DIRECTORS' REPORT Dear Shareholders, Your Directors present the 32nd Annual Report of the Company along with the Audited Financial Statements for the financial year ended 31st March, 2015. Dividend The Directors have refrained from recommending dividend for the year. Transfer to Reserves Your Company does not transfer any amount to reserves for the financial year 2014-15. Operations The Company is currently engaged in skill training in media and entertainment sectors under the brand name "EMDI Institute of Media & Communication (EMDI)" - a leader in Advertising, Event Management, PR and Journalism. This year EMDI enter's its 14th year of pioneering training. The Company is currently offering courses of EMDI at Mumbai, Delhi, Indore, Bhopal, Dubai and Uganda. During the year under review, EMDI Institute of Media and Communication, India has received the "The Global Quality Awards" for Quality & Excellence in Professional Education (Media & Communication) from Brands Academy and "The Edutainment Awards" for First Best Event Management School in India from Event Capital. EMDI - Dubai courses are accredited by EDEXCEL ASSURED CENTRE, UK's largest vocational accreditation board and EMDI Dubai is probably the only Institute offering industry relevant specialised courses in Dubai. During the year under review, the Company has also launched industry relevant courses in Digital Marketing & E-commerce under the brand name "World Media Academy (WMA)". With this initiative the Company continues to support the Prime Minister - Mr. Narendra Modi's vision of both Skill India & Digital India. For the pilot batch, WMA has received an encouraging response. The Company also offers specialized course in Wedding Planning through a LLP venture Company. Directors and Key Managerial Personnel In accordance with the provisions of the Companies Act, 2013 (the Act) and Articles of Association of the Company, Ms. Bela Desai will retires by rotation as Director at the ensuing Annual General Meeting and being eligible, offers herself for reappointment. Brief profile of Ms. Bela Desai is annexed to the Notice of Annual General Meeting as stipulated under Clause 49 of the Listing Agreement with the BSE. To broad base the Board of Directors, Mr. Yajurvindra Singh Bilkha was appointed as an Additional Director of the Company w.e.f. 4th July, 2015 through circular resolution and the Board has ratified his appointment at their meeting held on 13th August, 2015. He holds office up to the forthcoming Annual General Meeting pursuant to provisions of Section 161 of the Companies Act, 2013. The Company has received notice under Section 160 of the Companies Act, 2013, proposing his candidature for the office of Director liable to retire by rotation. Mr. Nowshir Engineer has been re-appointed as Managing Director of the Company for a period of 3 years w.e.f. 1st July, 2014 and the said re-appointment has been approved by the Central Government and members of the Company at their Annual General Meeting held on 25th September, 2014. Pursuant to Section 149 of the Companies Act, 2013, Mr. Abbas Patel and Dr. Anil Naik appointed as Independent Directors of the Company, not liable to retire by rotation for a period of five consecutive years with effect from 25th September, 2014. These Directors have given the declarations of independence to the Board confirming that they meet the criteria of independence as provided under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. Mr. Farhad Wadia has resigned as Director of the Company with effect from 13th May, 2015. The Board places on record its appreciation for the valuable contribution made by him during his tenure as a Director of the Company. Pursuant to the provisions of Section 203 of the Act, the appointment of Mr. Nowshir Engineer, Managing Director, Ms. Binal Gala, Chief Financial Officer and Mr. Dharmesh Parekh, Company Secretary, were formalized as the Key Managerial Personnel of the Company. During the year, Ms. Binal Gala has resigned as Chief Financial Officer of the Company and in her place Mr. Samkeet Patel has appointed as Chief Financial Officer of the Company. Particulars of Employees Since none of the employees of the Company was drawing remuneration in excess of the limits laid down under the provisions of Rules 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended from time to time, therefore details therewith are not furnished. Details of Remuneration to Directors The information relating to remuneration of directors as required under Section 197(12) of the Companies Act, 2013 and Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is given in Annexure A to this report. Number of Meetings of the Board During the financial year ended on 31st March, 2015 the Board of Directors of your Company have met 7 (Seven) times. For further details, please refer report on Corporate Governance of this Annual Report. Details of Committees of Directors Composition of Audit Committee, Nomination and Remuneration Committee and Stakeholders Relationship Committee, number of meetings held of each Committee during the financial year 2014 - 15 and meetings attended by each member of the Committee as required under the Companies Act, 2013 are provided in Corporate Governance Report and forming part of the report. The recommendation by the Audit Committee as and when made to the Board has been accepted by it. Material Changes and Commitment affecting the Financial Position of the Company There have been no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report. Subsidiary