Your Directors have pleasure in presenting the 33rd Annual Report on thebusiness and operations of your Company together with the Audited Financial Statements forthe year ended March 31 2018.
Financial Results and performance of the company
The summarized working results for the Financial Year ended on 31st March2018 as compared with the previous year are as under:-
| || || |
(Rs. In Lacs)
|Particulars || |
Standalone (as per Ind As)
Consolidated (as per Ind As)
| ||Year Ended 31St March 2018 ||Year Ended 31St March 2017 ||Year Ended 31St March 2018 ||Year Ended 31St March 2017 |
|Gross Income ||1883.24 ||407.63 ||2573.25 ||622.97 |
|Total Expenses ||1823.10 ||432.72 ||2517.70 ||663.07 |
|Profit/ (Loss) before Interest Depreciation Tax and ||60.14 ||(25.09) ||55.55 ||(40.10) |
|Exceptional & Extra Ordinary Items || || || || |
|Exceptional Items || || || || |
|Depreciation ||1.11 ||1.48 ||1.30 ||2.10 |
|Interest ||2.31 ||0.87 ||3.38 ||2.13 |
|Profit/ (Loss) before Tax ||56.72 ||(27.44) ||50.87 ||(44.33) |
|Tax Expenses || || ||-- ||3.73 |
|Net Profit / (Loss) for the Period ||56.72 ||(27.44) ||50.87 ||(48.06) |
|Other Comprehensive Income ||(123.95) ||340.30 ||(151.63) ||462.51 |
|Total Comprehensive Income for the period ||(67.22) ||312.87 ||(100.76) ||414.45 |
|Paid up equity share capital (Face Value per Share Rs. 10/-) ||914.02 ||914.02 ||914.02 ||914.02 |
|Earning Per Equity Share Basic ||0.62 ||(0.30) ||0.56 ||(0.53) |
|Earning Per Equity Share Diluted ||0.62 ||(0.30) ||0.56 ||(0.53) |
Effect of adoption of Ind AS on Financial Statements
With the adoption of Ind AS for preparation of Financial Statements for the Year2017-18 and recasting of Financial Statements for the Financial
Year 2016-17 and 2015-16 there has been impact on the Profitability Value of Stock inTrade Investments and Reserves of the Company. The same has been shown below for properunderstanding of the Financial Statements by our valued Shareholders.
Reconciliation of total comprehensive income for the year ended March 31 2017
| || || ||` |
|Particulars ||As per previous GAAP ||Effects of transition to Ind AS ||As per Ind AS |
|I. Revenue from operations ||365.60 ||- ||365.60 |
|II. Other income ||80.72 ||(38.69) ||42.03 |
|III. Total Income (I+II) ||446.32 ||(38.69) ||407.63 |
|IV. Expenses : || || || |
|Purchase of shares/ securities (stock-in-trade) ||420.09 ||- ||420.09 |
|Change in inventory of shares / securities (stock-in-trade) ||(127.82) ||36.54 ||(91.28) |
|Employee benefit expense ||20.32 ||- ||20.32 |
|Finance cost ||0.87 ||- ||0.87 |
|Depreciation and amortisation expense ||1.48 ||- ||1.48 |
|Other expenses ||83.58 ||- ||83.58 |
|Total expenses (IV) ||398.53 ||36.54 ||435.07 |
|V. Profit before and tax (III-IV) ||47.79 ||(75.23) ||(27.44) |
|VI. Tax Expense: || || || |
|Current tax ||- ||- ||- |
|Deferred tax ||- ||- ||- |
|Total tax expense (VI) ||- ||- ||- |
|VII. Profit for the year (V-VI) ||47.79 ||(75.23) ||(27.44) |
|VIII. Other Comprehensive Income || || || |
|(A) Items that will not be reclassified to profit or loss ||- ||340.30 ||340.30 |
|(B) Items that will be reclassified to profit or loss ||- ||- ||- |
|Total Other comprehensive income (X) ||- ||340.30 ||340.30 |
|IX. Total Comprehensive Income for the year (IX+X) ||47.79 ||265.08 ||312.87 |
(i) Notes to the reconciliation of equity as at April 1 2016 and March 31 2017 andTotal Comprehensive Income for the year ended March 31 2017:-Investments
Under Previous GAAP investments were classified into current and long terminvestments. Current investments were carried at the lower of cost or market value whilelong term investments were carried at cost less any impairment that was other thantemporary.
