TRC Financial Services Limited
Your Directors' have pleasure to present the Twenty Sixth Annual Report of yourCompany TRC Financial Services Limited for the financial year ended March 31 2020. Inline with the requirements of the Companies Act 2013 and the rules framed thereunderthis report covers the financial results and other developments during the Financial Year1st April 2019 to 31st March 2020.
1. SUMMARY OF OPERATIONS/RESULTS
The financial results of the Company for the year ended March 31st 2020compared to the previous year are summarized below:
|Particulars ||March 31 2020 ||March 31 2019 |
|Revenue from Operations ||104.70 ||62.59 |
|Other Income /Loss ||0.27 ||0.04 |
|Total Expenditure ||87.23 ||70.23 |
|Net Profit/(Loss) before tax ||17.74 ||(7.60) |
|Current Tax ||(2.15) ||- |
|MAT Credit ||2.07 ||- |
|Net Profit/(loss) after Tax ||17.66 ||(7.60) |
2. COMPANY'S AFFAIRS
Your Company has earned a total business revenue of Rs. 104.70 Lacs and the net profitof Rs. 17.66 Lacs for the financial year 2019-20 as against the revenue of Rs. 62.59 lacsand net loss of Rs. 7.60 in the previous financial year 2018-2019.
3. PERFORMANCE AND FUTURE PROSPECTS
Your Company has prepared the Financial Statements in accordance with Indian AccountingStandards ("IND AS") notified under the Companies (Indian Accounting Standards)Rules 2015 as amended by the Companies (Indian Accounting Standards) Rules 2016. TheCompany has adopted IND AS from 1st April 2018 with effective transition date of 1stApril 2017 and accordingly these Financial Statements together with the FinancialStatements for the comparative reporting period have been prepared with the recognitionand measurement principles stated therein prescribed under Section 133 of the CompaniesAct 2013 ("the Act") read with relevant Rules issued thereunder and the otheraccounting principles generally accepted in India.
During the year 2019-20 the company has earned Revenue of approximately Rs 100 lacsfrom consulting services. Employee benefit cost during the year was Rs 68.29 lacs ascompared to Rs. 47.10 lacs in previous year. Profit before tax during the year 2019-20 wasRs 17.66 lacs as compared to Loss of 7.60 in previous year 2018-19.
Further the management of the Company is looking at various opportunities for expandingthe business including other area of lending and building a loan book.
4. CHANGE IN THE MANAGEMENT OF THE COMPANY
During the year under review there was no change in the management of the Company.
5. DIVIDEND & TRANSFERS TO IEPF
Your Board does not recommend any dividend for the financial year ended March 31 2020.The Company was not required to transfer the amount of any unclaimed/unpaid dividend toInvestor Education Protection Fund.
6. TRANSFER TO RESERVE
The Board of Directors of your Company has transferred Rs. 3.53 Lacs from Retainedearnings to the Statutory reserve as directed by RBI for the year 2019-20.
7. CORPORATE GOVERNANCE
Regulation 15 of SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 provide threshold for applicability of corporate governance rules. Your company doesnot exceeds such threshold. Hence provision of corporate governance is not applicable onyour company.
8. CHANGE IN THE NATURE OF BUSINESS
No changes occurred in the nature of business during the financial year ended March 312020 and till the date of issue of this report.
9. MATERIAL CHANGES AND COMMITMENTS
No material changes/ commitments occurred between the end of the financial year towhich financial statements relate and the date of this report.
The Company has not accepted any deposits and as such no amount of principal orinterest is outstanding as of the Balance Sheet date.
11.SUBSIDIARY ASSOCIATE AND JOINT VENTURES COMPANIES
The Company does not have any subsidiary as per Clause 2(87) or associate as per Clause2(6) of the Companies Act 2013; also it has not entered into any joint venture agreementswith any other entities.
During the F.Y. 2019-2020 there was no change in the Share Capital of the Company.
