The Directors are pleased to present Twenty Fifth Annual Report together with theAudited Accounts of the Company for the year ended 31st March 2019.
The financial results of the company are summarized as below:
| ||(` in lacs) ||(` in lacs) |
| ||Year Ended 31/03/2019 ||Year Ended 31/03/2018 |
|Income ||45.60 ||45.03 |
|Profit/(Loss) before tax ||4.54 ||6.35 |
|Profit after Tax and adjustments ||3.31 ||4.69 |
|Balance carried to Balance Sheet ||3.31 ||4.69 |
REVIEW OF OPERATIONS
During the FY 2019 your company has earned a net profit of 3.31 lacs after taking intoaccount tax provision as against 4.69 lacs during FY 2018.
In view of inadequate profits the Board of Directors is not in a position to recommendany dividend for the year.
No amount is proposed for transfer to the General Reserve Account during the financialyear 2019.
SUBSIDIARY COMPANY AND CONSOLIDATED FINANCIAL STATEMENT
The Company does not have any subsidiary company hence the requirement of consolidatedfinancial statement pursuant to Section 133 of the Companies Act 2013 read with Rule 7 ofthe Companies (Accounts) Rules 2014 is not applicable.
CORPORATE SOCIAL RESPONSIBILITY
The Company does not fall under the preview of the Section 135 of the Companies Act2013.
The Company being a Non-Deposit Accepting Non-Banking Finance Company has not acceptedany deposits from the public during the year under review and shall not accept anydeposits from the public without obtaining prior approval of the Reserve Bank of India(RBI).
The Company is operating with its own limited resources. As the Financial market isfacing lot of challenges interest rates are constantly changing recoveries have becomemajor concern therefore survival of small NBFC with limited resource
. In the present scenario and based on the present business model the growth potentialin its business is becoming difficult is limited.
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of Section 152 of the Companies Act 2013 and theArticles of Association of the Company Mr. Beni Prasad Rauka retires by rotation at theensuing Annual General Meeting and offers himself for reappointment. Mr. Anand Bagwe hasexpressed inability for appointment as independent director of the Company for second termand accordingly his resignation accepted by the Board of Directors of the Company on 10thAugust 2019 and Mr. Dinesh Babel Chartered Accountant an Independent Director appointedas additional director of the Company and will hold office ensuing Annual General Meetingand proposed to be appointed as Independent Director for a term of 5 years. Mr. VinodKumar Sharma is being appointed as Independent Director for second term of 5 years..
DECLARATION BY INDEPENDENT DIRECTOR(S)
The Independent Directors of your Company have given the certificate of independence toyour Company stating that they meet the criteria of independence as mentioned underSection 149(6) of the Companies Act 2013.
FORMAL ANNUAL PERFORMANCE EVALUATION AND FAMILIARIZATION PROGRAM
The details of training and familiarization programmes and Annual Board Evaluationprocess for Directors have been provided under the Corporate Governance Report.
The policy on Director's appointment and remuneration including criteria fordetermining qualifications positive attributes independence of Director and alsoremuneration for Key Managerial Personnel and other employees forms part of CorporateGovernance Report of this Annual Report.
On appointment the concerned Director is issued a Letter of Appointment setting out indetail the terms of appointment duties responsibilities and expected time commitments.The details of program for familiarization of Independent Directors with the Companytheir roles rights responsibilities in the Company and related matters are put up on thewebsite of the Company at link:http://www.indergiri.com/images/policies/Familiarsation_Progrrame_for_Independent_Director.pdf
NOMINATION AND REMUNERATION POLICY
The Nomination and Remuneration Committee comprises Mr. Anand Bagwe as the Chairman andMr. Beni Prasad Rauka Mr. Kishan Sharma and Mr. Vinod Kumar Sharma as members of theCommittee. In terms of Section 178(1) of the Companies Act 2013 and Regulation 19 ofListing Regulations the Nomination and Remuneration Committee should comprise of at leastthree Directors; all of whom should be Non-Executive Directors. At least half of theCommittee members should be Independent with an Independent Director acting as theChairman of the Committee.
The Nomination and remuneration policy of the Board has provided as "AnnexureC" to this Report.
NUMBER OF MEETINGS OF THE BOARD
Five meetings of the board were held during the year.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that:
a) in the preparation of the annual accounts for the year ended 31st March2019 the applicable accounting standards have been followed and that no materialdepartures have been made from the same;
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 fairview of the state of affairs of the Company at the end of the financial year and of theprofits of the Company for that period;
c) they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities;
d) they have prepared the annual accounts on a going concern basis;
e) they have laid down internal financial controls for the Company and such internalfinancial controls are adequate and operating effectively; and
f) they have devised proper systems to ensure compliance with the provisions of allapplicable laws and such systems are adequate and operating effectively.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
The Company as part of the vigil mechanism' has in place a Whistle BlowerPolicy' to deal with instances of fraud and mismanagement if any. The Whistle BlowerPolicy has been approved by the Board at its meeting held on 31st May 2014 and has beenplaced on the website of the Company.
This vigil mechanism of the Company is overseen by the Audit Committee and providesadequate safeguard against victimization of employees and directors who avail of the vigilmechanism and also provide direct access to the Chairperson of the Audit Committee inexceptional circumstances.
