BOARD’S REPORT To, The Members of BCL Enterprises Limited, Your Directors are pleased to present the Annual Report on the business and operations of the Company, together with the Audited Financial Statements for the financial year ended 31st March, 2015. 1. BACKGROUND The Company is a Non Deposit Accepting Non Banking Finance Company (“NBFC”), holding a Certificate of Registration from the Reserve Bank of India (“RBI”) received on February 28, 2000. 2. STATE OF COMPANY’S AFFAIR The Company is in the business of financing activities, with the expected positive momentum in the Global economy, the business of the Company is expected to increase with the increasing rate of growth. The Company is focused on growth and achieving profitability along with a renewed commitment to enhance quality and customer service and to reduce costs. Investment and positive modifications are expected in the near future, boosting the Company's revenues. 3. FINANCIAL HIGHLIGHTS Revenue for the current year is Rs. 50.23 Lac as compared to Rs. 7.78 Lac in the previous year the ultimate increase in Revenue of 545.88%; Profit before tax for the current year is Rs. 14.02 Lac as compared to Rs. 1.60 Lac in the previous year the ultimate increase in PBT of 776.25%; Profit after tax for the current year is Rs. 8.24 Lac as compared to Rs. 1.10 Lac in the previous year the ultimate increase in PAT of 446.25% 5. RESERVES An amount of Rs. 1,64,883/- being 20% of the profits was transferred to Statutory Reserve Account for the financial year ended 31st March, 2015 as per the requirement of NBFC prudential norms. 6. DIVIDEND As the Company needs further funds to enhance its business operations, to upgrade the efficiency and to meet out the deficiencies in working capital, the Directors do not recommend any dividend on Equity Shares for the financial year 2014-15. 7. BUSINESS RISK MANAGEMENT Risk Management is an integral part of the Company’s business strategy. The Risk Management oversight structure includes Committees of the Board and Senior Management Committees. The Audit Committee of the Board reviews compliance with risk policies, monitors risk tolerance limits, reviews and analyzes risk exposure related to specific issues and provides oversight of risk across the organization. The Audit Committee nurtures a healthy and independent risk management function to inculcate a strong risk management culture in the Company. As part of the Risk Management framework, the management of Credit Risk, Market Risk, Operational Risk and Fraud Risk are placed under the Head-Risk, to ensure Integrated Risk Management for various Risks. 8. INTERNAL FINANCIAL CONTROL The Company’s internal control system is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. The internal control system is supported by an internal audit process for reviewing the adequacy and efficacy of the Company’s internal controls, including its systems and processes and compliance with regulations and procedures. The Company The Company’s internal control system is commensurate with the size, nature and operations of the Company. 9. VIGIL MECHANISM / WHISTLE BLOWER POLICY To review the matters relating to fraud risk, including corrective and remedial actions as regard people and processes, the Company has formulated a vigil mechanism policy which shall also safeguard the directors and employees from victimization who report their genuine concern relating to actual or suspected fraud, unethical behaviour, violation of the Company’s Code of Conduct or Ethical Policies, and any other event which would adversely affect the interests of the business of the Company and which is under direct control of the Audit Committee of the Company. The said policy has also posted on the website of the Company. 10. HUMAN RESOURCES The Company recognizes people as its most valuable asset and it has built an open, transparent and meritocratic culture to nurture this asset. The Company has kept a sharp focus on Employee Engagement. The Company’s Human Resources is commensurate with the size, nature and operations of the Company. 11. COMPLIANCE The Company has complied with all applicable provisions of the Companies Act, 2013 and the RBI Act, 1934, Listing Agreement executed with the Stock Exchanges and other applicable rules/regulations/guidelines issued from time to time. 12. DEPOSITS The Company has neither invited nor accepted any deposits from the public during the year. There is no unclaimed or unpaid deposit lying with the Company Brief resume of the Directors proposed to be appointed in ensuing Annual General Meeting, nature of their expertise in functional areas and the name of the public companies in which they hold the Directorship and the Chairmanship/Membership of the Committees of the Board are given as Annexure to the Notice convening the Annual General Meeting. 