DIRECTORS' REPORT Dear Members, Your Directors are pleased to present the 22nd Annual Report of the Company together with the Audited Financial Statements for the year ended 31st March, 2015. THE YEAR UNDER REVIEW: Your Company has successfully completed 22 years of operation. Your Company's key businesses since last two year mainly production of TV Serials and Movies. That have reported an encouraging performance for the year ended 31stMarch 2015. COMPANY'S PERFORMANCE: In the Current year under review, the Company decided to invest and utilize more funds into the field of entertainment, and in the Media industry. The Company booked a profit of Rs. 79, 79,916 in the Current year operation STANDALONE FINANCIAL STATEMENTS: The Audited Financial Statements of the Company for the financial year ended 31st March, 2015, prepared in accordance with the Companies Act, 2013 ("the Act"). 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 with Stock Exchange in India, is presented in a separate section forming part of the Annual Report. STATE OF AFFAIRS OF THE COMPANY: FUTURE OUTLOOK: The Company's major focus is to engage in the development, production, and distribution of commercial entertainment materials in all formats. CHANGE IN THE NATURE OF BUSINESS, IF ANY: There was no change in the nature of business of the Company during the year. DIVIDEND: Your Directors do not recommend any Dividend FIXED DEPOSIT: As on 31st March, 2015, the Company held no deposit in any form from anyone. There was no deposit held by the company as on 31st March, 2015, which was overdue or unclaimed by the depositors. For the present, the Board of Directors has resolved that not to accept any deposit from public. MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY: During the year under review there were no material change and commitment affecting the financial position of the Company. NUMBER OF MEETINGS OF THE BOARD: The Board met 5 times during the financial year, the details of which are given in the Corporate Governance Report that forms part of this Annual Report. The intervening gap between any two meetings was within the period prescribed by the Companies Act, 2013. DIRECTORS AND KEY MANAGERIAL PERSONNEL: Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Rules made there under and the Articles of Association of the Company, Mrs. Nayantara Katkar Sheorey, Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offered himself for re-appointment. The Companies Act, 2013 provides the appointment of Independent Directors. Pursuant to the provisions of Section 149 (4) of the Companies Act, 2013 provides that every listed company shall have at least one-third of the total number of directors as independent directors. The Board of the Company is not in compliance with aforesaid section and had taken necessary steps for Compliance. As per the Section 149(10) of the Companies Act, 2013 provides that independent director shall hold office for a term of upto five consecutive years on the Board of the Company; and shall be eligible for reappointment on passing a special resolution by the shareholders of the Company. Further, according to the Section 149 (11) of the Companies Act, 2013, no independent director shall be eligible for appointment for more than two consecutive terms of five years. Sub-section (13) states that the provisions of retirement by rotation as defined in Sub-sections (6) and (7) of Section 152 of the Act shall not apply to such independent directors. The Nomination and Remuneration Committee on 13/11/2014 has confirmed and ratified the appointment of Mr. Pankaj Agarwal and Mr. Bharat Bhelose as Independent Director of the company for a period of five years starting from 13th November, 2014 upto 12th November, 2019 and who are not liable to retire by rotation. On the recommendation of the Nomination and Remuneration Committee, the Board seeks the ratification of the same from the members of the Company. Further, at the time of appointment of an independent director, the Company issues a formal letter of appointment outlining his/her role, functions, duties and responsibilities as a director. Mr. Harsh Jain Additional Director of the company resigned from the Board due to pre occupation on 16/06/2015 and Mr Bharat Bhelose resigned from the Board due to pre occupation on 24/06/2015. INDEPENDENT DIRECTORS DECLARATION: The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The Independent Directors under section 149(6) of the Companies Act, 2013 declared that: 1. They are not a promoter of the Company or its holding, subsidiary or associate company; 2. They are not related to promoters or directors in the company, its holding, subsidiary or associate company. 3. The independent Directors have /had no pecuniary relationship with company, its holding, subsidiary or associate company , or their promoters, or directors, during the two immediately preceding financial years or during the current financial year; 4. None of the relatives of the Independent Director has or had pecuniary relationship or transaction with the company, its holding, subsidiary or associate company, or their promoters, or directors, amounting to two per cent. or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year; 5. Independent Director, neither himself nor any of his relatives-- (i) holds or has held the position of a key managerial personnel or is or has been employee of the company or its holding, subsidiary or associate company in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed; (ii) is or has been an employee or proprietor or a partner, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed, of-- (A) a firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate company; or (B) any legal or a consulting firm that has or had any transaction with the company, its holding, subsidiary or associate company amounting to ten percent. or more of the gross turnover of such firm; (iii) Holds together with his relatives two percent. or more of the total voting power of the company; or (iv) is a Chief Executive or Director, by whatever name called, of any nonprofit organization that receives twenty-five percent. or more of its receipts from the company, any of its promoters, directors or its holding, subsidiary or associate company or that holds two percent. or more of the total voting power of the company; 6. Independent Director possesses such qualifications as may be directed by the Board. The Company & the Independent Directors shall abide by the provisions specified in Schedule IV of the Companies Act, 2013. BOARD EVALUATION: Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 states that the performance evaluation of independent directors should be done by the entire Board of Directors, excluded the director being evaluated. The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The Board approved the evaluation results as collated by