DIRECTOR'S REPORT Dear Shareholders, Your Directors present the Twenty Ninth Annual Report together with the Audited Statement of Accounts for the year ended on 31st March, 2015. 2. DIVIDEND : With a view to conserve the resources for expansion of the business activities and working capital requirements of the Company, the board of directors of the company have not recommended any dividend for the year under review. 3. REVIEW OF OPERATIONS, SALES AND WORKING RESULTS : Your director report that during the year under review, in spite of economic slowdown the Company has recorded a total sales of Rs. 38,49,29,258 /- as compared to Rs. 36,09,04,401/- and earned other income of Rs. 9,63,550/ - as compared to Rs. 30,66,075/- for the financial year ended on 31st March, 2014 .The Profit before tax for the period under review is Rs. 98,68,454/- as compared to Rs. 95,24,233/- in the previous year. The Profit after tax during the year under review is Rs.79,88,094/- as against Rs.76,59,527/- in the previous year 2013-14. 4. MATERIAL CHANGES, TRANSACTION AND COMMITMENT/CHANGE IN THE NATURE OF BUSINESS, IF ANY : There is no change in the nature of the business of the Company for the year under review. During the year under review, no significant or material order was passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future. 5. MANAGEMENT DISCUSSION AND ANALYSIS (MDA) : MDA, for the year under review, is presented in a separate section, which forms part of the Annual Report. 6. SHARE CAPITAL : During the year under review, the Company has not increased its paid up capital. The paid up equity share capital of the Company as on 31st March, 2015 is Rs. 4,99,47,750/-. During the year under review, the Company has neither issued shares with differential voting rights nor granted stock options or sweat equity. 7. TRANSFER TO RESERVES : The Company proposes to transfer Rs. 14.34 Lacs to the General Reserves. An amount of Rs. 47.37 Lacs is proposed to be retained in the Statement of Profit and Loss of the Company. 8. SUBSIDIARY COMPANIES : The Company does not have subsidiary company, joint venture or associate companies during the year. There is no company which has ceased to be Company's subsidiary, joint venture or associate company during the year. 9. DIRECTORS AND KEY MANAGERIAL PERSONNEL : The Board consists of Executive and Non-executive Directors including Independent Directors who have wide and varied experience in different disciplines of corporate functioning. During the year under review, the members, in their Annual General Meeting held on 23rd September, 2014, approved the appointment of Shri Alpesh Tripathi and Shri Dipen Shah as Independent Directors who are not liable to retire by rotation. All the Independent Directors of the Company have furnished declarations that they meet the criteria of independence as prescribed under the Companies Act, 2013 and Listing Agreement with Stock Exchanges. During the year under review, Shri Abhishek Bhutoria was appointed as Additional Director in the capacity of Non Executive of the Company with effect from 1st September, 2015. We seek your confirmation for appointment of Shri Abhishek Bhutoria as Non Executive Director, on rotational basis. Based on disclosures provided by him, he is not disqualified from being appointed as Director as per section 164 of the Companies Act, 2013. Smt. Sushma Bhutoria, Whole Time Director, retires by rotation at the forthcoming Annual General Meeting, and being eligible offers herself for re-appointment. Apart from this, there were no changes in the Directors or Key Managerial Personnel during the year under review. The brief resumes and other relevant documents of the Directors being appointed / re-appointed are given in the Explanatory Statement to the Notice convening the Annual General Meeting, for your perusal. 10. BOARD MEETINGS : During the year, eight Board meetings were held, with gap between Meetings not exceeding the period prescribed under the Companies Act, 2013. Details of Board and Board committee meetings held during the year are given in the Corporate Governance Report which forms part of the Annual Report. Board meeting dates are finalised in consultation with all directors and agenda papers backed up by comprehensive notes and detailed background information are circulated in advance before the date of the meeting thereby enabling the Board to take informed decisions. 11. INDEPENDENT DIRECTOR'S FAMILIARIZATION PROGRAMME : Independent Directors at the time of their appointment are given the formal appointment letter mentioning various terms and conditions of their engagement. Independent Directors of the company are made aware of their role, duties, rights and responsibilities at the time of their appointment. Independent Directors have visited the plants of the company for understanding of manufacturing operations and different processes of their plants. The Board of Directors have complete access to the information within the company and to interact with senior management personnel. Independent Directors have freedom to interact with the management of the company. The Familiarisation programme has been conducted during the year under review and different aspects such as legal compliance management, corporate governance and role of independent directors have been covered in the same. 12. EVALUATION OF BOARD, COMMITTEES AND DIRECTORS : Pursuant to the provisions of the Act and Clause 49 of the Listing Agreement, the Board had carried out performance evaluation of its own, the Board Committees and of the Independent directors. Independent Directors at a separate meeting evaluated performance of the Non-independent Directors, Board as a whole and of the Chairman of the Board. The manner in which the evaluation has been carried out has been detailed in the Corporate Governance Report which forms part of the Annual Report. 13. