The Members of DOLPHIN MEDICAL SERVICES LIMITED
Your Directors hereby present the 25th Annual Report and Accounts of theCompany for the year ended 31st March 2017.
FINANCIAL RESULTS :
|Particulars ||2016-17 ||2015-16 |
|Operating Income ||35.13 ||56.69 |
|Other Income ||10.69 ||14.99 |
|Profit / (Loss) before Tax ||(30.17) ||(6.93) |
|Deferred Tax ||(3.43) ||(2.30) |
|Profit / (Loss) after Tax ||(26.74) ||(4.63) |
Discussion on Financial Performance:
During the year under consideration the Company got a loss of Rs.30.17 Lakhs before Taxas against loss of Rs.6.93 Lakhs during the previous year.
Management Discussion and Analysis
As mentioned in our earlier AGM Canara Bank has assigned its rights on the loanfavoring Edelweiss Asset Reconstruction Company Ltd. (EARC). The EARC has granted aNegotiated Settlement (NS) of dues at a total consideration of Rs.250.00 lakhs payable ininstallments specified therein. In terms of the NS the company has paid an amount ofRs.25.00 lakhs as upfront payment. After this the company has also paid some interest onthe due payments. Now that the company is in financial stress the company could not payfurther amounts to Edelweiss ARC and a part of the land at Deshmukh Village was soldtowards approximating to the said liability. The company is in further negotiations withEdelweiss ARC for closure of the account once for all. Efforts are also being made to addfinancial inflows and investments to the company by way of roping in new investors andalso looking at other ways and means of improving the financial strength of the company.To achieve this the company is also open to adding new lines of activity which may alsointurn lead to the turn around of the company. Few directors were also added to strengthenthe company.
The Following is the Financial Performance of your Company: (Rs. in Lakhs)
| ||2016-17 ||2015-16 ||Inc/(Dec) % |
|Income: || || || |
|Operations ||35.13 ||56.69 ||(38.03) |
|Other Income ||10.69 ||14.99 ||(28.69) |
|Total : ||45.82 ||71.68 ||(36.08) |
|Expenditure: || || || |
|Material Consumed ||8.23 ||17.05 ||(51.73) |
|Staff Cost ||3.77 ||3.90 ||(3.33) |
|Other Expenses ||30.56 ||24.09 ||26.86 |
|Depreciation ||33.43 ||33.57 ||(0.42) |
|Total : ||75.99 ||78.61 ||(3.33) |
|Profit/(Loss) ||(30.17) ||(6.93) ||335.35 |
Material changes and commitments if any affecting the financial position of the Companyoccurred between the end of the financial year to which this Financial Statements relateand the date of the report
There have been no material changes and commitments affecting the financial positionof the Company which occurred during between the end of the financial year to which thefinancial statements relate and the date of this report.
Details of significant and material orders passed by the regulators/ courts/ tribunalsimpacting the going concern status and the Company's operations in future
There are no significant material orders passed by the Regulators/ Courts which wouldimpact the going concern status of the Company and its future operations except the onementioned in detail in the Management Discussion. Share Capital:
Authorized Share Capital: During the year under review there was no change inauthorized share capital of the Company. Authorized share capital of the company as onMarch 31 2017 was Rs.250000000/- comprising of 25000000 equity shares of Rs.10.00each.
Paid-up Share Capital: During the year under review there was no change in paid upshare capital of the Company. Paid up share capital of the company as on March 31 2017was Rs.150999520/- comprising of 15099952 equity shares of Rs.10.00 each.
Your Directors have not recommended any dividend on Equity Shares for the year underreview.
Transfers to Reserves
Your Board of Directors does not appropriate any amount to be transferred to GeneralReserves during the year under review.
Revision of Financial Statements
There was no revision of the financial statements for the year under review.
During the year under review your Company has not accepted any fixed deposits withinthe meaning of Section 73 of the Companies Act 2013 read with rules made there under.
Subsidiaries Joint Ventures and Associate Companies The Company has no subsidiarycompanies.