Companies and Joint ventures Your Company has one subsidiary company viz., EMDI (Overseas) FZ LLC, a wholly owned subsidiary. The Company is also one of the partners in EMDI Wedding Academy LLP (50% share). The gross revenue of subsidiary for the financial year 2015 stood at AED 3,108,944 (Previous Year : AED 3,250,069). During the year, the Company had a profit of AED 495,875 (Previous year : AED 488,987). The gross revenue of joint venture partnership for the financial year 2015 stood at Rs. 19.20 lacs as against Rs. 6.87 lacs in the previous period. The profit before tax for the financial year 2015 was Rs. 1.52 lacs as against loss of Rs. 0.65 lacs in the previous period. The Company has divested its entire shareholding in its joint venture subsidiary - Eduhub Education Private Limited on 31st March, 2015, therefore, Eduhub Education Private Limited ceased to be a joint venture subsidiary of the Company. There are no associate companies within the meaning of Section 2(6) of the Companies Act, 2013. Further there has been no material change in the nature of business of the subsidiaries. Pursuant to provisions of Section 129(3) of the Act, a statement containing salient features of the financial statements of subsidiary company and joint venture partnership for the year ended 31st March, 2015 in Form AOC - 1 is attached to the financial statements of the Company. As required under the Companies Act, 2013 and the Listing Agreement with the Stock Exchange, the Company has prepared the Consolidated Financial Statements of the Company along with its subsidiary and joint venture partnership as per Accounting Standard which form part of the Annual Report and Accounts. The Annual Accounts of the subsidiary company and joint venture partnership along with related detailed information will be made available to the shareholders of the Company seeking such information. The Annual Accounts of the subsidiary company and joint venture partnership are also kept for inspection by any members at the Registered Office of the Company on all working days except Saturdays, during business hours upto the date of the meeting. Whistle Blower Policy/Vigil Mechanism Your Company has framed Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The details of the policy are given in Corporate Governance Report and policy is posted on the Company's website www.greycellsltd.com Risk Management Policy Your Company has approved Risk Management Policy wherein all material risks faced by the Company are identified and assessed. For each of the Risks identified, corresponding controls are assessed and policies and procedure are put in place for monitoring, mitigating and reporting risk on a periodic basis. Nomination and Remuneration Policy As required under Section 178 of the Companies Act, 2013 the Board of Directors has approved the Nomination and Remuneration Policy, which lays down a framework in relation to remuneration of Directors, Key Managerial Personnel and Senior Management of the Company. This policy also lays down criteria for determining qualifications, positive attributes, independence of Directors and other matters provided under sub-section (3) of Section 178 of the Companies Act, 2013. Gist of this policy are given in Annexure - B to this report. The detailed policy is posted on the Company's website www.greycellsltd.com Disclosure under the Sexual Harassment of women at workplace (Prevention, Prohibition and Redressal) Act, 2013 The Company has in place an Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of women at the workplace (Prevention, Prohibition and Redressal) Act, 2013. Complaint Redressal Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. Extract of Annual Report The details forming part of the Extract of Annual Return in Form MGT - 9 as required under Section 92 of the Companies Act, 2013 is included in this report as Annexure - C and form integral part of this Report. Auditors and Auditors' Report Statutory Auditors Pursuant to the provisions of Section 139 of the Act and the rules framed there under, M/s. Ford, Rhodes, Parks & Co., Chartered Accountants, were appointed as statutory auditors of the Company from the conclusion of the Annual General Meeting (AGM) of the Company held on 25th September, 2014 till the conclusion of the AGM to be held in the year 2017, subject to ratification of their appointment at every AGM. The Board of Directors of the Company at its meeting held on 13th May, 2015 recommended to the members of the company ratification of appointment of M/s. Ford, Rhodes, Parks & Co., Chartered Accountants as the Statutory Auditors of the Company for the financial year 2015-16. The Company has obtained a written consent from the Auditors to such continued appointment and also a certificate from them to the effect that their appointment, if ratified, would be in accordance with the conditions prescribed under the Companies Act, 2013 and the rules made there under, as may be applicable. The notes on accounts referred to in the Auditors' Report are self explanatory and do not require further clarifications by the Board except the Auditors has given one qualified opinion that is "The consolidated financial statements do not include the results of its erstwhile joint venture subsidiary - Eduhub Education Private Limited for the year ended 31st March, 2015." The reply of your Directors with respect to it as "The management of the operation of the joint venture subsidiary company - Eduhub Education Private Limited