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS : The Board, on the recommendation of the Nomination & Remuneration Committee, formulated criteria for determining Qualifications, Positive Attributes and Independence of a Director as also a Policy for remuneration of Directors, Key managerial Personnel and senior management. The said policy is attached here with as Annexure - G 14. AUDITORS : a) STATUTORY AUDITORS : Pursuant to provision of Section 139 of the Act and the rules framed thereunder, PGT & Associates, Chartered Accountant, were appointed as statutory auditors of the Company from the conclusion of the twenty eighth annual general meeting (AGM) of the Company held on 23rd September, 2014 till the conclusion of thirty third AGM to be held in the year 2019, subject to ratification of their appointment at every AGM. The observations of the auditors in their report are self-explanatory and therefore, in the opinion of the Directors, do not call for further comments. The notes of the auditors are self explanatory in the nature. b) SECRETARIAL AUDITORS : Pursuant to the provisions of Section 204 of the Companies Act.2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Punit S. Lath, Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure - B. The observations of the secretarial auditors in their report are self-explanatory and therefore, in the opinion of the Directors, do not call for further comments. The notes of the auditors are self explanatory in the nature. 15. INTERNAL CONTROL SYSTEM AND COMPLIANCE FRAMEWORK : The Company has an Internal Control System, commensurate with size, scale and complexity of its operations. The internal financial controls are adequate and are operating effectively so as to ensure orderly and efficient conduct of business operations. The Company has appointed M/s. Tulsian Sanjay & Co., as Internal Auditors of the Company. The Audit Committee in consultation with the internal auditors formulates the scope, functioning, periodicity and methodology for conducting the internal audit. The internal auditors carry out audit, covering inter alia, monitoring and evaluating the efficacy and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations and submit their periodical internal audit reports to the Midit Committee. Based on the internal audit report and review by the Audit committee, process owners undertake necessary actions in their respective areas. The internal auditors have expressed that the internal control system in the Company is robust and effective. The Board has also put in place requisite legal compliance framework to ensure compliance of all the applicable laws and that such system are adequate and operating effectively. 16. AUDIT COMMITTEE : The details pertaining to composition of audit committee are included in the Corporate Governance Report, which forms part of this report. 17. THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 : There has been no complaint related to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, during the year. 18. RISK MANAGEMENT AND POLICY ON RISK MANAGEMENT : At present the company has not identified any element of risk which may threaten the existence of the company. The Board has formulated Policy on Risk Management and the same is uploaded on the Company's website at www.griltarp.com 19. VIGIL MECHANISM : The Company has set up vigil mechanism viz. Whistle Biower Policy to enable the employees and Directors to report genuine concerns and irregularities, if any in the Company, noticed by them. The same is reviewed by the Audit Committee from time to time. 20. RELATED PARTY TRANSACTIONS AND POLICY ON RELATED PARTY TRANSACTIONS : All 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. Details on Related Party Transactions in Form AOC - 2 has been enclosed as Annexure - F. The Board has formulated Policy on Related Party Transactions and the same is uploaded on the Company's website at www.griltarp.com . None of the Non-Executive Directors has any pecuniary relationship or transactions with the Company. 21. MANAGERIAL REMUNERATION AND PARTICULARS OF EMPLOYEES : The information required under Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 forms part of this Report and statement of particulars of employees is annexed as Annexure - D & E. 22. LOANS, GUARANTEES OR INVESTMENTS : Details of Loans, Guarantees and Investments, if any covered under the provisions of Section 186 of the Act are given in the notes to the Financial Statements. 23. DEPOSITS : Your Company has not accepted any deposits from the public falling within the purview of Section 73 of the Act, read with the Companies (Acceptance of Deposits) Rules, 2014. 24. EXTRACT OF THE ANNUAL RETURN : The extract of the Annual Return in form MGT 9 is annexed herewith as Annexure - A. 25. DIRECTORS' RESPONSIBILITY STATEMENT : To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors confirm: a. that in the preparation of the annual accounts for the year ended 31st March 2015, the applicable Accounting Standards had been followed along with proper explanation relating to material departures, if any; b. that the directors had selected 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 ended 31st March 2015 and of the profit of the Company for that period; . c. that proper and sufficient care has been taken 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. that the annual accounts/financial statements have been prepared on a going concern basis; e. that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively; f. that 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. 26. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO : A statement containing the necessary information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is annexed to this report as Annexure - C. 27. CORPORATE GOVERNANCE : As required by Clause 49 of the Listing Agreement, a separate Report on Corporate Governance forms part of the Annual Report. The report on Corporate Governance also contains certain disclosures required under the Companies Act, 2013. A certificate from the Statutory Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, forms part of this report. 28. DISCLOSURES UNDER SECTION 134(3)(L) OF THE COMPANIES ACT, 2013 : Except as disclosed elsewhere in this report, there have been no material changes and commitments which can affect the financial position of the Company occurred between the end of the financial year of the Company and date of this report. 29. ACKNOWLEDGEMENT : Your Directors express their sincere gratitude for the assistance and cooperation extended by Financial Institutions, Banks, Government Authority, Shareholders, Suppliers, Customers and Stakeholders. Your Directors also wish to place on record their appreciation of the contribution made by the employees at their level towards achievements of the Companies goals. By order of the Board of Directors For Gujarat Raffia Industries Limited Pradeep Bhutoria Chairman & Managing Director Place : Santej Date : 1st September 2015 |