Particulars of Contracts & Arrangements with Related Parties
There was no contract or arrangements made with related parties as defined underSection 188 of the Companies Act 2013 during the year under review.
Particulars of Loans Guarantees or Investments
Pursuant to section 186 of Companies Act 2013 and Schedule V of the Securities andExchange Board of India (Listing Obligations and Disclosure Requirements) Regulations2015 ("Listing Regulations")the Company neither has directly or indirectlygiven any loan to its Directors nor extended any guarantee or provided any security inconnection with any loan taken by them. Further the Company has neither given anyinter-corporate loan / advance nor made any investments in other companies during thefinancial year 2016-17.
Number of Board Meetings held
A calendar of Meetings is prepared and circulated in advance to the Directors. Duringthe year Six Board Meetings were convened. The details of which are given in the CorporateGovernance Report. The maximum interval between any two meetings did not exceed 120 daysas prescribed in the Companies Act 2013 and Secretarial Standard-1
Directors and Key Managerial Personnel
During the year Mr. Nanapaneni Buddha Sagar Mrs. Madala Sesha Ratnam Mr. TurlapatiSeshu Kumar and Mrs. Turlapati Padmasri were appointed as Additional Directors w.e.f.04.12.2017. Now the Board proposes to appoint them as Directors of the company.
The Board recommends the appointment of Mr. Nanapaneni Buddha Sagar Mrs. Madala SeshaRatnam Mr. Turlapati Seshu Kumar and Mrs. Turlapati Padmasri. Items seeking your approvalon the above are included in the Notice convening the AGM.
Based on the confirmations received from Directors none of the Directors aredisqualified from appointment under Section 164 of the Companies Act 2013.
Apart that there was no other appointment or cessation of appointment of key managerialpersonnel during the financial year.
Declaration by Independent Directors
The Independent Directors of the Company have submitted their declarations as requiredunder Section 149(7) of the Companies Act 2013 stating that they meet the criteria ofindependence as per sub-section (6) of Section 149 of the Act.
Familiarization programme for Independent Directors
The Company proactively keeps its Directors informed of the activities of the Companyits management and operations and provides an overall industry perspective as well asissues being faced by the industry.
Independent Directors' Meeting
The Independent Directors met on 14.02.2017 without the attendance of Non-IndependentDirectors and members of the Management. The Independent Directors reviewed theperformance of Non-Independent Directors and the Board as a whole; the performance of theChairman of the Company taking into account the views of Executive Director andNon-Executive Directors and assessed the quality quantity and timeliness of flow ofinformation between the Company Management and the Board that is necessary for the Boardto effectively and reasonably perform their duties.
The Board adopted a formal mechanism for evaluating its performance as well as that ofits Committees and individual Directors including the Chairman of the Board. The exercisewas carried out through a structured evaluation process covering various aspects of theBoard functioning such as composition of the Board & committees experience &competencies performance of specific duties & obligations contribution at themeetings and otherwise independent judgment governance issues etc.
Internal Financial control system and their adequacy:
The Board of your Company has laid down internal fi-nancial controls which comply withthe provisions of the Companies Act 2013 and Listing Regulation with Stock Exchange andthat such internal -financial controls are adequate and operating effectively. YourCompany has adopted policies and procedures for ensuring the orderly and efficient conductof its business including adherence to the Company's policies 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.
Directors Responsibility Statement as required under Section 134(5) of the CompaniesAct 2013:
Pursuant to the provisions of Section 134(5) of the Companies Act 2013 the Board ofDirectors states that:
(a) In the preparation of annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
(b) They have selected such accounting policies and applied them consistently and madejudgments and estimates that are reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financial year and of the profitand loss for that period;
(c) They have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) They have prepared the annual accounts on a going concern basis;
(e) They have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively and
(f) They have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.
Nomination and Remuneration policy
In compliance to the provisions of Section 178 of the Companies Act 2013 andRegulation 19 of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015the Nomination and Remuneration Committee has recommended to the Board a Nomination andRemuneration policy with respect to appointment / nomination and remuneration payable forthe Directors Key Managerial Personnel and senior level employees of the Company. Thesaid policy has been adopted by the Board and the same was discussed in the CorporateGovernance Report. We affirm that the remuneration paid to the directors is as per theterms laid out in the nomination and remuneration policy of the Company.
