DIRECTORS' REPORT Dear Shareholders 1. Your Directors have pleasure in presenting the 21st Annual Report of your company together with the Auditors Report for the year ended 31st March 2015. 2. BUSINESS & PERFORMANCE During the year under review, the Company has made a loss of Rs. -14.44 lacs for the financial year2014-2015 as compared to standalone profit of Rs.6.97 lacs forthe financial year 2013-2014. 3. DIVIDEND In order to conserve resources the Board of Directors have decided not to declare any dividend for the current financial year 2014-15. 4. TRANSFER TO PROFIT & LOSS ACCOUNT Your Company proposes to transfer Rs. -14,44,182/- to the General Reserve 5. MATERIAL CHANGE AND COMMITMENTS OF THE COMPANY There are 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; and there are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future. 6. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENT The Company has given loan of Rs.9,34,60,967/- under Section 186 of the Act during the financial year 2014-15.The Company has not given any guarantee nor made any investments during the Financial year 2014-2015. 7. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO: Company's business does not require any technology absorption and hence no reporting is required to be furnished underthis heading. Foreign Exchange inflow and outflow during the year is Nil. 8. DEPOSITS: Your Company has not accepted any deposits from the public during the year under review. There are no outstanding deposits as on 31st March 2015. 9. DIRECTORSAND KEY MANAGERIAL PERSONNEL RETIREMENT BY ROTATION In terms of Section 152 of the Companies Act 2013, Mr. S. P.Bharat Jain Tatia, who retire by rotation at the forthcoming AGM and is eligible for re-appointment. Mr. S. P.Bharat Jain Tatia offered himself for re-appointment. Brief profile is mentioned in the Notice of forthcoming Annual General Meeting ofthe company. INDEPENDENT DIRECTOR Pursuant to the provisions of clause 49 of the Listing Agreement entered into with the Stock Exchange Mr. E. Subbarayan and Ms. D. Hemamalini are the Independent Directors ofthe Company and appointment was made for 5 years at the 20th AGM. KEY MANAGERIAL PERSONNAL Mrs. Sangita Tatia was appointed as the Chief Financial Officer of the Company with effect from 22.08.2014 during the financial year. The Company is yet appoint company secretary and had given advertisement and circulars at the institute of company secretary (ICSI) The performance evaluation ofthe Independent Directors was carried out by the entire Board. The performance evaluation ofthe Chairman and the Executive Directors was carried out by the Independent Directors. 10. STATUTORY AUDITORS M/s. K.Subramanyam & Co., Chartered Accountants, (Firm Registration Number 004146S) have been appointed as statutory auditors ofthe company at the last Annual General Meeting held on 29/09/2014, to hold office till the conclusion ofthe twenty first Annual General Meeting ofthe company. The Board of Directors ofthe company has recommended the appointment of Messrs. K.Subramanyam & Co., Chartered Accountants, (Registration Number 004146S) as statutory auditors ofthe company from the conclusion of twenty first Annual General Meeting till the conclusion of twenty fifth Annual General Meeting ofthe company, subject to the ratification of appointment of Statutory Auditors at every annual general meeting by the shareholders. 11. COMMENT ON STATUTORY AUDITOR'S REPORT There were no adverse remarks made by the statutory auditor, Mr. K. Subramanian, Chartered Accountants bearing (Membership No. 023663, Regn. No. 004146S), in the Statutory Audit Report, during the current financial year. 12. SECRETARIAL AUDITORS 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 M/s Lakshmmi Subramanian & Associates, Practising Company Secretaries,(CP No.1087:, FCS:3534),Company Secretaries to undertake the secretarial audit of the company. The Secretarial Audit Report is annexed herewith as Annexure VI'. 13. COMMENT ON SECRETARIAL AUDITOR REPORT With Reference to the remarks made by the secretarial auditor, Mr. P.S. Srinivasan, Associate partner M/s. Lakshmmi Subramanian & Associates Practicing Company Secretaries bearing (CP No. 3122), in the Secretarial Audit Report, the company has taken the corrective measures during the current financial year. 14. PERSONNEL According to Section 197(12) ofthe Companies Act, 2013 read with rule 5(2) ofthe Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014,none of the employees fall under the category specified under the said Section and the Rules made there-under. 