13.BOARD OF DIRECTORS KEY MANAGERIAL PERSONNEL AND COMMITTEES THEREOF
13.1 Board of Directors and Key Managerial personnel The Current Composition of Boardof Directors and Key Managerial Personnel of the Company is as follows:
|Sr. No. ||Name of Director and Key Managerial Personnel ||DIN/ PAN ||Category |
|1. ||Mr. Giddaiah Koteswar ||07121503 ||Whole Time Director |
|2. ||Mr. Naresh Gandhi ||08130774 ||Non - Executive Independent Director |
|3. ||Mr. K. Sanjay Prabhu ||00023196 ||Non- Executive Non - Independent Director |
|4. ||Mrs. Uma Prasad Bontha ||08406107 ||Non- Executive Independent Director |
|5. ||Ms. Charmi Kartik Gindra ||AQAPC3360K ||Company Secretary and Compliance Officer |
13.2 Board of Directors
Details of Board Meetings/Committee Meetings
The Board of Directors met five times during the year. The details as per Standard 9 ofthe Secretarial Standards-1 on Board meetings / committee Meetings held during thefinancial year 2019-20 are furnished below:
|Board Meeting Dates || ||11th April 2019 25th May 2019 6th August 2019 11th November 2019 and 5th February 2020 |
|Audit Committee Meeting Dates || ||11th April 2019 25th May 2019 6th August 2019 11th November 2019 and 5th February 2020 |
|NRC Committee Meeting Dates || ||11th April 2019 and 6th August 2019 |
|Stakeholders Relationship Committee Meeting Date || ||6th August 2019 |
Attendance of Directors at Meetings
|SR. No ||Name of the Director ||Board meeting attended ||Audit Committee meetings attended ||NRC Committee meetings attended ||Stakeholders Relationship Committee attended ||Attendance at the last AGM |
|1. ||Mr. Naresh Gandhi ||5 ||5 ||2 ||1 ||Yes |
|2. ||Mr. Sanjay Prabhu ||5 ||5 ||2 ||- ||Yes |
|3 ||Mrs. Uma Prasad ||4 ||4 ||2 ||1 ||Yes |
|4 ||Mr. Giddaiah Koteswar ||5 ||- ||- ||1 ||Yes |
|5 ||Mr. Chirag Meswani ||1 ||- ||- ||- ||NA |
|6 ||Mr. Siddhartha Mehra ||1 ||1 ||1 ||- ||NA |
Changes in Directors/ Key Managerial Personnel
During the year under review and since the last Boards report the following changes inthe composition of Board of Directors and Key Managerial Personnel took place:
1. Mr. Giddaiah Koteswar was appointed as Additional Non Executive Director w.e.f. 9thApril 2019 and then was appointed as Whole Time Director w.e.f. 11th April2019.
2. Mr. Chirag Meswani has resigned as Whole time Director and Director with effect from11th April 2019.
3. Mrs. Uma Prasad Bontha was appointed as Additional Non Executive IndependentDirector w.e.f. 9th April 2019.
4. Mr. Sidhartha Mehra tendered his resignation as a director w.e.f. 15thMay 2019.
5. Mr. Manoj Tulsani resigned as Chirf Financial Officer as w.e.f 8thNovember 2019.
Retirement by Rotation
In accordance with the provisions of Section 152 of the Companies Act 2013 and theCompany's Articles of Association Mr. Giddaiah Koteswar (DIN: 07121503) retires byrotation at 26th Annual General Meeting and being eligible has offered himselffor re-appointment.
The Board of Directors recommends to the shareholders to re-appoint him at the 2 6thAnnual General Meeting.
Committee Meeting Independent Directors
During the year under review the Independent Directors was held on 24thMay 2019 and 5th February 2020 inter alia to discuss:
1. Evaluation of performance of Non Independent Directors and the Board of Directors asa whole;
2. Evaluation of performance of the Chairman of the meetings of the Company takinginto account the views of Executive and Non Executive Directors.
3. Evaluation of the quality content and timelines of flow of information between theManagement and the Board that is necessary for the Board to effectively and reasonablyperform its duties
Declaration from Independent Directors
The Company has received necessary declaration from each independent director underSection 149(7) of the Companies Act 2013 that he/she meets the criteria of independencelaid down in Section 149(6) of the Companies Act 2013 and Regulation 25 of SEBI (ListingObligations and Disclosures Requirements) Regulations 2015.
In the opinion of the Board all the Independent Directors possess the integrityexpertise and experience including the proficiency required to be Independent Directors ofthe Company fulfil the conditions of independence as specified in the Act and the SEBIListing Regulations and are independent of the management and have also complied with theCode for Independent Directors as prescribed in Schedule IV of the Act.
Familiarization program for independent directors
All new independent directors appointed on the Board attend a familiarization program.
After appointment a formal letter is issued to the independent directors outlininghis/her roles functions duties and responsibilities.
The performance of the board was evaluated by the board after seeking inputs from allthe directors on the basis of the criteria such as the board composition and structureeffectiveness of board processes information and functioning etc.
