The Members of Wall Street Finance Limited
Your Directors are pleased to present 32nd Annual Report of your Companyalong with the Audited Financial Statements for the year ended 31st March2019.
The Company continues to provide forex services for individual and business travelersand also caters to the outwards remittance requirements for students for their overseaseducation and other remitters under the Liberalised Remittance Scheme (LRS) of RBI.
The Company is into the transformational journey with the objective of enhancing valuecreation for all stakeholders. The Company has already announced the launch of its digitalcorporate platform for corporates to manage their foreign exchange requirements forbusiness travel and digital agent platform a comprehensive solution for agent partnersfor providing foreign exchange services.
In line with the Company's focus to be an asset lite forex tech Company recently theCompany has launched 'WSFx Smart Agent' mobile app for the Company's agent partners. Theagent platform along with smart agent app will provide a comprehensive digital solutionfor agent partners to manage their forex referral business in an efficient and seamlessmanner.
The financial results of the Company for the year under review are summarized below:
| || || || ||(R in lakhs) |
|Particulars || |
| ||31.03.2019 ||31.03.2018 ||31.03.2019 ||31.03.2018 |
|Profit before finance cost depreciation prior period adjustments and tax ||173.16 ||85.77 ||172.18 ||127.75 |
|Less: Finance Cost ||126.86 ||312.46 ||126.86 ||309.74 |
|Profit / (Loss) before depreciation / tax ||46.30 ||(226.69) ||45.32 ||(181.99) |
|Less: Depreciation ||39.15 ||60.85 ||39.15 ||61.65 |
|Net profit / (loss) before exceptional and extraordinary items and tax ||7.15 ||(287.54) ||6.17 ||(243.64) |
|Add: Exceptional item ||- ||3821.66 ||- ||3821.66 |
|Net profit / (loss) before tax ||7.15 ||3534.12 ||6.17 ||3578.02 |
|Less: Tax including Deferred Tax ||(5.02) ||852.89 ||(5.02) ||859.20 |
|Profit / (loss) after tax ||12.17 ||2681.23 ||11.19 ||2718.82 |
|Add: Other Comprehensive Income ||4.68 ||19.24 ||4.68 ||19.24 |
|Surplus carried to balance sheet ||16.85 ||2700.47 ||15.87 ||2738.06 |
During the FY 2018-19 the income from operations amounted to RS. 2387.79 Lakhspertaining only to Forex business as against RS. 3450.40 Lakhs for the FY 2017-18pertaining to Forex as well as Money Transfer Service Scheme upto 30thSeptember 2018. The net profit after tax of the Company has declined to RS. 12.17 Lakhsduring the FY 2018-19 as against the net profit of RS. 2681.23 Lakhs for the FY 2017-18which included profit from sale of MTSS business of RS. 3821.66 Lakhs. Hence Income andProfit figures of the FY 2017-18 are not comparable.
At consolidated level during the FY 2018-19 the income from operations amounted toRS. 2388.18 Lakhs as against RS. 3567.69 Lakhs for the FY 2017-18. The net profit aftertax of the Company has declined to RS. 11.19 Lakhs during the FY 2018-19 as against thenet profit of RS. 2718.82 Lakhs for the FY 2017-18 which included the profit on sale ofMTSS business as stated above.
The Company is engaged only in the business of Money Changing and therefore there isno separate reportable segment under Indian Accounting Standard 108 - Operating Segment.The nature of the Company's activities is such that geographical segments cannot beseparately identified.
There was no change in the share capital of the Company during the financial yeaRs.2018-19.
The Board of Directors of your Company is pleased to recommend a final dividend @15%i.e. RS. 1.50 per equity share of the face value of RS. 10 each payable to thoseShareholders whose names appear in the Register of Members as on the Book Closure / RecordDate. An amount of RS. 35.68 Lakhs would be payable as dividend distribution tax on thefinal dividend.
The Company has transferred unclaimed / unpaid matured deposits of RS. 20526(including interest of RS. 5526) to IEPF on 16th April 2018 on expiry ofseven years. There were no outstanding matured unclaimed and unpaid fixed deposit ofpublic as on 31st March 2019. The Company has not accepted public depositsduring the year under review. Thus as on date there is no deposits lying in the books andpending with the Company.
The working capital requirements of the Company are currently funded by the Company'sbankers at a reasonable cost. Various strengthening and tightening measures employed bythe management have resulted in better utilization of the existing credit facilitiesavailable to the Company and efforts are always on to get facilities from the bankers atthe best possible terms.
