DIRECTOR'S REPORT To, The Members, The Directors are pleased to present Twenty first Annual Report together with the Audited Accounts of the Company for the year ended 31st March, 2015. REVIEW OF OPERATIONS During the FY 2015, your company has earned a net profit of Rs.1.70 lacs after taking into account tax provisions and MAT credit entitlement as against Rs. 0.09 lacs during FY 2014. DIVIDEND In view of inadequate profits, the Board of Directors is not in a position to recommend any dividend for the year. RESERVES No amount is proposed for transfer to the General Reserve Account during the financial year 2015. SUBSIDIARY COMPANY AND CONSOLIDATED FINANCIAL STATEMENT The Company does not have any subsidiary company hence the requirement of consolidated financial statement pursuant to Section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014 is not applicable. CORPORATE SOCIAL RESPONSIBILITY The Company does not fall under the preview of the Section 135 of the Companies Act, 2013. DEPOSITS The Company being a Non-Deposit Accepting Non-Banking Finance Company has not accepted any deposits from the public during the year under review and shall not accept any deposits from the public without obtaining prior approval of the Reserve Bank of India (RBI). FUTURE OUTLOOK The Company is operating with its own limited resources. As the Financial market is facing lot of challenges interest rates are constantly changing, recoveries have become major concern, therefore survival of small NBFC with limited resource is becoming difficult. In the present scenario and based on the present business model the growth potential in its business is limited. DISCLOSURE UNDER THE LISTING AGREEMENT UNDER CLAUSE 32 Cash flow statement pursuant to Clause 32 of listing agreement is annexed to the financial statement of the Company and forming part of this Annual Report. DIRECTORS AND KEY MANAGERIAL PERSONNEL In accordance with the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company Mr. Beni Prasad Rauka, retires by rotation at the ensuing Annual General Meeting and offers himself for reappointment. The Board appointed Ms. Poonam Kishan Sharma, as Additional Director with effect from 2941 June, 2015 and has considered her as a Woman Director in terms of the provision of the Companies Act 2013 and pursuant to Clause 49 of Listing Agreement. Mr. Dilip Lokoram Arora, Member of the Board, resigned from the Board of the Company effective from 1141 August, 2014. The Board thanks him for his insights that have helped the Company immensely. The resolution seeking approval of the Members for the appointment of Ms. Poonam Kishan Sharma have been incorporated in the notice of the annual general meeting of the Company along with brief details about her. The Company has received a notice under Section 160 of the Act along with the requisite deposit proposing the appointment of Ms. Poonam Kishan Sharma. Declaration by Independent Director(s) The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of Independence prescribed both under the Companies Act, 2013 and Clause 49 of the Listing Agreement. Formal Annual Performance 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 Independent Directors, Board, Committees and other individual Directors, process of evaluation was followed as per the Policy laid down in this regard. The manner in which the evaluation has been carried out has been explained in the Report on Corporate Governance. Nomination and Remuneration Policy The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection of Directors, determining Directors independence and payment of remuneration to Directors, Key Managerial Personnel and other employees. The Nomination and Remuneration Policy is stated in the Report on Corporate Governance. In accordance with the provisions of Section 178 of Companies Act,2013 the Board of Directors have adopted a Policy on Board Diversity and Director Attributes and the Remuneration Policy. The Policy on Board Diversity and Director Attributes has been framed and adopted by the Board on 1341 November 2014 to encourage diversity of thought, experience, knowledge, perspective, age and gender in the Board. The Nomination and remuneration policy of the Board has provided as "Annexure-C" to this Report. Familiarization Program On appointment, the concerned Director is issued a Letter of Appointment setting out in detail, the terms of appointment, duties, responsibilities and expected time commitments. The details of program for familiarization of Independent Directors with the Company, their roles, rights, responsibilities in the Company and related matters are put up on the website of the Company at link: http://www.indergiri.com/images/policies/ Familiarsation_Progrrame_for_Independent_Director.pdf Number of meetings of the Board Four meetings of the Board were held during the year. For details of the meetings of the Board, please refer to the corporate governance report, which forms part of this report. DIRECTORS' RESPONSIBILITY STATEMENT Your Directors state that: a)in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same; 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. VIGIL MECHANISM / WHISTLE BLOWER POLICY The Company as part of the 'vigil mechanism' has in place a 'Whistle Blower Policy' to deal with instances of fraud and mismanagement, if any. The Whistle Blower Policy has been approved by the Board at its meeting held on 31st May, 2014 and has been placed on the website of the Company. This vigil mechanism of the Company is overseen by the Audit Committee and provides adequate safeguard against victimization of employees and directors who avail of the vigil mechanism and also provide direct access to the Chairperson of the Audit Committee in exceptional circumstances. RISK MANAGEMENT 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/Risk Management Committee of the Board through appropriate structures including suitable reporting mechanisms. INTERNAL CONTROL SYSTEMS IFL Internal Control System is designed to ensure operational efficiency, protection and conversation of resources. The internal control system is supported by an internal audit process for reviewing the adequacy and efficacy of internal control including its system, process and compliance with regulations and procedures. Internal Audit Reports are discussed with the Management and are reviewed by the Audit Committee of the Board. POLICY ON PREVENTION OF SEXUAL HARASSMENT The Board of Directors at its meeting held on 7th February, 2014, approved the "IFL Policy on Prevention and Redressal Sexual Harassment at Workplace" in terms of The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The said policy is uploaded on the website of the Company. During the year under review, there were no complaints received against any employee. AUDITORS' REPORT The notes referred