MORARKA FINANCE LIMITED
The Directors are pleased to present their Thirty Seventh (37th) Annual Report to themembers together with the Audited Financial Statements of the Company for the year ended31st March 2022.
1. FINANCIAL RESULTS:
[Amount in Rs]
| ||For the year Ended 31/03/2022 ||For the year Ended 31/03/2021 |
|Profit / (Loss) before tax ||40526204 ||9179036 |
|Less: Current Tax ||3498302 ||2280703 |
|Provision for taxation earlier year ||(754638) ||- |
|Deferred Tax ||859104 ||47953 |
|Profit / (loss) after tax ||36923436 ||6850380 |
|Add: Balance b/f from previous years ||116155733 ||110675430 |
|Less: Appropriations || || |
|Transfer to reserve Fund u/s 45 IC of RBI Act ||7384687 ||1370076 |
|Dividend Paid ||4502100 ||- |
|MAT Credit Balance Written-off ||967727 ||- |
|Balance carried to balance sheet ||140224655 ||116155733 |
2. FINANCIAL PERFORMANCE:
For the financial year ended March 31 2022 your company has posted Profits of Rs369.23 lakhs compared to the profit for the financial year ended March 31 2021 of Rs68.50 lakhs.
3. COVID-19 IMPACT:
The focus of the Company is to ensure the health and well-being of all the concerned.To ensure safety of the employees relaxed working hours to avoid rush hours is instilledby the Company. The Company is motivated and keeping positive outlook for its futuregrowth and prospects.
4. TRANSFER TO RESERVE:
As required by section 45-IC of the RBI Act 1934 the Company maintains a reserve fundand transfers there in a sum not less than twenty per cent of its net profit every year asdisclosed in the statement of profit and loss and before any dividend is declared.
5. SUBSIDIARIES JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR:
The Company does not have any Subsidiary Joint Ventures or Associate Companies.
Your Board of Directors has recommended dividend of Rs 4 per Equity share (i.e. 40%)for the financial year 2021-22.
7. SHARE CAPITAL:
The paid up Equity Capital of your company as at March 31 2022 was Rs 45021000/-The company has not issued any shares with differential voting rights and it has notgranted any stock options or sweat equity during the year under the review. Further noneof the directors of the company hold instruments convertible into equity shares of thecompany.
Pursuant to Section 152(6) of the Companies Act 2013 read with Schedule IV andArticles of the company Ms. Priyanka G. Morarka (DIN: 00001088) Director retire byrotation and being eligible offers herself for re-appointment.
The brief resume/details relating to Directors who are to be appointed / re-appointedas above are furnished in the Corporate Governance Report.
Declaration from Independent Directors:
Pursuant to the requirements of section 149(7) of the Companies Act 2013 the companyhas received the declarations from all the independent directors confirming the fact thatthey all are meeting the eligibility criteria as stated in section 149(6) of the Companiesact 2013.
9. CHANGE IN NATURE OF BUSINESS:
There is no change in nature of business of the company.
10. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
No Material changes have occurred subsequent to the close of the financial year of theCompany to which the balance sheet relates and the date of the report.
11. CORPORATE SOCIAL RESPONSIBILITY:
The company is not falling in the purview of criteria specified in section 135(1) ofthe Companies Act 2013 and hence the requirements pertaining to section 135 of theCompanies Act 2013 is not applicable to the company.
12. HUMAN RESOURCES:
The company is having six directors chief executive officer chief finance officer andcompany secretary being key managerial personnel under Section 203 of the Companies Act2013. All are experts in their relevant fields. Company's well-disciplined workforce whichhas served the company for years lies at the very foundation of the company's majorachievements.
13. BUSINESS RISK MANAGEMENT:
Over the period of time company has been following the principle of risk minimizationas is the norm in every sector it is a gist for company growth and long term survival inthis competitive cosmos.
In terms of requirements of RBI - Scale Based Regulations 2021 (SBR) a RiskManagement Committee (RMC) is required to be constituted and the same has been constitutedby the Company as on February 02 2022 having following members:
1. Shri B. J. Maheshwari - Chairman
2. Shri Vijay S. Banka - Member
3. Ms. Priyanka G. Morarka - Member
The Board members were informed about risk assessment and minimization procedures afterwhich the Board formally accepted steps for framing implementing and monitoring the riskmanagement plan for the company. The main objective of this policy is to ensuresustainable business growth with stability and to promote a pro-active approach inreporting evaluating and resolving risks associated with the business. In order toachieve the key objective the policy establishes a structured and disciplined approach toRisk Management in order to guide decisions on risk related issues. In today'schallenging and competitive environment strategies for mitigating inherent risks inaccomplishing the growth plans of the Company are imperative. The common risks inter aliaare: Regulations Competition Business risk Technology obsolescence InvestmentsRetention of talent and Expansion of facilities. Business risk inter-alia furtherincludes financial risk political risk fidelity risk legal risk.
As a matter of policy these risks are assessed and steps as appropriate are taken tomitigate the same.
