To The Members
Your Directors have pleasure in presenting the 10th Annual Report of yourCompany together with the Audited Statements of Accounts for the year ended March 312015.
| || ||( Rs. in Lac) |
|Financial Results ||Year Ended 31.03.2015 ||Year Ended 31.03.2014 |
| || || |
|Sales / Income from Operations ||50.63 ||2633.75 |
| ||10.88 ||8.94 |
|Less : Provision for Taxation (includes prior || || |
| ||1.52 ||6.27 |
|period tax payments and deferred Tax) || || |
|Less : Extra-Ordinary Items ||3.06 ||0.00 |
| ||6.30 ||2.67 |
| ||17.20 ||14.53 |
|Balance carried forward ||23.50 ||17.20 |
OVERVIEW OF INDIAN ECONOMY
The Economy of India is the seventh-largest in the world by nominal GDP and the thirdlargest by purchasing power parity (PPP). The country is one of the G-20 major economiesa member of BRICS and a developing economy among the top 20 global traders according tothe WTO.
According to the Indian Finance Ministry the annual growth rate of the Indian economyis projected to on April 1 2015 up from 7.2% (201415).
India was the 19th-largest merchandise and the 6th largest services exporter in theworld in 2013; it imported a total of $616.7 billion worth of merchandise and services in2013 as the 12th-largest merchandise and 7th largest services importer. The agriculturalsector is the largest employer in Indias economy but contributes a declining shareof its GDP (13.7% in 2012-13). Its manufacturing industry has held a constant share of itseconomic contribution while the fastest-growing part of the economy has been its servicessector which includes among others the construction telecommunications softwareand information technologies infrastructure tourism education health care traveltrade and banking industries.
OVERALL PERFORMANCE & OUTLOOK
Virtually there were no business activities in Commodities business segment both interm of trading and brokerage. The Company was having a membership of Commodity Exchangenamely National Spot Exchange and all activities in said Exchange has been banned by Courtof Law due to so called scam. Looking to the scenario the Company has opted to be out ofcommodity trading / broking business and
In addition to the Commodity trading business the Company has also opted to be out ofSecurities trading / investments during the year under review and thus source of incomeduring the year was interest income.
Members of the Company as stated in the Notice convening AGM.
Gross Revenue / Income from Operations stood at Rs. 50.63 Lac in comparison to lastyears figure of Rs. 2633.75 Lac. In term of Net Profit the same was of Rs. 6.30 Lac(after considering Tax and Extra Ordinary Items) in comparison to last years netProfit of Rs. 2.67 Lac.
The Outlook for current financial looks extremely challenging looking to its entry innew business and to challenge to establish itself in such new business environment.
DIVIDEND AND RESERVES
Due to inadequate profit during the year and in order to conserve resources for futureyour Directors do not recommends any Dividend for the year under review.
During the year under review Nil amount was transferred to General Reserve.
The paid up Equity Share Capital as on March 31 2015 was Rs. 7.427 Crore. During theyear under review the Company has not issued shares with differential voting rights norgranted stock options nor sweat equity. As on March 31 2015 Apart from Mr. Manish Baidwho is holding 1.40 Lac Shares or 1.885% of Paid-up Capital Mr. I. C. Baid who isholding 1.95 Lac Shares or 2.626% of Paid-up Capital Mr. Samir Baid who is holding 1.95Lac Shares or 2.626% of Paid-up Capital none of others Directors and/or Key ManagerialPerson of the Company holds shares or convertible instruments of the Company.
FINANCE AND ACCOUNTS
Your Company prepares its financial statements in compliance with the requirements theCompanies Act 2013 and the Generally Accepted Accounting Principles (GAAP) in India. Thefinancial statements have been prepared on historical cost basis. The estimates andjudgments relating to the financial statements are made on a prudent basis so as toreflect in a true and fair manner the form and substance of transactions and reasonablypresent the Companys state of affairs profits/(loss) and cash flows for the yearended 31st March 2015.
The Company continues to focus on judicious management of its working capital.Receivables inventories and other working capital parameters were kept under strict checkthrough continuous monitoring.
There is no audit qualification in the standalone financial statements by the statutoryauditors for the year under review.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
Details of Loans Guarantees and Investments if any covered under the provisions ofSection 186 of the Companies Act 2013 are given in the notes to the Financial Statements.
The Company does not have any material subsidiary whose net worth exceeds 20% of theconsolidated net worth of the holding company in the immediately preceding accounting yearor has generated 20% of the consolidated income of the Company during the previousfinancial year. Accordingly a policy on material subsidiaries has not been formulated.
