DIRECTORS' REPORT To, The Members, Your Directors have pleasure in presenting their Twenty Ninth Annual Report on the business and operations of the Company and the accounts for the Financial Year ended March 31, 2015. b) Dividend Your directors wish to retain the profit for the growth and development of the Company. Hence no dividend is recommended for the financial year ending 31st March 2015. c) Reserves During the year an amount of Rs.760,000/- (Rupees Seven Lakhs Sixty Thousand only) is transferred to Statutory Reserve as per Section 45-IC of the Reserve Bank of India Act, 1934. d) Brief description of the Company's working during the year/State of Company's affair During the year under report, the Company extended hire purchase finance to the tune of Rs. 337.54 lakhs and financing under other credit facility of Rs.66.35 lakhs. The total income of the Company is at Rs.181.52 lakhs during the year under review as against Rs.158.74 lakhs in the previous financial year; and the profit before tax during the year under review is at Rs. 44.79 lakhs as compared to Rs.23.26 lakhs in the previous financial year; and that profit after tax during the year under review is at Rs. 37.99 lakhs as compared to Rs. 13.10 lakhs in the previous financial year. There is no separate reportable segment as per Accounting Standard - 17 as the operation related to one segment e) Information required under Non-Banking Financial Companies Acceptance Of Public Deposits (Reserve Bank) Directions, 1998 There are no instance where the public deposit of the company have not been claimed by the depositors or not paid by the company after the date on which the deposit became due for repayment.. As such The total amount due under such accounts remaining unclaimed or unpaid beyond the dates referred to above was NIL. f) Change in the nature of business, if any There is no significant change in the activities of the company. Your Company continues to advance finance under the various categories as in previous years. g) Material changes and commitments, if any, 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 No Material changes occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of this report. h) Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future There are no instances wherein significant and material orders passed by regulators or courts or tribunals had impacted the going concern status and company's operations. i) Details in respect of adequacy of internal financial controls with reference to the Financial Statements. The Company's Internal Control System is designed to ensure operational efficiency, protection and conservation of resources, accuracy and promptness in financial reporting and compliance with laws and regulations. Adequate Internal Control Systems and checks are in place, commensurate with the size of the Company and nature of its business. The management exercises financial control on the operations through a well defined monitoring process and standard operating procedures. During the year, your Company has appointed Mr. Rajesh Modi, Chartered Accountant, proprietor M/s Rajesh & Co. to conduct the internal audit. The Internal Auditor monitors and evaluates the efficiency and adequacy of internal control in the Company, its compliance with operating systems, accounting procedures and policies. Based on the findings of the Internal Auditor, the management takes corrective action in the respective areas and thereby strengthens the control mechanism. j) Vigil Mechanism / Whistle Blower Policy The company has a Vigil Mechanism Policy to deal with any instance of fraud or mismanagement. The details of the Policy are explained in the Corporate Governance Report and are also posted on the website of the company. k) Details of Subsidiary/Joint Ventures/Associate Companies Your Company do not have a Subsidiary/Joint Venture/Associate Company as such instances of reporting does not arise. l) Performance and financial position of each of the subsidiaries, associates and joint venture companies included in the consolidated financial statement. As there are no subsidiaries, associates and joint venture companies, instances of reporting on their performance and financial position does not arise. n) Statutory Auditors Pursuant to the new requirement of Section 139 (1) of the Companies Act, 2013 M/s Chandarana & Sanklecha, Chartered Accountants (Firm Registration No. 000557S) were appointed as Statutory Auditor for financial year 2014-15 and are to hold office till the conclusion of the forthcoming Annual General Meeting. They have confirmed their eligibility under Section 141 of the Companies Act 2013 and the Rules framed there under for re-appointment as Auditors of the Company. As required under Clause 49 of the Listing Agreement, The auditors have also confirmed that they hold a valid certificate issued by the Peer Review Board of the Institute of Chartered Accounts of India. As required by Section 139 (1) of the Companies Act, 2013 the appointment of Statutory Auditors is placed before the members for approval. o) Auditors' Report The Board of Directors wish to state that the Auditors Report on the Audited Financial Statement of the Company for the year ended 31st March 2015 do not contain any qualification, reservation or adverse remark, so need not require any explanation or comment p) Share Capital i. Issue of equity shares with differential rights The Board of Directors wish to inform that there are no instance during the financial year for issue of sweat equity shares as such the requirement for providing details as provided in rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014 does not arise. ii. Issue of sweat equity shares The Board of Directors wish to inform that there are no instance during the financial year for issue of sweat equity shares as such the requirement for providing details as provided in rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014 does not arise. iii. Issue of employee stock options The Board of Directors wish to inform that there are no instance during the financial year for issue of employee stock options as such the requirement for providing details as provided in rule 12 (9) of Companies (Share Capital and Debentures) R q) Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employeesules, 2014 does not arise. The Board of Directors wish to inform that there are no instance during the financial year where the company had made provision of money for purchase of its