14. SYSTEM OF INTERNAL CONTROL & THEIR ADEQUACY:
The Company has put in place adequate system of internal control to safeguard andprotect from loss unauthorized use or disposition of its assets. All the transactions areproperly authorized recorded and reported to the Management. The Company is following allthe applicable Accounting Standards for properly maintaining the books of accounts andreporting financial statements. The internal auditor of the company checks and verifiesthe internal control and monitors them in accordance with policy adopted by the company.The Company continues to ensure proper and adequate systems and procedures in commensuratewith its size and nature of its business.
15. WHSITLE BLOWER POLICY OR VIGIL MECHANISM:
The company has put in place a whistle blower policy pursuant to which employees of thecompany can raise their concerns pertaining to fraud malpractice or any other activityor event which is against the interest of the company. Details of complaints received andthe action taken are reviewed by the Audit Committee. Whistle Blower Mechanism'sfunctioning is reviewed by the Audit Committee from time to time. None of the company'semployees are denied access to audit committee.
16. EVALUATION OF BOARD:
As per the provisions of the Companies Act 2013 a structured questionnaire wasprepared after taking into account various aspects of Board's functioning composition ofboard together with its committees culture execution and performance of specific rolesduties and obligation. So far as the performance evaluation of independent directors areconcerned the same is done by Board. The Chairman is evaluated by the independentdirectors. The board has expressed that they are satisfied with process of evaluation.
17. POLICY ON APPOINTMENT AND REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:
The company have constituted Nomination and Remuneration Committee (NRC) as requiredunder section 178 of the Companies Act 2013 which recommends the appointment of Directorsto the Board. The NRC is responsible to identify persons who are qualified to becomedirectors on the Board and to evaluate them on criteria such as academic qualificationsprevious experience track record and integrity of the persons identified beforerecommending their appointment to the Board. The compensation policy of the company dulyreviewed and recommended by the Nomination and Remuneration committee has been articulatedin line with the requirements of the Companies Act 2013 and placed on below mentionedweblink:https://www.morarkafinance.in/static-data/2019-20/Nomination-and-Remuneration-Policy.pdf
The company's compensation policy is aimed to attract retain reward and motivatetalented individuals critical for achieving strategic goals and long term success.Remuneration policy is aligned to business strategy market dynamics internalcharacteristics and complexities within the organization. The ultimate objective is toprovide a fair and transparent structure that helps the organization to retain and acquirethe talent pool critical in building competitive advantage and brand equity. Thecompensation system also takes into account factors like roles skills / competenciesexperience and grade / seniority to differentiate pay appropriately on the basis ofcontribution skill and availability of talent on account of competitive market forces.
The company pays sitting fees to its Non-executive directors for attending meetings ofthe Board and its Committees. Nonexecutive directors are also reimbursed with expensesincurred by them for attending meetings of the Board and its Committees at actuals. Theremuneration payable to the Non- executive directors and Independent Directors is governedby the provisions of the Companies Act 2013.
The company does not have any subsidiary and hence holding directorships by any of thedirectors of the company in subsidiary is not applicable in case of the company. Shri B.J. Maheshwari and Shri Vijay S. Banka have relinquished any sitting fees payable to themfor attending the Board/ Committee meetings.
18. MEETINGS OF THE BOARD OF DIRECTORS:
The Board of Directors of the Company met Four (4) times during the year: May 212021August 10 2021 October 13 2021 & February 02 2022.
19. RELATED PARTY TRANSACTIONS:
Related party transactions that were entered during the financial year were on an arm'slength basis and were in the ordinary course of business. There were no materiallysignificant related party transactions with the Company's Promoters Directors Managementor their relatives which could have had a potential conflict with the interests of theCompany. Transactions with related parties entered by the Company in the normal course ofbusiness are periodically placed before the Audit Committee for its omnibus approval andthe particulars of contracts entered during the year as per Form AOC-2 is enclosedherewith and marked as Annexure I.
The Board of Directors of the Company has on the recommendation of the AuditCommittee adopted a policy to regulate transactions between the Company and its RelatedParties in compliance with the applicable provisions of the Companies Act 2013 the rulesthereunder and the Listing Regulations and placed on below mentioned weblink:https://www.morarkafinance.in/static-data/2019-20/Policy-on-Related-Party-Transactions.pdf
20. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATOR OR COURTS:
There are no significant material orders passed by the Regulators / Courts which wouldimpact the going concern status of the Company and its future operations.
21. STATEMENT OF DIRECTOR'S RESPONSIBILITIES:
To the best of their knowledge and belief and according to the information andexplanations obtained by them your Directors make the following statements in terms ofSection 134(3)(c) of the Companies Act 2013:
a. that in the preparation of the annual financial statements for the year ended March31 2022 the applicable accounting standards have been followed along with properexplanation relating to material departures if any;
b. that such accounting policies as mentioned in Notes to the Financial Statements havebeen selected and applied consistently and judgement and estimates have been made that arereasonable and prudent so as to give a true and fair view of the state of affairs of theCompany as at March 312022 and of the profit of the Company for the year ended on thatdate;
c. that proper and sufficient care has been taken 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. that the annual financial statements have been prepared on a going concern basis;
e. that proper internal financial controls were in place and that the financialcontrols were adequate and were operating effectively.
f. that systems to ensure compliance with the provisions of all applicable laws were inplace and were adequate and operating effectively.
