|BSE: 530707||Sector: IT|
|NSE: AFTEK||ISIN Code: INE796A01023|
|BSE 00:00 | 04 Mar||Aftek Ltd|
|NSE 05:30 | 01 Jan||Aftek Ltd|
|BSE: 530707||Sector: IT|
|NSE: AFTEK||ISIN Code: INE796A01023|
|BSE 00:00 | 04 Mar||Aftek Ltd|
|NSE 05:30 | 01 Jan||Aftek Ltd|
Your Directors are pleased to present the 30th Annual Report of the Company togetherwith the Audited Financial Statements for the year ended 31st March 2017.
SUMMARY OF FINANCIAL RESULTS OF THE COMPANY:
Income of the company from operations is ` 1157.99 Lacs Profit before tax is (-`4076.05) Lacs as compared to (-` 1925.36) in the previous year.
TRANSFER TO RESERVES:
Due to unabsorbed losses no amount has been proposed to be transferred to Reserves
As on 31st March 2017 the Company held no deposit in any form from anyone. There wereno deposits held by the company as on 31st March 2017 which were overdue or unclaimed bythe depositors. For the present the Board of Directors has resolved not to accept anydeposit from public.
Our Company has 1 direct subsidiary. During the year the Board of Directors reviewedthe affairs of the subsidiaries. In pursuant to the provisions of Section 129(3) of theCompanies Act 2013 read with Rule 5 of the Companies (Accounts) Rules 2014 a statementcontaining salient features of the financial statements of the subsidiary companies inForm AOC-1 is given in Annexure I in this Board's Report.
MANAGEMENT'S DISCUSSION AND ANALYSIS REPORT:
Management's Discussion and Analysis Report for the year under review as stipulatedunder Regulation 34 (3) read with Schedule Part V of the SEBI (Listing Obligations andDisclosures Requirements) Regulations 2015 with Stock Exchange in India is presented ina separate Annexure -II forming part of the Annual Report.
CHANGE IN THE NATURE OF BUSINESS IF ANY:
There was no change in the nature of business of the Company or any of its subsidiariesduring the year.
MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY:
During the year under review there were no material changes and commitments affectingthe financial position of the Company.
DIRECTORS AND KEY MANAGERIAL PERSONNEL:
Mr. Nitin K Shukla retires by rotation at the ensuing Annual General Meeting and beingeligible Offer themselves for reappointment. Your Directors recommend therere-appointment.
NUMBER OF MEETINGS OF THE BOARD:
The Board met 5 times during the financial year the details of which are given in theCorporate Governance Report that forms part of this Annual Report. The intervening gapbetween any two meetings was within the period prescribed by the Companies Act 2013.
INDEPENDENT DIRECTORS DECLARATION:
The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he/she meets the criteria of independencelaid down in Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI (ListingObligations and Disclosures Requirements) Regulations 2015. Independent Directors undersection 149(6) of the Companies Act 2013 declared that:
1. They are not promoters of the Company or its holding subsidiary or associatecompany;
2. They are not related to promoters or directors in the company its holdingsubsidiary or associate company.
3. The independent Directors have /had no pecuniary relationship with companyits holding subsidiary or associate company or their promoters or directors duringthe two immediately preceding financial years or during the current financial year;
4. None of the relatives of the Independent Director has or had pecuniaryrelationship or transaction with the company its holding subsidiary or associatecompany or their promoters or directors amounting to two per cent or more of its grossturnover or total income or fifty lakh rupees or such higher amount as may be prescribedwhichever is lower during the two immediately preceding financial years or during thecurrent financial year;
5. Independent Director neither himself nor any of his relatives
(i) holds or has held the position of a key managerial personnel or is or has beenemployee of the company or its holding subsidiary or associate company in any of thethree financial years immediately preceding the financial year in which he is proposed tobe appointed;
(ii) is or has been an employee or proprietor or a partner in any of the threefinancial years immediately preceding the financial year in which he is proposed to beappointed of
(A) a firm of auditors or company secretaries in practice or cost auditors of thecompany or its holding subsidiary or associate company; or
(B) any legal or a consulting firm that has or had any transaction with the companyits holding subsidiary or associate company amounting to ten percent or more of the grossturnover of such firm;
(iii) Holds together with his relatives two percent. or more of the total voting powerof the company; or
(iv) is a Chief Executive or Director by whatever name called of any nonprofitorganization that receives twenty-five percent. or more of its receipts from the companyany of its promoters directors or its holding subsidiary or associate company or thatholds two percent or more of the total voting power of the company;
