Your directors have pleasure in presenting their Seventeenth Annual Report togetherwith the Audited Accounts for the year ended on 31st March 2016.
|Particulars ||March 31 2016 ||March 31 2015 |
|Income from Operations ||785.06 ||8595.39 |
|Other Income ||124.18 ||32.32 |
|Total Income ||909.24 ||8627.71 |
|Total Expenditure ||886.93 ||8866.89 |
|Profit /(Loss) before Finance Charges Depreciation and Tax ||22.31 ||(239.18) |
|Finance Charges ||0.38 ||3.16 |
|Profit /(Loss) after interest but before Depreciation ||21.93 ||(242.34) |
|Depreciation ||14.31 ||20.41 |
|Profit /(Loss) before Tax ||7.62 ||(262.75) |
|Provision for Tax || || |
|- Current Tax || || |
|- Deferred Tax || || |
|Prior period Taxes ||3.24 || |
|Net Profit /(Loss) for the Year ||4.38 ||(262.75) |
|Profit /(Loss) brought forward from previous year ||1273.47 ||1555.31 |
|Transitional Depreciation || ||(19.09) |
|Profit available for Appropriations ||1277.85 ||1273.47 |
|Appropriations || || |
|Balance Profit /(Loss) carried forward to Balance Sheet ||1277.85 ||1273.47 |
On account of negligible profit during the year your directors have not recommendedany dividend on equity shares for the year ended on 31st March 2016.
REVIEW OF OPERATIONS
During the year under review income from Post Production activity decreased to 21.69Lac from 22.21 Lac in the previous year. Income from trading in IPR of Films/Productionand Distribution of Films and TV Serials decreased to Rs. 763.37 Lac from Rs. 8573.18 Lacin the previous year. Your Company earned a profit of Rs.4.38 Lac vis--vis Net Loss ofRs. 262.75 Lac in the previous year after providing for Depreciation of Rs. 14.31 Lac(Previous Year Rs. 20.41 Lac) Current Tax of Rs. Nil (Previous Year Rs.Nil) and DeferredTax of Rs. Nil (Previous Year Rs.Nil).
MATERIAL CHANGES BETWEEN THE END OF THE FINANCIAL YEAR AND THE DATE OF THIS REPORT
BUY BACK OF SHARES
In terms of resolution passed by the Board of Directors in its meeting held on 20thApril2016 and in accordance with the provisions of Companies Act2013 and the Securitiesand Exchange Board of India(Buy-back)Regulations1998 and with the approval ofshareholders by Postal Ballot on 2nd June2016 the Company has completed buy-back of25800000 fully paid equity shares of Re.1/- each at price of Rs.3/- per share for anaggregate amount of Rs. 774 Lac from existing shareholders of the Company through TenderOffer mechanism. Consequent upon the said buy-back the paid-up equity share capital ofthe Company now stands reduced to Rs. 774 Lac.
BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Your Board comprises of 4 (Four) Directors including 2 (Two) Independent Directors.Independent Directors provide their declarations both at the time of appointment andannually confirming that they meet the criteria of independence as prescribed underSection 149(6) of the Companies Act 2013. During the year your Board met 4 (Four) timesdetails of which are available in Corporate Governance Report annexed to this report.
In terms of Section 152 of the Companies Act 2013 Smt. Malavika A. Acharya(07007469) Director retires by rotation at the forthcoming AGM and is eligible forre-appointment. Smt. Malavika A. Acharya (07007469) has offered herself for reappointment.
The details of training and familiarization programmes and Annual Board Evaluationprocess for directors have been provided under Corporate Governance Report.
Shri Liladhar M. Sawant Chief Financial Officer of the Company met with an untimelyaccidental death on 21st March 2016 at a young age of 40 years. The Board while condolingthe death of Shri Liladhar M. Sawant has recorded its appreciation for the valuableservices rendered by him during his association with the Company.
DIRECTORS' RESPONSIBILITY STATEMENT
In accordance with Section 134(5) of the Companies Act 2013 your Board of directorsconfirms that:
i) in the preparation of the annual accounts the applicable accounting standards havebeen followed and there are no material departures from the said standards;
ii) the accounting policies have been consistently applied and reasonable and prudentjudgment and estimates have been made so as to give a true and fair view of the profit ofthe Company for the year ended on 31st March 2016 and the state of affairs of the Companyas at 31st March 2016 as disclosed in the enclosed accounts;
iii) proper and sufficient care has been taken for maintenance of adequate accountingrecords in accordance with the provisions of the Companies Act 2013 for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
iv) the annual accounts have been prepared on a going concern basis.
v) They have laid down internal financial controls for the Company and such financialcontrols are adequate and operating effectively; and
vi) They have devised proper systems to ensure compliance with provision of allapplicable laws and such systems are adequate and operating effectively.
EXTRACT OF ANNUAL RETURN
An extract of the Annual Return as of 31st March 2016 pursuant to the sub-section (3)of Section 92 of Companies Act 2013 is appended as an Annexure I to this report.
PARTICULARS OF LOAN GUARANTEE AND INVESTMENTS
The Particualrs of loans / advances guarantees and investments under Section 186 ofthe Companies Act 2013 are given in the notes forming part of the Financial Statements.
RISK MANAGEMNET POLICY
The Company has constituted a Risk Management Committee for identifying and evaluatingthe risks associated with the Business of the Company and to minimize them. The details ofCommittee and its terms of reference are set out in the Corporate Governance Report.
