B.A.G. Films and Media Limited
Your Directors have pleasure in presenting their 23rd Annual Report onbusiness and operations of the Company along with the Audited Financial Statements for thefinancial year ended March 31 2016. The consolidated performance of the Company and itssubsidiaries has been referred to wherever required.
The Standalone and Consolidated performance of the Company and its subsidiaries forthe year under review along with previous year figures are given hereunder:
| || || || ||(Rupees in Lacs) |
|Particulars ||Standalone ||Consolidated |
| ||2015-16 ||2014-15 ||2015-16 ||2014-15 |
|Total Income ||2381.73 ||3237.73 ||11881.67 ||12935.11 |
|Profit before Depreciation & Financial Charges ||1553.45 ||1455.26 ||2985.17 ||2722.43 |
|Financial Charges ||1319.68 ||1421.67 ||1521.13 ||1619.37 |
|Cash Profit ||233.78 ||33.59 ||1466.67 ||1105.72 |
|Depreciation ||928.63 ||1548.71 ||1515.03 ||2443.43 |
|Profit before Tax ||(694.86) ||(1515.11) ||(50.99) ||(1340.37) |
|Provision for Tax ||(84.56) ||(261.68) ||(53.56) ||(391.52) |
|Profit after Tax ||(610.30) ||(1253.43) ||2.57 ||(948.85) |
|Proposed Dividend ||Nil ||Nil ||Nil ||Nil |
COMPANY PERFORMANCE/ STATE OF COMPANYS AFFAIRS
During the year under review the Standalone revenue from operation of the company isRs. 2311.58 lacs against Rs. 3153.74 lacs during the previous financial year. As per theConsolidated Accounts the total revenue from operations is down by 8% from Rs. 12767.22lacs to Rs. 11724.08 lacs during the year. However your Company improved on bottom lineby improving efficiency. There was consolidated cash profit of Rs. 233.78 lacs as againstRs. 33.59 lacs in previous year.
On standalone basis loss after tax for the year was substantially curtailed down toRs. 610.30 lacs against Rs. 1253.43 lacs in Financial Year 2014-15.
Your Company plans to create and deliver popular high quality programming for cateringto not only domestic but also to the demands of international viewership and expects toearn high returns for the stakeholders. Your Company also leveraged content creations andmade optimum use of internal resources and its infrastructure. Your company gavesignificant impetus to international business regarding healthy growth in export.
Your Company has earned royalties for its media education brand ISOMES (InternationalSchool of Media & Entertainment Studies).
ISOMES is offering full time graduate courses in Broadcast Journalism under the aegisof B.A.G. Films Media Education Society.
News24 a 24 hours National Hindi free to air Hindi news channel operating throughits subsidiary News24 Broadcast India Limited has consistently maintained healthy marketshare in Hindi News Genre and is available throughout India on cable and DTH platforms.
News 24 Hindi news channel is also available throughout West Asia and the MENA Regionon DU network.
E24 a 24 hours Bollywood Entertainment channel operating through its subsidiary E24Glamour Limited pitched as Bollywoods direct connection managed to attract audienceof all age groups and succeeded in creating a new genre in television entertainment. E24now available throughout west Asia and the MENA region on DU network has gained popularityin international market too. Darshan24: Darshan24 is the new age devotional channelwhich has been designed for all age groups. The Channel endeavors to bring the massesclose to roots of our Indian culture and its diverse religion in order to teach and preachthe new generation our long age tradition and customs.
It is the source of all wisdom the home of all knowledge focusing on the elevationand awakening of the soul the enhancement of the power within us. Channel is dedicated tothe Indian Philosophy Religion Spiritual solidarity Culture and dissemination of thevast and timeless knowledge of the great "Sanatana Dharma" to the people of theworld.
Your Company has 10 FM Radio stations popularly known as Dhamaal24 at 106.4FM under its subsidiary Skyline Radio Network Limited in the cities of Hissar KarnalPatiala Shimla Muza_arpur Ranchi Jabalpur Jalgaon Dhule and Ahmednagar. During theyear the company has successfully migrated its radio stations from Phase-II to Phase-III.
106.4 FM Radio Dhamaal24 Har Khushi hai Jahan is a hybrid FM Channelbringing to the listeners life in all manifestations. Dhamaal24 is a channel with aslice of life and approach to the infotainment & entertainment programming.
CHANGE IN THE NATURE OF BUSINESS IF ANY
There was no change in the nature of business of the Company during the financial yearended March 31 2016.
The Directors express their inability to declare any dividend for the financial yearended March 31 2016 on account of loss incurred during the year under review. The Companyhas not made any transfer to General Reserve.
TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCTION AND PROTECTION FUND
Pursuant to the erstwhile provisions of Section 205A(5) and 205C of the Companies Act1956 relevant amounts which remained unpaid or unclaimed for a period of seven years havebeen transferred by the Company to the Investor Education and Protection Fund (IEPF)established by the Central Government. Pursuant to the provisions of Investor Educationand Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lyingwith companies) Rules 2012 the Company has uploaded the details of unpaid and unclaimedamounts lying with the Company as on 23.09.2015 (date of last Annual General Meeting) onthe Companys website www.bag_lms.com and also on the Ministry of CorporateAffairs website.
