The Directors have the pleasure in presenting the Annual Report and Audited Accounts ofthe Company for the year ended on March 31 2019
The summarized standalone financial performance of the Company for the financial yearendedMarch 31 2019 as compared to previous year was as under::
| || ||Standalone (Amount in Rs.) |
|PARTICULARS ||Year ended March 31 2019 ||Year ended March 31 2018 |
|Revenue from Operations ||397560652.20 ||421571329.18 |
|Other Income ||31870449.02 ||31853153.78 |
|Total Income ||429431101.22 ||453424482.96 |
|Profit before Interest Depreciation Prior ||42544496.54 ||39805032.10 |
|Period Items and Tax (PBIDTA) || || |
|Less: Finance Costs ||14964841.10 ||13349813.15 |
|Less: Depreciation and Amortization ||16334044.01 ||14224099.62 |
|Profit before Exceptional/ Prior Period Items and Tax ||11245611.33 ||12231119.33 |
|Less: Exceptional/ Prior Period Items (Net) ||0.00 ||0.00 |
|Profit Before Taxes (PBT) ||11245611.33 ||12231119.339139 |
|Less: Tax Expense (Net) ||6279328.00 ||116.00 |
|Profit for the year (PAT) ||4966283.33 ||3092003.33 |
In the year under review the turnover of the company has decreased to Rs.397560652.20 in financial year 2018-19 as compared to Rs. 421571329.18 in financialyear 2017-18 due to Decrease in Exports of Leather Footwear. Operating Profit hasincreased to Rs. 4966283.33 in financial year 2018-19 as compared to Rs. 3092003.33 infinancial year 2017-18.
The management continues to pursue its efforts to improve its operational efficiency bybetter Capacity Utilisation and diversification into High quality value added exportquality footwear to improve its Turnover and Operating margin in current year. Outlook forcurrent year will be better barring any unforeseen circumstances.
There is no change in nature of business of the Company during the Financial Year underreview.
Your Directors regret their inability to recommend dividend in order to conserveresources for future growth.
TRANSFER TO RESERVES
During the year under review there is no transfer to the General Reserves (StatutoryReserve).
COMPANIES POLICY ON DIRECTORS APPOINTMENT AND REMUNEARTION:
The company has made its own selection process viz a viz for executive and nonexecutive directors. Nomination and Remuneration Committee has checked out all the normsas provide in section 149 (6) of
Companies Act 2013 for selection and appointment of Independent Directors in companyto ensure that the thoughts of such director are not biased at all. All the directors whohave been appointed as independent director in company are well competent since they areworking in the company for a very long period. The company follows proper mechanism forthe remuneration paid to the directors as per the recommendation made by the Nominationand Remuneration committee after observing their comments.
MATERIAL CHANGES AND COMMITMENTS IF ANY AFFECTING THE FINANCIAL POSITION:
The company would like to inform that no material changes and commitments affecting thefinancial position of the company have occurred during the period from the end offinancial Year till the date of this report.
PARTICULARS OF LOANS GUARANTEES & INVESTMENTS:
The Company has not granted any secured or unsecured loans from /to companies firms orother parties listed in the register maintained under section 189 of the act CompaniesAct 2013 dealing with any loan investments and /or guarantee.
LEGAL FRAMEWORK AND REPORTING STRUCTURE:
The Company would like to inform that a legal compliance tool has been installedvertically within the organization for monitoring and complying all laws applicable to theCompany. This tool is being overseen and supervised by the office of the Chief FinancialOfficer. Further the Chief Financial Officer has also been cast the responsibility ofproviding a compliance certificate at every Board meeting including the keynon-compliances during the quarter.
CSR Activities are not applicable to the company. Since the Company does not meet thecriteria as defined under section 135 of Companies Act 2013 and the rules madethereunder.