Under Ind AS equity instruments have been classified as Fair Value through OtherComprehensive Income (FVTOCI). Fair value movements are recognized directly in othercomprehensive income on such investments.
(ii) Stock in Trade
Under Previous GAAP stock-in-trade were valued at cost or net realisable valuewhichever is lower. However Under Ind AS securities or shares held as stock-in-trade aremeasured at fair value and any gain /(loss) arising on subsequent recognition at thebalance sheet date is recognised in Statement of Profit and Loss.
Reconciliation of Equity as previously reported under IGAAP to Ind-AS
|Particulars || |
As at March 31 2017
As at April 1 2016
| ||As per IGAAP ||Adjustments ||As per Ind AS ||As per IGAAP ||Adjustments ||As per Ind AS |
|ASSETS || || || || || || |
|Non-current assets || || || || || || |
|(a) Property plant and equipment ||4.29 ||- ||4.29 ||5.20 ||- ||5.20 |
|(b) Intangible assets ||0.05 ||- ||0.05 ||- ||- ||- |
|(c) Financial assets || || ||- || || ||- |
|(i) Investments ||507.41 ||540.00 ||1047.41 ||523.81 ||238.39 ||762.20 |
|(d) Non-current tax assets (net) ||22.64 ||- ||22.64 ||33.98 ||- ||33.98 |
|(e) Other non-current assets ||- ||- ||- ||30.00 ||- ||30.00 |
|Total non-current assets ||534.39 ||540.00 ||1074.39 ||593.00 ||238.39 ||831.38 |
|Current assets || || || || || || |
|(a) Stock in Trade ||240.62 ||56.09 ||296.71 ||112.81 ||92.63 ||205.43 |
|(b) Financial assets || || ||- || || || |
|(i) Trade receivables ||- ||- ||- ||2.73 ||- ||2.73 |
|(ii) Cash & cash equivalents ||0.84 ||- ||0.84 ||15.93 ||- ||15.93 |
|(iii) Loans ||257.50 ||- ||257.50 ||237.50 ||- ||237.50 |
|(iv) Other financial assets ||20.27 ||- ||20.27 ||22.89 ||- ||22.89 |
|(c) Other current assets ||4.05 ||- ||5.55 ||27.34 ||- ||27.34 |
|Total current assets ||523.29 ||56.09 ||581.37 ||419.18 ||92.63 ||511.81 |
|TOTAL ASSETS ||1057.68 ||596.09 ||1655.76 ||1012.18 ||331.01 ||1343.19 |
|EQUITY AND LIABILITIES || || || || || || |
|Equity || || || || || || |
|Equity share capital ||914.02 || ||914.02 ||914.02 ||- ||914.02 |
|Other equity ||137.39 ||596.09 ||735.47 ||89.59 ||331.01 ||420.60 |
|Total equity ||1051.40 ||596.09 ||1649.49 ||1003.61 ||331.01 ||1334.62 |
|Non current liabilities || || || || || || |
|(a) Provisions ||2.22 || ||2.22 ||2.22 || ||2.22 |
|Total non-current liabilities ||2.22 ||- ||2.22 ||2.22 ||- ||2.22 |
|Current liabilities || || || || || || |
|(a) Financial liabilities || || || || || || |
|(i) Trade payables ||0.22 ||- ||0.22 ||- ||- ||- |
|(b) Other current liabilities ||3.84 ||- ||3.84 ||6.35 ||- ||6.35 |
|Total current liabilities ||4.06 ||- ||4.06 ||6.35 ||- ||6.35 |
|TOTAL EQUITY AND LIABILITIES ||1057.68 ||596.09 ||1655.76 ||1012.18 ||331.01 ||1343.19 |
Your Company has earned a net profit of Rs.56.72 Lacs (As per Ind AS) as on 31stMarch 2018 against a Profit of IGAP) / Loss of Rs 27.44 Lacs (as per Ind AS) in theprevious year ended on 31st March 2017.