In terms of Section 125 of the Companies Act 2013 (herein after referred as "theAct") and erstwhile provisions of Section 205A(5) and 205C of the Companies Act1956 unclaimed or unpaid dividend relating to the financial year 2007-08 is due forremittance on or before 23.10.2015 transferred to the Investor Education and ProtectionFund. Details of transfer of Fund to IEPF during the financial year 2015-16 are givenherein below:-
|Particulars ||Amount |
| ||(in Rs.) |
|Opening Balance (01-04-2015) ||132212 |
|Less: Transfer of Unclaimed Dividend to IEPF ||132212 |
|Closing Balance (31-03-2016) ||Nil |
There are 4 (four) Directors on the Board of your Company comprising of 2 IndependentDirectors 1 Non-Executive Director and 1 Chairperson cum Managing Director (CMD).
The Board of the Company besides Ms. Anurradha Prasad as the Chairperson cum ManagingDirector has 2 (two) women Independent Directors i.e. Dr. Anuradha Mishra and Ms. UrmilaGupta.
Definition of Independence of Directors is derived from Regulation 16 of the SEBI(Listing Obligations & Disclosure Requirements) Regulations 2015 (herein afterreferred as "the SEBI Listing Regulations") and Section 149(6) of the Act. TheCompany has received necessary declaration from Independent Directors stating that theymeet the prescribed criteria of independence. Based on the confirmation/ disclosuresreceived from the Directors under section 149 (7) of the Act the following Non-Executiveare considered as Independent Directors:
1. Dr. Anuradha Mishra
2. Ms. Urmila Gupta
In a separate meeting of independent directors performance of non-independentdirectors performance of the board as a whole and performance of the chairman wasevaluated taking into account the views of executive directors and non-executivedirectors. The same was discussed in the board meeting that followed the meeting of theindependent directors at which the performance of the board its committees andindividual directors was also discussed. Performance evaluation of independent directorswas done by the entire board excluding the independent director being evaluated.
Appointments/ Resignations from the Board of Directors
During the financial year under review no changes have been made in Board of Directorsof the Company.
Appointments/ Resignations of the Key Managerial Personnel
Ms. Anurradha Prasad Chairperson cum Managing Director Mr. Ajay Jain Chief FinancialOfficer and Mr. Rajeev Parashar Secretary of the Company are the Key Managerial Personnelas per the provisions of the Act. The Board of Directors of the Company at their meetingheld on May 29 2015 appointed Mr. Ajay Jain as Chief Financial Officer of the Company.
The Board of Directors of the Company at their meeting held on February 12 2015re-appointed Ms. Anurradha Prasad as Chairperson cum Managing Director with approval ofShareholders at 22nd Annual General Meeting held on 23.09.2015 for a further period of5(five) years with effect from April 1 2015.
Directors Retiring by Rotation
Pursuant to provision of section 152 of the Act read with the Articles of Associationof the Company Mr. Sudhir Shukla will retire by rotation at the 23rd Annual GeneralMeeting and being eligible for re-appointment.
Schedule IV of Companies Act 2013 read with corporate governance requirements asprescribed under the SEBI Listing Regulations mandates that annual performance evaluationof Directors should be carried out by Independent Directors and annual performanceevaluation of Independent Directors should be carried out by other Directors to theexclusion of 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 evaluation process has been explained inthe Corporate Governance Report section in the Annual Report. The Board approved theevaluation process results as collated by the Nomination & Remuneration Committee ofthe Company. The performance of the board was evaluated after seeking inputs from all thedirectors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The Board of Directors of your Company met 4 (four) times during the year under review.The details of Board meetings and the attendance of the Directors are provided in theCorporate Governance Report which forms part of this report.
Composition of Committees of the Board of Directors
The Board Committees play a crucial role in the governance structure of the Company andhave been constituted to deal with specific areas/activities which concern the Company andneed a closer review. The Board Committees are set up under the formal approval of theBoard to carry out clearly defined roles which are considered to be performed by membersof the Board. The terms of reference of Board Committees are determined by the Board fromtime to time.
The Companys Board has the following Committees:
1. Audit Committee
2. Stakeholders Relationship Committee
3. Risk Management Committee
4. ESOP Compensation Committee
5. Nomination and Remuneration Committee
The details of terms of reference membership composition and attendance at meetingsare provided in Corporate Governance Report of this Annual Report which forms part of thisreport.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 134(5) of the Companies Act 2013 the Board of Directors to thebest of their knowledge and ability confirm that:-a) in the preparation of the annualaccounts for the year ended March 31 2016 the applicable accounting standards have beenfollowed along with proper explanation relating to material departures if any; b) theyhave selected such accounting policies and applied them consistently and made judgmentsand estimates that are reasonable and prudent so as to give a true and fair view of thestate of affairs of the Company at the end of the financial year and of the loss of theCompany for the year ended on that date; c) they have taken proper and sufficient care forthe maintenance of adequate accounting records in accordance with the provisions of theAct for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; d) they have prepared the annual accounts of the Company on agoing concern basis. e) the internal financial controls to be followed by theCompany were laid down and such internal financial controls are adequate and operatingeffectively. f) they have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
The Company has four subsidiaries as on March 31 2016 out of which one is wholly ownedforeign subsidiary. There is no associate company within the meaning of Section 2(6) ofthe Companies Act 2013 ("the Act").
Consolidated Financial Statements
Pursuant to provisions of section 129(3) of the Act a statement containing salientfeatures of the financial statements of the Companys subsidiaries in Form AOC-1 isattached to the financial statements of the Company. Further pursuant to the provisionsof section 136 of the Act the financial statements of the Company including theconsolidated financial statements along with relevant documents and separate auditedfinancial accounts in respect of subsidiaries are available on the companys websitewww.bag_lms.com.
EXTRACT OF ANNUAL RETURN
Pursuant to section 92(3) and section 134(3)(a) of the Act extract of the Annual Returnas on March 31 2016 in Form No. MGT-9 is enclosed as Annexure I to thisreport.