CONSERVATION OF ENERGY TECHNOLOGYABSORPTION AND FOREIGN EXCHANGEEARNINGS AND OUTGO
As required Under Section 134(3) (m) of the Companies Act 2013 read with the Companies(Disclosure of particulars in the report of the Board of Directors) Rules 88 and Rule 8(3) of Companies (Accounts) Rules 14 and forming part of the report of the Directors.(Annexure-1)
COMMITTEES TO THE BOARD:
The Company has several Committees which have been established in Compliance with therequirements of the relevant provisions of applicable laws and statutes. The Company hasfollowing Committees of the Board:
? Audit Committee
? Nomination & Remuneration Committee
? Share transfer & Shareholder's Grievance Committee
(i)MEETINGS OF THE BOARD:
Seven meetings of the Board of Directors were held during the year. For furtherdetails please see report on corporate governance.
|S. Date of ||Attendance of the Directors |
|No. Board Meeting ||ASLAM SAEED ||JAVED IQBAL ||SAMEENA ASAD IRAQI ||OSAMA ANWAR ||RAJ KRISHNA AGRAWAL |
|1 30-04-2018 || || || || || |
|2 05-07-2018 || || || || || |
|3 21-08-2018 || || || || || |
|4 12-10-2018 || || || || || |
|5 15-12-2018 || || || || || |
|6 31-03-2019 || || ||X || || |
The Audit Committee consists of Mr. AslamSaeed Mr. JavedIqbaland Mr. Raj KrishnaAgarwalall being Non Executive Directors. The broad terms of reference to the AuditCommittee include reviewing with management the quarterly and annual financial results/statements financial or risk management policies adequacy of internal control systemsand internal audit functions overseeing of the Company's financial reporting processrecommending the appointment and removal of auditors etc.
|S. Date of || |
Attendance of the Directors
|No. Committee Meeting ||AslamSaeed ||JavedIqbal ||Raj Krishna Agarwal |
|1 30-05-2018 || || || |
|2 08-08-2018 || || || |
|3 14-11-2018 || || || |
|4 14-02-2019 || ||x || |
(iii) SHARE TRANSFER AND SHAREHOLDER'S GREIVANCE COMMITTEE:
The Share transfer & Shareholder's Grievance Committee was constituted tospecifically look into Share Transfers and redressal of investor's complaints relating totransfer of shares non-receipt of balance sheet non-receipt of declared dividends etc.under the Chairmanship of Mr. AslamSaeed who is independent non-executive Director. Theother members of the Committee are Mrs. SameenaAsad Iraqi Whole-time Director and Mr.JavedIqbal Director of the company.
|1. No. of Complaints received from Investors from 01.04.16 to 31.03.17 ||ZERO |
|2. No. of solved to the satisfaction of the Shareholders ||ZERO |
|3. No. of pending share transfers ||NIL |
During the financial year the SHARE TRANSFER AND SHAREHOLDER'S GREIVANCE COMMITTEE MetOn:
|S. Date of || |
Attendance of the Directors
|No. Committee Meeting ||AslamSaeed ||SameenaAsad Iraqi ||JavedIqbal |
|1 13-04-2018 || || || |
|2 12-07-2018 || || || |
|3 13-10-2018 || ||x || |
|4 14-01-2019 || ||x || |
|5 30-03-2019 || ||x || |
(iii) NOMINATION AND REMUNERATION COMMITTEE
In compliance with section 178 of the Act and of the Listing Agreement the Board hasconstituted "Nomination and Remuneration Committee" which comprises Mr.AslamSaeed Mr. JavedIqbal and Mr. Raj Krishna Agarwal all being Non ExecutiveDirectors. During the year under review One meeting of the Committee has been held
The Board has framed a policy for selection and appointment of Directors SeniorManagement and their remuneration.
|S. Date of || |
Attendance of the Directors
|No. Committee Meeting ||AslamSaeed ||JavedIqbal ||Raj Agarwal ||Krishna |
|1 30-06-2018 || || || || |
(ii)ESTABLISHMENT OF VIGIL / WHISTLE BLOWER MECHANISM:-
The Company promotes ethical behavior in all its business activities and in line withthe best practices for corporate governance. It has established a system through whichdirectors & employees may report breach of code of conduct unethical businesspractices illegality fraud and corruption etc at work place without fear of reprisal.The functioning of the Vigil mechanism is reviewed by the Audit Committee from time totime. None of the Whistle Blowers have been denied access to the Audit Committee of theBoard. The details of the Whistle Blower Policy are explained in the Report on CorporateGovernance and also available on the website of the company.