6. Independent Director possesses such qualifications as may be directed by theBoard.
7. The Company & the Independent Directors shall abide by the provisionsspecified in Schedule IV of the Companies Act 2013.
SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 mandates thatthe Board shall monitor and review the Board evaluation framework. The Companies Act 2013states that a formal annual evaluation needs to be made by the Board of its ownperformance and that of its committees and individual directors. The Schedule IV of theCompanies Act 2013 states that the performance evaluation of independent directors shouldbe done by the entire Board of Directors excluding the director being evaluated.
The evaluation of all the directors and the Board as a whole was conducted based on thecriteria and framework adopted by the Board. The Board approved the evaluation resultsalongwith evaluation done by the Nomination and Remuneration Committee.
PERFORMANCE OF THE BOARD AND COMMITTEES:
During the year under review the performance of the Board & Committees andIndividual Director(s) based on the below parameters was satisfactory:
(i) All Directors had attended the Board meetings;
(ii) The remunerations paid to Executive Directors are strictly as per the Company andindustry policy.
(iii) The Independent Directors only received sitting fees.
(iv) The Independent Directors contributed significantly in the Board and committeedeliberation and business and operations of the Company and subsidiaries based on theirexperience and knowledge and Independent views.
(v) The Credit Policy Loan Policy and compliances were reviewed periodically;
(vi) Risk Management Policy was implemented at all critical levels and monitored by theInternal Audit team who places report with the Audit committee and Board.
MEETING OF INDEPENDENT DIRECTORS:
Pursuant of the provision of Section 149 (8) of the Companies Act 2013 read withSchedule IV and Regulation 25 of SEBI (Listing Obligations and Disclosures Requirements)Regulations 2015 the Independent Directors of the Company held their meeting on 14thFebruary 2017 reviewed the performance of non- independent directors and the Board as awhole including the Chairperson of the Company views expressed by the executive directorsand non-executive directors at various level and quantified the quality quantity andtimeliness of flow of information between the Company management and the Board andexpressed satisfaction.
POLICY ON DIRECTORS APPOINTMENT AND REMUNERATION:
The current policy is to have an appropriate mix of executive and independent directorsto maintain the independence of the Board and separate its functions of governance andmanagement. As on 31st March 2017 the Board consists of 6 members. Out of which one isthe Managing Director two are Whole Time Directors.
The policy of the Company on directors appointment and remuneration including criteriafor determining qualifications positive attributes independence of a director and othermatters provided under Sub section (3) of Section 178 of the Companies Act 2013 adoptedby the Board and are stated in this Board report. We affirm that the remuneration paid tothe directors is as per the terms laid out in the nomination and remuneration policy ofthe Company.
COMMITTEES OF THE BOARD:
Currently the Board has Three Committees: 1) Audit Committee 2) Nomination andRemuneration Committee 3) Stakeholders Relationship Committee
A detailed note on the Board and its Committees is provided under the CorporateGovernance Report that forms part of this Annual Report.
NOMINATION AND REMUNERATION COMMITTEE AND STAKEHOLDERS RELATIONSHIP COMMITTEE:
Pursuant to the Section 178 of the Companies Act 2013 the Company has set up aNomination and Remuneration and Stakeholders Relationship Committee. A detailed note onthe composition of the Committees is provided in the corporate governance report sectionof this Annual Report.