Your Company is not engaged in any manufacturing or processing activity as suchparticulars required to be given in terms of Section 134 (3) (m) of the Act read alongwith Companies (Accounts) Rules 2014 regarding conservation of energy and technologyabsorption are not applicable.
FOREIGN EXCHANGE EARNING AND OUTGO
During the financial year 2015-16 your Companys foreign exchange earnings wereRs. 15500000/-and foreign exchange outgoings were Rs. 3130425/- as against Rs.132853055/- of foreign exchange earnings and Rs. 5380347/- of foreign exchangeoutgoings for the financial year 2014-15.
SIGNIFICANT AND MATERIAL ORDERS
During the year under review there were no significant and material orders passed bythe Regulators or Courts or Tribunals impacting the going concern status andCompanys operations in future.
INTERNAL FINANCIAL CONTROLS AND THEIR ADEQUACY
The Board of your Company has laid down internal financial controls that are adequateand operating effectively. Your Company has adopted policies and procedures for ensuringthe orderly and efficient conduct of its business including the safeguarding of itsassets the prevention and detection of frauds and errors the accuracy and completenessof the accounting records and the timely preparation of reliable financial disclosures.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments covered under the provisions of Section186 of the Act are given in the notes to the Financial Statements.
RISK MANAGEMENT POLICY
In accordance with the requirements of the Companies Act 2013 the Company has adoptedRisk Management Policy approved by Board and established a risk management framework toidentify mitigate and control the risk and threat. An abridged policy on Risk Managementhas been placed on the Companys website www.bag_lms.com.
The details of Committee and its terms of reference are set out in the CorporateGovernance Report forming part of the Boards Report.
During the year under review your Company has not accepted any deposits under section73 to 76 of the Companies Act 2013 read with Companies (Acceptance of Deposits) Rules2014.
CORPORATE SOCIAL RESPONSIBILITY POLICY
The Company believes in voluntary commitment of Corporate Social Responsibilityinitiatives though mandatory contribution is not yet applicable on the company. TheCompany shall report the same and shall submit the relevant report as and when they becameapplicable.
NOMINATION AND REMUNERATION POLICY
The Company has constituted a Nomination and Remuneration Committee of Directors incompliance with provisions of Section 178 of the Companies Act 2013 and Regulation 19 ofthe SEBI Listing Regulations as amended from time to time. The Remuneration policy of theCompany is a comprehensive policy which is competitive in consonance with the industrypractices. The policy ensures equality fairness and consistency in rewarding theemployees on the basis of performance against set objectives.
The Companys Policy relating to appointment of Directors payment of managerialremuneration Directors qualifications positive attributes independence ofDirectors and other related matters as provided under Section 178(3) of the Companies Act2013 is furnished in Annexure II and forms part of this Report.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onan arms length basis and were in the ordinary course of business. There are nomaterially significant related party transactions made by the Company with PromotersDirectors Key Managerial Personnel or other designated persons which may have a potentialconflict with the interest of the Company at large.
All related party transactions are placed on a quarterly basis before the AuditCommittee and also before the Board for their approval. Prior omnibus approval of theAudit Committee is obtained for the transactions which are of a foreseeable and repetitivenature. In line with the provisions of the Companies Act 2013 and the SEBI ListingRegulations the Board has approved a policy on related party transactions. An abridgedpolicy on related party transactions has been placed on the Companys website www.bag_lms.com.
The particulars of every contract transaction and arrangement entered into by theCompany with related parties referred to in sub-section (1) of section 188 of theCompanies Act 2013 including certain arms length transactions under third provisothereto are disclosed in Form No. AOC -2 in Annexure III and form part ofthis Report.
The Company has a Whistle Blower Policy to establish a vigil mechanism for Directorsand employees of the Company to report concerns about unethical behavior actual orsuspected fraud or violation of the companys code of conduct or ethics policy to the
Audit Committee. There is no restriction for reporting any such occurrence and all theemployees have uninterrupted access for reporting their concern in confidence to the AuditCommittee. The details of the Whistle Blower Policy are posted on the website of theCompany at www.bag_lms.com.
AUDITORS AND AUDITORS REPORT
Pursuant to the provisions of section 139 of the Companies Act 2013 an audit firm canact as auditors for a maximum tenure of two terms of 5 consecutive years. For the purposeof reckoning this limit existing tenure of the auditors needs to be counted. Howevercompanies have been given a transition time of 3 years from April 1 2014 to comply withthis provision.
Accordingly the Companys Auditors M/s. Joy Mukherjee
& Associates (FRN: 006792C) Chartered Accountants who retire at the ensuingAnnual General Meeting may continue as statutory auditors for auditing financialstatements for the financial year ending March 31 2017. M/s. Joy Mukherjee &Associates have confirmed their eligibility and willingness to accept office ifre-appointed. Based on the recommendation of Audit Committee the Board has approved theproposal for placing the matter of re-appointment of M/s. Joy Mukherjee & Associatesas statutory auditors at the 23rd Annual General Meeting.
Qualification in Auditors reports
There are no qualifications reservations or adverse remarks made by M/s. Joy Mukherjee& Associates Statutory Auditors in their report for the financial year ended March31 2016.
Pursuant to provisions of section 143(12) of the Companies Act the Statutory Auditorshave not reported any incident of fraud to the Audit Committee during the year underreview.