The company has established a whistle blower mechanism for the directors and employeesto report concerns about unethical behavior actual or suspected fraud or violation of thecompany's code of conduct or ethics policy. During the Financial Year 2018-19 there was nocomplaint reported by any Director or employee of the company under this mechanism
(iv) EXTRACT OF ANNUAL RETURN:-
Pursuant to sub-section 3(a) of Section 134 and sub-section (3) of Section 92 of theCompanies Act 2013 read with Rule 12 of the Companies (Management and Administration)Rules 2014 the extracts of the Annual Return in MGT-9 as at March 31 2019is notapplicable as Per Companies (Amendment) Act 2017
AUDITORS & AUDITORS' REPORT: (a) Statutory Auditors & Audit Report:
In terms of the provisions of Section 139 of the Companies Act 2013 read withprovisions of theCompanies (Audit and Auditors) Rules 2014 asamended M/s.JaiswalMisra& CO. Chartered Accountants Kanpurwas appointed as the Auditors of theCompany fora consecutive period of five years from conclusionof the AGM held on September30 2015 untilconclusion of the AGM of your Companyscheduled to be held in the year2020.The Members may note that consequent to thechanges made in the Companies Act 2013and theCompanies (Audit and Auditors) Rules 2014 by theMinistry of Corporate Affairs(MCA) vide notificationdated May 7 2018 the proviso to Section 139(1) ofthe CompaniesAct 2013 read with explanation tosub-rule 7 of Rule 3 of the Companies (AuditandAuditors) Rules 2014 the requirement of ratificationof appointment of Auditors by theMembers atevery AGM has been done away with. Thereforethe Company is not seeking anyratificationof appointment of M/s. JaiswalMisra& CO. Chartered Accountants Kanpurasthe Auditors of the Company bythe Members at the ensuing AGM.Your Company has received acertificate from M/s. JaiswalMisra& CO. Chartered Accountants Kanpurconfirmingtheireligibility to continue as Auditors of theCompany in terms of the provisions of Section141of the Companies Act 2013 and the Rules framedthereunder. They have also confirmedthat theyhold a valid certificate issued by the Peer ReviewBoard of the ICAI as requiredunder the provisionsof Regulation 33 of the Listing Regulations.
(b) Secretarial Audit & Secretarial Audit Report:
Pursuant to Section 204 of the Companies Act and The Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Company has appointed M/s T. Jainand AssociatesPracticing Company Secretary as secretarial auditor for conductingSecretarial Audit for all applicable laws for the Financial Year 2019.The Report of theSecretarial Audit Report to be set out in Annexure-3 to the Director's Report.
There was no observation made by the secretarial auditor in his report.
PARTICULARS OF TRANSACTION WITH RELATED PARTIES
The Details of contract or arrangements made with related parties as defined underSection 188 of the Companies Act 2013 during the year under review in Form AOC-2 isannexed with this report as
DECLERATION BY INDEPENDENT DIRECTORS
During the year the Independent directors ofthe Company had no pecuniary relationshiportransactions with the Company other than sitting feesand reimbursement of expensesincurred by them forthe purpose of attending meetings of the Company.Based on thedeclaration(s) of Independent Directorsthe Board of Directors recorded their opinionthatthe Independent Directors are independent of themanagement and have fulfilled theconditions asspecified in the Companies Act 2013 and Rules madethere under as well asconcerning provisions of SEBI(LODR) Regulations 2015.The company has received necessarydeclaration from each independent director under section 148 (7) of the Companies act2013 that he/she meets the criteria of independence laid down in Section 149 (6) of theCompanies act 2013.
DIRECTOR'S RESPONSIBILITY STATEMENT:-
In accordance with the requirements of Section 134(5) of the Companies Act 2013 it ishereby confirmed that:- a) in the preparation of the annual accounts the applicableaccounting standards had been followed along with proper explanation relating to materialdepartures; b) the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are 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 that period; c) the directorshad taken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguarding the assets of the company andfor preventing and detecting fraud and other irregularities; d) the directors had preparedthe annual accounts on a going concern basis; e) the directors had laid down internalfinancial controls to be followed by the company and that such internal financial controlsare adequate and were operating effectively; and f) the directors had devised propersystems to ensure compliance with the provisions of all applicable laws and that suchsystems were adequate and operating effectively.
