BOARDS' REPORT FOR THE FINANCIAL YEAR 2014-15 Dear Members, 1. Your Directors have pleasure in presenting their 21st Annual Report on the business and operations of the Company together with the audited financial statements for the financial year ended March 31st, 2015. 2. Dividend Your Directors have not recommended any dividend for the financial year 2014-15. 3. Transfer Of Unclaimed Dividend To Investor Education And Protection Fund The provisions of Section 125(5) of the Companies Act, 2013 do not apply on the company as no dividend has been declared during the year. 4. Public Deposits Being a non-deposit taking Company, your Company has not accepted any deposits from the public within the meaning of the provisions of the Non-Banking Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998. 5. Reserves No amount was transferred to reserves during the year. 5. Brief description of the Company's working during the year/State of Company's affair Your Company being a Non Banking Financial Company (NBFC) is currently engaged in the financial activities. The business of the Company largely depends on the policies by the Reserve Bank of India, Ministry of Finance as well as Global volatility in the financial market. 6. Change in the nature of business, if any The Company has not changed its nature of business during the year. 7. Material Changes and Commitments, if any, affecting the Financial Position of the Company There is no such material change and commitment affecting the financial position of your Company which have occurred between the end of the financial year to which the financial statements relate and the date of the report. 8. Details in respect of adequacy of internal financial controls with reference to the Financial Statements. The directors, have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. 9. Details of Subsidiary/Joint Ventures/Associate Companies The company does not have any subsidiary/ Joint Ventures/ Associate Companies. 10. Statutory Auditors The Statutory Auditors, M/s MUKESH I GUPTA & CO, Chartered Accountants, hold office till the conclusion of the ensuing Annual General Meeting and are recommended for re-appointment. The certificate from the Auditors have been received to the effect that their re-appointment, if made, would be within the prescribed limit under section 141 of the Companies Act, 2013. 11. Auditors' Report The observations made by the Auditors are self- explanatory and do not require any further clarification. Further, the explanations or comments by the Board on every qualification, reservation or adverse remark or disclaimer made by the auditor in his report are annexed. 12. Familiarisation Programme for Independent Directors In terms of Clause 49 (II) (B)(7) of the Listing Agreement, your Company is required to conduct the Familiarisation Programme for Independent Directors (IDs) to familiarise them about their roles, rights, responsibilities in your Company, nature of the industry in which your Company operates, business model of your Company, etc., through various initiatives. The details of such familiarization programmes are available on your Company's website www.goyalassociatesltd.com and a link to the said programmes have been provided elsewhere in this Annual Report. 13. Extract of Annual Return An extract of Annual Return as on the financial year ended on March 31, 2015 in Form No. MGT-9 as required under Section 92(3) of the Companies Act, 2013 read with Rule 12(1) of the Companies (Management and Administration) Rules, 2014, is set out as an annexure to the Directors' Report and forms part of this Annual Report. 14. Share Capital Issue of equity shares with differential rights The Company has not issued any of its securities with differential rights during the year under review. Buy Back of Securities The company has not bought back any of its securities during the year under review. Sweat Equity, Bonus Shares & Employee Stock Option Plan The company has neither issued sweat equity or bonus shares nor has provided any stock option scheme to the employees. Capital Reduction The Honorable High Court Ahmedabad Gujarat approved the scheme of reduction of the company w.e.f effective date 1st April, 2014. Since the audit of the company already been over the company is taking appropriate step to give effect to the reduction. 15. Conservation of energy. Technology absorption and Foreign exchange earnings and Outgo The provisions of section 134(m) of the Companies Act 2013 regarding the disclosure of particulars of conservation of energy and technology absorption prescribed by the rules are not applicable to our company. The company does not have any Foreign Exchange transactions during the financial year. 16. Corporate Social Responsibility (CSR) As the company does not have net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year, the disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is not applicable. 