The Key Features of the Policy of the said committee are as follows: For Appointment ofIndependent Director (ID): a. Any person who is between the age of 25 years and below 75years eligible to become Independent Director(ID);
b. He has to fulfill the requirements as per section 149 of the Companies Act 2013read with Clause 49 of the Listing Agreement;
c. Adhere to the code of conduct as per Schedule IV to the Companies Act 2013;
d. Strictly adhere to the Insider Trading Regulation of the SEBI and Insider Tradingpolicy of the Company;
e. Independent Director should have adequate knowledge and reasonably able tocontribute to the growth of the Company and stakeholders;
f. Independent Director should be able to devote time for the Board and other meetingsof the company;
g. Entitled for sitting fees and reasonable conveyance to attend the meetings; and
h. Able to review the policy participate in the meeting with all the stakeholders ofthe company at the Annual General Meeting.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to the Section 134(3) (c) and Section 134 (5) of the Companies Act 2013 theBoard of Directors of the Company hereby confirms:
(i) That in the preparation of the accounts for the financial year ended 31st March2017 the applicable accounting standards have been followed along with proper explanationrelating to material departures;
(ii) That the Directors have selected such accounting policies and applied themconsistently and made judgments and estimates that were reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit and loss of the Company for the year under review;
(iii) That the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;
(iv) That the Directors have prepared the accounts for the financial year ended 31stMarch 2017 on a going concern' basis.
(v) The internal financial controls are laid and have been followed by the company andthat such controls are adequate and are operating effectively. Such controls meanscontrols and policies and procedures adopted and adhered by the company for orderly andefficient conduct of the business for safeguarding assets prevention and detection offrauds and errors and maintenance of accounting records and timely preparation offinancial statements and review its efficiency.
(vi) The Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
In terms of the provisions of Section 177(9) of the Companies Act 2013 the Companyhas implemented a vigil mechanism named Whistle Blower Policy to deal with instance offraud and mismanagement if any in staying true to our values of Strength Performanceand Passion and in line with our vision of being one of the most respected companies inIndia the Company is committed to the high standards of Corporate Governance andstakeholder responsibility.
A high level Committee has been constituted which looks into the complaints raised. TheCommittee reports to the Audit Committee and the Board. The Whistle Blower Policy ensuresthat strict confidentiality is maintained whilst dealing with concerns and also that nodiscrimination will be meted out to any person for a genuinely raised concern.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Board has adopted the policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation ofreliable financial disclosures.
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. To maintain its objectivity and independence the InternalAudit function reports to the Chairman of the Audit Committee.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company.
Based on the report of internal audit function process owners undertake correctiveaction in their respective areas and thereby strengthen the controls. Significant auditobservations and recommendations along with corrective actions thereon are presented toBoard.
M/s. Udit S Master Chartered Accountants are the Internal Auditor of the Company.
At the Annual General Meeting held on 30th December 2014 M/s. GMJ & Co. CharteredAccountants were appointed as statutory auditors of the Company to hold office till theconclusion of the Annual General Meeting to be held in the calendar year 2018.
In terms of the first proviso to Section 139 of the Companies Act 2013 theappointment of the auditors shall be placed for ratification at every Annual GeneralMeeting. Accordingly the appointment of M/s. GMJ & Co. Chartered Accountants asstatutory auditors of the Company is placed for ratification by the shareholders.
In this regard the Company has received a certificate from the auditors to the effectthat if they are re-appointed it would be in accordance with the provisions of Section141 of the Companies Act 2013.
The Auditors have made qualification to the financial statement. Their reports onrelevant notes on accounts are self-explanatory and do not call for any comments undersection 134 of the companies Act 2013.
Auditor qualification and management reply
SECRETARIAL AUDITORS AND THEIR REPORT:
M/s. Ramesh Chandra Mishra & Associates Company Secretary in Practice wasappointed to conduct the secretarial audit of the Company for the financial year 2016-17as required under Section 204 of the Companies Act 2013 and Rules thereunder. TheSecretarial Audit Report for F.Y. 2016-17 is Annexure-III to this Board's Report.