The performance of the committees was evaluated by the board after seeking inputs fromthe committee members on the basis of the criteria such as the composition of committeeseffectiveness of committee meetings etc.
The board and the nomination and remuneration committee reviewed the performance of theindividual directors on the basis of the criteria such as the contribution of theindividual director to the board and committee meetings.
In a separate meeting of independent directors performance of non-independentdirectors and performance of the board as a whole was evaluated taking into account theviews of executive directors and non-executive directors. Performance evaluation ofindependent directors was done by the entire board excluding the independent directorbeing evaluated.
Policy on director's appointment and remuneration
The current policy of the Company is to have an optimum combination of both executiveand independent directors to maintain the independence of the Board and separate itsfunctions of governance and management.
The policy of the Company on director's appointment and remuneration includingcriteria for determining qualifications independence of director and other matters asrequired under Section 178(3) of the Companies Act 2013 is available on our website(www.trcfin.in). There has been no change in the policy since the last financial year. Weavow that the remuneration paid to the directors is as per the terms laid out in thenomination and remuneration policy of the Company.
All our policies are available on our website (www.trcfin.in.com). The policies arereviewed periodically by the Board and updated based on need.
13.3 Committees of Board of Directors
The Audit Committee of Directors is constituted as per the provisions of Section 177 ofthe Companies Act 2013. The Composition of Audit Committee is as follows:
|Sr. No. ||Name of Member ||DIN ||Category |
|1. ||Mr. Naresh Gandhi Chairman ||08130774 ||Non - Executive Independent Director |
|2. ||Mr. K. Sanjay Prabhu ||00023196 ||Non - Executive Non- Independent Director |
|3. ||Mrs. Uma Prasad Bontha ||08406107 ||Non - Executive Independent Director |
Nomination and Remuneration Committee
The Nomination & Remuneration Committee of Directors is constituted in accordancewith the requirements of Section 178 of the Companies Act 2013. The Composition ofNomination and Remuneration Committee is as follows:
|Sr. No. ||Name of Members ||DIN ||Category |
|1. ||Mr. Naresh Gandhi - Chairman ||08130774 ||Non - Executive Independent Director |
|2. ||Mr. K Sanjay Prabhu ||00023196 ||Non - Executive Non- Independent Director |
|3. ||Mrs. Uma Prasad Bontha ||08406107 ||Non-Executive Independent Director |
Stakeholders Relationship Committee
Pursuant to Section 178 of the Companies Act 2013 the Board of Directors hasconstituted the Stakeholders Relationship Committee. The Composition of StakeholdersRelationship Committee is as follows:
|Sr. No. ||Name of the Member ||DIN ||Category |
|1. ||Mr. Naresh Gandhi - Chairman ||08130774 ||Non - Executive Independent Director |
|2. ||Mr. Giddaiah Koteswar ||07121503 ||Whole-time Director |
|3. ||Mrs. Uma Prasad Bontha ||08406107 ||Non-executive Independent Director |
The Board of Directors has constituted the Investment Committee to co-ordinate andoversee the organizations investment portfolio as required under RBI's NBFC regulations.Composition of the same is as follows
|Sr. No. ||Name of Director ||DIN ||Category |
|1. ||Mr. Giddaiah Koteswar ||08130774 ||Whole-time Director |
|2. ||Mr. Naresh Gandhi ||08130774 ||Non - Executive Independent |
|3. ||Mrs. Uma Prasad Bontha ||08406107 ||Non - Executive Independent |
14.CERTIFICATE FROM COMPANY SECRETARY IN PRACTICE
Priti J. Sheth of M/s Priti J Sheth & Associates practicing Company Secretaries hasissued a certificate as required under the Listing Regulations confirming that none ofthe Directors on the Board of the Company has been debarred or disqualified from beingappointed or continuing as director of Companies by SEBI/ Ministry of Corporate Affairs orany such statutory authority. The certificate is enclosed as "Annexure B"
15. CORPORATE SOCIAL RESPONSIBILITY
The provisions of Section 135 of the Companies Act 2013 and the Companies (CorporateSocial Responsibility Policy) Rules 2014 in respect of Corporate Social Responsibilityare not applicable to the Company.
16. DETAILS OF ESTABLISHMENT OF VIGIL MECHANISM AND WHISTLE BLOWER POLICY
The Company has adopted a Whistle Blower mechanism for directors and employees toreport concerns about unethical behavior. The said policy has been posted on the websiteof the Company-www.trcfn.in.