17. Directors: A) Changes in Directors and Key Managerial Personnel At the Board Meeting held on 31/03/2015 the following changes took place in the composition of Board of Directors: i) Omprakash Suresh Choudhary resigned from the directorship of the company and ii) Roopam Goel was appointed as an Additional Executive Director. B) Declaration by an Independent Director(s) and re- appointment Rahul Sharma and Jaipal Singh Barsi Singh Parmar, Independent Directors of the Company have confirmed that they fulfilled all the conditions of the Independent Directorship as laid down in sub-section (6) of Section 149 of the Companies Act, 2013 and the rules made there under and the same have been noted by the Board. C) Formal Annual Evaluation In compliance with the Schedule IV of the Companies Act 2013, a meeting of the Independent Directors of the company was held to review and evaluate the performance of the Non-independent Directors and the chairman of the company taking into account the views of the Executive Directors and Non- Executive Directors, assessing the quality, quantity and timeliness of flow of information between the company management and the Board and also to review the overall performance of the Board. The meeting of the company was held on 14th February, 2015, wherein the performance of the Board as a whole was evaluated. 18. Number of meetings of the Board of Directors Ten Meetings of the Board of Directors were held during the financial year 2014-15. These were held on the following dates: i) 30/05/2014, ii) 19/07/2014, iii) 26/07/2014, iv) 14/08/2014, v) 14/11/2014, vi) 15/12/2014, vii) 08/01/2015, viii) 24/01/2015, ix) 14/02/2015 and x) 31/03/2015. 20. Order of Court The company is not subject to any legal proceedings and claims which will have a material or adverse effect on the going concern status or company's operations or financial conditions. 21. Sexual Harassment Of Women At Work Place The Company has in place a policy in line with the requirements of The Sexual Harassment of Women at Workplace (Prevention, Prohibition 8b Redressal) Act, 2013. Internal Complaints Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this Policy. There were nil complaints received during the year under review. 22. Details of establishment of vigil mechanism for directors and employees Pursuant to sub-section (9) 8b (10) of section 177 of the Companies Act, 2013, read with rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014, the Company has established a Whistle Blower Policy (Vigil mechanism) for Directors and Employees of the Company to report their genuine concerns or grievances. The policy was approved by the Board of Directors of the Company at its meeting held on 26th July, 2014 and the Audit Committee was empowered by the Board of Directors to monitor the same and to report to the Board about the complaints in an unbiased manner. 24. Particulars of Loans, Guarantees or Investments There are no loans, guarantees or investments as per Section 186 of the Companies Act, 2013 25. Particulars of Contracts or Arrangements with Related Parties: Your company has no material individual transactions with its related parties which are covered under section 188 of the Companies Act, 2013, which are not in the ordinary course of business and not undertaken on an arm's length basis during the financial year 2014-15. 26. Stakeholders' Relationship Committee Composition of the Nomination & Remuneration Committee is in accordance with the requirements of sectof the Companies Act 2013. 27. Managerial Remuneration: The Company has not earned minimal profit during the year so it has not provided any Managerial Remuneration to the Directors. 28. Secretarial Audit Report The Secretarial Audit Report has been given by Mr. Anand Kumar Khandelia, Company Secretaries and there is no qualification, reservation or adverse remark or disclaimer made by the company secretary in the secretarial audit report. 29. Corporate Governance Certificate The Corporate Governance certificate from the auditor regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing agreement has been annexed with the report. 30. Corporate Governance and Management Discussion fit Analysis Reports The Corporate Governance Report and Management Discussion 8b Analysis Report have been annexed with the report. 31. Risk management policy The company does not have any Risk Management Policy as the element of risk threatening the Company's existence is very minimal. 32. Operational Review The Company discloses standalone unaudited financial results on a quarterly basis, standalone audited financial results on an annual basis and consolidated audited financial results on an annual basis. Your Company has complied with all the norms prescribed by the Reserve Bank of India (RBI) including the Fair practices, Anti Money Laundering and Know Your Customer (KYC) guidelines. 