Your Directors are confident of even better working of the company in the FinancialYear 2018-19. The company is taking the necessary steps to improve the working of thecompany in the ensuing year
The Management is putting its best efforts for the growth of Company.
The Consolidated Financial Statements of your Company for the Financial Year 2017-18are prepared in compliance with applicable provisions of the Companies Act 2013 read withthe Rules issued there under applicable Accounting Standards (Ind AS) and the provisionsof Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015. The Consolidated Financial Statements have been preparedon the basis of Audited Financial Statements of your Company its Subsidiary and AssociateCompany as approved by their respective Board of Directors.
Keeping in view conserving of profits of the Company Directors do not recommend anydividend for the Financial Year 2017-18.
The Company has one Subsidiary Company namely M/s Mefcom Securities Limited. 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. TheFinancial Statements of the Subsidiary Company and related information are available forinspection by the members at the Registered Office of your Company during business hourson all days except Second Saturdays Sundays and public holidays up to the date of theAnnual General Meeting (AGM') as required under Section 136 of the Companies Act2013. Any members desirous of obtaining a copy of the said Financial Statements may writeto the Managing Director at the Registered Office of your Company. The FinancialStatements including the Consolidated Financial Statements Financial Statements ofSubsidiary and all other documents required to be attached to this report have uploaded onthe website of your Company i.e. www.mefcom.in
The compliance with the Corporate Governance provisions as specified in Regulations 1718 19 20 21 22 23 24 25 26 27 and clauses (b) to (i) of sub-regulation 46 andpara C D and E of Schedule V of Securities and Exchange Board of India (ListingObligations and Disclosure Requirements) Regulations 2015 shall not apply to the Companybecause paid up equity share capital is less than Rs.10 Ten Crores and net worth is lessthan Rs.25 Crores as on the last day of the previous financial year. Accordingly reportunder these provisions is not given in the Director 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 . 47.79 Lacs (As percontrols and their adequacy risk management systems and other material developmentsduring the Financial Year 2017-18.
The Company has neither accepted nor renewed any deposits during the Financial Year2017-18 within the meaning of Section 73 and 74 of the Companies Act 2013 read with theCompanies (Acceptance of Deposits) Rules 2014 (including any statutory modification(s)or re-enactment(s) for the time being enforce).
Directors and Key Managerial Personnel
Mr. Tarsem Garg Director of the company regained as Director on 12thFebruary 2018. The Board places on record with appreciation the contribution made by Mr.Tarsem Garg as independent director of the company.
In accordance with the provisions of Section 152 of the Companies Act 2013 andArticles of Association of the Company Mrs. Nisha Ashwanin Kumar is retire by rotationand Mr. I C Singhal who had been appointed as additional Director of the Company retiresat the ensuing Annual General Meeting but being eligible offers themselves forre-appointment. The Board recommends their re-appointment.
Ms. Natasha Goyal Company Secretary cum Compliance Officer of the Company has resignedw.e.f. 01.02.2018.
As required under Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 the information on the particulars of theDirectors proposed for appointment/re-appointment has been given in the Notice of theAnnual General Meeting.
Pursuant to the provisions of the Companies Act 2013 and Securities and Exchange Boardof India (Listing Obligations and Disclosure Requirements) Regulations 2015 the Boardhas carries out an evaluation of its own performance the Directors individually as wellas evolution of the working of its Audit Committee Nomination and Remuneration Committeethe manner in which the evaluation has been carried out.