UPDATE ON THE FRAUDULENT TRANSACTION AT A BRANCH IN SOUTHERN REGION IN YEARS. 2011-12
(a) Weizmann Forex Limited had filed a civil claim of RS. 125 Lakhs before the Hon'bleCourt of Principal Sub Civil Judge Kollam Kerala in respect of some fraudulenttransactions at a branch in southern region in yeaRs. 2012. The final decree in respect ofaforesaid fraud was passed by the Hon'ble Court of Principal Sub Civil Judge KollamKerala on 21st November 2016 whereby a sum of RS. 4.04 Lakhs with interestwas decreed against the Company and the balance amount of RS. 121.93 Lakhs was dismissedin favour of the Company. Weizmann Forex Limited has filed an appeal before Hon'ble HighCourt of Kerala and the same remains pending.
(b) Update on Insurance Matters
The Company has already reported the recovery of substantial amount of RS. 474.98 Lakhsfrom Insurance Company against an original insurance claim of RS. 521.61 filed in the FY2011-12 for losses arising out of some fraudulent transactions at a branch in southernregion. The balance amount of RS. 20.54 Lakhs is still pending with the Insurance Companysince 2014-15.
The Company has filed an another application with Insurance Company to claim RS. 225Lakhs paid to Muthoot Exchange Private Limited towards full and final settlement of alldisputes vide order dated 5th September 2016 under Special Leave Petitionissued by Supreme Court of India and the said claim is also pending with InsuranceCompany.
CASH FLOW STATEMENT
In conformity with the relevant provisions of the Companies Act 2013 and the SEBI(Listing Obligations and Disclosure Requirements) Regulations 2015 ('Listing Regulations2015') the cash flow Statement for the year ended 31st March 2019 is attachedas part of the Annual Financial Statements of the Company.
SUBSIDIARY cOMpANY AND cONSOLIDATED FINANciAL STATEMENT
Pursuant to Section 129(3) of the Companies Act 2013 the consolidated financialstatements for the financial year ended 31st March 2019 includes financials ofS Global Insurance Advisory Limited wholly owned subsidiary of the Company.
In accordance with the provisions of the Companies Act 2013 and the provisions ofIndian Accounting Standards ('Ind-AS') the consolidated financial statements of theCompany forms part of the Annual Report and shall be laid before the ensuing 32ndAnnual General Meeting ('AGM') of the Company along with the Company's financialstatements. Further a statement containing salient features of the financial statementsof S Global Insurance Advisory Limited in the prescribed format AOC-I attached asannexure-I to Directors report.
In accordance with the third proviso of Section 136(1) of the Companies Act 2013 theAnnual Report of the Company containing therein its standalone and the consolidatedfinancial statements and all other documents as required under the relevant provisions ofthe Companies Act 2013 has been placed on the website of the Company and further as perfourth proviso of the said section audited annual financial statements of the subsidiaryCompany have also been placed on the website of the Company www.wsfx.in.
PERFORMANCE AND FINANCIAL POSITION OF WHOLLY OWNED SUBSIDIARY COMPANY
During the year under review S Global Insurance Advisory Limited has earned a totalrevenue of RS. 0.39 Lakhs as compared to RS. 0.44 Lakhs in the FY 2017-18 thereby booked aloss of R (0.98) Lakhs as compared to the Loss of R (0.36) Lakhs in FY 2017-18.
PARTICULARS OF LOANS INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
The Company has not given any loan guarantee or provided security to any party duringthe year under review. The Particulars of investments made have been disclosed in the noteno. 7 of standalone financial statements which forms part of the Annual Report.
CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES
During the financial year under review in compliance of provisions of Section 188 ofthe Companies Act 2013 readwith rules framed thereunder and Regulation 23 of the ListingRegulations 2015 (including amendments thereof) omnibus approval of the Audit Committeewas taken wherever required. There being no 'material' related party transactions asdefined under Regulation 23 of the Listing Regulations 2015.
The details of the related party transactions entered during the year under review areincluded in the note no. 31 forming part of the standalone financial statements whichforms part of Annual Report.
The Policy of related party transactions and dealings with related party transactionsas approved by the Audit Committee and the Board of Directors is uploaded on the websiteof the Company and link for the same is https://wsfx.in/assets/pdf/corporate-governance/Policies&Codes/Policy_on_Related_Party_Transactions.pdf
FOREIGN EXCHANGE EARNINGS AND OUTGO
The Company is into the business of foreign exchange the earnings and outgo in foreigncurrencies are as under:
| || ||(R in Lakhs) |
|Particulars || |
For the year ended
| ||31.03.2019 ||31.03.2018 |
|Earnings in foreign currency || || |
|Export of foreign currencies ||2433.31 ||3233.52 |
|Inward Remittance received - Money transfer services ||- ||207436.23 |
|Outgo in foreign currency || || |
|Import of foreign currencies ||18482.45 ||956.91 |
|Professional fees ||15.00 ||0.00 |
|Travelling expenses ||1.14 ||0.00 |
PARTICULARS REGARDING CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION
Since the Company does not own any manufacturing facility the other Particularsrelating to conservation of energy and technology absorption stipulated in Section 134(3)of the Companies Act 2013 read with rule 8(3) of the Companies (Accounts) Rules 2014 asamended from time to time are not applicable to the Company.