Goods and Services Tax (GST)
The introduction of Goods and Services Tax (GST) is a very significant step in thefield of indirect tax reforms in India. By amalgamating a large number of Central andState taxes into a single tax it would mitigate cascading or double taxation in a majorway and pave the way for a common national market. Not Applicable to this company.
Indian Accounting Standards
The Ministry of Corporate Affairs vide its notification dated 16th February 2015 hasnotified the Companies (Indian Accounting Standards) Rules 2015. In pursuance of the saidnotification the Company will adopt Indian Accounting Standards with effect from 01stApril 2017. The implementation of Indian Accounting Standards (IAS) is a major changeprocess for which the Company has set up a dedicated team and is providing desiredresources for its completion within the time frame. The impact of the change on adoptionof said IAS is being assessed.
M/s. Pinnamaneni & Co Chartered Accountants the Company's auditors term officewill conclude with this Annual General Meeting. They have expressed willingness to acceptthe assignment for a further period of Five years as per the Companies Act 2013. Theyhave also confirmed their eligibility for such an appointment under Section 139 of theCompanies Act 2013. The Board recommends the firms re-appointment as Company's auditors.Qualification by Statutory Auditor
There were no qualifications reservations or adverse remarks made by the Auditors intheir report.
Pursuant to the provisions of Section 204 of the Act and the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 the Board of Directors has appointedMr. Bharatiraju Vegiraju Practicing Company Secretariey for conducting Secretarial Auditof the Company for the financial year 2016-2017. The Secretarial Audit Report is annexedherewith as Annexure - I.
Qualification by Secretarial Auditor
The Secretarial Auditor's Report does not contain any qualifications reservation oradverse remarks except non compliance of Section 203 of the Companies Act 2013 andRegulation 6 of the Listing Regulation 2015 entered with Stock Exchange(s) in respect ofappointment of Company Secretary as Key Managerial Person.
In complying with the provisions of Section 203 of the Companies Act 2013 regardingappointment of Company Secretary the Board has made utmost effort for appointment of theCompany Secretary as Key Managerial Person but has not been able to appoint a Companysecretary due to lack of suitability of the candidate to the profile of the Company interms of Job profile and remuneration.
In pursuance of Section 138 of the Companies Act 2013 read with rules made thereunder the Board has appointed Dr. M Lakshmi Sudha CFO of the Company as InternalAuditors of the Company to carry out internal auditing of books of accounts periodically.
All properties and insurable interests of the Company not insured at the reinstatementvalues.
Industrial relations continued to be cordial throughout the year under review VigilMechanism / Whistle Blower Policy
Pursuant to Section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies(Meetings of Board and its Powers) Rules 2014 and Regulation 22 of the ListingRegulation 2015 the Board has adopted Whistle Blower Policy. This policy aims forconducting the affairs in a fair and transparent manner by adopting highest standards ofprofessionalism honesty integrity and ethical behavior.
A mechanism has been established for employees to report concerns about unethicalbehavior actual or suspected fraud or violation of Code of Conduct and Ethics. The policyalso provided adequate safeguards against the victimization of employees who avail of themechanism and allows direct access to the Chairman of the Audit Committee in exceptionalcases.
Your Company hereby affirms that during the year no Director / employee have beendenied access to the Chairman of the Audit Committee and that no complaints were receivedManagement Discussion and Analysis
In terms of the provisions of Regulation 34 of the Securities and Exchange Board ofIndia (Listing Obligations and Disclosure Requirements) Regulations 2015 the ManagementDiscussion and Analysis given above discusses the key issues concerning the business andcarried on by the Company.
Management of Risks
There is considerable pressure to keep up the realization from the services in view ofhighly competitive market. Audit Committee
The Composition of the Audit Committee is provided in the Corporate Governance Reportforming part of this report. All the recommendations made by the Audit Committee wereaccepted by the Board.
