Your Directors present the Twenty Sixth Annual Report together with the AuditedStatements of Account for the financial year ended March 31 2017.
1. FINANCIAL RESULTS:
During the year under review the Company has achieved the following financial results:
( Rs. in Lakhs )
|Particulars ||31.03.2017 ||31.03.2016 |
|Revenue from operations ||753.54 ||781.69 |
|Other Income ||69.59 ||86.38 |
|Profit /(Loss) before Financial Charges Depreciation Taxation and Prior Period items ||20.06 ||(6.80) |
|Less: Depreciation ||24.40 ||34.70 |
|Less: Finance Costs ||18.74 ||96.43 |
|Profit /(Loss) before Taxation and Prior Period items ||(23.08) ||(137.93) |
|Less: Taxation (Including Deferred Tax) ||0.00 ||14.00 |
|Profit /(Loss) for the year ||(23.08) ||(151.93) |
|Less: Prior period items ||0.00 ||0.00 |
|Net Profit/(Loss) for the year ||(23.08) ||(151.93) |
|Balance of Profit/(Loss) brought forward from last year ||(773.88) ||(506.38) |
|Profit/(Loss) Carried forward to Balance sheet ||(796.97) ||(773.88) |
2. OVERVIEW OF COMPANY PERFORMANCE:
During the year under review sales has registered a fall by about 4 % compared toprevious year. The fall in sales was due to impact of demonetisation which resulted inlower sales in the months of January and February 2017. Loss has come down from Rs.151.93 Lakhs to Rs. 23.08 Lakhs due to profit on sale of assets.
Progress of Rehabilitation and measures initiated by the Company to improve itsfinancial performance:
The efforts taken by the Company towards improving its financial performance hasstarted bearing fruits. In the financial year ended March 31 2017 the Company hassucceeded in bringing down its losses considerably and earn a nominal operating profit ofRs. 1.32 Lakhs.
The Board of Directors is confident of widening its operating profits during thecurrent financial year and earn a decent net profit.
3. DIVIDEND & RESERVES:
In view of loss incurred by the Company your Directors do not recommend any dividendfor the financial year ended March 31 2017.
During the year under review no amount was transferred to General Reserve.
4. SHARE CAPITAL:
The Paid Up Capital of the Company as at March 31 2017 stood at Rs. 101996525/-.During the year under review the Company has not issued shares with differential votingrights nor has granted any stock options or sweat equities. As on March 31 2017 none ofthe Directors of the Company hold instruments convertible into equity shares of theCompany.
5. EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT-9 as requiredunder Section 92 (3) of the Companies Act 2013 and Rule 12(1) of the Companies(Management & Administration) Rules 2014 is included in this Report as Annexure A and forms an integral part of this Report.
In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Mr. Sathish Shastry Director and Mr. Umesh ShastryDirector retires by rotation at the ensuing Annual General Meeting and being eligibleoffers themselves for re-appointment. The Board recommends their re-appointment for theconsideration of the Members of the Company at the ensuing Annual General Meeting.
The Independent Directors have given declaration that they meet the criteria ofindependence as laid down under Section 149(6) of the Companies Act 2013 and Regulation16(b) of SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015.
During the year under review there is no change in the Board of Directors of theCompany.
7. NUMBER OF MEETINGS OF THE BOARD:
During the Financial Year 2016-17 7 (Seven) meetings of the Board were held detailsof which are given in the Corporate Governance Report.
8. KEY MANAGERIAL PERSONNEL:
The following are the Key Managerial Personnel of the Company: 1. Suresh Shastry -Chairman and Managing Director 2. Supriya Shastry - Whole Time Director 3. Sathish Shastry- Whole Time Director 4. Umesh Shastry - Whole Time Director 5. Yogeesh M Dasar - CompanySecretary (w.e.f. 04.01.2017)
9. COMMITTEES OF THE BOARD:
The Board of Directors has the following Committees:
1. Audit Committee
2. Remuneration and Nomination Committee
3. Stakeholders' Relationship Committee
Details of the Committee along with their composition number of meetings andattendance at the meetings are provided in the Corporate Governance Report.