RELATED PARTY TRANSACTIONS
All transactions entered into with Related Parties as defined under the Companies Act2013 and Clause 52 of the SME Listing Agreement during the financial year were in theordinary course of business and on an arms length pricing basis and do not attractthe provisions of Section 188 of the Companies Act
2013 thus disclosure in form AOC-2 is not required. There were no materiallysignificant transactions with related parties during the financial year which were inconflict with the interest of the Company. Suitable disclosure as required by theAccounting Standards (AS18) has been made in the notes to the
Financial Statements. The policy on Related Party Transactions as approved by the Boardis uploaded on the Companys website.
MANAGEMENT DISCUSSION & ANALYSIS
As required by Clause 52 of the SME Listing Agreement the Management Discussion andAnalysis is annexed and forms part of the Directors Report.
There was no change in Management of the Company during the year under review.
During the year Mrs. Amrita Baid was appointed as Managing Director of the Companyw.e.f. 30th September 2014 and Mr. Laxmi Narayan Sharma was appointed asNon-Executive Independent Directors of the Company for the terms of 5 Years up to 17thApril 2020.
Further Mr. Manish Baid and Mr. Alok Kr. Das have resigned from the directorship ofthe Company w.e.f. September 30 2014 and 18th April 2015 respectively due totheir personal commitments.
In accordance with the requirements of the Companies Act 2013 and as per theprovisions of Articles of Association of the Company Mr. Samir Baid is liable to retireby rotation and being eligible offers himself for re-appointment at the ensuing AnnualGeneral Meeting.
Further none of the Directors of the Company are disqualified under sub-section (2) ofSection 164 of the Companies Act 2013.
As per provisions of Section 149 of the 2013 Act independent directors shall holdoffice for a term up to five consecutive years on the board of a company but shall beeligible for re-appointment for another term up to five years on passing of a specialresolution by the company and disclosure of such appointment in Boards Report.Further Section 152 of the Act provides that the independent directors shall not be liableto retire by rotation in the Annual General Meeting (AGM) of the Company.
As per Revised Clause 52 of the Listing Agreement (applicable from October 1 2014)any person who has already served as independent director for five years or more in acompany as on October 1 2014 shall be eligible for appointment on completion of thepresent term for one more term of up to 5 (five) years only.
DETAILS OF DIRECTORS / KMP APPOINTED AND RESIGNED DURING THE YEAR
|Sl. No. ||Name ||Designation ||Date of Appointment ||Date of Resignation |
|1. ||Mr. Manish Baid ||Non Executive Director ||- ||30th Sept 2014 |
|2. ||Ms. Amrita Baid ||Managing Director ||30th Sept 2014 ||- |
|3. ||Mr. Nitish Vyas ||Company Secretary ||- ||1st Sept 2014 |
|4. ||Mr. Manish Kedia ||Company Secretary ||1st Sept 2014 ||- |
|5. ||Mr. Ajay Kr. Sharma ||CFO ||12th Aug 2014 ||- |
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS TRIBUNALS OR COURTS
There are no other significant and material orders passed by the Regulators/Courts thatwould impact the going concern status of the Company and its future operations.
MATERIAL CHANGES AND COMMITMENTS AFFECTING FINANCIAL POSITION BETWEEN THE END OF THEFINANCIAL YEAR AND DATE OF REPORT
There have been no material changes and commitments affecting the financial position ofthe Company between the end of Financial Year and date of the report.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 134(5) of the Companies Act 2013 the Board ofDirectors confirms that:
1. In the preparation of the annual accounts for the year ended 31st March 2015 allthe applicable accounting standards prescribed by the Institute of Chartered Accountantsof India have been followed;
2. The Directors had adopted such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the financial year and of theprofit of the Company for that period;
3. The Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of this Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities; and
4. The Directors had prepared the annual accounts on a going concern basis.
5. Proper internal financial controls were in place and that the financial controlswere adequate and were operating effectively; and
6. Systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
The Company is having membership of Commodity Exchange namely National Spot Exchange.Further the Company is doing investment in commodities via said Exchange as well as doingthe business of Investment in Shares & Securities. The brokerage business on saidExchange is not in operative now due to the freezing of Exchange activities as briefedhere in below.
It is imperative to disclose the fact that the National Spot Exchange the Exchange ofwhich the Company was having membership has been suspended by FMC the Regulatory Bodyfor Commodity Exchange due to alleged violation of Norms & Regulations and after thediscovery of scam on said Exchange. Both EOW and FMC are looking to the matter.
Further members are hereby informed that the Company was having exposure of Rs.1605.49 Lac at the time when the operations of National Spot Exchange have been suspendedby FMC. The case has been filed by both FMC & Investors against National Spot Exchangeto investigate the matter and to get back dues from said Exchange.
Your Company believes that in addition to progressive thought it is imperative toinvest in information and technology to ascertain future exposure and prepare forchallenges. In its endeavor to obtain and deliver the best your Company has tie-ups withan IT solution Company to harness and tap the latest and the best of technology in theworld and deploy/absorb technology wherever feasible relevant and appropriate.
