DIRECTORS' REPORT To The Members, Your Directors have pleasure in presenting the Twenty Ninth Annual Report, together with the Audited statements of Accounts of the Company for the year ended 31st March, 2015 along with Auditor's Report thereon: OPERATIONS During the year 2014-2015 the company has earned net profit of Rs.5.86 Lakhs as against loss of Rs.2.73 Lakhs during the year 2013-2014. CHANGE IN THE NATURE OF BUSINESS: During the year under review, there has been no change in the nature of business of the Company. DIRECTORS Sri. Y. B. K. Murthy, Director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. Pursuant to Sections 149 (6) & 149 (7) of the Companies Act, 2013, the Independent directors of the company gave a declaration that they have complied with the criteria of independence as set out under sub section (6) of section 149 of the Companies Act, 2013. BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation has been carried out as per the Nomination and Remuneration Policy. During the year Six Board Meetings were properly convened and held. KEY MANAGERIAL PERSONNEL The Company had already appointed Shri. N. Swaroop Kumar, as Manager, Miss. Y. Vasavi as Chief Financial Officer and Ms. Akshita Surana as the Company Secretary. The Board designated them as Key Managerial personnel of the Company under the provisions of the Companies Act, 2013. NAMES OF THE COMPANIES WHICH HAVE BECOME/CEASED TO BE SUBSIDIARIES, JOINT VENTURES OR ASSOCIATE COMPANIES DURING THE YEAR The Company did not have any subsidiaries, associates or joint ventures during the year. FIXED DEPOSITS The 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. SIGNIFICANT MATERIAL ORDERS PASSED BY THE COURTS / REGULATORS / TRIBUNALS IMPACTING GOING CONCERN STATUS AND COMPANY'S OPERATIONS To the best of our knowledge, the Company has not received any such orders from Regulators, Courts or Tribunals during the year, which may impact going concern status or the company's operations in future. DETAILS IN RESPECT OF ADEQUACY OF INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENTS The Company has in place proper and adequate internal control systems commensurate with the nature of its business, and size and complexity of its operations. Internal control systems comprising of policies and procedures designed to ensure reliability of financial reporting, timely feedback on achievement of operational and strategic goals, compliance with policies, procedures, applicable laws and regulations, and that all assets and resources are acquired are used economically. TRANSFER TO STATUTORY RESERVE The Company has transferred an amount of Rs. 1,20,000/- towards statutory reserve. DIVIDEND In view of accumulated losses, your directors do not recommend any dividend for the Financial Year 2014-2015. DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to the requirements under Section 134(5) of the Companies Act, 2013, in respect of Directors' responsibility statement, Your Directors state that: i. In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures; ii. Appropriate accounting policies had been selected and applied 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 at the end of the financial year 2014-15 and of the profit of the Company for that period; iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; iv. The annual accounts for the year 2014-2015 have been prepared on a going concern basis. v. That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively, and vi. That systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. AUDITORS The shareholders in their meeting held on 26th September, 2014 approved the appointment of M/s Janardhan Rao Deshmukh & Co., Chartered Accountants, Hyderabad, as the Statutory Auditors of the Company to hold office till the conclusion of 31st Annual General Meeting subject to ratification of shareholders in every Annual General Meeting. Accordingly, a resolution seeking Members ratification on appointment of M/s. Janardhan Rao Deshmukh & Co., Chartered Accountants, Hyderabad, as the Statutory Auditors of the Company for the financial year 2015-16 is included at item No.3 of the Notice convening the Annual General Meeting, as required under clause 49 of the Listing Agreement. SECRETARIAL AUDIT Pursuant to provisions of section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. PS. Rao & Associates a firm of Company Secretaries in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as Annexure I to this Report. INTERNAL AUDITORS The Board on the recommendations of the Audit Committee have appointed M/s. Suresh and Babu, Chartered Accountants as internal auditors of the Company. AUDIT COMMITTEE The following is the composition of Audit Committee as at 31st March, 2015: 1. Sri. P.R.K. Murthy 2. Mrs. S. Jhansi Kumari 3. Sri.Y.B.K. Murthy NOMINATION AND REMUNERATION COMMITTEE The following is the