INTERNAL FINANCIAL CONTROLS
The Company has adopted relevant policies and procedures for ensuring the orderly andefficient conduct of its business including adherence to the Company's policies thesafeguarding of its assets the prevention and detection of frauds and errors theaccuracy and completeness of the accounting records and the timely preparation of reliablefinancial information.
The internal financial controls are exercised through documented policies guidelinesand procedures. It is supported by regular internal audits conducted by the external firmsof Chartered Accountants appointed by the Audit Committee and the Board. The Auditobservations and corrective actions if any taken thereon are periodically reviewed bythe Audit Committee to ensure effectiveness of the internal control system. The StatutoryAuditors have reviewed the internal financial controls as part of control assuranceprocess. It was reported to be satisfactory and acceptable and no material weaknesses inthe design or operations were observed. The recommendation of the internal and statutoryauditors for improving or further strengthening internal financial controls with referenceto the financial statements were accepted by the Management and implemented from time totime.
MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY
There are no material changes and commitments affecting the financial position of theCompany which has occurred between the end of the financial year of the Company i.e. 31stMarch 2019 and the date of the Director's report i.e. 28th May 2019.
LISTING OF SECURITIES
Equity Shares of the Company are presently listed on BSE Limited. The annual listingfee for the yeaRs. 2019-20 has been duly paid to BSE Limited.
UPDATE ON REGULATORY APPROVALS
During the year under review Authorized Dealer Category-II License has been renewedfor a period of five years and it will be valid till 31st December 2023 andRBI has also given permission for a period of one year to import currency notes till 31stMarch 2020.
BOARD OF DIRECTORS
In accordance with the provisions of Section 152(6) of the Companies Act 2013 andArticles of Association of the Company Mr. Ramesh Venkataraman being longest in theoffice shall retire at the ensuing AGM and is eligible for the re-appointment. The Boardrecommends his re-appointment at ensuing AGM for the approval of members.
Shareholders had approved the appointment of Ms. Asha Shah (DIN: 08137628) as a WomanIndependent Director on the Board of the Company for a period of five years at the lastAnnual General Meeting held on 31st August 2018.
All Independent Directors have provided declarations as required under Section 149(7)of the Companies Act 2013 that they meet the criteria of Independence as provided inSection 149(6) of the Companies Act 2013 and rules made thereunder and regulation16(1)(b) of the Listing Regulations 2015. The Independent Directors have complied withthe Code for Independent Directors as prescribed in Schedule IV to the Companies Act2013.
The Board of Directors have recommended to the shareholders to consider there-appointment of Mr. Brij Gopal Daga Mr. Madhukar Raghunath Sardar and Mr. SudipBandyopadhyay as an Independent Directors for another period of five years at the comingAnnual General Meeting of the Company.
KEY MANAGERIAL PERSONNEL
The following were the Key Managerial Personnel's of the Company during the FY 2018-19:
(1) Mr. Narasimhan Srikrishna Whole Time Director and Chief Executive Officer
(2) Mr. Dipesh Dharod Chief Financial Officer
(3) Ms. Chaitali Desai Company Secretary
ANNUAL EVALUATION OF THE BOARD
The Board has carried out the annual evaluation for its performance and its Committeesand of Individual Directors including Chairman of the Board. The main criteria ofevaluation include the composition / size of the Board talent skills experience of theBoard Members Directors' participations in the board functioning suggestions anddeliberations at the meetings Board process polices and other related matters.
Performance evaluation of the Board its Committees Individual Directors and Chairmanfor the financial yeaRs. 2018-19 was done as per the criteria as defined under theperformance evaluation policy as adopted by the Board. The detailed process of evaluationforms part of the Corporate Governance report.
AUDITORS AND AUDITORS REPORT
M/s. DTS & Associates Chartered Accountants Mumbai were appointed at the 30thAnnual General Meeting (AGM) held on 20th September 2017 for a period of fiveyears as the statutory auditors of the Company to hold office until the conclusion of theAnnual General Meeting to be held in the calendar yeaRs. 2022. The Company had receivedletter from the said firm that their appointment is within the prescribed limits andconfirmed that they are not disqualified pursuant to provisions of the Companies Act 2013and other applicable statutory provisions.