17.SIGNIFICANT AND MATERIAL ORDERS
There are no significant and material orders passed by the regulators courts ortribunals impacting the functioning of the Company.
M/s. Harish Hedge & Co. Chartered Accountants (ICAI Firm Registration No.128540W) were appointed as the Auditors of the Company by the shareholders of the Companyat the 22nd Annual General Meeting of the Company held on September 29 2016.In terms of the provisions of Section 139 of the Companies Act 2013 read with theCompanies (Audit and Auditors) Rules 2014 M/s. Harish Hedge & Co. the Auditors ofyour Company shall hold office till the conclusion of the ensuing 26th AGM.Your Board places on record its deep appreciation for the valuable contributions of theAuditors during their long association with you your Company and wishes them success inthe future.
Your Board has decided to recommend the appointment of M/s. NBS & Co. CharteredAccountants (ICAI Firm Registration No._110100W) as Statutory Auditors of the Companyunder Section 139 of the Companies Act 2013 for a period of five consecutive years i.e.to hold the office till the conclusion of the sixth Annual General Meeting to be held inthe financial year 2025. The Board places on record its appreciation of the services ofthe retiring Auditors M/s. Harish Hedge & Co. who have been Auditors of the Companysince the financial year 2016-17.
19.STATUTORY AUDITORS' REPORT
The Statements made by the Auditors in their report are self-explanatory and doesn'trequire any comments by the Board of Directors.
20.INTERNAL FINANCIAL CONTROL (IFC)
Your Company's internal control system (including Internal Financial Controls withreference to Financial statements) ensures efficiency reliability and completeness ofaccounting records and timely preparations of reliable financial and managementinformation compliance with all applicable laws and regulations optimum utilization andthe protection of the Company's assets.
The Company has appointed M/s. VMRS & Co. Chartered Accountants as the InternalAuditors as mandated under Section 138 of the Companies Act 2013 for conducting theInternal Audit of the Company.
21. REPORTING OF FRAUDS
There was no instance of fraud during the year under review which required theStatutory Auditors to report to the Audit Committee and / or Board under Section 143(12)of Act and Rules framed thereunder.
22. RISK MANAGEMENT POLICY
The Company has adopted a Risk Management Policy which helps the Company inidentification of risk lays down procedure for risk assessment and procedure for riskmitigation.
23. PARTICULARS OF LOANS GUARANTEES AND INVESTMENTS
Since the Company is a registered entity under the Reserve Bank of India to conduct thebusiness of Non Banking Financial Services pursuant to the section of 186 (11) (a) (b)of the Companies Act 2013 the company is exempted from complying with the provisions.
Further details of Investments made by the Company during the year under review form apart of the financial statements.
24. PARTICULARS OF TRANSACTION BETWEEN THE COMPANY AND THE NON EXECUTIVE DIRECTORS
During the year under review the company has not entered into any transaction with itsNon Executive Directors.
25. PREVENTION OF SEXUAL HARASSMENT OF WOMEN AT WORK PLACE
In order to prevent sexual harassment of women at work place your Company has adopteda Policy for prevention of Sexual Harassment of Women at Workplace. During the year underreview the Company has not received any complaints in this regard.
Further the provisions relating to constitution of Internal Complaints Committee underthe Sexual Harassment of Women at Workplace (Prevention Prohibition and Redressal) Act2013 are not applicable.
26. COMPLIANCE WITH THE ICSI SECRETARIAL STANDARDS
The relevant Secretarial Standards issued by the Institute of Company Secretaries ofIndia (ICSI) related to the Board Meetings and General Meetings have been complied with bythe Company.
27. DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134(5) of the Companies Act 2013 in relation to financialstatements for the year ended 31st March 2020 the Board of Directors statethat:
a. In the preparation of the Annual Accounts the applicable accounting standards hadbeen followed.
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.
e. The Directors had laid down internal financial controls to be followed by theCompany and such internal financial controls are adequate and were operating effectively.
f. The directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.
28.EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in Form MGT - 9 inaccordance with Section 92(3) of the Companies Act 2013 read with the Companies(Management and Administration) Rules 2014 is enclosed as "Annexure A" to thisreport.
Further Annual return for the financial year 2019-20 once file shall be available onthe on the website of the Company i.e. www.trcfin.in.