The Board has re-appointed M/s. Ramesh Chandra Mishra & Associates CompanySecretary in Practice as secretarial auditor of the Company for the financial year2017-18.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS/REGULATORS:
There are no orders passed by the regulators or courts or tribunals impacting the goingconcern status and Company's operations in future.
CONSERVATION OF ENERGY TECHNOLOGY AND FOREIGN EXCHANGE:
The relevant information pertaining to conservation of energy technology absorptionforeign exchange earnings and outgo as prescribed under section 134(3)(m) of the CompaniesAct 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 are set out hereinbelow:
A) CONSERVATION OF ENERGY:
The Company continues its policy of encouraging energy conservation measures. Theregular review of energy consumption and the systems installed to control utilization ofenergy is undertaken.
B) RESEARCH &DEVELOPMENT ACTIVITIES:
The Company has its own R&D center. The R&D centre follows stringent guidelinesbased on Good Laboratory Practices and is well equipped with the latest equipment inparticle size analysis gas chromatography high-performance liquid chromatographydissolution testing stability chambers and lab-scale manufacturing machines.
RELATED PARTY TRANSACTIONS/CONTRACTS:
The Company has implemented a Related Party Transactions policy for the purposes ofidentification and monitoring of such transactions. The policy on related partytransactions is uploaded on the Company's website.
All related party transactions are placed before the Audit Committee for approval.Prior omnibus approval of the Audit Committee is obtained on an annual basis which isreviewed and updated on quarterly basis.
Pursuant to the Section 134(3) (h) of the Companies Act 2013 and Rule 8(2) of theCompanies (Accounts) Rules 2014 the particulars of contract or arrangement entered intoby the Company with related parties referred to in Section 188(1) but during thefinancial year no such transactions happened hence no annexure attached separately.
The details of such related party transactions are available in the Notes to theStandalone financial statements section of the Annual Report.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS:
Loans Guarantees and Investments covered under section 186 of the Companies Act 2013form part of the notes to the financial statements provided in this Annual Report.
HUMAN RESOURCES MANAGEMENT:
We take this opportunity to thank employees at all levels for their dedicated serviceand contribution made towards the growth of the company. The relationship with the workersof the Company's manufacturing units and other staff has continued to be cordial.
To ensure good human resources management at the company we focus on all aspects ofthe employee lifecycle. During their tenure at the Company employees are motivatedthrough various skill-development engagement and volunteering programs.
As per provisions of Section 197(12) of the Companies Act 2013 read with Rule 5(1) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 duringthe financial year no such payment made to either any executive directors or senior levelemployees as per aforesaid section hence no annexure attached.
In terms of Section 197(12) of the Companies Act 2013 read with Rule 5(2) and 5(3) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 noemployee(s) drawing remuneration in excess of limits set out in said rules forms part ofthe annual report.
EXTRACT OF ANNUAL RETURNS:
Pursuant to the Section 134(3) (a) of the Companies Act 2013 the details forming partof the extract of the Annual Return is Form MGT-9.
A Report on Corporate Governance along with a Certificate from M/s. Ramesh Mishraregarding compliance with the conditions of Corporate Governance as stipulated underClause 49 of the Listing Agreement with Stock Exchange read with the relevant provisionsof SEBI (Listing Obligations and Disclosures Requirements) Regulations 2015 forms part ofthis Report and Annexure-VI to this Board's Report.
INSURANCE OF ASSETS:
All the fixed assets finished goods semi-finished goods raw material packingmaterial and goods of the company lying at different locations have been insured againstfire and allied risks.
BANK AND FINANCIAL INSTITUTIONS:
Directors are thankful to their bankers for their continued support to the company.
Your Directors convey their sincere thanks to the Government Banks Shareholders andcustomers for their continued support extended to the company at all times.
The Directors further express their deep appreciation to all employees for commendableteamwork high degree of professionalism and enthusiastic effort displayed by them duringthe year.