10. BOARD EVALUATION:
Pursuant to the provisions of the Companies Act 2013 and SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a structured questionnaire was prepared aftertaking into consideration the various aspects of Board's functioning composition of theBoard and its Committees and performance of specific duties obligations and governance.The performance evaluation of Independent Directors was completed. The performanceevaluation of the Chairman and Non-Independent Directors was carried out by theIndependent Directors through a meeting of Independent Directors.
11. FAMILIARISATION PROGRAMME FOR INDEPENDENT DIRECTORS:
The details of programmes for familiarisation of Independent Directors with theCompany their roles rights responsibilities in the Company nature of the industry inwhich the Company operates business model of the Company and related matters are put upon the website of the Company www.smithsandfoundersindia. com
12. FIXED DEPOSITS:
The Company has not accepted fixed deposits from the public and shareholders within themeaning of Section 73(1) of the Companies Act 2013 and Rules made there under during theyear under review.
13. DIRECTORS RESPONSIBILITY STATEMENT:
As required under Section 134(3)(c) of the Companies Act 2013 your Directors statethat: a) in the preparation of the annual accounts the applicable accounting standardshave been followed along with proper explanations relating to material departures; b) theDirectors 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 March 31 2017 and its loss for the year endedon that date; c) the Directors have taken proper and sufficient care for the maintenanceof adequate accounting records in accordance with the provisions of the Act forsafeguarding the assets of the Company and for preventing and detecting fraud and otherirregularities; d) the annual accounts have been prepared on a Rs. going concern' basis;e) the Directors had laid down internal financial controls to be followed by the Companyand that such internal financial controls are adequate and were operating effectively; andf) the Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
14. PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS BY COMPANY:
During the year under review the Company has not given any loan guarantee or made anyinvestment covered under the provisions of Section 186 of the Companies Act 2013.
15. REMUNERATION AND NOMINATION POLICY:
The Board of Directors have framed a policy which lays down a framework in relation toremuneration of Directors Key Managerial Personnel and Senior Management of the Company.The policy also lays down criteria for selection and appointment of Board Members. ThePolicy is given in Annexure-B and forms an integral part of this report.
16. RELATED PARTY TRANSACTIONS:
During the year under review the Company has not entered into any transaction with anyrelated party attracting the provisions of Section 188 of the Companies Act 2013 and theRules made thereunder. The disclosure required pursuant to clause (h) of sub-section (3)of Section 134 of the Companies Act 2013 and Rule 8(2) of the Companies (Accounts) Rules2014 in Form AOC 2 is given in Annexure-C and forms an integral part of thisreport. Further there are no material related party transactions during the year underreview with the Promoter Directors or Key Managerial Personnel.
All Related Party Transactions are placed before the Audit Committee and also to theBoard for approval. The policy on Related Party Transactions as approved by the Board ofDirectors has been uploaded on the website of the Company www.smithsandfoundersindia. com
17. VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a Whistle Blower Policy to report genuine concerns or grievances. TheWhistle Blower Policy of the Company can be accessed on the Company's website atwww.smithsandfoundersindia. com
18. RISK MANAGEMENT:
The Company has in place Risk Management Policy according to which the Board ofDirectors of the Company and the Audit Committee periodically review and evaluate the riskmanagement system of the Company so that the management controls the risks throughproperly defined network.
19. CORPORATE SOCIAL RESPONSIBILITY:
No disclosures on Corporate Social Responsibility are required as provision underSection 135 of the Companies Act 2013 and Rules made thereunder are not applicable to theCompany.
20. CORPORATE GOVERNANCE:
As per Regulations 34(3) read with Schedule V of the SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 a separate section on corporate governancepractices followed by the Company together with a Certificate from the Company's Auditorsconfirming compliance forms an integral part of this
21. MANAGEMENT DISCUSSION AND ANALYSIS:
The Report on Management Discussion and Analysis forms part of this Report. Certainstatements in this section may be forward looking. Many factors may affect the actualresults which could be different from that the Directors envisage in terms of the futureperformance and outlook.