The Auditors' Report for the financial year ended 31st March 2019 on thefinancial statements of the Company is a part of this Annual Report. The notes onfinancial statement referred to in the Auditors' Report are self-explanatory and do notcall for any further comments. The Auditors' Report does not contain any qualificationreservation or adverse remark.
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 D. M. Zaveri & Co. (C.P No. 4363) a firm of Company Secretaries inPractice to undertake the secretarial audit of the Company. The secretarial audit reportfor the financial year ended 31st March 2019 does not contain anyqualification reservation or adverse remark and the same is enclosed as annexure II tothis Report.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
The Company has framed a CSR policy in compliance of the relevant provisions of theCompanies Act 2013 and the same is uploaded on the website of the Company and link forthe same is https://wsfx.in/assets/pdf/corporate-governance/Policies&Codes/CSR_Policy.pdf. An average net profit made during the three immediatelypreceding financial years calculated in accordance with the provisions of Section 198 isnegative. Hence the Company is not required to spend on CSR initiative for the FY2018-19. An average net profit of the Company for three preceeding financial years is R(6.22) Lakhs.
NOMINATION AND REMUNERATION POLICY
The Company has devised a policy on Nomination Remuneration and Board Diversityincluding criteria for determining qualifications positive attributes independence of adirector and other matters specified under the provisions of Section 178 of the CompaniesAct 2013. The said policy has been uploaded on the website of the Company and link forthe same ishttps://wsfx.in/assets/pdf/corporate-governance/Policies&Codes/Nomination_Remuneration%20and%2Board%20 Diversity%20policy.pdf.
The policy lays down criteria and terms and conditions with regard to identifyingpersons who are qualified to become directors (Executive and Non-Executive includingIndependent Directors) KMPs and persons who may be appointed in senior managementpositions and retain motivate and promote talent and to ensure long term sustainabilityof talented managerial persons and create competitive advantage for the Company.
Key provisions of the policy are summarized hereunder:
- The Board approves the remuneration of Executive Director on recommendation ofNomination of Remuneration Committee subject to approval of the shareholders. The Companypays remuneration to Executive Director in accordance with the applicable provisions ofthe Act and the rules framed thereunder.
- Non Executive Independent Directors are paid sitting fees for attending the Boardmeetings Audit Committee meetings and Nomination and Remuneration Committee meetings inaccordance with the Companies Act 2013. The Nomination and Remuneration Committee mayrecommend to the Board of Directors the payment of commission to the NonExecutiveIndependent Directors and Non-Executive Non-Independent Director and Promoter Director asper the provisions of the Act and the rules framed thereunder subject to approval of theShareholders if required.
- The Board on the recommendation of the Nomination and Remuneration Committeeapproves the remuneration payable to the Key Managerial Personnel and Senior ManagementPersonnel. The structure of remuneration payable to Key Managerial Personnel and SeniorManagement Personnel is in accordance with the compensation framework applicable to allemployees.
All the recommendations of the Audit Committee were accepted by the Board. Thecomposition of the Audit Committee forms part of the Corporate Governance Report.
RISK MANAGEMENT POLICY
The Company has in place a mechanism to identify assess monitor and mitigate variousrisks to key business objectives. Major risks identified by the functions aresystematically addressed through mitigating actions on a continuing basis. These arediscussed at the meetings of the Audit Committee and the Board of Directors of theCompany.
MEETING OF THE BOARD
During the period under review your Company has complied with the SecretarialStandards 1 related to Board Meetings issued by the Institute of Company Secretaries ofIndia.
The Board met four times during the year under review. The details of which are givenin Corporate Governance report which forms part of the Annual Report. The intervening gapbetween the meetings was within the period as prescribed under the Companies Act 2013 andthe Listing Regulations 2015.
COMMITTEES OF THE BOARD
Currently the Company has four Committees as indicated below:
(a) Audit Committee
(b) Nomination and Remuneration Committee
(c) Stakeholders Relationship Committee
(d) Corporate Social Responsibility Committee
Details of all the Committees along with their charters composition and meetings heldduring the year are provided in the corporate governance report forms part of the annualreport.
PARTICULARS OF EMPLOYEES AND RELATED DISCLOSURES
Disclosures pertaining to remuneration and other details as required under Section197(12) of the Act read with rule 5(1) 5(2) and 5(3) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 (including amendments thereof) formspart of this report and annexed as annexure III.
The details of sitting fees paid to Non-Executive Independent Directors during the FY2018-19 are provided in the corporate governance report forms part of the annual report.