M/s. Prakkash Muni & Associates (Firm Regn. No. 111792W) Chartered Accountantswere appointed as Statutory Auditors of your Company at the 15th Annual General meetingheld on 22nd September 2014 for a term of three years. As per the provisions of Section139 of the Companies Act 2013 the appointment of Auditors is required to be ratified bymembers at every Annual General meeting. Your Board of Directors recommend to ratify theirreappointment for the year 2016-17.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There is no qualification reservation adverse remark or disclaimergiven by the Auditors in their Report.
A separate report on Corporate Governance is provided together with a Certificate fromStatutory Auditors of the Company regarding compliance of conditions of CorporateGovernance as stipulated under Schedule V of the SEBI (Listing Obligations &Disclosure Requirements) Regulations 2015. A certificate of the Managing Director interms of Regulation 17(8) as specified in Part B of Schedule II of SEBI (ListingObligations & Disclosure Requirements) Regulations2015 inert alia confirming thecorrectness of the financial statements and cash flow statements adequacy of the internalcontrol measures and reporting of matters to the Audit Committee is also annexed.
The Nomination & Remuneration Committee of the Board has laid down the evaluationcriteria for the performance of executive/Non executive / Independent Directors through aBoard effectiveness survey. A questionnaire of the survey is designed with the objectiveof reviewing the functioning and effectiveness of the Board. Each Board member isrequested to evaluate the effectiveness of the members of the Board (other than theDirector being evaluated) on the basis of information flow decision making of thedirectors relationship to stakeholders Company performance Company strategy and theeffectiveness of the whole Board and its various committees on a scale of one to five.
Evaluation of Independent Directors is done on the basis of their role in GovernanceControl and Guidance and more particularly their performance in the following areas:
* Their contribution towards monitoring the Company's corporate governance practice
* Their participation in formulating business strategies and
* Their participation in Board and Committee meetings and generally fulfilling theirobligations and fiduciary responsibilities as Directors of the Company.
The Company did not receive any complaint of sexual harassment at workplace during theyear under review.
SECRETARIAL AUDIT REPORT
Pursuant to the provisions of Section 204 of Companies Act 2013 and the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 the Company withapproval of Board appointed M/s Dholakia & Associates LLP Company Secretaries inpractice to undertake the Secretarial Audit of the Company for the financial year 2015-16.There were no qualification reservation or adverse remarks give by Secretarial Auditorsof the Company. The Detailed Report on Secretarial Audit is appended as an Annexure II tothis Report.
Your Company has not invited / accepted any deposits from public under Section 73 andSection 76 of the Companies Act 2013.
RELATED PARTY TRANSACTIONS
In line with the requirements of the Companies Act 2013 and SEBI(Listing Obligationsand Disclosure Requirements) Regulations 2015 your Company has formulated a Policy onRelated Party Transactions which is also available on Company's website atwww.babaartslimited.com.
The Company has not entered into any transactions with related parties in accordancewith the Accounting Standard 18 prescribed by the Institute of Chartered Accountants ofIndia.
INTERNAL CONTROL SYSTEM
The Company has in place adequate internal financial controls with reference tofinancial statements.
The Internal Auditor continuously monitors the efficiency of the internalcontrols/compliance with the objective of providing to Audit Committee and the Board ofDirectors an independent objective and reasonable assurance of the adequacy andeffectiveness of the organization's risk management control and governance processes.This system of internal control facilitates effective compliance of Section 138 ofCompanies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements)Regulations 2015.
During the year such controls were tested and no reportable material weakness in thedesign or operation was observed.
PARTICULARS OF EMPLOYEES
The particulars of employees in accordance with the provision of Section 197(12) of theCompanies Act 2013 read with Rule 5 (1) and 5(2) of the Companies (Appointment &Remuneration of Managerial Personnel) Rules 2014 is appended as an Annexure III(a) &an Annexure III (b) to this Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE EARNINGS ANDOUTGO:
Conservation of Energy
Your Company's activities do not require substantial energy consumption. However theCompany continues to lay emphasis on reducing energy consumption by constantly monitoringthe consumption and taking steps to reduce wasteful use of energy.
The Company is engaged in providing post production services to entertainment industryin its post production studio and creating content for Television and also in filmproduction and distribution where there is not much scope for exports. The Company isselling overseas rights of films to domestic distributors. The Company did not have anyexport income during the year.
|Foreign Exchange Earning ||Nil |
|Foreign Exchange Outgo ||Nil |
Research & Development Technology Absorption Adoption and Innovation
The Company has not under taken any Research & Development activity.
SUBSIDIARY JOINT VENTURES AND ASSOCIATE COMPANIES.
The Company does not have any Subsidiary Joint Venture and Associate Company.
The Board wishes to thank all the Company's customers film producers artists andtechnicians satellite channels and Company's bankers who have extended their continuoussupport to the Company.
Your Directors specially thank the shareholders of the Company for having reposed theirconfidence in the management of the Company and employees and technicians of the Companyat all levels for their dedicated services to the Company and the contribution made bythem towards working of the Company.
| ||For and On behalf of the Board of Directors |
| ||Gordhan P. Tanwani |
| ||Chairman & Managing Director |
|Place : Mumbai || |
|Date : 10th August 2016 || |