22. SECRETARIAL AUDIT:
Pursuant to the provisions of Section 204 of the Companies Act 2013 and the Rules madethereunder the Company has appointed Naveen K. Shenoy Practicing Company Secretary asthe Secretarial Auditor of the Company. The Secretarial Audit Report is annexed as Annexure-Dand forms an integral part of this Report. The Secretarial Audit Report does notcontain any qualification reservation or adverse remark.
Regarding the observation about not achieving the minimum public shareholding of 25% byFebruary 20 2017 the promoters of the Company have informed the Company that concertedefforts are being made by them to bring down their shareholding to at least 75% as earlyas possible.
The Company's Auditors M/s. B.N.Subramanya & Co. Chartered Accountants werere-appointed as the
Statutory Auditors of the Company to hold office from the conclusion of Twenty ThirdAnnual General Meeting held on December 27 2014 until the conclusion of the TwentySeventh Annual General Meeting to be held in the year 2018 subject to ratification oftheir appointment by the Members at every Annual General Meeting held after the AnnualGeneral Meeting held on December 27 2014.
As required under provisions of Section 139 of the Companies Act 2013 the Company hasreceived written consent from M/s. B.N.Subramanaya & Co. to their appointment and aCertificate to the effect that that their re-appointment if made would be in accordancewith the Companies Act 2013 and the Rules framed thereunder and that they satisfy thecriteria provided in Section 141 of the Companies Act 2013. The Members are requested toratify the appointment of the Statutory Auditors as foresaid.
The Auditors' Report does not contain any qualification reservation or adverse remarkon the financial statements for the year ended March 31 2017. The statements made by theAuditors in their Report are self-explanatory and do not call for any further comments.
24. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There are no significant and material orders passed by the Regulators/Courts/ Tribunalsthat would impact the going concern status of the Company and its future operations.
25. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The Company has an adequate internal control system commensurate with its size andnature of its business.
26. HEALTH SAFETY AND ENVIRONMENT:
The health and safety of the workforce is of paramount importance. The Company aims toprovide a workplace that is free from any occupational hazards or illness.
27. SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITION & REDRESSAL)ACT 2013:
During the year under review the Company has not received any complaint under theSexual Harassment of Women at Workplace (Prevention Prohibition & Redressal) Act2013.
28. MATERIAL CHANGES AND COMMITMENT IF ANY AFFECTING THE FINANCIAL POSITION OF THECOMPANY.
No material changes and commitment affecting the financial position of the Companyoccurred between the end of the financial year to which this financial statement relatesand the date of this report.
29. STATUTORY INFORMATION:
The information on conservation of energy technology absorption and foreign exchangeearnings and outgo pursuant to Section 134 (3)(m) of the Companies Act 2013 read withRule 8(3) of the Companies (Accounts) Rules 2014 is given in Annexure-E whichforms part of this Report.
There were no employees employed throughout the year who were in receipt ofremuneration of Rs. 1.02 Crore per annum or more. There were no employees employed forpart of the year who were in receipt of remuneration of Rs. 8.50 Lakhs per month or more.During the year under review the Company had 64 employees.
The information required under Section 197(12) of the Companies Act 2013 read withCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 and formingpart of the Directors' Report for the year ended March 31 2017 is given in Annexure-F tothis Report.
Your Directors wish to place on record their appreciation for the contribution made bythe employees at all levels but for whose hard work and support your Company'sachievements would not have been possible. Your Directors also wish to thank its MembersGovernment Authorities Banks Customers and Vendors for their continued unstinted supportto the Company.
| ||By the Order of the Board |
|Place: Bangalore ||SURESH SHASTRY |
|Date: 09.08.2017 ||Chairman & Managing Director |