vested with minority shareholders. The Company did not receive the duly approved audited/unaudited financial results post June, 2014, hence the Company has not consolidated the same in its quarterly results. As on 31st March, 2015, the Company has divested its entire shareholding in its joint venture subsidiary." Secretarial Audit The Board has appointed Mr. Ashish Kumar Jain of A. K. Jain & Co., Company Secretaries, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed herewith marked as Annexure - D to this Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remarks or disclaimer. Deposit from Public The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet. Particulars of Loans, Guarantees or Investments by Company Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to Financial Statements. Related Party Transaction All Related Party Transactions entered during the year were in Ordinary Course of the Business and on arm's length basis. No Material Related Party Transactions, i.e. transactions exceeding ten percent of the annual consolidated turnover as per the last audited financial statements, were entered during the year by your Company. Accordingly, the disclosure of Related Party Transactions as required under Section 134(3)(h) of the Companies Act, 2013 in Form AOC - 2 is not applicable. All related party transactions are placed before the Audit Committee and also before the Board for approval on quarterly basis. Prior omnibus approval of the Audit Committee is obtained for the transactions which are of a foreseen and repetitive nature. The details of the related party transactions as required under Accounting Standard -18 are set out in Note No. 31 to the Standalone financial statements forming part of this Annual Report. Board Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board of Directors of the Company has carry out Annual evaluation of its own performance, its Committees and individual directors, the Board as a whole and that of Chairman after taking into consideration of the various aspects of the Board's functioning, composition of the Board and its Committees, culture, execution and performance of specific duties, obligations and governance. The performance evaluation of the Independent Directors was completed. The result of the evaluation is satisfactory and adequate and meets the requirement of the Company. Particulars of Conservation of Energy, technology absorption and foreign exchange earning and outgo a) Conservation of Energy The Company is not involved in any manufacturing activity and hence has low energy consumption levels. Nevertheless, the Company makes all efforts to conserve and optimize the use of energy by using energy - efficient infrastructure, computers and equipments with latest technologies. b) Technology Absorption and Research and Development The Company's research and development focus is on developing new frameworks, processes and methodologies to improve the speed and quality of service delivery. c) Foreign Exchange Earnings and Outgo The earnings and expenditure in foreign exchange were as under: Earning Rs. 10.64 lacs Expenditure Rs. 0.60 lacs Corporate Governance Report and Management's Discussion and Analysis Report A separate section on Corporate Governance along with the Management Discussion & Analysis forming part of Directors' Report and certificate from the company secretary in whole time practice regarding compliance of conditions of Corporate Governance stipulated in Clause 49 of the Listing Agreement is annexed to and forms part of the Director's Report. The Ministry of Corporate Affairs has made majority of the provisions of the Companies Act, 2013 effective from 1st April, 2014. Your Company is already in substantial compliance of most of the governance requirements provided under the new law. Pursuant to the revised Clause 49 of the Listing Agreement your Company has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as prescribed under the Listing Agreement are complied with. As on the last day of the previous financial year, the paid up equity share capital of the Company is Rs. 7,90,77,150/- therefore Clause 49 shall not be mandatory to the Company as per the SEBI Circular No. CIR/CFD/POLICY CELL/712014 dated, September 15, 2014. However the Company has complied with some of the provisions of Clause 49 voluntarily to the extent possible. Your Company has proactively adopted provisions related to formation of Nomination and Remuneration Committee and Stakeholder Relationship Committee, ahead of implementation of the new law. Your Company is committed to embrace the new law in letter and spirit. Directors' Responsibility Statement In terms of Section 134(3)(c) of the Companies Act, 2013 in relation to financial statements for the year ended 31st March, 2015, the Board of Directors confirm/state that: a) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departure; b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date; c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets 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 the Company and that such internal financial controls are adequate and are operating effectively; and f) the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively. Acknowledgements Your Directors wish to thank all Employees, Bankers, Investors, Business Associates, Advisors etc. for their continued support during the year. By order of the Board of Directors of Greycells Education Limited Abbas Patel Chairman Place : Mumbai Date : 13th August, 2015 |