DIRECTORS' REPORT Dear Shareholders, Your Directors take pleasure in presenting the One Hundred & Third Annual Report on the business and operations of your Company together with the Audited Accounts for the Financial Year ended 31 st March, 2016. 2. DIVIDEND: Your Directors are pleased to recommend for the approval of the shareholders dividend @ 7.50% i.e. Rs. 0.75 per share for the year ended 31 st March, 2016. 3. SHARE CAPITAL OF THE COMPANY: The Paid up Equity Share Capital, as at 31 st March, 2016 was Rs. 25,500,000/- divided into 25,50,000 Equity shares, having face value of Rs. 10/- each fully paid up. During the year under review, the Company has not issued any shares with differential voting rights nor granted any stock options or sweat equity. 4. WORKING RESULT : The Company's gross turnover is slightly higher than the previous year and profit before tax has improved substantially as compared to the previous year. This has been possible due to sustained efforts from the employees of the Company. 5. FUTURE OUTLOOK: The Company has been exploring opportunities to increase the trading activities and diversify into new areas for better growth. 6. BOARD OF DIRECTORS: In accordance with the provisions of Section 152 of the Companies Act 2013 and the Articles of Association of the Company, Ms. Paramita Mahapatra, retires by rotation at the forthcoming Annual General Meeting and being eligible has offered herself for re-appointment. During the year under review, Mr. Prakash Mehta, Director of the Company has resigned w.e.f. January 12,2016 &, in lieu towards filling the vacancy created by Mr. Prakash Mehta the Company has appointed Mr. Rajivkumar Bakshi as an Additional Director w.e.f. 3rd February, 2016. Your Board proposes to regularize his appointment under Section 161 (1 ) of the Act and appoint him as an Independent Director for a term of 2 (two)years. 7. DECLARATION BY INDEPENDENT DIRECTOR (S) Ail Independent Directors have given declaration that they meet the criteria of Independence as laid down under section 149(6) of the Companies Act 2013 8. DIRECTORS* RESPONSIBILITY STATEMENT: Pursuant to section 134 (3) (c) of the Companies Act 2013, the Directors Confirm : a. that in the preparation of the Annual Accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures, if any; b. that the Directors had selected such accounting policies and applied them consistently and made judgments and estima.tes that are reasonable and prudent so as to give a true and fair view of the state of affaire of the company at the end of the financial year and of the profit and loss of the company for that period; c. the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets 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 the company and that such internal financial controls are adequate and were operating effectively. f. the Directors had devised proper Systems to ensure compliance with the provisions of ail applicable laws and that such Systems were adequate and operating effectively 10. BOARD EVALUATION: The Company's Board of Directors are dedicated to act in good faith; in the best interest of the company and its stakeholders. . With an aim to maintain a proactive and effective Board, the Board has committed to a continuing process of recommending and laying down the criteria to evaluate the performance of the entire Board of the Company. Some of the specifie issues on which performance of the Board, Individual Directors & its Committees as per their policies & parameters were discussed atthe meeting held on February 03,2016: Sr.NoJ Assessment Criteria Attendance, participations in the Meetings and timely inputs on the minutes of the meetings Contribution towards growth of the Company including actual vis-a-vis budgeted performance. Leadership initiative, like new ideas and planning towards growth of the Company and steps initiated towards Branding of the Products of the Company. 4 Adherence to ethical standards & code of conduct of Company 5 Team work attributes and supervising & training of staff members 6 Compliance with policies, Reporting of frauds, violation etc. and disclosureof interest 7 Safeguarding of interest of whistle blowers under vigil mechanism and Safeguard of confidential information 11. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS: The details of the number of meetings of the Board held during the Financial Year 2015-2016 forms a part of the Voluntary Corporate Governance Report. 12. AUDIT COMMITTEE: The Audit Committee as on March 31,2016 comprises of the following Independent and Executive Directors: Mr. Kaushik D. Shah, Mr. Pinaki Misra, Mr. Rajivkumar Bakshi & Mr. Pavan G. Morarka as members. Further, ail recommendations of Audit Committee were accepted by the Board of Directors. Other details about the Audit Committee and other Committees of the Board are provided in the Voluntary Corporate Governance Report forming part of this Annual Report. 13. NOMINATION & REMUNERATION POLICY: The Company has been following well laid down policy on appointment and remuneration of Directors, KMP and Senior Management Personnel. The appointment of Directors is made pursuant to the recommendation of Nomination and Remuneration Committee (NRC). The remuneration of Executive Directors comprises of Basic Salary and Perquisites & follows applicable requirements of the Companies Act, 2013. Approval of shareholders for payment of remuneration to Executive Directors is sought, from time to time. The remuneration of Non-Executive Directors comprises of sitting fees in accordance with the provisions of Companies Act, 2013 and reimbursement of expenses incurred in connection with attending the Bpard meetings, Committee meetings, General Meetings and in relation to the business of the Company. 14. VIGIL MECHANISM / WHISTLE BLOWER POLICY: The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns, grievances, frauds and mismanagements, if any. The Vigil Mechanism /Whistle Blower policy has been posted on the website of the Company (www.whbrady.in). 15. PREVENTION OF SEXUAL HARASSMENT: The Company has constituted an Internal Complaint Committee as required under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressai) Act, 2013 and the Rules made there under. During the year under review, no complaints were reported. 16. FIXED DEPOSITS: Your Company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014. 17. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: The Company has not given any guarantees during the Financial Year 2015-16 but has granted loans and made investments covered under Section 186 of the Companies Act, 2013 which forms a part of the notes to the financial statements provided in this Annual Report. 