Number of meetings of the Board of Directors
During the Financial Year 2017-18 the Board of Directors met 5 (Five) times on thefollowing dates:
|April to June 2017 ||30.05.2017 |
|July to September 2017 ||02.08.2017 |
| ||13.09.2017 |
|October to December 2017 ||11.12.2017 |
|January to March 2018 ||12.02.2018 |
The intervening gap between the Meetings was within the period prescribed under theCompanies Act 2013. All material information was circulated to the directors before themeeting or placed at the meeting including minimum information required to be madeavailable to the Board.
During the Financial Year 2017-18 4 (four) Meetings of the Audit Committee of theCompany were held i.e. on May 30 2017 September 13 2017 December11 2017 and February12 2018.
Independent Directors' Meeting:
As per Clause 7 of the Schedule IV of the Companies Act (Code for IndependentDirectors) a separate meeting of the Independent Directors of the Company (without theattendance of Non-Independent Directors) was held on March 28 2018 inter-alia todiscuss:
Evaluation of the performance of Non Independent Directors and the Board ofDirectors as a whole.
Evaluation of the performance of the Chairman of the Company taking intoaccount the views of the Executive and Non-Executive Directors.
Evaluation of the quality content and timelines of flow of information betweenthe Management and the Board that is necessary for the Board to effectively and reasonablyperform its duties.
Directors' Responsibility Statement
In accordance with the provisions of Section 134 (5) of the Companies Act 2013 theDirectors to the best of their knowledge ability hereby state and confirm that:
(a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanations 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 of the company for the period;
(c) the directors had taken proper and 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 prepared the annual accounts on a going concern basis;
(e) the internal financial controls to be followed by the Company were laid down andsuch internal financial controls were adequate and were operating effectively; and
(f) the directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.
Details in respect of adequacy of Internal Financial Controls with reference to theFinancial Statements.
The Company has a robust and comprehensive Internal Financial Control Systemcommensurate with the size scale and complexity of its operations. The objective of theseprocedures is to ensure efficient use and protection of the Company's resources accuracyin financial reporting and due compliance of statues and corporate policies andprocedures. The system encompasses the major processes to ensure reliability of financialreporting compliance with the policies procedures laws and regulations safeguardingassets and economical and efficient use of resources. The policies and procedures adoptedby the company ensure the orderly and efficient conduct of its business and adherence tothe company's policies prevention and detection of frauds and errors accuracy andcompleteness of the records and timely preparation of reliable financial information. Thescope and authority of the Internal Audit function is defined in the Internal AuditManual. To maintain its objectivity and independence the Internal Audit function reportsto the Chairman of the Audit Committee of the Board and to the Chairman and ManagingDirector.
The Internal Audit Department monitors and evaluates the efficacy and adequacy ofinternal control system in the Company its compliance with operating systems accountingprocedures and policies at all locations of the Company. Based on the report of internalaudit function process owners undertake corrective action in their respective areas andthereby strengthen the controls. Significant audit observations and recommendations alongwith corrective actions thereon are presented to the Audit Committee of the Board.
AUDITORS Statutory Auditors
The Auditors M/s Doogar & Associates Chartered Accountants (Firm RegistrationNo.000561N) retire at the ensuing Annual General Meeting and being eligible; offerthemselves for re-appointment for a period of 2018-19 from the conclusion of ensuingAnnual General Meeting till the conclusion of next Annual General Meeting.
As regards the Statutory Auditors' observations the relevant Notes on SignificantAccounting Policies Notes on Accounts and other disclosers are self-explanatory andtherefore do not call for any further comments.
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 P. K. Mishra & Associates (CP No. 16222 & Membership no. F-4305) toundertake care for the the Secretarial Audit of the Company for the Financial Year ended31st March 2018. The Secretarial Audit Report (in Form MR-3) is annexed as Annexure-C'hereto and forms a part of this report.
