Your Directors have pleasure in presenting the 31st Annual Report of the Companytogether with Audited Accounts for the year ended 31st March 2016.
| ||STANDALONE ||CONSOLIDATED |
|PARTICULARS ||YEAR ENDED 31ST MARCH 2016 ||YEAR ENDED 31ST MARCH 2015 ||YEAR ENDED 31ST MARCH 2016 ||YEAR ENDED 31ST MARCH 2015 |
| ||(Rs. IN Lacs) ||(Rs. IN Lacs) ||(Rs. IN Lacs) ||(Rs. IN Lacs) |
|Gross Income ||182.90 ||235.80 ||214.93 ||270.00 |
|Total Expenses ||179.22 ||174.40 ||216.75 ||224.58 |
|Profit/ (Loss) before interest Depreciation and Tax ||11.01 ||69.33 ||6.42 ||56.61 |
|Depreciation ||5.17 ||5.94 ||6.06 ||9.20 |
|Interest ||2.17 ||1.99 ||2.17 ||1.99 |
|Provision for Tax ||- ||- ||9.78 ||- |
|Prior period expenses ||- ||- ||- ||- |
|Profit/ (Loss) after Tax ||3.67 ||61.40 ||-11.60 ||45.42 |
OPERATION AND FUTURE OUTLOOK
Your Company has earned a net profit of Rs. 3.67 Lacs as on 31st March 2016 against aprofit of Rs. 61.40 Lacs in previous year ended on 31st March 2015.
Merchant Banking activities is very low in the year under review in comparison to theprevious year. The Company is taking necessary steps to show better results in ensuingyear in this activity.
Your Directors are putting their best efforts for the growth of the Company.
The Consolidated Financial Statements of your Company for the financial year 2015-16are prepared in compliance with applicable provisions of the Companies Act 2013 read withthe Rules issued thereunder applicable Accounting Standards and the provisions of SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015. The consolidatedfinancial statements have been prepared on the basis of audited financial statements ofyour Company its subsidiary and associate Company as approved by the respective Board ofDirectors.
Keeping in view to conserve resources of the Company Director do not recommend anydividend for the financial year 2015 - 16.
The Company has one Subsidiary Company namely M/s. Mefcom Securities Ltd. There hasbeen no material change in the nature of the business of the subsidiary.
A separate statement containing the salient features of financial statements of theSubsidiary of your Company forms part of consolidated financial statements in compliancewith Section 129 and other applicable provisions if any of the Companies Act 2013.
The financial statements of the Subsidiary Company and related information areavailable for inspection by the members at the Registered Office of your Company duringbusiness hours on all days except Second Saturdays Sundays and public holidays upto thedate of the Annual General Meeting (AGM') as required under Section 136 of theCompanies Act 2013. Any member desirous of obtaining a copy of the said financialstatements may write to the Managing Director at the Registered Office of your Company.The financial statements including the consolidated financial statements financialstatements of subsidiary and all other documents required to be attached to this reporthave been uploaded on the website of your Company www.mefcom.in
CORPORATE GOVERNANCE REPORT
The Company fully complies with the Corporate Governance practices as enunciated in theSEBI (LODR) Regulations 2015 Corporate Governance Report presented in a separate sectionforms an integral part of this Annual Report.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis forms an integral part of this report and givesdetails of the overall industry structure economic developments performance and state ofaffairs of your Company's various businesses viz. the decorative business internationaloperations industrial and home improvement business internal controls and theiradequacy risk management systems and other material developments during the financialyear 2015-16.
During the year under review your Company has not accepted any deposit within themeaning of Sections 73 and 74 of the Companies Act 2013 read with the Companies(Acceptance of Deposits) Rules 2014 (including any statutory modification(s) orre-enactment(s) for the time being in force).
DIRECTORS AND KEY MANAGERIAL PERSONNEL
In accordance with the provisions of the Companies Act 2013 and Articles ofAssociation of the Company Mrs. Nisha Ashwani Kumar is liable to retire by rotation atthe ensuring General Meeting but being eligible offers herself for re-appointment. TheBoard recommends her re-appointment.
Ms. Pinky Jha Company Secretary of the Company has resigned w.e.f 23rd April 2016.The Board places on record her appreciation for the contribution made by her during hertenure.
As required under SEBI (Listing Obligations & Disclosure Requirements) Regulations2015 the information on the particulars of the Directors proposed forappointment/re-appointment has been given in the Notice of the Annual General Meeting.
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations& Disclosure Requirements) Regulations 2015 the Board has carries out an evaluationof its own performance the Directors individually as well as evolution of the working ofits Audit Committee Nomination & Remuneration Committees the manner in which theevaluation has been carried out has been explained in the Corporate Governance Report.
The remuneration paid to the Directors is in accordance with the Nomination andRemuneration Policy formulated in accordance with Section 178 of the Companies Act 2013and Regulation 19 of the Listing Regulations (including any statutory modification(s) orre- enactment(s) for the time being in force). The salient aspects covered in theNomination and Remuneration Policy have been outlined in the Corporate Governance Reportwhich forms part of this report. The Managing Director of your Company does not receiveremuneration w.e.f. 1st October 2015 onwards from your Company and any of thesubsidiaries of your Company.
NUMBER OF MEETINGS OF THE BOARD AND ITS COMMITTEES
During the year under review four (4) Board Meetings four (4) Audit CommitteeMeetings four (4) Stakeholders Relationship Committee Meetings and Two (2) RemunerationCommittee Meetings were convened and held. The details of such Meetings are given in theCorporate Governance Report which forms a part of this Report. The intervening gap betweenthe Meetings was within the period prescribed under Companies Act 2013.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors' Responsibility Statement referred to in clause (c) of subsection (3) andsub section (5) of Section 134 of the Companies Act 2013 shall state that
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;
(b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;
(c) 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;
(d) the Directors had prepared the annual accounts on a going concern basis; and
(e) the Directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
AUDITORS Statutory Auditors
The Auditors M/s. V. K. Dhingra & Company Chartered Accountants (FRN- 085842)retire at the ensuing Annual General Meeting and being eligible offer themselves forre-appointment for a period of 2016-17 from the conclusion of ensuing Annual GeneralMeeting till the conclusion of next Annual General Meeting.