18. EXTRACT OF ANNUAL RETURN: The details forming part of the extract of the Annual Return in form MGT-9, as required under Section 92 of the Companies Act, 2013, is included in this Report as Annexure "A" and forms an integral part of this Report. 19. RELATED PARTYTRANSACTIONS: AH Related Party transactions that were entered into during the Financial Year were on arm's length basis and were in the ordinary course of the business. AH the Related Party Transactions are placed before the Audit Committee and also to the Board for their approval in accordance with the Related Party Transactions Policy of the Company. The disclosure in Form AOC-2 is given as per Annexure "B". 20. CORPORATE SOCIAL RESPONSIBILITY (CSR) The provisions of Section 135 of the Companies Act, 2013 read with the Rules made thereunder, in respect of Corporate Social Responsibility Policy were not applicable to the Company for the Financial Year 2015-16. 21. CODEOFCONDUCT: Your Company is committed to conducting its business in accordance with the applicable laws, rules and regulations and highest standards of business ethics. In recognition thereof, the Board of Directors has implemented a Code of Conduct for adherence by the Directors, Senior Management Personnel and Employees of the Company. This will help in dealing with ethical issues and also foster a culture of accountability and integrity. The Code has been posted on the Company's website www.whbrady.in AH the Board Members and Senior Management Personnel have confirmed compliance with the Code. 22. SUBSIDIARIES, ASSOCIATE COMPANIES & JOINT VENTURES : Brady & Morris Engineering Co. Ltd. (Subsidiary Company) M/s. Brady & Morris Engineering Co. Ltd is carrying on the business of manufacturing material handling Equipments. The Company holds 72.50% of the Equity Share Capital and 100% of the 7% Redeemable Non Cumulative Non Convertible Preference Shares in Subsidiary Company as on 31 st March, 2016. The Annual Accounts of Subsidiary Company for the year ended 31 st March 2016 along with the Report are annexed with the Company's Annual Report for the information of the shareholders. Astatement containing the details of the Subsidiary is attached in Form AOC-1 in the given Annexure "C". 23. APPOINTMENT OF AUDITORS: M/s. C. L. Dalal &Co., Chartered Accountants, were appointed as the Statutory Auditors of the Company atthe AGM held on 27th September, 2014 to hold office until the conclusion of the 104th AGM, are recommended for ratification of appointment for the Financial Year 2016-17. As required under the provisions of Section 139 of the Companies Act, 2013, the Company has obtained written confirmation from M/s. C. L. Dalal & Co., Chartered Accountants that their appointment, if made, would be in conformity with the limits specified in the said Section. 24. SECRETARIALAUDIT: Pursuant to provisions of Section 204 of the Companies Act, 2013 and the Rules made there under, the Company has appointed M/s. GMJ & Associates, Company Secretaries to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure "D" and forms an integral part to this Report. 25. AUDITOR'S REPORT/SECRETARIAL AUDIT REPORT: The Auditors Report and the Secretarial Audit Report for the year ended 31/03/2016 do not contain any qualification,* reservation & adverse remark. 26. INTERN AL CONTROL SYSTEMS AND THEIR ADEQUACY: The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined by the Audit Committee. To maintain its objectivity and independence, the Internal Audit function reports to the Chairperson of the Audit Committee of the Board of Directors. The Internal Audit Department monitors and evalua.tes the efficacy and adequacy of internal control System in the Company, its compliance with operating Systems, accounting procedures and policies of the Company. Based on the report of internal audit function, the Company undertakes corrective action in their respective areas and thereby strengthens the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee of the Board. 27. PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO: The information on conservation of energy, technology absorption pursuant to Section 134(3)(m) of the Companies Act, 2013, read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is not applicable to the Company as there was no manufacturing activity during the year. FOREIGN EXCHANGE EARNING AND OUTGO Please refer Notes 25 & 34 28. RISK MANAGEMENT POLICY: The Company has a Risk Management Policy with the Objective to formalize the process of Identification of Potential risk and adopt appropriate risk mitigation measures through a risk management structure. The Policy is a step by the Company towards strengthening the existing internal controls and updating the same as may be required from time to time. 29. PARTICULARS OF EMPLOYEES: The information required pursuant to Section 197 read with Rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed as Annexure "E" to this Report. None of the employees of the Company fall within the purview of the information required under Section 197 read with Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 during the financial year. 30. CORPORATE GOVERNANCE: The Voluntary Corporate Governance Report, which forms an integral part of this Report, is set out in Annexure "F", as stipulated under various regulations of the SEBI (Listing obligations and disclosure requirements) Regulations, 2015. 31. HEALTH, SAFETY AND ENVIRONMENT: The Company, in order to fulfill its commitment towards health, safety and environment, hastaken active steps towards Safety Management System. For developing effectiveness of Safety Management System, training of ail employees across the Company is ensured through various training programs. The same is being monitored through internal audit teams and delegation of safety management up to the local level. Further, emergency management plans are reviewed and updated regularly. Regular site visits ensure the enhancement of safety culture which has also ensured the safe commissioning of the newprojects. v 32. INSURANCE: Ail the properties of the Company including Office Building, Plant & Machinery, Stocks, etc. are adequately insured. 33. ACKNOWLEDGEMENT: The Directors take this opportunity to express their appreciation for the cooperation received from the Company's Bankers, valuable Customers and others concerned with the Company. Your involvement as shareholders is greatly valued and your board looks forward to your continued support Registered Office : Brady House, 12-14, Veer Nariman Road, Fort, Mumbai -400 001. May 20, 2016. For and on behalf of the Board W. H. Brady & Co. Limited PAVAN G. MORARKA (DIN: 00174796) Chairman & Managing Director |