14. DECLARATION GIVEN BY INDEPENDENT DIRECTOR The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed under sub-section (6) of Section 149 of the Companies Act, 2013. 15. BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration Committees and Shareholder Grievance Committee. The manner in which the evaluation has been carried out is based on the criteria as specified by the management of the Company i.e. No. of meetings attended, quality suggestion accepted by the Board from the individual Director, participation of Directors in Board discussion, etc. 16. CHANGE IN THE NATURE OF BUSINESS There were no changes in the nature of business of the Company during the financial year 2014-15. * Directors do not receive any remuneration, sitting fees, or commission from the Company. ii) Except Company Secretary no remuneration was paid to any Director of the Company in a FY 2014- 15. Further there is no increase in the salary of Company Secretary during the year. iii) The percentage increase in the median remuneration of employees in the financial year: Median remuneration of employees for the current year is Rs. 2,00,780/- per year as compared to Rs. 1,02,000/- per year in the previous year, the ultimate increase in median remuneration of employees is 96.84%. iv) The number of employees on the rolls of Company as on 31st March, 2015 is Seven (7). v) The relationship between average increase in remuneration and Company performance cannot be explained as no remuneration paid to the Directors in the relevant period vii) The shares of the Company are listed on Metropolitan Stock Exchange of India Ltd (formerly MCX Stock Exchange Limited) and the shares are infrequently traded therefore variations in the market capitalization of the Company cannot be determine. Further, the net-worth of the Company in the current financial year is Rs. 5.97 Crore as compared to Rs.1.07 Crore in the previous financial year. viii) There was an increase of 20% in current year in the salaries of employees from the previous year and there was no increase in remuneration paid to the Key Managerial Personnel. Hence, the comparison between the two cannot be made. ix) Comparison of each remuneration of the key managerial personnel against the performance of the Company: x) As no remuneration has been paid to the Directors during the year, there are no key parameters for any variable component of remuneration. xi) The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year cannot be determined as there was no remuneration being paid to Director. xii) The Company affirms that remuneration given (if any) is as per the remuneration policy of the Company. 18. DISCLOSURE UNDER RULE 5 (2) & (3) OF THE COMPANIES (APPOINTMENT AND REMUNERATION) RULES, 2014 No directors/employees of the Company was in receipt of amount exceeding a salary of Rs. 5,00,000/-per month or Rs. 60,00,000/- per annum or more when employed for whole of the year, under the provisions of Rule 5 (2) & (3) of The Companies (Appointment And Remuneration) Rules, 2014. 19. DIRECTOR’S APPOINTMENT AND REMUNERATION POLICY The Board has, on the recommendation of the Nomination & Remuneration Committee framed and adopted a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their remuneration. The said Policy has been posted on the Website of the Company. 20. MEETINGS The agenda and Notice for the Meetings is prepared and circulated in advance to the Directors. During the year, Fifteen (15) Board of Directors Meetings, Three (3) Nomination & Remuneration Committee Meetings and Four (4) Audit Committee Meetings were convened and held. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013. 21. PARTICULARS OF CONTRACT OR ARRANGEMENT WITH RELATED PARTIES U/S 188(1) None of the transactions with related parties falls under the scope of Section 188 (1) of the Companies Act, 2013. 22. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The provisions of Section 186 of the Act pertaining to investment and lending activities are not applicable to the Company since the Company is an NBFC. Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013, are given in notes to the Financial Statements. 23. CORPORATE SOCIAL RESPONSIBILITY The disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 is not applicable as Company is not covered under the criteria mentioned in Section 135(1) of Companies Act, 2013. 24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS There are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations. 25. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY There have been no material changes and commitments affecting the financial position of the Company between the end of the financial year to which the financial statements relate and the date of the report. 26. SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES During the year under review, name of the companies which have become / ceased to be Company’s subsidiaries, joint ventures or associate companies are as below : 1. No Company has become Subsidiary of the Company during the financial year 2014-15. 2. Companies which ceased to be subsidiaries during the financial year 2014-15 ? Harit Tredelink Limited(Ceased to be subsidiary of the Company w.e.f 30th June, 2014) ? Danta Tradelink Limited(Ceased to be subsidiary of the Company w.e.f 30th June, 2014) ? Kalkin Probuild Limited(Ceased to be subsidiary of the Company w.e.f 30th June, 2014) 3. No Company has become / ceased to be a joint venture or associates during the financial year 2014-15. 27. COMPOSITION COMMITTEES OF THE BOARD: a) AUDIT COMMITTEE: The composition of audit committee of the Company is as follow: 28. STATUTORY AUDITORS The Company’s Auditors, M/s. Krishan Rakesh & Co., [FRN NO. 009088N] Chartered Accountants, who were appointed in casual vacancy caused by resignation of M/s R.K. rathi & Co. Chartered Accountants, and whose term of appointment expires in the year 2017, have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed there under, and shall be appointed as per provisions of Section 139 of the Companies Act, 2013, at the ensuing Annual General Meeting of the Company for a term of 4 years starting from financial year 2015-16 to 2018-2019. 29. SECRETARIAL AUDIT REPORT 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 M/s Grover Ahuja & Associates, Practicing Company Secretary to undertake the Secretarial Audit of the Company for the Financial Year 2014-15. The Secretarial Audit Report is prescribed form MR-3. Auditors Remarks are self-explanatory and do not require any clarification from the Board except the following: Qualification: As the Company has appointed the Independent Director in the Extra-ordinary General Meeting dated 17th April, 2015, the composition of Audit Committee and Nomination and Remuneration Committee was not in accordance with the provisions of Companies Act, 2013. Comments: The Audit Committee and Nomination and Remuneration Committee has been duly constituted by the Board of Directors in its meeting held on 30th April, 2015. Qualification: As required under Section 93 of the Companies Act, 2013 read with Rule 13 of Companies (Management and Administration) Rules, 2014, the Company has not filed MGT-10 for the change in holding of top ten shareholders pursuant to preferential allotment in its board meeting dated 21st June, 2014. Comments: As the Companies Act, 2013 was in the nascent stage and due to absence of an in-house compliance officer, the management inadvertently bypassed the required compliance. The Company then appointed a Company Secretary w.e.f. 22nd September, 2014 to circumvent the above and the management has assured to comply all applicable provisions of the Companies Act, 2013. 30. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith. 31. REPORT UNDER THE PREVENTION OF SEXUAL HARASSMENT ACT, 2013 There were no complaints reported under the Prevention of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. 32. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO In view of the nature of the activities carried out by the Company, Section 134(3) (m) of the Companies Act, 2013, read with Companies (Accounts) Rules, 2014 relating to conservation of energy and technology absorption, are not applicable to the Company. During the year under review, the Company had no earnings and expenditure in foreign exchange. 33. DIRECTORS RESPONSIBILITY STATEMENT To the best of our knowledge and belief and according to the information and explanations obtained by us, your Directors make the following statements in terms of Section 134(3) (c) of the Companies Act, 2013: a.) that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; b.) that the directors had 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.) that the directors had 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.) that the directors had prepared the annual accounts on a going concern basis; e.) that 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; and 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. 34. ACKNOWLEDGMENT The Directors gratefully acknowledge all stakeholders of the Company viz. financial institutions, Government Authorities, customers, members, dealers, vendors, banks and other business partners for the excellent support received from them during the year. The Directors place on record their sincere appreciation to all employees, executives, staff and workers of the Company for their unstinted commitment and continued contribution to the Company. By the order of the Board For BCL Enterprises Limited Sd/- Mahendra Kumar Sharda Chairman |