As regard to the Auditors' observations the relevant note in the significantAccounting Policies notes on accounts and order disclosures are self explanatory and itis reproduces as given in notes on accounts point no. 35 (ii) i.e. "Gratuity isaccounted for on accrual basis upto 31.03.2013 and no provision for gratuity liability ismade from 01.04.2013. During the year no gratuity was paid".
Pursuant to the provision of Section 204 of Companies Act 2013 read with the theCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 M/s. KundanAgarwal & Associates Practicing Company Secretaries (Certificate of Practice Number -8325) has been appointed as Secretarial Auditor to undertake the Secretarial Audit of theCompany for the Financial Year ended 31st March 2016. The detailed report on the same isappended as an Annexure to this Report.
Secretarial Auditors have made two observations and the responses of your Directorswith respect to the same are as follows:
A) "During the period Company had one Director who is disqualified to becomeDirector as per Section 164 (2) of the Companies Act 2013 and have to vacate office asper provision of Section 167 of the Companies Act 2013. Though this cessation from theoffice is w.e.f. 31st July 2015."
The response of your Directors:
Your Director would like to apprise you that Mr. Tika Ram Khare has vacated his officew.e.f. 31st July 2015.
B) "The Company had appointed Mr. Anup Kumar Verma as CFO of the Company as on13th February 2016 through the provisions of the Section 203 of the Companies Act 2013was applicable from 31/03/2016."
The response of your Directors:
Your Director would like to apprise you that the Company had identified the requirementof appointment of CFO as per the provision of Section 203 of Companies Act 2013 but theCompany was unable to search the right candidate for the post of CFO in the FY 2014-15therefore the Company could not appoint CFO within the prescriber time limit. As soon asthe Company found the eligible candidate Mr. Anup Kumar Verma has been appointed as CFOof the Company w.e.f. 13th February 2016.
EXTRACT OF ANNUAL RETURN
In compliance to Section 92(3) of the Companies Act 2013 read with rule 12(1) of theCompanies (Management and Administration) Rules 2014 an extract of Annual Return in FormMGT-9 is enclosed as Annexure DR- 2 which forms part of this Annual Report.
RELATED PARTY TRANSACTIONS
All related party transactions that were entered into during the financial year were onarm's length basis and were in the ordinary course of the business. There are nomaterially significant related party transaction made by the Company with Promoters KeyManagerial Personnel or other designated persons which may have potential conflict withinterest of the Company at large.
LOAN AND INVESTMENTS
During the year under review the Company has not given any Loan Guarantee and madeany Investment covered under the provisions of Section 186 of the Companies Act 2013.
VIGIL MECHANISM/WHISTLE BLOWER POLICY
The Company is committed to the high standards of Corporate Governance and stakeholderresponsibility.
The Company established a vigil mechanism to be known as the Whistle BlowerPolicy' for its Directors and employees to report instances of unethical behavior actualor suspected fraud or violation of the Company's Code of Conduct. The aim of the policyis to provide adequate safeguards against victimization of whistle blower who avails ofthe mechanism and also provide direct access to the Chairman of the Audit committee inappropriate or exceptional cases.
Accordingly Whistle Blower Policy' has been formulated with a view to provide amechanism for the Directors and employees of the Company to approach the Ethics counseloror the Chairman of Audit Committee of the Company.
DECLATATION BY INDEPENDENT DIRECTORS
The Independent Directors of the Company have submitted the declaration of Independenceas required under Section 149 (7) of the Companies Act 2013 confirming that they meetthe criteria of Independence under Section 149 (6) of the Companies Act 2013.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo as stipulated under Section 134 of the Companies Act 2013 read withthe Companies (Accounts) Rules 2014 is set out as under:
Conservation of Energy
The Company is engaged in providing the financial services and such operationsdo not account for substantial energy consumption. However the Company is taking allpossible measures to conserve energy. Several environment friendly measures have beenadopted by the Company such as:
Installation of TFT monitors that save the power.
Automatic power shut down of the monitors
Creating environmental awareness by way of distributing information inelectronic form.
Minimizing Air conditioning usage.
Shutting off all the lights when not in use.
Education and awareness programs for the employees.
The management frequently puts circulars on the corporate intranet for the employeeseducating them on ways and means to conserve electricity and other natural resources andensures strict compliance with the same.
The management understands the importance of technology in the business segment inwhich the Company works and lays utmost emphasis on the system development and innovationwith the use of new technological advancement. During the year the Company has installedseveral software and this effort will reduce the unnecessary usage of paper and manpower.
Foreign Exchange Earning And Outgo
During the year under review Company did not have any foreign exchange earnings andout go.
RISK MANAGEMENT POLICY
The Company has adequate systems and procedures in place for identification andmitigation of all potential risks to the business of the Company.
Your Directors wish to express their grateful appreciation for the co-operation andassistance extended to the Company by various Government departments regulators stockexchanges other statutory bodies and bankers to the Company. The Directors thankfullyacknowledge the continuous support and guidance of all the shareholders and moreimportantly for the confidence reposed in the Company's management.
|By order of the Board |
|FOR Mefcom Capital Markets Limited |
|Vijay Mehta ||Tarsem Garg |
|Managing Director ||Director |
|Place: New Delhi || |
|Date: 30.05.2016 || |