Your Company has an elaborate Risk Management procedure which is based on threepillars: Business Risk Assessment Operational Controls Assessment and Policy Complianceprocesses. Major risks identified by the businesses and functions are systematicallyaddressed through mitigating actions on a continuing basis. The Company has set up a RiskManagement Committee to monitor the risks and their mitigating actions and the key risksare also discussed at the Audit Committee.
Some of the risks identified by the Risk Management Committee relate to competitiveintensity and cost volatility.
INTERNAL CONTROL SYSTEMS
The Company's internal control systems are commensurate with the nature of its businessand the size and complexity of its operations. These are routinely tested and certified byStatutory as well as Internal Auditors and cover all functions and areas.
Significant audit observations and follow up actions thereon are reported to the AuditCommittee. The Audit Committee reviews adequacy and effectiveness of the Company'sinternal control environment and monitors the implementation of audit recommendationsincluding those relating to strengthening of the Company's risk management policies andsystems.
POLICY ON PREVENTION OF SEXUAL HARASSMENT
As per the requirement of The Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (Act') and Rules made thereunder yourCompany has approved the "IFL Policy on Prevention and Redressal Sexual Harassment atWorkplace". During the year under review there were no complaints received againstany employee.
M/s. S.K. Rathi & Co. Chartered Accountants Mumbai (Firm Registration No.108724W) were reappointed as Statutory Auditors of your Company at the 25th Annual GeneralMeeting held on 13th September 2019 for a term of five consecutive years.
The Report given by the Auditors on the financial statements of the Company is part ofthe Annual Report. There has been no qualification reservation adverse remark ordisclaimer given by the Auditors in their Report.
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 Dinesh Kumar Deora practicing company secretary to undertake the SecretarialAudit of the Company for the financial year 2018-19. The Secretarial Audit Report in FormMR-3 is annexed herewith marked as "Annexure A" to this Report.
INTERNAL AUDIT AND COMPLIANCE
The Company conducts its internal audit and compliance functions within the parametersof regulatory framework which is well commensurate with the size scale and complexity ofoperations. The internal controls and compliance functions are installed evolvedreviewed and upgraded periodically.
The Company has appointed Manoj Sharma & Associates Chartered Accountants toconduct internal audit covering all areas of operations of the Company. The reports areplaced before the Audit Committee of the Board.
The Audit Committee reviews the performance of the audit and compliance functions theeffectiveness of controls and compliance with regulatory guidelines and gives suchdirections to the Management as necessary / considered appropriate. The Company has frameda compliance policy to effectively monitor and supervise the compliance function inaccordance with the statutory requirements.
RELATED PARTY TRANSACTIONS
In line with the requirements of the Companies Act 2013 and Listing Regulations yourCompany has formulated a Policy on Related Party Transactions which is also available onCompany's website http://www.indergiri.com/images/policies/IFL_Policy_on_Related_Party_Transactions.pdf
The Policy intends to ensure that proper reporting approval and disclosure processesare in place for all transactions between the Company and Related Parties. All RelatedParty Transactions entered during the year were in Ordinary Course of the Business and onArm's Length basis. No Material Related Party Transactions i.e. transactions exceedingten percent of the annual consolidated turnover as per the last audited financialstatements were entered during the year by your Company. Accordingly the disclosure ofRelated Party Transactions as required under Section 134(3)(h) of the Companies Act 2013in Form AOC-2 is not applicable.
All related party transactions are placed before the Audit Committee as also the Boardfor their approval on quarterly basis. Transactions with related parties as per therequirements of Accounting Standard 18 are disclosed to the notes to accounts annexed tothe financial statements.
ENERGY CONSERVATION TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The provisions of Section 134(3) (m) of the Companies Act 2013 and the rules madethere under relating to conservation of energy technology absorption do not apply to yourCompany as it is not a manufacturing Company.
However your Company has been increasingly using information technology in itsoperations and promotes conservation of resources. During the year under review there wasno foreign earning or expenditure in the Company.
INTERNAL FINANCIAL CONTROL AND ITS ADEQUACY
The Board has adopted policies and procedures for ensuring the orderly and efficientconduct of its business including adherence to the company's policies the safeguardingof its assets the prevention and detection of frauds and errors the accuracy andcompleteness of the accounting records and the timely preparation of reliable financialdisclosures.
PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
The provisions of Section 186 of the Act pertaining to investment and lendingactivities is not applicable to the Company since the Company is an NBFC whose principalbusiness is acquisition of securities.
The Company does not possess any material properties which need insurance.
STANDARD ASSETS' PROVISIONING AND STATUTORY RESERVE
The Company has made Statutory Reserve (SR) pursuant to the provisions of Section 45 IC(1) of RBI Act and accordingly transferred 20% on its net profit for FY 2019 to StatutoryReserve.
EXTRACT OF ANNUAL RETURN
Extract of Annual Return of the Company in Form MGT-9 is annexed herewith as "AnnexureB" to this Report.
PARTICULARS OF EMPLOYEES
None of the employees was in receipt of remuneration in excess of limits prescribedunder Section 197(12) of the Companies Act 2013 read with Rules 5(2) and 5(3) of theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014.
The Company gratefully acknowledges the co-operation and supports extended by theBanker Shareholders and Clients of the Company and place on record its appreciation forthe active support and assistance of the employees for the performance.
| ||For and on behalf of the Board of Director || |
| ||Laxminarayan Sharma ||Kishan Sharma |
|Place: Mumbai ||Managing Director ||Director |
|Date: 10th August 2019 ||DIN: 01731396 ||DIN: 01168525 |