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 hasappointed M/s Balika Sharma & Associates a firm of Company Secretaries in Practice toconduct the Secretarial Audit of the Company for the financial year ended March 31 2016.There are no qualifications reservations or adverse remarks made by the SecretarialAuditor in her report. The Report of the Secretarial Audit in Form No MR-3 for thefinancial year ended March 31 2016 is enclosed as Annexure IV to this Report.
The equity shares of the Company are listed with National Stock Exchange of IndiaLimited (NSE) and BSE Limited (BSE). There are no arrears on account of payment of listingfee to the Stock Exchanges.
The Company is committed to maintain the highest standards of Corporate Governance andadhere to the Corporate Governance requirements.
As per Regulation 34 of the SEBI Listing Regulations a separate section on corporategovernance practices followed by your Company together with a certificate from ManagingDirector CFO and M/s. Joy Mukherjee & Associates Statutory Auditors on compliancewith corporate governance norms under the Listing Regulations is annexed and forms partof this Report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
In terms of Regulation 34 of the SEBI Listing Regulations the Management Discussionand Analysis Report on your Companys performance industry trends and other materialchanges with respect to your Company and its subsidiaries wherever applicable areprovided separately and forms part of this Report.
CODE OF CONDUCT
The Company has in place a comprehensive Code of Conduct (the Code) modified from timeto time applicable to Directors Independent Directors and senior management personnel.The Code gives guidance and support needed for ethical conduct of business and complianceof law. The Code reflects the values of the Company. A copy of the Code has been put onthe Companys website www.bag_lms.com. The Code has been circulated toDirectors and Senior Management Personnel and its compliance is afirmed by them annually.
In compliance with the SEBI (Prohibition of Insider Trading) Regulations 2015 (SEBIRegulations) the existing Code of Conduct which was formulated under erstwhile regulationhas been replaced with the new Code of Conduct viz. "Code of conduct for trading byinsiders" pursuant to Regulation 9 of the SEBI (Prohibition of Insider Trading)Regulations 2015. Besides the Company has also formulated code of fair disclosure ofUnpublished Price Sensitive Information in addition therewith pursuant to Regulation 8 ofthe SEBI (Prohibition of Insider Trading) Regulations 2015. These codes are applicable toDirectors/officers/connected person/designated employee of the Company and their immediaterelatives.
PREFRENTIAL ALLOTMENT Convertible Warrants
Your company had issued and allotted 80000000 warrants to eligible allottees underpromoter/non- promoter group on preferential basis with an option to get allotted oneequity share per warrant before expiry of eighteen months from the date of allotmentpursuant to section 42 and 62 of the Companies Act 2013 with the approval accorded by theMembers of the Company at the 21st Annual General Meeting held on June 25 2014. In thefirst tranche 8500000 warrants of Rs. 2/- each at a price of Rs. 3.40/- per shares("conversion price" including a premium of Rs.
1.40/-per shares) were converted into equal number of equity shares of Rs. 2/- eachduring the FY 2014-15 and listing and trading permission for these shares have been dulyobtained from the respective Stock Exchanges.
In the second tranche 9400000 warrants of Rs. 2/- each at a price of Rs. 3.40/- pershares ("conversion price" including a premium of Rs. 1.40/-per shares) wereconverted into equal number of equity shares of Rs. 2/- each vide StakeholdersRelationship Committee date 14.01.2016 and listing and trading permission for these shareshave been duly obtained from the respective Stock Exchanges. During the year under reviewthe Company has forfeited the balance 62100000 warrants which were not exercised withinspecified time by the warrant holders and balance amount of 25% received as upfront moneywas also forfeited. The paid up equity share capital of the Company as on March 31 2016was Rs. 376236180/- (including the calls in arrear of Rs. 170341/-) divided into188118090 equity shares of Rs. 2 each.
PARTICULARS OF EMPLOYEES
Disclosures with respect to the remuneration of Directors and employees as requiredunder sub-section (12) of Section 197 of the Act read with Rule 5(1) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 is annexed as part ofthis report in Annexure V.
The information required pursuant to Section 197 of the Act read with Rule 5(2)&(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 inrespect of employees of your Company is available for inspection by the members atregistered office of the Company during business hours on working days up to the date ofthe ensuing Annual General Meeting. If any member is interested in obtaining a copythereof such member may write to the Company Secretary in this regard.
Information Required Under Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013
Your Company has a policy and framework for employees to report sexual harassment casesat workplace and the process ensures complete anonymity and confidentiality ofinformation. As required under the provisions of Sexual Harassment of Women at Workplace(Prevention Prohibition and Redressal) Act 2013 your Company has constituted anInternal Complaints Committee which provides a forum to all female personnel to lodgecomplaints (if any) therewith for redressal. No complaints were received by the committeeduring the year under review. No complaints were filed during the year. This is incompliance with section 22 of the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013.
Material Events Occurred between the end of Financial Year to which the FinancialStatements Relate and the Date of the Report :
No material events have occurred between the end of Financial Year 2015-16 and the dateof this Report which have effect over the Financial position of the Company.
The consolidated financial statements of the Company forms part of this Annual Report.Accordingly this Annual Report of your Company does not contain the financial statementsof its subsidiaries. The Audited Annual Accounts and related information of theCompanys subsidiaries will be made available upon request. These documents will alsobe available for inspection during business hours at the Companys registered officein Delhi India. The subsidiary companies documents will also be available forinspection at the respective registered offices of the subsidiary companies duringbusiness hours.
Your Directors the Central and State Government Departments organizations and agenciesfor the continued help and cooperation extended by them.