As required under Section 204 of the Companies Act 2013 and Rules made thereunder theBoard has appointed M/s. Priti J. Sheth & Associates Practicing Company Secretariesas Secretarial Auditor of the Company for the F Y 2019-20.
30.SECRETARIAL AUDIT REPORT
The Secretarial Audit Report for the financial year 2019-20 forms part of Annual Reportas " Annexure C" to the Boards Report.
31. DIRECTORS COMMENT ON QUALIFICATION OR OBSERVATION
The responses of your Directors on the observations made by the Secretarial Auditor areas follows:-
Response to point No.1 The terms of M/s. Harish hedge & Co Expires at this ensuingAnnual General Meeting and the Company proposes to appoint M/s. NBS & Co. in placeexisting Statutory Auditors.
Response to point No.2 The Companies endeavor is to comply with all the NBFC norms ofReserve Bank of India. The Company has submitted various documents required from time totime and has been in continuously following up with RBI for obtaining the CKYCregistration.
32. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS ANDOUTGO
(A) CONSERVATION OF ENERGY
i. The Steps Taken Or Impact On Conservation Of Energy: The Company takes necessarymeasure to conserve energy at its offices.
ii. The Steps Taken By The Company For Utilizing Alternates Source Of Energy: NIL
iii. The Capital Investment on energy conservation equipment's: NIL
(B) TECHNOLOGY ABSORPTION
i. The efforts made towards technology absorption: NIL
ii. The benefits derived like product improvement cost reduction product developmentor import substitution: NIL
iii. In case of imported technology (imported during last three years reckoned frombeginning of financial year)
Details of technology imported: Nil
Year of Import: Nil
Whether technology has been fully absorbed: Nil
If not fully absorbed areas where absorption has not taken place and thereasons thereof: Nil
iv. The expenditure incurred on Research and Development: Nil
FOREIGN EXCHANGE EARNINGS AND OUTGO
The details of Foreign exchange earnings and outgo during the period under review is asunder:
|Particulars ||As at March 31 2020 ||As at March 31 2019 |
|Foreign Exchange earned ||Nil ||Nil |
|Foreign Exchange used ||Nil ||Nil |
33. CEO / CFO CERTIFICATION
The company is exempted under Regulation 15(2) of the SEBI (Listing Obligations andDisclosures) Regulations 2015 from including CEO / CFO certificate as a part of AnnualReport.
34. RELATED PARTY TRANSACTIONS
During the year under review there were no transactions falling under the purview ofSection 188 of the Companies Act 2013 and the rules framed thereunder.
35. MANAGEMENT DISCUSSION AND ANALYSIS
The management discussion and analysis report as per the SEBI (Listing Obligations andDisclosures) Regulations 2015 forms integral part of this Annual Report.
36. RESERVE BANK OF INDIA REGULATIONS
The Reserve Bank of India has classified the Company as "Category 'B' Non-BankingFinance Company".
The Company continues to comply with all the applicable regulation prescribed by theReserve Bank of India ("RBI") from time to time.
37. MAINTENANCE OF COST RECORDS:
Maintenance of cost records as specified by the Central Government under sub-section(1) of section 148 of the Companies Act 2013 is not applicable to the Company.
38. PARTICULARS OF REMUNERATION TO DIRECTORS KEY MANAGERIAL PERSONS AND EMPLOYEES
The Company wishes to place on record their appreciation to the contribution made bythe employees to the operations of the company during the period.
During the year under review there were no employees who were in receipt of theremuneration beyond the limits prescribed under Rule 5 (2) of Companies (Appointment andRemuneration) Rules 2014 and therefore no disclosures need to be made under the saidsection. Further the details of the top 10 employees in terms of remuneration drawnpursuant to rule 5(1) and 5(2) of Companies (Appointment and Remuneration) Rules 2014shall be available at the registered office of the Company during the business hours andthe details ratios of the remuneration of each Director to the median remuneration to theemployees of the Company for the financial year are enclosed as "Annexure D" tothe Board's Report. The Company has 4 permanent employees during the year 2019-20.
Your Board wishes to place on record its sincere appreciation for the wholeheartedsupport received from members government authorities bankers consultants and all otherbusiness associates. We look forward to continued support of all these partners inprogress.
For and on behalf of the Board of Directors TRC FINANCIAL SERVICES LIMITED
|Sd/- ||Sd/- |
|Giddaiah Koteswar ||Korodi Sanjay Prabhu |
|Whole Time Director ||Director |
|DIN:07121503 ||DIN:00023196 |