Secretarial Auditors have made the observations and the responses of your Directorswith respect to the same are as follows:
"A) During the Period Company has not appointed the Company Secretary afterNatasha Goyal resigned w.e.f. 01.02.2018" The response of your Directors:
Your Directors would like to apprise you that the Company had made sincere efforts forappointment of the Company Secretary but no suitable candidate is available. YourDirectors ensure that the Company will appoint Company Secretary very soon. However yourdirectors are ensuring compliance of all rules and regulations of BSE SEBI ROC MCA andother regulatory bodies.
MAINTENANCE OF COST RECORDS
The Central Government has not specified maintenance of cost records for any of theproducts of the company under Section 148(1) of the Companies Act 2013.
During the year under review the Company has complied with the applicable standardsissued by the Institute of Company Secretaries of India.
COMPLIANCE WITH PROVISIONS OF SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013
The Company is committed to uphold and maintain the dignity of women employee and ithas in place a policy which provides for protection against sexual harassment of women atworkplace and for prevention and redressal of such complaints. During the year no suchcomplaints were received. The Company has also constituted an Internal ComplianceCommittee under the Sexual Harassment of women at workplace (Prevention Prohibition andRedressal) Act 2013.
Transfer of unclaimed dividend to Investor Education and Protection Fund
The provisions of Section 125(2) of the Companies Act 2013 do not apply as there wasno dividend declared and paid last year.
Transfer to Reserves
The company has not transferred any amount to General Reserve Fund during the FinancialYear under review.
Change in the nature of business if any
There was no Change in the nature of business of the Company during the Financial Yearended March 31 2018.
During the year under review the Issued Subscribed and paid up
Equity Share Capital of the Company was Rs.91401680/-.
a. Buy Back of Securities
The Company has not bought back any of its securities during the year under review.
b. Sweat Equity
The Company has not issued any Seat Equity shares in accordance with the provisions ofSection 54 of the Companies Act 2013 read with Rule 8 of the Companies (Share Capital andDebentures) Rules 2014 during the year under review.
c. Bonus Shares
The Company has not issued any Bonus shares in accordance with the provisions ofSection 63 of the Companies Act 2013 read with Rule 14 of the Companies (Share Capitaland Debentures) Rules 2014 during the year under review.
d. Employees Stock Option Plan
The Company has not provided any Stock Option Scheme to its employees during the yearunder review.
Material Changes and Commitment 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 this Report.
No material changes and commitments affecting the financial position of your Companyhave occurred between the end of the Financial Year to which the Financial Statementsrelate and on the date of this report.
Conservation of Energy Technology Absorption Foreign Exchange Earnings and Outgo
The information pertaining to conservation of energy technology absorption ForeignExchange Earnings and outgo as required under
Section 134 (3) (m) of the Companies Act 2013 read with Rule 8(3) of the Companies(Accounts) Rules 2014 are provided herein below:-
Conservation of Energy
The Company is engaged in providing the financial services and such operations do notaccount for substantial energy consumption. However the Company is taking all possiblemeasures to conserve energy. Several environment friendly measures have been adopted bythe Company such as:
Installation of TFT monitors that save the power.
Automatic power shut down of the monitors.
Creating environmental awareness by way of distribution information inelectronic form.
Minimizing Air conditioning usage.
Shutting off all the lights when not in use.
Education and awareness programs for the employee.
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 under review the
Company has installed several software and this efforts will reduce the unnecessaryusage of paper and manpower.
Foreign Exchange Earnings and outgo
During the year under review the Company did not have any Foreign Exchange Earningsand Outgo.
Statement concerning development and implementation of Risk Management Policy of theCompany
In today's economic environment Risk Management is very important part of thebusiness. The main aim of risk management is to identify monitor and take precautionarymeasures in respect of the events that may pose risk for the business. Your Companyrecognizes risk management as an integral component of good corporate governance. Thecompany has developed and adopted a risk management policy.