Your Directors also gratefully acknowledge all stakeholders of the Company viz.viewers producers vendors members stock exchanges auditors consultantsdealers banks and other business partners for the excellent support received fromthem during the year. The Directors place on record their sincere appreciation to allemployees of the Company for their unstinted commitment and continued contribution to theCompany.
|For and on behalf of the Board of Directors |
|B.A.G. Films and Media Limited |
|Anurradha Prasad |
|Chairperson cum Managing Director |
|Date : May 30 2016 |
|Place : Noida |
NOMINATION AND REMUNERATION POLICY OF DIRECTORS KEY MANAGERIAL PERSONNEL AND OTHEREMPLOYEES
[B.A.G. Films and Media Limited]
Section 178 of the Companies Act 2013 and the provisions of clause 49 of the ListingAgreement with Stock Exchanges require the Nomination and Remuneration Committee (NRC) ofthe Board of Directors of every listed entity among other classes of companies to -formulate the criteria for determining qualifications positive attributes andindependence of a director and recommend to the Board a policy relating to theremuneration for the directors key managerial personnel and other employees. - identifypersons who are qualified to become directors and who may be appointed in seniormanagement in accordance with the criteria laid down recommend to the Board theirappointment and removal.
- carry out evaluation of every directors performance. - formulate the criteriafor evaluation of Independent Directors and the Board.
Accordingly in adherence to the above said requirements and in line with the Companyphilosophy towards nurturing its human resources Board of Directors adopted theNomination and Remuneration Policy of B.A.G. Films and Media Limited (herein after calledas B.A.G.) for the directors key managerial personnel and other employees of the Companyduly recommended by NRC as set out below.
B.A.G. is an equal opportunities employer. The organization does not discriminate ongrounds of age gender color race ethnicity language caste creed economic or socialstatus or disability. Pay revisions and other benefits are designed in such a way tocompensate good performance of the employees of the Company and motivate them to do betterin future.
Employee recognition schemes in the form of ESOPs have also been introduced assuccessful tools in acknowledging their contribution and making them partners in thewealth created by B.A.G.
The endeavor of the organization is to acknowledge the contributions of its directorskey managerial personnel and other employees with best compensation and benefits thatappropriately reward performance in line with the regulatory and industry best practices.
In the formulation of this Policy the Nomination and Remuneration Committee has alsoendeavored to ensure the guiding principles as prescribed u/s 178(4) of the Companies Act
2013 and the section on Responsibilities of Board under clause 49 of the ListingAgreement summarized hereunder: a) the level and composition of remuneration isreasonable and sufficient to attract retain and motivate human resource includingdirectors of the quality required to run the company successfully; b) relationship ofremuneration to performance is clear and meets appropriate performance benchmarks; c)remuneration to directors key managerial personnel and senior management reflecting shortand long term performance objectives appropriate to the working of the company and itsgoals; d) facilitating effective shareholder participation in key Corporate Governancedecisions such as the nomination and election of board members; e) aligning key executiveand board remuneration with the longer term interests of the company and its shareholders;f) ensuring a transparent board nomination process with the diversity of thoughtexperience knowledge perspective and gender in the Board.
NOMINATION OF THE DIRECTORS
The Nomination and Remuneration Committee of the Board of Directors is dedicated toensuring the continuance of a dynamic and forward-thinking Board and recommend to theBoard qualified candidates for directorship.
Before recommending a nominees candidature to the Board for being appointed as aDirector the following criteria set out may be applied as guidelines in consideringpotential nominees to the Board of Directors.
- The background and qualifications of the Directors considered as a group shouldprovide a significant breadth of experience knowledge and abilities to assist the Boardin fulfilling its responsibilities.
- Directors should be selected so that the Board of Directors should remain as adiverse body with diversity reflecting gender ethnic background country of citizenshipand professional experience. Because a mix of viewpoints and ideas enhances theBoards ability to function effectively the Committee shall consider the diversityof the existing Board when considering potential nominees so that the Board maintains abody of directors from diverse professional and personal backgrounds.
- Potential nominees shall not be discriminated against on the basis of race religionnational origin sex disability or any other basis prohibited by law.
- Any nominee should be free of any conflict of interest which would violate anyapplicable law or regulation or interfere with the performance of the responsibilities ofa director.
- Commitment of the nominee to understanding the Company and its industry embracingthe organisations values to help shape its vision mission and strategic directionincluding oversight of risk management and internal control.
- Commitment of the nominee to spending the time necessary to function effectively as aDirector including attending and participating in meetings of the Board and itsCommittees.
- Demonstrated business acumen experience and ability to use sound judgment and tocontribute to the effective oversight of the business and financial affairs of a largemultifaceted global organisation.
- The nominee reflects the right corporate tone and culture and excels atboard-management relationships.
- Experience in strategic planning and managing multidisciplinary responsibilities theability to navigate among diverse professional groups and points of view a track recordof communicating effectively in a global environment and high standards of integrity andprofessional conduct.
- Nominees understand and endeavour to balance the interests of shareholders and/ orother stakeholders and put the interests of the company or organisation aboveself-interest. He/ she has demonstrated a commitment to transparency and disclosure.
- He/ she is committed to superior corporate performance consistently striving to gobeyond the legal and/or regulatory governance requirements to enhance not just protectshareholder value.
- Nominee contributes to effective governance through superior constructiverelationships with the Executive Directorate and management.
REMUNERATION OF THE DIRECTORS
The Company strives to provide fair compensation to directors taking intoconsideration industry benchmarks Companys performance vis--vis the industryresponsibilities shouldered performance/track record macroeconomic review onremuneration packages of heads of other organisations.