The Risk Management Committee duly constituted by the Board had formulated a RiskManagement Policy for dealing with different kinds of risks attributable to the operationsof the Company. Risk Management Policy of the Company outlines different kinds of risksand risk mitigating measures to be adopted by the Board. The Company has adequate internalcontrol systems and procedures to combat the risk. The Risk Management procedure will bereviewed periodically by the Audit Committee and the Board.
Corporate Social Responsibility (CSR) Initiatives:
Section 135 of the Companies Act 2013 provides the threshold limit for applicabilityof the CSR to a Company ie. (a) network of the Company to be 500 crore or more; or(b) turnover of the company to be 1000 crore or more; or (c) net profit of thecompany to be 5 crore or more. As the Company does not fall under any of thethreshold limits given above the provisions of section 135 are not applicable to theCompany.
Extract of Annual Return
In accordance with the provisions of Section 134(3(a) of the Companies Act 2013 anextract of the Annual Return in Form MGT-9 is appended as Annexure - II to the Board'sReport.
Information on Conservation of Energy Technology Absorption & Foreign ExchangeEarnings and outgo
Pursuant to the provisions of Section 134 (3) (m) of the Companies Act 2013 read withRule 3 of Companies (Accounts) Rules 2014 the relevant information pertaining toconservation of energy technology absorption foreign exchange earnings and outgo isappended hereto as Annexure - III and forms part of the Board's Report. Company's Policyon Prohibition Prevention and Redressal of Sexual Harassment of Women at Workplace
The Company prohibits any form of sexual harassment and any such incidence isimmediately investigated and appropriate action taken in the matter against the offendingemployee(s) based on the nature and the seriousness of the offence. The Company has apolicy on Prohibition Prevention and Redressal of Sexual Harassment of Women at Workplace(the Policy) and matters connected therewith or incidental thereto covering all theaspects as contained under the "The Sexual Harassment of Women at Workplace(Prohibition Prevention and Redressal) Act 2013" notified by the Government ofIndia vide Gazette Notification dated 23rd April 2013.
There was no case of sexual harassment reported during the year under review.
Disclosure about Cost Audit
Cost Audit is not applicable to your Company.
Remuneration ratio of the Directors / Key Managerial Personnel (KMP) / Employees:
The information required under Section 197 of the Companies Act 2013 read with rule5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are provided in separate annexure forming part of this Report as Annexure - IV.
There were no employee in the company throughout the financial year who were in receiptof remuneration of Rs.102 lacs or more employees employed for part of the year and inreceipt of Rs.8.50 lac or more per month. Hence the provisions of Rule 5(2) The Companies(Appointment and Remuneration of Managerial Personnel) Rules
2014 are not applicable.
The Company is committed to good corporate governance in line with the ListingAgreement (up to 30th November 2015) and Schedule V of Listing Regulations(with effect from 1st December 2015) and Provisions Rules and Regulations ofthe Companies Act 2013. The Company is in compliance with the provisions on corporategovernance specified in the Listing Agreement with BSE. The certificate dated 04.12.2017was obtained from Mr. P.V.V.Satyanarayana Partner Pinnamaneni & Co. CharteredAccountants and the report on Corporate Governance form part of this Directors' Report asAnnexure - V.
Disclosures as per the Listing Agreement & SEBI Regulations Cash flow statement
In due compliance of the listing agreements and in accordance with the requirementsprescribed by SEBI the cash flow statement is prepared and is appended to this AnnualReport.
Company's equity shares are listed in the Bombay Stock Exchange Limited.
There is an outstanding Listing Fee of Rs.528220/- to Bombay Stock Exchange Ltd.
Share transfer agency
The Company has appointed M/s XL Softech Systems Ltd #3 Sagar Society Road No.2Banjarahills Hyderabad - 500034 as its share transfer agency for handling both physicaland electronic transfers.