Details of policy developed and implemented by the Company on its Corporate SocialResponsibility initiatives
The Company has not developed and implemented any Corporate Social Responsibilityinitiatives as the provisions of Section 135 of the Companies Act 2013 relating toCorporate Social Responsibility are not applicable.
Particulars of Loans Guarantees or Investments made under Section 186 of the CompaniesAct 2013
The Company has given loans guarantees and investments made during the financial yearunder review in compliance with the provisions of Section 186 of the Companies Act 2013
Subsidiaries Associates and Joint Venture Company
The Company has one Subsidiary Company namely M/s Mefcom Securities Limited. There hasbeen no material change in the nature of the business of the subsidiary.
The Company does not have any Associates and Joint Venture Company during the yearunder review.
Particulars of Contracts or Arrangements made with 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 was 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.
The particulars of Contracts or Arrangements with Related Parties referred in Section188 (1) of the Companies Act 2013 in Form No. AOC-2 are attached as Annexure-B
Suitable disclosure as required by Accounting Standards (AS-18) has been made in theNotes to the Financial Statements.
Details of significant and Material Orders passed by the
Regulators Courts and Tribunal:
No significant and material order has been passed by the Regulators Courts andTribunals impacting the going concern status and Company's operations in future.
The details forming part of the extracts of Annual Return pursuant to the provisions ofSection 92 read with Rule 12 of the Companies (Management and Administration) Rules 2014is annexed herewith as Annexure-A of this Report.
Particulars of Employees and related disclosures
There was no employee in the Company who was in receipt of the remuneration in excessof Rs.10200000/- p.a. Lacs if employed throughout the year or Rs.8.50 Lacs per monthif employed for the part of the financial year or received remuneration in excess of thatdrawn by the Managing Director / Whole Time Director / Manager and holding 2% or moreequity share capital of the company (himself along with and dependent children) andtherefore no disclosure is required to be made under Rules 5(2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014.
Ratio of remuneration
The Company has not paid any remuneration to its Directors and therefore informationrelating to remuneration of Directors of the Company as required under Section 197 (12) ofthe Companies Act 2013 read with Rule 5 of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 is not applicable.
Declaration by Independent Director(s):
All the Independent Directors have submitted their disclosures to the
Board that they fulfill all the requirements as stipulated in Section 149 (6) of theCompanies Act 2013 so as to qualify themselves to be appointed as Independent Directorsunder the provisions of the Companies Act 2013 and the relevant rules.
Criteria for Evaluation of Directors
For the purpose of proper evaluation the Directors of the Company have been divided in3 (three) categories i.e. Independent Non-Independent & Non-Executive and Executive.
The criteria for evaluation includes factors such as engagement strategic planning andvision team spirit and consensus building effective leadership domain knowledgemanagement qualities team work abilities result/achievements understanding andawareness motivation/ commitment/ diligence integrity/ ethics/ value and openness/receptivity.
The securities of the company listed on Bombay Stock Exchange Limited. The listing feesunder Regulation 14 of Securities and Exchange Board of India (Listing Obligations andDisclosure Requirements) Regulations 2015 have been paid to Bombay Stock Exchange Limitedfor the Financial Year 2017-18.
The Board places on record its appreciation for the continued cooperation and supportextended to the Company by customers vendors bankers stock exchanges SEBI otherregulatory authorities depositories auditors legal advisors consultants businessassociates state government local bodies and all the employees with whose helpco-operation and hard work the Company is able to achieve the results.
The Board deeply acknowledges the trust and confidence placed by the customers of theCompany and all its shareholders.
| ||For and on behalf of Board of Directors of |
| ||Mefcom Capital Markets Limited |
| ||Vijay Mehta |
|Place : New Delhi ||Director |
|Date : 08.08.2018 ||DIN-00057151 |