 01311041 Place: Mumbai Date: 30th May, 2015 |