During the year under review none of the employees of the Company were in receipt ofremuneration in excess of limits as prescribed under rule 5(2) of the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2016. Hence no reporting inthis regard would be required under rule 5(2) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2016.
EXTRACT OF ANNUAL REPORT
Pursuant to Section 134(3)(a) and Section 92(3) of the Companies Act 2013 read withrelevant rules framed thereunder the extract of Annual Return as on 31stMarch 2019 forms part of this Report and annexed as annexure IV and the same will beuploaded on the Company's website www.wsfx.in.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 134(5) of the Companies Act 2013 it ishereby confirmed that:
(a) in the preparation of the annual accounts the applicable accounting standards havebeen followed along with proper explanation relating to material departures;
(b) the Directors selected such accounting policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at the end of the financial year and of theprofit and loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a 'going concern' basis;
(e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
(f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems are adequate and operating effectively.
EMPLOYEE STOCK OPTION PLAN
The Board approved a fresh ESOP scheme titled 'Wall Street Finance Limited - EmployeesStock Option Plan 2018 (WSFL-ESOP 2018)' as recommended by the Nomination and RemunerationCommittee for an issue of options upto 17.35.000 to eligible employees including Directors(other than Promoters of the Company Independent Directors and Directors holding directlyor indirectly more than 10% of the outstanding Equity Shares of the Company) and toeligible employees of the holding and subsidiary company. The approval of members wasobtained through postal ballot on 7th April 2018 being last date of votingthrough ballot paper and e-voting.
The result was declared to BSE and uploaded on the Company's website www.wsfx.in on 9thApril 2018 for an issue upto 17.35.000 Options convertible into equity shares of theCompany in compliance of the provisions of the Companies Act 2013 Listing Regulations2015 and SEBI (Share based employee benefits) regulations 2014.
Further the Nomination and Remuneration Committee had granted 1033590 Options toeligible employees and Non-Executive Director on 7th June 2018 at the closingmarket price of 5th June 2018 i.e. RS. 25.20 per option. Vesting period ofoptions granted will be commenced after one year from the date of grant of options and itwill be vested in three tranches over a period of three years. Exercise period for thevested options will be valid for three years from the date of vesting. Each option isconvertible into one equity share of the Company. The details of vesting period andexercise of options are asunder:
|I. Vesting Details || || |
|Description ||Vesting Date ||No. of options |
|30% of granted options (1st Tranche) ||06/06/2019 ||310077 |
|30% of granted options (2nd Tranche) ||06/06/2020 ||310077 |
|40% of granted options (3rd Tranche) ||06/06/2021 ||413436 |
|II. Exercise Details || || |
|Number of options ||Last date for Exercise ||Exercise Price |
|Exercise of 310077 options vested on 06/06/2019 ||06/06/2022 ||RS. 25.20/- per option |
|Exercise of 310077 options vested on 06/06/2020 ||06/06/2023 ||RS. 25.20/- per option |
|Exercise of 413436 options vested on 06/06/2021 ||06/06/2024 ||RS. 25.20/- per option |
The relevant details on the options granted and the accounting of their costs are setout in the notes to the Standalone Financial Statements.
A separate section on Corporate Governance standards followed by the Company asstipulated under Regulation 27 of the Listing Regulations 2015 along with StatutoryAuditors and Secretarial Auditors certificates in compliance of Schedule V of Regulation34(2) thereon forms part of the Annual Report.
DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION PROHIBITIONAND REDRESSAL) ACT 2013
The Company has in place Sexual Harassment policy in line with the requirements of theSexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal) Act2013 readwith relevant rules framed thereunder. This policy provides for protectionagainst sexual harassment of women at work place and for prevention and redressal of suchcomplaints.
The Company has complied with provisions relating to the constitution of InternalComplaints Committee under the Sexual Harassment of Women at Workplace (PreventionProhibition and Redressal) Act 2013. There was no complaint received from any employeeduring the financial yeaRs. 2018-19.
There were no significant and material orders passed by the regulators or courts ortribunals impacting the going concern status and the Company's operation in future.
Your Directors would like to place on record their sincere appreciation and gratitudefor the guidance provided by the Reserve Bank of India and other statutory authorities andsupport received from bankers shareholders business associates and the esteemedcustomers during the year under review.
The Directors also wish to thank all the employees for their sincere efforts at alllevels.
| || ||For and on behalf of the Board |
| ||Narasimhan Srikrishna ||Brij Gopal Daga |
|Date : 28th May 2019 ||Director ||Director |
|Place : Mumbai ||DIN : 07175251 ||DIN : 00004858 |