BUSINESS RISK MANAGEMENT
Pursuant to the requirement of Clause 52 of the SME Listing Agreement the Company hasconstituted a Business Risk Management Committee. The details of Committee and its termsof reference are set out in the Corporate Governance Report forming part of theBoards Report.
The Company has a robust Business Risk Management (BRM) framework to identify evaluatebusiness risks and opportunities. This framework seeks to create transparency minimizeadverse impact on the business objectives and enhance the Companys competitiveadvantage. The business risk framework defines the risk management approach across theenterprise at various levels including documentation and reporting. The framework hasdifferent risk models which help in identifying risks trend exposure and potential impactanalysis at a Company level as also separately for business segments viz. Finance andCapital Market activities.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY
The Company has an Internal Control System commensurate with the size scale andcomplexity of its operations. The scope and authority of the Internal Audit (IA) functionis defined in the Internal
Audit Charter. To maintain its objectivity and independence the Internal Auditfunction reports to the Chairman of the Audit Committee of the Board.
The Internal Audit Department monitors and evaluates the efficiency and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies. Based on the report of internal audit function process ownersundertake corrective action in their respective areas and thereby strengthen the controls.Significant audit observations and corrective actions thereon are presented to the AuditCommittee of the Board.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
As required under Rule 7 of The Companies (Meetings of Board and its Powers) Rules2014 the Company has a vigil mechanism named Fraud Risk Management Policy (FRM) to dealwith instance of fraud and mismanagement if any. The detail of the FRM Policy isexplained in the Corporate Governance Report.
RESEARCH & DEVELOPMENT
The Company believes that technological obsolescence is a reality. Only progressiveresearch and development will help us to measure up to future challenges andopportunities. We invest in and encourage continuous innovation. During the year underreview expenditure on research and development is not significant in relation to thenature size of operations of your Company.
The Auditors M/s Bharat D. Sarawgee & Co. Chartered Accountants Kolkata who areStatutory
Auditors of the Company and holds the office until the conclusion of ensuing AnnualGeneral Meeting and are recommended for re-appointment to audit the accounts of theCompany from the conclusion of the 10th Annual General Meeting up to the conclusion of the14th consecutive Annual General Meeting
(subject to ratification by the members at every subsequent AGM). As required under theprovisions of Section 139 & 142 of the Companies Act 2013 the Company has obtainedwritten confirmation from
M/s. Bharat D. Sarawgee & Co. that their appointment if made would be inconformity with the limits specified in the said Section.
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 Khusboo Goenka Company Secretaries in Practice (C.P. No. 8172) to undertakethe Secretarial Audit of the Company. The Report of the Secretarial Audit Report isannexed elsewhere in this Annual Report.
The Company has appointed M/s. Jaiswal Akash & Co. Chartered Accountants Kokata(FRN 328324E) as Internal Auditors of the Company for the current financial year.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form MGT 9 is annexedelsewhere in this Annual Report.
PARTICULARS OF EMPLOYEES
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company will be provided upon request. In terms of Section 136 of the Act theReport and Accounts are being sent to the Members and others entitled thereto excludingthe information on employees particulars which is available for inspection by theMembers at the Registered Office of the Company during business hours on working days ofthe Company up to the date of the ensuing Annual General Meeting. If any Member isinterested in obtaining a copy thereof such Member may write to the Company Secretary inthis regard.
PARTICULARS UNDER SECTION 134 (3) (m) OF THE COMPANIES ACT 2013
Since the Company is into the Business of Commodity Broking as well as an Investee/trader into Shares and Securities; the information regarding conservation of energyTechnology Absorption Adoption and innovation under section 134(3)(m) of the CompaniesAct 2013 read with Rule 8 of The Companies (Accounts) Rules 2014 is reported to beNIL.
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company has not earned or used foreign exchange earnings/outgoings during the yearunder review.
During the year under review your Company has not accepted any deposit from the publicfalling within the ambit of Section 73 of the Companies Act 2013 and The Companies(Acceptance of Deposits) Rules 2014.
REPORT ON CORPORATE GOVERNANCE
The Company conforms to the norms of Corporate Governance as envisaged in the CompaniesAct 2013 and the Listing Agreement with the BSE Limited. Pursuant to Clause 52 of SME ofthe
Listing Agreement a Report on the Corporate Governance and the Auditors Certificate onCorporate
Governance are annexed to this report.
Your Directors wish to place on record their appreciation towards the contribution ofall the employees of the Company and their gratitude to the Companys valuedcustomers bankers vendors and members for their continued support and confidence in theCompany.
|Place: Kolkata ||By order of the Board |
|Date: May 28 2015 ||For GCM COMMODITY & DERIVATIVES LIMITED |
|Registered Office : ||I. C. BAID |
|3B Lal Bazar Street Sir R N M House ||(DIN : 00235263) |
|5th Floor Kolkata 700001 West Bengal ||Chairman |