to by the Auditors in their report are self-explanatory and do not require any further clarification. STATUTORY AUDITORS Pursuant to the provisions of Section 139 and 141 of the Companies Act, 2013, M/s. S.K. Rathi & Co, Chartered Accountants, were appointed as Statutory Auditors of the Company to hold office upto the 23 rd Annual General Meeting, subject to the ratification by the members at every Annual General Meeting to be held during their term. The appointment of M/s. S.K. Rathi & Co, Chartered Accountants, as Statutory Auditors of the Company, is eligible for ratification and they have consented to the same and have confirmed that the appointment, if ratified, shall be within the limits prescribed under the Companies Act, 2013 and that they are not disqualified for such appointment within the meaning of Section 139 and 141 of the Companies Act, 2013, read with Companies (Audit and Auditors) Rules, 2014. The Board recommends the ratification of M/s. S.K. Rathi & Co, Chartered Accountants, as Statutory Auditors of the Company for financial year 2015 -16, to the members at the ensuing Annual General Meeting. SECRETARIAL AUDITOR 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 has appointed Ms. S. K. Jain and associates, Practicing Company Secretaries to undertake the Secretarial Audit of the Company for the financial year 2014-15. The Secretarial Audit Report in Form MR-3 is annexed herewith marked as "Annexure-A" to this Report. Ms. S.K. Jain and associates, in their secretarial audit report have stated that, 1)The Company does not Company Secretary during the audit period as required under section 203 of the Companies Act, 2013. 2)The Company is not registered under the Bombay Shops and Establishment Act, 1948. 3)The Company has not appointed Woman Director during the audit period as required under 2nd proviso to Sub-section (1) of Section 149 of the Companies Act, 2013. 4)The Company has not provided the E-voting facility to the shareholders of the Company as required under section 108 of the Companies Act read with Rules made thereunder and clause 35B of the Listing Agreement. The Directors are of the view that 1)The Company could not get a Company Secretary in employment due to the size and volume of the business and current profitability, however as the Board of Directors consists of qualified chartered accountants and also one of the Director is a qualified Company Secretary, therefore all compliance are done regularly and timely basis. 2)The Company is in the process of obtaining required permission from the owner/tenant and shall arrange to get the registration done as soon as possible. 3)The Company has appointed woman Director with effect from 29th June, 2015 in compliance with the proviso to subsection (1) of Section 149 of the Companies Act, 2013. 4)The Board is of the opinion that e-voting was optional pursuant to the general circular no. 20/2014 dated 1741 June, 2014 of Ministry of Corporate affairs, the e-voting facility was not mandatory till 31st December, 2014. The Shareholder meeting was held on 2741 September, 2014. INTERNAL AUDIT AND COMPLIANCE The Company conducts its internal audit and compliance functions within the parameters of regulatory framework which is well commensurate with the size, scale and complexity of operations. The internal controls and compliance functions are installed, evolved, reviewed, and upgraded periodically. The Company has appointed Manoj Sharma & Associates, Chartered Accountants, to conduct internal audit covering all areas of operations of the Company. The reports are placed before the Audit Committee of the Board. The Audit Committee reviews the performance of the audit and compliance functions, the effectiveness of controls and compliance with regulatory guidelines and gives such directions to the Management as necessary / considered appropriate. The Company has framed a compliance policy to effectively monitor and supervise the compliance function in accordance with the statutory requirements. RELATED PARTY TRANSACTIONS There have been no materially significant related party transactions, pecuniary transactions or relationships between the Company and its Directors that may have potential conflict with the interest of the Company. The Company has adopted a Framework on Related Party Transactions for the purpose of identification and monitoring of such transaction. All related party transactions are placed before the Audit Committee as also the Board for their approval on quarterly basis. Transactions with related parties, as per the requirements of Accounting Standard 18, are disclosed to the notes to accounts annexed to the financial statements. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO The provisions of Section 134(3) (m) of the Companies Act, 2013, and the rules made there under relating to conservation of energy, technology absorption do not apply to your Company as it is not a manufacturing Company. However, your Company has been increasingly using information technology in its operations and promotes conservation of resources. During the year under review, there was no foreign earning or expenditure in the Company. CORPORATE GOVERNANCE REPORT The report on Corporate Governance for the Company forms an integral part of this Annual Report. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS The provisions of Section 186 of the Act pertaining to investment and lending activities is not applicable to the Company since the Company is an NBFC whose principal business is acquisition of securities. Details of guarantees and/or security in connection with loans to other bodies corporates or persons as covered under the provisions of Section 186 of the Act, are given in Note No. 9 to the Financial Statements. INSURANCE The Company does not possess any material properties, which need insurance. STANDARD ASSETS' PROVISIONING Pursuant to the Notification No. DNBS.222/CGM (US)-2011 dated 17th January, 2011 issued by the RBI for making a general provision at 0.25% on the outstanding Standard Assets of NBFCs, your Company has made provision as per the statutory requirements. EXTRACT OF ANNUAL RETURN Extract of Annual Return of the Company in Form MGT-9 is annexed herewith as "Annexure-B" to this Report. PARTICULARS OF EMPLOYEES None of the employees was in receipt of remuneration in excess of limits prescribed under Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. ACKNOWLEDGEMENTS: The Company gratefully acknowledges the co-operation and supports extended by the Banker, Shareholders and Clients of the Company and place on record its appreciation for the active support and assistance of the employees for the performance. For and on behalf of the Board of Director Laxminarayan Sharma DIN: 01731396 Managing Director Kishan Sharma Director DIN:01168525 Date: 27th May, 2015 Place : Mumbai |