22. CORPORATE GOVERNANCE:
In accordance with Regulation 34 of SEBI (LODR) Regulations 2015 Corporate GovernanceReport along with Auditors' certificate thereon is enclosed and forms part of the report.
23. EXTRACT OF ANNUAL RETURN:
Pursuant to Section 92(3) of the Companies Act 2013 the extract of the Annual Returnin form MGT-9 is provided on the website of the Company and same can be view at this linkhttps://www.morarkafinance.in/static-data/2021-22/MGT-9-2021-22.pdf.
24. PARTICULARS OF EMPLOYEE:
The information required pursuant to Section 197 read with Rule 5 of The Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 in respect of employeesof the Company is attached herewith and marked as Annexure II.
All the non-executive directors of the company due to financial constraints beingfaced by the company have relinquished their remuneration. Further no sitting fees hasbeen paid to any director during the year except to Shri S. H. Nevatia Ms. K. SavithaRao and Ms. Priyanka Morarka.
The particulars of the employees who are covered by the provisions contained in Rule5(2) and rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 are:
a) Employed throughout the year Nil
b) Employed for part of the year Nil
The remuneration paid to all Key management Personnel was in accordance withremuneration policy adopted by the company.
25. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTIONPROHIBITION AND REDRESSAL) ACT 2013:
The Company has put in place internal policy on Anti Sexual Harassment. No complaintshave been received under this policy during the year.
26. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE AND OUTGO:
Particulars relating to conservation of energy and technology absorption stipulatedunder Section 134(3)(m) of the Companies Act 2013 read with Rule 8 of The Companies(Accounts) Rules 2014 is not applicable to the company. The company does not have anyforeign exchange earnings and expenditure.
The term of M/s. B P Gharda & Co. Chartered Accountants having Firm Reg. No.103155W Mumbai who were appointed as the Statutory Auditors of the Company at the AGMheld on 26th September 2017 retires at this Annual General Meeting after completing theirterm of 5 years. As per the provisions of Section 139(2) of the Companies Act 2013 andon the recommendation of Audit Committee & Board of Directors M/s Jayesh Dadia &Associates LLP Chartered Accountants Mumbai having ICAI Firm Registration No.121142W/W100122 has been proposed to be appointed as the Statutory Auditors of the Company for aterm of 5 consecutive years. The Company has received their written consent and acertificate that they satisfy the criteria provided under Section 141 of the Act and thatthe appointment if made shall be in accordance with the applicable provisions of the Actand rules framed thereunder. Also peer review certificate have been obtained from theproposed Auditors.
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. V K M & Associates (CP No.:4279 FCS: 5023) Company Secretaries toundertake the secretarial audit of the company. The Secretarial Audit Report is annexedherewith as Annexure IN. The observations in the said report are self-explanatoryand no further comments/explanations are called for.
28. AUDITOR'S REPORT
There are no adverse remarks or observations of the Statutory Auditors in their Report.
29. MANAGEMENT DISCUSSION AND ANALYSIS:
As required under Regulation 34(2)(e) of SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 and listing regulations of Stock Exchanges the ManagementDiscussion and Analysis Report is enclosed as a part of this report.
30. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS
No Loans Guarantees or investments are made under Section 186 of the Act during theyear.
31. PUBLIC DEPOSITS
The Company is an NBFC - ND and hence does not have any fixed deposits at the beginningof the year in terms of Section 74 of the Companies Act 2013. The Company did not acceptany deposits during the year.
The Company's Equity Shares are listed on Bombay Stock Exchange Limited (BSE).
33. CODE OF CONDUCT:
Your Company is committed to conducting its business in accordance with the applicablelaws rules and regulations and highest standards of business ethics. In recognitionthereof the Board of Directors has implemented a Code of Conduct for adherence by theDirectors Senior Management Personnel and Employees of the Company. This will help indealing with ethical issues and also foster a culture of accountability and integrity. Allthe Board Members and Senior Management Personnel have confirmed compliance with the Code.
34. REPORTING OF FRAUDS
There have been no instances of fraud reported by the Statutory Auditors under Section143(12) of the Companies Act 2013 & Rules framed thereunder either to the Company orto the Central Government.
Your Directors take this opportunity to place on record their appreciation for theco-operation received from Employees and overwhelming support extended by theshareholders.
| ||By order of the Board |
| ||FOR MORARKA FINANCE LIMITED |
| ||G. R. MORARKA |
| ||CHAIRMAN |
| ||(DIN : 00002078) |
| ||B. J. MAHESHWARI |
|Place : Mumbai ||DIRECTOR |
|Dated: April 29 2022 ||(DIN : 00002075) |