The remuneration payable to the directors of the company shall at all times bedetermined in accordance with the provisions of the Companies Act 2013.
Appointment and Remuneration of Managing Director and Whole-time Director The terms andconditions of appointment and remuneration payable to a Managing Director and Whole-timeDirector(s) shall be recommended by the Nomination and Remuneration Committee to the Boardfor its approval which shall be subject to approval by shareholders at the next generalmeeting of the Company and by the Central Government in case such appointment is atvariance to the conditions specified in Schedule V to the Companies Act 2013. Approval ofthe Central Government is not necessary if the appointment is made in accordance with theconditions specified in Schedule V to the Act.
In terms of the provisions of Companies Act 2013 the Company may appoint a person asits Managing Director or Whole-time Director for a term not exceeding 5 (Five) years at atime.
The executive directors may be paid remuneration either by way of a monthly payment orat a specified percentage of the net profits of the Company or partly by one way andpartly by the other.
The break-up of the pay scale performance bonus and quantum of perquisites includingemployers contribution to P.F. pension scheme medical expenses club fees etc.shall be decided and approved by the Board on the recommendation of the Committee andshall be within the overall remuneration approved by the shareholders and CentralGovernment wherever required. While recommending the remuneration payable to a Managing/Whole-time Director the Nomination and Remuneration Committee shall inter alia haveregard to the following matters:
Financial and operating performance of the Company
Relationship between remuneration and performance
Industry/ sector trends for the remuneration paid to executive directorate AnnualIncrements to the Managing/ Whole-time Director(s) shall be within the slabs approved bythe Shareholders. Increments shall be decided by the Nomination and Remuneration Committeeat times it desires to do so but preferably on an annual basis.
Remuneration of Independent Directors
Independent Directors may receive remuneration by way of
Sitting fees for participation in the Board and other meetings
Reimbursement of expenses for participation in the Board and other meetings
Commission as approved by the Shareholders of the
Independent Directors shall not be entitled to any stock options. Based on therecommendation of the Nomination and Remuneration Committee the Board may decide thesitting fee payable to independent directors. Provided that the amount of such fees shallnot exceed the maximum permissible under the Companies Act 2013.
Remuneration to Directors in other Capacity
The remuneration payable to the directors including Managing or Whole-time Director orManager shall be inclusive of the remuneration payable for the services rendered by him inany other capacity except the following: (a) the services rendered are of a professionalnature; and
(b) in the opinion of the Nomination and Remuneration Committee the director possessesthe requisite qualification for the practice of the profession.
EVALUATION OF THE DIRECTORS
As members of the Board the performance of the individual Directors as well as theperformance of the entire Board and its Committees is required to be formally evaluatedannually. Section 178(2) of the Companies Act 2013 also mandates the Nomination andRemuneration Committee to carry out evaluation of every directors performance.
In developing the methodology to be used for evaluation on the basis of best standardsand methods meeting international parameters the Board / Committee may take the advice ofan independent professional consultant.
Assistance in conducting the process of evaluation shall be provided by a person asauthorized by the Board and for this purpose such person shall report to Board.
NOMINATION AND REMUNERATION OF THE KEY MANAGERIAL PERSONNEL (OTHER THAN MANAGINGDIRECTORS/WHOLE TIME DIRECTORS) KEY EXECUTIVES AND SENIOR MANAGEMENTS
The executive management of a company is responsible for the day to day management of acompany. The Companies Act 2013 has used the term "key managerial personnel" todefine the executive management.
The KMPs are the point of first contact between the company and its stakeholders. Whilethe Board of Directors are responsible for providing the oversight it is the keymanagerial personnel and the senior management who are responsible for not just layingdown the strategies as well as its implementation.
The Companies Act 2013 has for the first time recognized the concept of Key ManagerialPersonnel. As per section 2(51) "key managerial personnel" in relation to acompany means: (i) the Chief Executive Officer or the Managing Director or the Manager;(ii) the Whole-time Director; (iii) the Chief Financial Officer; (iv) the CompanySecretary; and (v) such other officer as may be prescribed.
Among the KMPs the remuneration of the CEO or the Managing Director and the Whole-timeDirector(s) shall be governed by the Section on REMUNERATION OF THE DIRECTORS of thisPolicy dealing with "Remuneration of Managing Director and Whole-time Director".
Apart from the directors the remuneration of
- All the Other KMPs such as the company secretary or any other officer that may beprescribed under the statute from time to time; and
- "Senior Management" of the Company defined in the clause 49 of the ListingAgreement with the Stock Exchanges i.e. personnel who are members of its core managementteam excluding the Board of Directors. Senior executives one level below the Boardshall be determined by the Human Resources Department of the Company in consultation withthe Managing Director and/ or the Whole-time Director.
The remuneration determined for all the above said senior personnel shall be in linewith the Companys philosophy to provide fair compensation to key - executiveofficers based on their performance and contribution to the Company and to provideincentives that attract and retain key executives instill a long-term commitment to theCompany and develop a pride and sense of Company ownership all in a manner consistentwith shareholders interests.
The break-up of the pay scale and quantum of perquisites including employerscontribution to P.F. pension scheme medical expenses club fees etc. shall be decided bythe Companys HR department.
Decisions on Annual Increments of the Senior Personnel shall be decided by the HumanResources Department.
REMUNERATION OF THE EMPLOYEES
Apart from the Directors KMPs and Senior Management the remuneration for rest of theemployees is determined on the basis of the role and position of the individual employeeincluding professional experience responsibility job complexity and local marketconditions.