own shares by employees or by trustees for the benefit of employees as such the requirement for providing details as provided in rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 does not arise r) Extract of the annual return The extract of the annual return for the financial year ended on 31st March 2015 as required by Section 92 (3) of the Companies Act 2013 is provided as Annexure "A" s) Information as per section 134(3)(m) of the Companies Act, 2013 The company has no activity relating to consumption of energy or technology absorption. The company does not have any foreign exchange earnings and outgo during the year. t) Corporate Social Responsibility (CSR) The Corporate Social Responsibility (CSR) which is applicable to every company having net worth of rupees five hundred crore or more, or turnover of rupees one thousand crore or more or a net profit of rupees five crore or more during any financial year is Not applicable and as such instances of disclosures as per Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 does not arise. u) Directors: At the forthcoming AGM, Shri J. Ashok Galada, Managing Director is liable to retire and being eligible has offered himself for re-appointment Your Directors recommend the re-appointment of director retiring by rotation to the members. v) Declaration from Independent Director(s) The Company had received necessary declaration from each independent Director of the Company under Section 149 (7) of the Companies Act, 2013 that each of them meets with thecriteria of their independence as laid down in Section 149 (6). w) Formal Annual Evaluation The Board periodically evaluates its own performance and that of its committees and individual directors. y) Audit Committee The terms of reference of the Audit Committee are as per the guidelines set out in the listing Agreement with the stock exchange and these also confirm to the provisions of the Companies Act, 2013. The details of date of the meeting of the committee and attendance of each Director along with scope of Audit Committee are given in the Corporate Governance Report. The Board has not rejected any proposal / recommendations of the Audit Committee during the year. z) Details of establishment of vigil mechanism for directors and employees The Company has a Vigil Mechanism named "Whistle Blower Policy" to deal with genuine concerns raised by the Directors/employees, if any. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the Company's website www.galadafinance.in aa) Nomination and Remuneration Committee ab) Particulars of loans, guarantees or investments under section 186 The Company has not given any loans or Guarantees covered under the provisions of Section 186 of the Companies Act, 2013. The details of the Investments made by Company are given in the notes to the financial statements. ac) Particulars of contracts or arrangements with related parties: All related party transaction that was entered into during the financial year was on an arm's length basis in the ordinary course of business. There are no 'material' contracts or arrangements or transactions which were not at arm's length basis and therefore disclosure in form AOC -2 is not required. All Related Party Transactions are placed before the Audit Committee as also the Board for approval. Prior omnibus approval of the Audit Committee is obtained for the transactions which are foreseeable and repetitive nature. For the transactions entered into pursuant to the omnibus approval so granted, a statement giving details of all related party transactions is placed before the Audit Committee and the board of Directors for their approval on a quarterly basis. ad) Managerial Remuneration: Disclosure of remuneration under section 197 (12) of the companies act, 2013 read with rule 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are provided at Annexure "B" ae) Secretarial Audit Report Shri T. S. Raju, Practicing Company Secretary (Membership No. 2745),having address at Regency House, 2A, Second Floor, 250/7, Anna Salai, Teynampet, Chennai 600 006 Tel No. 2435 0676 has conducted the Secretarial Audit of the Company for the Financial Year 2014-15. The Secretarial Audit report issued by the him is attached to this report as Annexure - "C" . As there are no qualification, reservation or adverse remark or disclaimer made by the Company secretary in whole time practice in the secretarial audit report, the need for providing explanation or comments on the same by the Board of Directors does not arise af) Corporate Governance Certificate The Compliance certificate from the auditors regarding compliance of conditions of corporate governance as stipulated in Clause 49 of the Listing agreement is provided as Annexure "D" to this report. ag) Corporate Governance Report The Company is committed to maintain the standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The Report on corporate governance as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report and is attached as Annexure-E. The requisite certificate from the Auditors of the Company confirming compliance with the conditions of corporate governance as stipulated under the aforesaid Clause 49, is attached to the Report on corporate governance. ah) Management's Discussion and Analysis Report Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report. ai) Risk management policy A Risk Management Policy for the Company has been adopted by the Board. The Company manages risk through a detailed Risk Management Policy framework which lays down guidelines in identifying, assessing and managing risks that the businesses are exposed to. Risk is managed by the Board through appropriate structures that are in place. aj) Directors' Responsibility Statement The terms of clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, the directors state that: (a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures; (b) the directors had 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 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; and (e) the directors, in the case of a listed company, 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 all applicable laws and that such systems were adequate and operating effectively. ak) Acknowledgements Your Directors would like to express their appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company's executives, staff and employees. For and on behalf of the Board of Directors Justice P Bhaskaran Chairman DIN:00126136 Date: 01.08.2015 Place: Chennai |