The Securities and Exchange Board of India (SEBI) on September 2 2015 issued SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 with the aim toconsolidate and streamline the provisions of the Listing Agreement for different segmentsof capital markets to ensure better enforceability. The said regulations were effective 1stDecember 2015. Accordingly all listed entities were required to enter into the ListingAgreement within six months from the effective date. The Company entered into ListingAgreement with BSE Limited during December 2015
We seek to promote and follow the highest level of ethical standards in all ourbusiness transactions guided by our value system. The SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 mandated the formulation of certain policiesfor all listed companies. The policies are reviewed periodically by the Board and updatedbased on need and new compliance requirement.
i) Whistleblower Policy (Policy on vigil mechanism)
The Company has adopted the whistleblower mechanism for directors and employees toreport concerns about unethical behavior actual or suspected fraud or violation of theCompany's code of conduct and ethics. There has been no change to the Whistleblower Policyadopted by the Company during fiscal 2017.
ii) Policy for Determining Materiality for Disclosures
This policy applies to disclosures of material events affecting Dolphin MedicalServices Limited. This policy is in addition to the Company's corporate policy statementon investor relations which deals with the dissemination of unpublished price-sensitiveinformation.
iii) Policy on Document Retention
The policy deals with the retention and preservation of corporate records of theCompany Code of conduct
The Company has adopted Code of Conduct for the Board and for the Senior levelemployees of the Company and they are complying with the said code. A declaration by theDirector to this effect is furnished to the Board's Report. Director and CFO Certification
The Director and CFO certification of the financial statements for the year 2016-17 isprovided elsewhere in this Annual Report.
Your Company treats its "human resources" as one of its most importantassets. Your Company continuously invests in attraction retention and development oftalent on an ongoing basis. A number of programs that provide focused people attention arecurrently underway. Your Company thrust is on the promotion of talent internally throughjob rotation and job enlargement.
Awards and recognition
The Company has not received any award during the Financial Year.
Statements in these reports describing company's projections statements expectationsand hopes are forward looking. Though these expectations etc are based on reasonableassumption the actual results might differ.
Event Based Disclosures
During the year under review the Company has not taken up any of the followingactivities:
a) Issue of sweat equity share: The Company has not issued any sweat equity sharesduring the year under review and hence no information as per provisions of Section54(1)(d) of the Act read with Rule 8(13) of the Companies (Share Capital and Debenture)Rules 2014.
b) Issue of shares with differential rights: The Company has not issued any shares withdifferential rights and hence no information as per provisions of Section 43(a)(ii) of theAct read with Rule 4(4) of the Companies (Share Capital and Debenture) Rules 2014.
c) Issue of shares under employee's stock option scheme: The Company has not issued anyequity shares under Employees Stock Option Scheme during the year under review and henceno information as per provisions of Section 62(1)(b) of the Act read with Rule 12(9) ofthe Companies (Share Capital and Debenture) Rules 2014.
d) Non- Exercising of voting rights : During the year under review there were noinstances of non-exercising of voting rights in respect of shares purchased directly byemployees under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) ofCompanies (Share Capital and Debentures) Rules 2014.
e) Disclosure on purchase by company or giving of loans by it for purchase of itsshares:
The Company did not purchase or give any loans for purchase of its shares.
f) Buy back shares: The Company did not buy-back any shares during the period underreview.
g) Disclosure about revision: Since the company did not undergo any revision thisclause is Not Applicable to the company for the period under review.
h) Preferential Allotment of Shares: The Company did not allot any shares onpreferential basis during the period under review.
The Directors wish to place on record their gratitude to shareholders and thank thecustomers vendors bankers host of other State and Central Government DepartmentsSecurity Exchange Board of India and Stock Exchanges at Mumbai and others for theircontinued support to the Company's growth. The Directors also wish to place on recordtheir appreciation for the contribution made by the employees at all levels for theirsincerity hard work solidarity and dedicated support to the Company.
| ||For and on behalf of the Board of Directors of |
|Date : 04.12.2017 ||DOLPHIN MEDICAL SERVICES LIMITED |
| ||Sd/- |
|Place: Hyderabad ||NARENDRA SEENA KARKERA |
| ||DIRECTOR |