composition of Nomination and Remuneration Committee as at 31st March, 2015: 1. Sri. RR.K. Murthy 2. Mrs. S. Jhansi Kumari 3. Sri.Y.B.K. Murthy The Board has on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The terms of reference of the Nomination and Remuneration Committee includes the following: To identify and recommend to the Board, in accordance with the criteria as laid down, for appointment/reappointment/removal of the Executive/Non-Executive Directors and the senior management of the Company; To formulate criteria for evaluation and evaluate the performance of every director, including the independent Directors; To formulate the criteria for determining qualifications, positive attributes and independence of the Directors; To recommend to the Board a remuneration policy for the Directors, Key Managerial Personnel and other employees of the Company; To formulate the policy of remuneration and ensure that a. The level and composition of remuneration is reasonable, commensurate with the qualifications and experience, and sufficient to attract, retain and motivate directors, key managerial personnel of the quality required to run the company successfully; b. Relationship of remuneration to performance is clear and meets appropriate performance benchmarks and; Any other function as may be mandated by the Board or stipulated by the Companies Act, 2013, SEBI, Stock Exchanges or any other regulatory authorities from time to time. STAKE HOLDERS RELATIONSHIP COMMITTEE The following is the composition of Stake Holders Relationship Committee as at 31st March, 2015: 1. Mr. P.R.K. Murthy 2. Mrs. Jhansi Kumari 3. Mr. T. Adinarayana The Committee focuses on shareholders' grievances and strengthening of investor relations. The committee looks after the services of the Registrars and share transfer agents and recommends measures for providing efficient services to investors. The Committee specifically looks into investor complaints like Transfer/transmission/transposition of shares, and other related issues. There were no complaints pending for redressal as at 31st March, 2015. MEETING OF INDEPENDENT DIRECTORS The Independent directors of the company have met separately without the attendance of Non-Executive Directors on 30th March, 2015 inter-alia, review the performance of the Manager, Non-Executive Directors and the Board as a whole. The independent Directors in the said meeting also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board to effectively and reasonably perform its duties. CHANGES IN THE SHARE CAPITAL During the year the company has not issued any fresh shares. RISK MANAGEMENT The Company has a risk management policy and an internal control frame work, which is used to mitigate the risks.The Board and Audit committee on regular intervals are updated on the risk management systems, processes and minimization procedure of the Company. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES OF COMPANY The Company has a Whistle Blower Policy to deal with instances of fraud and mismanagement, if any in the Company and the requisite mechanism for directors and employees to report genuine concerns has been established. STAKE HOLDERS RELATIONSHIP COMMITTEE The following is the composition of Stake Holders Relationship Committee as at 31st March, 2015: 1. Mr. P.R.K. Murthy 2. Mrs. Jhansi Kumari 3. Mr. T. Adinarayana The Committee focuses on shareholders' grievances and strengthening of investor relations. The committee looks after the services of the Registrars and share transfer agents and recommends measures for providing efficient services to investors. The Committee specifically looks into investor complaints like Transfer/transmission/transposition of shares, and other related issues. There were no complaints pending for redressal as at 31st March, 2015. MEETING OF INDEPENDENT DIRECTORS The Independent directors of the company have met separately without the attendance of Non-Executive Directors on 30th March, 2015 inter-alia, review the performance of the Manager, Non-Executive Directors and the Board as a whole. The independent Directors in the said meeting also assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board to effectively and reasonably perform its duties. CHANGES IN THE SHARE CAPITAL During the year the company has not issued any fresh shares. RISK MANAGEMENT The Company has a risk management policy and an internal control frame work, which is used to mitigate the risks.The Board and Audit committee on regular intervals are updated on the risk management systems, processes and minimization procedure of the Company. VIGIL MECHANISM FOR DIRECTORS AND EMPLOYEES OF COMPANY The Company has a Whistle Blower Policy to deal with instances of fraud and mismanagement, if any in the Company and the requisite mechanism for directors and employees to report genuine concerns has been established. EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in Form MGT -9 are annexed herewith as Annexure - II. RELATED PARTY TRANSATIONS As a matter of policy, your company carries out transactions with related parties on an arms-length basis. Disclosures as required under form AOC-2 are annexed herewith as Annexure - III and also contained in Note 31 and 32 (Other Notes to Financial Statements). There are no materially significant related party transactions made by the company with promoters, directors, key managerial personnel which may have a potential conflict with the interests of the company at large. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The Company being a non banking finance company registered with Reserve Bank of India, it mainly deals in the business of Investments and financing activities, is exempt from complying with the provisions of Section 186 of the Companies Act, 2013. Accordingly, the disclosures of the loans given and Investments made as required under the aforesaid section have not been given in this report. OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 In order to prevent sexual harassment of women at work place a new act The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 has been notified on 9th December, 2013. The primary objective of the said policy is to protect the women employees from sexual harassment at the place of work and also provides for punishment in case of false and malicious representations. During the financial year 2014-2015, the Company has not received any complaint of sexual harassment against women employees of the Company. LISTING OF EQUITY SHARES Your company shares are listed with the BSE Ltd., the listing fee has been paid for the financial year 2015-2016. MANAGEMENT DISCUSSION AND ANALYSIS India started the financial year 2014-2015, on a very positive note after the general elections with significant improvement in the sentiment both USHAKIRAN FINANCE LIMITED in the capital markets and the business environment. While the economy has been reported to have grown at 7.5% in the financial year 2015 as per the new series, it is not getting fully reflected in the performance of the corporate sector or in creation of investment. In the latter half of the financial year the economy and the markets have been affected by the global developments including the fiscal crisis faced by Greece, the less than expected performance of the Chinese economy, the volatility in commodity markets especially in metals and minerals. The remarkable story in these circumstances has been the growth of the e-commerce business cutting across many sectors including retail, property, used cars, fashion, insurance, household services and many more. It is comparable to the growth of IT and the ITES sector in the earlier years and the interesting fact is that in both these businesses the government intervention has been minimal. The impact of this growth in e-commerce business on the economy would be felt in the coming years in terms of employment, investment in technology and logistics etc. In the year under review the company has earned nominal profits. Your Directors hope that the Government will be able to push through the critical reforms and then markets may see significant growth. The Company undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned not to place undue reliance on these forward looking statements. CORPORATE GOVERNANCE Compliance with the provisions of clause 49 of the Listing Agreement with regard to corporate governance report is not mandatory as the Equity Share Capital of the company do not exceed Rs.10 crores and net worth do not exceed Rs.25 crores as per SEBI circular no.CIR/CFD/ POLICYCELL/7/2014 dt. 15-9-2014, hence corporate governance report has not been enclosed to directors report. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUT GO U/S. 134 (3) (m) OF COMPANIES ACT, 2013 READ WITH RULE 8 OF THE COMPANIES (ACCOUNTS), RULES 2014. The company has not engaged in any manufacturing activity and thus its operations are not energy intensive. However, adequate measures are always taken to ensure optimum utilization and maximum possible saving of energy. There were no Foreign Exchange earnings and out go during the year. PARTICULARS OF EMPLOYEES The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the company is herewith annexed as Annexure "IV". ACKNOWLEDGEMENTS: Your Directors gratefully acknowledge the continued assistance and cooperation extended by various Government Authorities, and banks to the company. The Board expresses its appreciation of the understanding, dedication and support extended by the employees of the Company. Your Directors also sincerely acknowledge the confidence and faith reposed by the shareholders in the Company. For and on behalf of the Board (T. Adinarayana) Chairman Place: Hyderabad Date : 29.05.2015 |