The Company considers it essential to incentivize the workforce to ensure adequate andreasonable compensation to the staff. The Human Resources Department shall ensure that thelevel of remuneration motivates and rewards high performers who perform according to setexpectations for the individual in question.
The various remuneration components basic salary allowances perquisites etc. may becombined to ensure an appropriate and balanced remuneration package.
The increments to the remuneration paid to the employees shall be determined based onthe annual appraisal carried out by the HODs of various departments. Decisions on AnnualIncrements shall be made on the basis of this annual appraisal.
This Policy shall apply to all future employment of Companys Senior Managementincluding Key Managerial Personnel and Board of Directors.
Any or all the provisions of this Policy would be subject to the revision/ amendment inthe Companies Act 2013 related rules and regulations guidelines and the ListingAgreement on the subject as may be notified from time to time. Any such amendment shallautomatically have the effect of amending this Policy without the need of any approval bythe Nomination and Remuneration Committee and/or the Board of Directors.
ANNEXURE III FORM NO. AOC-2
(Pursuant to clause (h) of sub-section (3) of section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014) Form for Disclosure of particulars ofcontracts/arrangements entered into by the company with related parties referred to in subsection (1) of section 188 of the Companies Act 2013 including certain arms lengthtransaction under third proviso there to is given below:
1. Details of contracts or arrangements or transactions not at Arms lengthbasis:
There were no contracts or arrangements or transactions entered into during the yearended March 31 2016 which were not at arms length basis.
2. Details of material contracts or arrangement or transactions at armslength basis:
The details of material contracts or arrangements or transactions at arms lengthbasis for the year ended March 31 2016 are as follow:
|Sr. No. ||Name of Related Party ||Nature of Relationship ||Nature of contracts or arrangements or transactions ||Duration of contracts or arrangements or transactions ||Salient Terms ||Amount (in Rs.) |
|1 ||News24 Broadcast India Limited ||Subsidiary ||Leasing of Equipments ||Continuing ||As per Related Party Transaction Policy ||49384768 |
|2 ||E24 Glamour Limited ||Subsidiary ||Leasing of Equipments ||Continuing ||As per Related Party Transaction Policy ||6189120 |
|3 ||Anurradha Prasad ||Chairperson cum Managing Director ||Managerial Remuneration ||Continuing ||As per Agreement ||8333330 |
| ||For and on behalf of the Board of Directors |
| ||B.A.G. Films and Media Limited |
| ||Anurradha Prasad |
| ||Chairperson cum Managing Director |
| ||(DIN:00010716) |
|Date : May 30 2016 || |
|Place : Noida || |
Form No. MR-3
SECRETARIAL AUDIT REPORT
FOR THE FINANCIAL YEAR ENDED 201516
[Pursuant to section 204(1) of the Companies Act 2013 and Rule No.9 of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014] To
B.A.G Films and Media Limited
We have conducted the Secretarial Audit of the compliance of applicable statutoryprovisions and the adherence to good corporate practices by B.A.G. Films and MediaLimited CIN L74899DL1993PLC051841 (hereinafter called "the Company").Secretarial Audit was conducted in a manner that provided us a reasonable basis forevaluating the corporate conducts/statutory compliances and expressing our opinionthereon.
Based on our verification of the Companys books papers minute books forms andreturns filed and other records maintained by the Company and also the informationprovided by the Company its officers agents and authorized representatives during theconduct of Secretarial Audit we hereby report that in our opinion the company hasduring the audit period covering the financial year commencing from 1st April 2015 andended on 31st March 2016 ("Audit Period") complied with the statutoryprovisions listed hereunder and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent in the manner and subject to the reportingmade hereinafter: We have examined the books papers minute books forms and returnsfiled and other records maintained by the Company for the financial year ended March 312016 according to the provisions of:
1) The Companies Act 2013 (the Act) and the rules made thereunder to the extentnotified and came into force;
2) The Securities Contracts (Regulation) Act 1956 (SCRA) and the rulesmade there under;
3) The Depositories Act 1996 and the Regulations and Bye-laws framed thereunder;
4) Foreign Exchange Management Act 1999 (FEMA) & the Rules and Regulations madethereunder to the extent of Foreign Direct Investment Overseas Direct Investment andExternal Commercial Borrowings;
5) The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (SEBI Act):-a) The Securities and ExchangeBoard of India (Substantial Acquisition of Shares and Takeovers) Regulations 2011;
b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 2015;
c) The Securities and Exchange Board of India (Issue of Capital and DisclosureRequirements) Regulations 2009;
d) Listing Agreement with Stock Exchanges in force upto 30th November 2015;
e) The Securities and Exchange Board of India (Listing Obligation and DisclosureRequirement ) Regulations 2015; During the Audit Period under review the Company hascomplied with the provisions of the Acts Laws and Regulations and guidelines to theextent applicable as mentioned above.
6. As informed by the management being a programs and content provider there is nosector specific law applicable to the Company. We have also examined compliance with theapplicable clauses of the following: i. Secretarial Standards issued by the Institute ofCompany Secretaries of India. ii. Listing Agreement entered into by the Company withNational Stock Exchange of India Limited and BSE Limited in force up to 30th November2015. iii. The Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015.
We further report that
The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors and Committees thereof that took place during theperiod under review were carried out in compliance with the provisions of the Act.
Adequate notice is given to all directors to schedule the Board Meetings. Agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarifications on the agenda items beforethe meeting and for meaningful participation at the meeting. Majority decisions werecarried out with unanimous consent and therefore no dissenting views were captured andrecorded as part of the minutes
We further report that there are adequate systems and processes in the companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines as stated above.