In accordance with Regulation 15 of the SEBI(LODR) Regulations 2015 the CorporateGovernance provisions are not applicable to your Company as the Paid up Equity ShareCapital of the Company is not exceeding Rs. 10 Corers and Net Worth of the Company is notexceeding Rs. 25 Corers as on the last day of previous financial year. AccordinglyCorporate Governance Report Certification from Practicing Company Secretary andCertification from CEO/CFO are not given in Annual Report.
(i) In terms of the provisions of Section 197 (12) of the Companies Act 2013 readwith Rule 5 (2) and (3) of the Companies (Appointment and Remuneration) Rules 2013 asamended the names and other particulars of the employees are not required to be set outin the Directors' Report as none of the employee is drawing the remuneration as prescribedunder Rule 5(2)(i).
In terms of Section 136 of the Companies Act 2013 the Annual Report excluding theaforesaid information is being sent to all the Members of the Company and others entitledthereto. Members who are interested in obtaining such particulars may write to the ChiefFinancial Officer of the Company at its Registered Office.
(ii) The ratio of the remuneration of each director to the median employee'sremuneration and other details in terms of sub-section 12 of Section 197 of the CompaniesAct 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 are not required to be set out in the Director's Report as none ofthe Directors are drawing remuneration owing to the limited profits available in thecompany as detailed in.
No director has been appointed during the financial year 2018-19 Re-appointment
In accordance with provisions of the Act and the Articles of Association of theCompany Mr. AslamSaeed (DIN: 00996483)is liable to retire by rotation and is eligible forre-appointment. The disclosures required pursuant to SEBI Listing Regulations are given inthe Notice of the AGM forming part of the Annual Report. Resolution proposing hisappointment is set-out in the notice calling ensuing AGM
RISK MANAGEMENT POLICY
Pursuant to the requirement of Section 134(3) (n) ofthe Companies Act 2013 theCompany has already inplace a Risk Management Policy which was reviewedby the AuditCommittee and approved by the Boardof Directors of the Company. The Policy provides forarobust Risk Management Framework to identify andassess risks such as operationalstrategic financialsecurity property regulatory reputational and otherrisks and thatthere is an adequate Risk ManagementInfrastructure in place capable of addressing theserisks.Audit Committee of the Company has been entrustedwith responsibility to assist theBoard in the matterswhich are given below:
INTERNAL CONTROL SYSTEM
The Board has adopted policies and procedures forensuring orderly and efficient conductof its business including adherence to the company's policies thesafeguarding of itsassets prevention and detectionof fraud error reporting mechanisms the accuracyandcompleteness of the accounting records and thetimely preparation of reliable financialdisclosures.
INDEPENDENT DIRECTORS MEETING
During the year under review the Independent Directors met to discuss:
-Evaluation of the performance of Non independent Directors & the Board ofDirectors as whole;
-Evaluation of the performance of the Chairman of the Company taking into account theviews of the executive and non-executive directors. -Evaluation of the quality contentand timelines of flow of information between the management and the board that isnecessary for the board to effectively & reasonably perform its duties.
Formal Annual evaluation has been made by the Board of its own Performance and that ofits Committees & Individual Directors during the meeting of Board of Directors and bycommon discussion with concerned persons.
The Directors would like to express their sincere appreciation for the cooperation andassistance received from the Authorities Stock Exchanges Associates Bankers as well asour Shareholders at large during the year under review. The Directors also wish to placeon record their deep sense worker of appreciation for the commitment abilities and hardwork of all executives officers and staff who enabled Company to consistently deliversatisfactory and rewarding performance even in the challenging economic conditions.
|DATE : 04-09-2019 ||By Order of the Board |
|PLACE: KANPUR ||For AKI INDIA LIMITED |
|Regsitered Office: ||SD/- |
|9/6 (11) || |
|AsharfabadJajmau Kanpur- ||[SAMEENA ASAD IRAQI] |
|208010 ||WHOLE-TIME DIRECTOR |