33. NBFC Company The Company is engaged in the Business of Non Banking Financial Institution and it has obtained a certificate of Registration from the Reserve Bank of India. The Company has not accepted any deposit from the public. The Company has complied with the prudential norms relating to the Income Recognition, Accounting Standards, asset classification and provisioning for bad and doubtful debts as applicable to it in terms of Non Banking Financial (Non Deposit Accepting or Holding) Companies Prudential Norms (Reserve Bank) Directions -2007. Non-banking Finance Companies (NBFCs) like Asset Finance Companies (NBFC-AFCs) and Infrastructure Finance Companies (NBFC-IFCs) form an integral part of the financial fabric of the Indian economy. Most of the banks are unable to cater to the finance needs of micro, small and medium enterprises (MSMEs) and it is these NBFCs which bridge the gap and act as an extended arm of the banking system in India. During the year under review, several regulatory changes took place in the NBFC space. The important ones are mentioned hereafter: > NBFCs desirous of issuing cobranded prepaid instruments need to apply for one-time approval from RBI. > RBI simplified documentation for NBFC registration. > No Debenture Redemption Reserve is required to be created by NBFCs for privately placed debentures and only 25 per cent is required in case of publicly issued debentures. > Banks have been allowed to engage non-deposit taking NBFCs (NBFCNDs) as Business Correspondents (BCs) provided (a) there is no comingling of bank funds and those of NBFC-ND appointed as BC, and (b) there is a specific contractual agreement between bank and NBFC-ND to ensure that all possible areas of conflict of interest are adequately taken care of. > Any NBFC with asset size of Rs. 1,000 crore or more can participate in interest rate futures market in recognized stock exchanges as trading members subject to RBI / SEBI guidelines. > NBFCs with asset size of Rs. 1,000 crore or more need to report online to stock exchanges information on shares pledged in their favour by borrowers for availing loans RBI limited the amount NBFCs can lend against shares pledged as collateral to 50 per cent of the value of shares. > NBFCs are subject to different regulations when it comes to loans to volatile sectors such as capital market and real estate. > In case of FDI in NBFCs, minimum capitalization shall include share premium received along with the face value of the share, only when it is received by the company upon issue of the shares to the nonresident investor. > A panel set up by RBI has recommended that NBFCs, along with banks, should undertake 360 degree feedback in order to ensure a transparent and comprehensive performance assessment that can adequately differentiate performance among employees. > NBFCs now figure among the list of eligible entities which can promote a Small Finance Bank subject to fulfilment of other eligibility criteria NBFCs with minimum net worth of Rs. 500 crore and with consistent track record of distributable profit for last 3 years and with rating of not less than 'AA-' or equivalent will be eligible to file shelf prospectus for public issue of debt securities. > RBI relaxed guidelines for issuance of private placement of NCDs (maturity of more than 1 year) by NBFCs. Guidelines stipulated for 2 categories - (a) issuance can be with a maximum subscription of less than Rs. 1 crore (Category A) and (b) can be with minimum subscription of Rs. 1 crore (Category B), which can be unsecured and such unsecured debentures will not be treated as public deposits. > RBI aligned loan restructuring norms of NBFCs with those of banks in order to minimize risk of defaults NBFCs planning to provide investment advisory services need to obtain approvals from both RBI and SEBI. > NBFCs with minimum asset size of Rs. 500 crore to be empowered to enforce security interest in NPAs and the SARFAESI Act, 2002 to be amended to this effect. > For NBFCs, the security for the debentures by way of charge or mortgage shall be created in favour of the debenture trustee on any movable property of the NBFC which in case of any other Company shall only be created on specific movable property. 34. Directors' Responsibility Statement Pursuant to Section 134(5) of the Companies Act, 2013, your Directors confirm 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 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 and loss of the company for that period; (c) 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; (d) the directors have prepared the annual accounts on a going concern basis; (e) the directors, have laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively, and (/) the directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively. 35. Acknowledgements Your Directors would like to express their appreciation of the co-operation and assistance received from the shareholders, bankers and other business constituents during the year under review For and on behalf of the Board of Directors Sd/-Vinay Agrawal Managing Director Din: 03133446 Sd/-Roopam Goel Director Din: 06931378 Place: Kolkata Date: 29th May, 2015 |