15. RELATED PARTIES TRANSACTIONS The Company has entered into contract / arrangements with the related parties in the ordinary course of business and on arm's length basis. Thus provisions of Section 188(1) of the Act are not applicable.-Annexure -1 details to begiven-AOC2 16. EXTRACT OF ANNUAL RETURN The extract of Annual Return as provided under Sub-Section (3) of Section 92 of the Companies Act, 2013 (the "Act") is enclosed at Annexure-ll in the prescribed form MGT-9 and forms part of this Report. 17. RISK MANAGEMENT The Risk Management is overseen by the Audit Committee of the Company on a continuous basis. The Committee oversees Company's process and policies for determining risk tolerance and review management's measurement and comparison of overall risk tolerance to established levels. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuous basis. 18. DISCLOSURE AS PER SEXUAL HARRASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 The Company has zero tolerance for sexual harassment at workplace and has in place a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and the rules framed there under. During the financial year 2014-15, the Company has not received any complaints on sexual harassment. 19. MANAGEMENT DISCUSSION &ANALYSIS REPORT As per Clause 49 of the listing agreement entered into with the stock exchanges, Management Discussion and Analysis report (ANNEXURE IV) and Corporate Governance Report with Auditors' certificate thereon (ANNEXURE-V) are attached and form part of this report. 20. CORPORATE GOVERNANCE REPORT The Company is committed to maintain the highest standards of corporate governance and adhere to the corporate governance requirements set out by SEBI. The report on Corporate Governance as stipulated under the Listing Agreement forms an integral part of this Report. The requisite certificate from the Auditors ofthe Company confirming compliance with the conditions of corporate governance is attached to the report on Corporate Governance. 21. NUMBER OF MEETINGS OF THE BOARD Seven meetings of the Board of Directors of the Company were held during the year. For detail of the meetings, please referto the Corporate Governance Report, which forms part of this Report. 22. CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT The Directors and members of Senior Management have affirmed compliance with the Code of Conduct for Directors and Senior Management ofthe Company. A declaration to this effect has been signed by Mr. S.P. Bharat Jain Tatia, the Managing Director of the Company and forms part of the Annual Report and the website of the Company atwww.kreon.in 23. VIGIL MECHANISM The Company has established a vigil mechanism for Directors and employees to report their genuine concerns. For details, please refer to the Corporate Governance Report attached to this Report and the website of the Company atwww.kreon.in. 24. CORPORATE SOCIAL RESPONSIBILITY The provisions of Companies Act, 2013 regarding Corporate Social Responsibility are not attracted to the company as per the act and no committee is required to be form. 25. DIRECTORS" RESPONSIBILITY STATEMENT To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statements in terms of Section 134(3)(c) ofthe Companies Act, 2013: a. that in the preparation of the annual financial statements for the year ended March 31,2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any; b. that such accounting policies as mentioned in Notes to the Financial Statements have been selected and applied consistently and judgment and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs ofthe Company as at March 31, 2015 and ofthe profit ofthe Company for the year ended on that date; c. that 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; d. that the annual financial statements have been prepared on a going concern basis; e. That proper internal financial controls were in place and that the financial controls were adequate and were operating effectively. f. That systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively. 26. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS-BEFORE ACKNOWLEDGEMNT IN DIRECTORS REPORT There are no significant material orders passed by the Regulators / Courts which would impact the going concern status ofthe Company and its future operations. 27. ACKNOWLEDGEMENTS The Board of Directors would like to thank all employees of the Company and also Company's shareholders, auditors, customers and bankers fortheir continued support. On behalf of the Board of Directors For KREON FINANNCAIL SERVICES LIMITED Sd/-S. PANNALAL TATIA Whole Time Director Din.No.01208913 Place: Chennai Date: 28.8.2015 |