We further report that during the audit period there were no instances of: (i)Redemption / buy-back of securities.
(ii) Major decisions taken by the Members in pursuance to Section 180 of the CompaniesAct 2013. (iii) Merger / amalgamation / reconstruction etc.
(iv) Foreign technical collaborations.
We further report that during the Audit Period the members of the Companyinter-alia passed the following Special Resolution(s): Under Section 196 197 198 andSection 203 of the Act Re-appointment of Ms. Anurradha Prasad (DIN 00010716) asChairperson cum Managing Director of the Company in the Annual General Meeting datedSeptember 23 2015.
Under Section 188 of the Act Approvals for Related Part Transactions in the AnnualGeneral Meeting dated September 23 2015. The Company has issued equity shares on apreferential basis during the financial year under review in compliance with applicableprovisions of Companies Act 2013 relevant rules made thereunder the Securities andExchange Board of India (Issue of Capital and Disclosure Requirement) Regulations 2009and the Securities and Exchange Board of India (Listing Obligation and DisclosureRequirement) Regulations 2015.
| ||For Balika Sharma & Associates |
| ||Company Secretaries |
| ||Balika Sharma |
|Place : Noida ||Proprietor |
|Date : 30.05.2016 ||FCS No: 4816 |
| ||C P No: 3222 |
This report is to be read with our letter of even date which is annexed as Annexure1 and forms an integral part of this report.
B.A.G. Films and Media Limited
Our report of even date is to be read along with this letter:
1. Management of Secretarial record is the responsibility of the management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.
2. We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the contents of the Secretarial Records. Theverification was done on test basis to ensure that correct facts are reflected insecretarial records. We believe that the processes and practices we followed provide areasonable basis for our opinion.
3. We have not verified the correctness and appropriateness of financial records andBooks of Accounts of the Company.
4. Wherever required we have obtained the Management representation about thecompliance of laws rules and regulations & happening of events etc.
5. The compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. Our examination was limited tothe verification of procedure on test basis.
6. The Secretarial Audit Report is neither an assurance as to the future viability ofthe Company nor the efficacy or effectiveness with which the management has conducted theaffairs of the Company.
| ||For Balika Sharma & Associates |
| ||Company Secretaries |
| ||Balika Sharma |
|Place : Noida ||Proprietor |
|Date : 30.05.2016 ||FCS No: 4816 |
| ||C P No: 3222 |
DETAILS PERTAINING TO REMUNERATION AS REQUIRED UNDER S ECTION 197_12_ OF THE COMPANIESACT 2013
i) The percentage increase in remuneration of each Director Chief Financial Officerand Company Secretary during the financial year 2015-16 ratio of the remuneration of eachDirector to the median remuneration of the employees of the Company for the financial year2015-16:
(a) Ms. Anurradha Prasad Chairperson cum Managing Director get remuneration for thefinancial year 2015-16 is Rs. 83.33 lacs zero percentage increase in remuneration Ratioof remuneration of each Director/to median remuneration of employees was 18:1.
(b) Mr. Ajay Jain Chief Financial Officer get remuneration for the financial year2015-16 Rs. 30 lacs with zero percentage increase in remuneration.
(c) Mr. Rajeev Parashar Company Secretary get remuneration for the financial year2015-16 Rs. 30 lacs with zero percentage increase in remuneration.(Note: No remunerationis paid to Non-executive Directors except sitting fee).
ii) The median remuneration of employees of the Company during the financial year wasRs. 4.57 Lacs;
iii) In the financial year there was a decrease of 0.29% in the median remuneration ofemployees;
iv) There were 31 permanent employees on the roll of Company as on March 31 2016;
v) Relationship between average increase in remuneration and company performance: Theincrease in remuneration is not solely based on the Company performance but also includesvarious other factors like individual performance experience skill sets industry trendeconomic situation and future growth prospects etc. All these factors are considered forrevision of remuneration. vi) Comparison of Remuneration of the Key ManagerialPersonnel(s) against the performance of the Company: The increase in remuneration is notsolely based on the Company performance but also includes various other factors likeindividual performance experience skill sets industry trend economic situation andfuture growth prospects etc. All these factors are considered for revision ofremuneration.
Ms. Anurradha Prasad Chairperson cum Managing Director constitutes 5.36% of the EBIDTAof the Company Mr. Ajay Jain Chief Financial Officer 1.93% and Mr. Rajeev ParasharCompany Secretary 1.93% of the EBIDTA.
vii) a) Variations in the market capitalization of the Company : The marketcapitalization as on March 31 2016 was Rs.7900.96 Lacs (Rs. 5182.82 Lacs as on March 312015)
b) Percent increase over/ decrease in the market quotations of the shares of thecompany as compared to the rate at which the company came out with the last public offerin the year: The Company had come out with initial public offer (IPO) in 2003 An amount ofRs 10 (face value Rs. 2 at a premium of Rs. 8) invested in the said IPO would be worth Rs4.20 as on March 31 2016 indicating a Compounded Annual Growth Rate of -6.01%.
viii) Average percentage increase made in the salaries of employees other than themanagerial personnel in the last financial year i.e. 2015-16 was zero whereas the decreasein the managerial remuneration for the same financial year was 16.67%.
ix) The key parameters for the variable component of remuneration availed by theDirectors. Not Applicable;
x) The ratio of the remuneration of the highest paid director to that of the employeeswho are not directors but receive remuneration in excess of the highest paid directorduring the year - Not Applicable; and
xi) It is hereby affirmed that the remuneration paid is as per the Remuneration Policyfor Directors Key Managerial Personnel and senior management.