the Nomination and Remuneration Committee. PERFORMANCE OF THE BOARD AND COMMITTEES: During the year under review, the performance of the Board & Committees and Individual Director(s) based on the below parameters was satisfactory: (i) Most of the Directors attended the Board meeting; (ii) The remunerations paid to executive Directors are strictly as per the company and industry policy. (iii) The Independent Directors only received sitting fees. (iv) The Independent Directors contributed a lot in the Board and committee deliberation and business and operation of the company and subsidiaries based on their experience and knowledge and Independent views. (v) The Credit Policy, Loan Policy and compliances were reviewed periodically; (vi) Risk Management Policy was implemented at all critical levels and monitored by the Internal Audit team who places report with the Board and Audit committee. MEETING OF INDEPENDENT DIRECTORS: Pursuant of the provision of Section 149 (8) of the Companies Act, 2013 read with Schedule IV and Clause 49 of the Listing Agreement, the Independent Directors of the Company held their meeting on 13th February, 2015, reviewed the performance of non- independent directors and the Board as a whole including the Chairperson of the Company, views expressed by the executive directors and non-executive directors at various level, and quantified the quality, quantity and timeliness of flow of information between the Company, management and the Board and expressed satisfaction. POLICY ON DIRECTORS' APPOINTMENT AND REMUNERATION: The current policy is to have an appropriate mix of executive and independent directors to maintain the independence of the Board and separate its functions of governance and management. As on 31st March, 2015, the Board consists of 8 members. Out of which two is the Independent Directors, two Promoter directors and the four is the Executive Directors. The policy of the Company on directors' appointment and remuneration, including criteria for determining qualifications, positive attributes, independence of a director and other matters provided under Sub section (3) of Section 178 of the Companies Act, 2013, adopted by the Board and are stated in this Board report. We affirm that the remuneration paid to the directors is as per the terms laid out in the nomination and remuneration policy of the Company. COMMITTEES OF THE BOARD: Currently, the Board has Four Committees: 1) Audit Committee, 2) Nomination and Remuneration Committee, 3) Risk Management Committee, 4) Shares Transfer /Investor Grievances Committee, A detailed note on the Board and its Committees is provided under the Corporate Governance Report that forms part of this Annual Report. NOMINATION AND REMUNERATION COMMITTEE AND STAKEHOLDERS RELATIONSHIP COMMITTEE Pursuant to the Section 178 of the Companies Act, 2013, the Company has set up a Nomination and Remuneration and Stakeholders Relationship Committee under the Chairmanship of the Independent Director Mr. Pankaj Agarwal, Mr. Bharat Dashrath Belose, Mr. Cyrus Bhot and Mr. Shantanu Sheorey. The Gist of the Policy of the said committee: For Appointment of Independent Director (ID): a. Any person who is between the age of 25 years and below 75 years eligible to become Independent Director(ID); b. He has to fulfill the requirements as per section 149 of the Companies Act, 2013 read with Clause 49 of the Listing Agreement; c. Adhere to the code of conduct as per Schedule IV to the Companies Act, 2013; d. Strictly adhere to the Insider Trading Regulation of the SEBI and Insider Trading policy of the Company; e. Independent Director should have adequate knowledge and reasonably able to contribute to the growth of the Company and stakeholders; f. Independent Director should be able to devote time for the Board and other meetings of the company; g. Entitled for sitting fees and Reasonable conveyance to attend the meetings; and h. Able to review the policy, participate in the meeting with all the stakeholders of the company at the Annual General Meeting. RISK MANAGEMENT POLICY The company has developed Risk Management Policy mainly covering the following areas of concerns 1. License and policy of respective government all over the world in connection with Movies and serials. . 2. Adequate policy in connection with foreign exchange, management fluctuations thereof duly placed before the Board. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY: The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures. The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. The scope and authority of the Internal Audit function is defined in the Internal Audit Manual. To maintain its objectivity and independence, the Internal Audit function reports to the Chairman of the Audit Committee. The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to Board. M/s. Dhawan & Co. - Chartered Accountants is the internal Auditor of the Company. DIRECTORS' RESPONSIBILITY STATEMENT: Pursuant to the Section 134(3)(c) and Section 134 (5) of the Companies Act, 2013, the Board of Directors of the Company hereby confirm: (i) That in the preparation of the accounts for the financial year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures; (ii) That the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that were 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 the year under review; (iii) That the Directors have taken proper and sufficient care 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) That the Directors have prepared the accounts for the financial year ended 31stMarch 2015 on a 'going concern' basis. (v) The internal financial controls laid and have been followed by the company and that such controls are adequate and are operating effectively. Such controls means controls and policies and procedures adopted and adherence by the company for orderly and efficient conduct of the business for safeguarding assets, prevention and detection of frauds and errors and maintenance of accounting records and timely preparation of financial statements and review its efficiency. (vi) 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. AUDITORS: STATUTORY AUDITORS At the Annual General Meeting held on August 14, 2014, M/s. Motilal & Associates, Chartered Accountants, were appointed as statutory auditors of the Company to hold office till the conclusion of the 22nd Annual General Meeting to be held in the calendar year 2015. In terms of the first proviso to Section 139 of the Companies Act, 2013, the appointment of the auditors shall be placed for ratification at every Annual General Meeting. Accordingly, the appointment of M/s. Motilal & Associates, Chartered Accountants, as statutory auditors of the Company, is placed for ratification by the shareholders. In this regard, the Company has received a certificate from the auditors to the effect that if they are re-appointed, it would be in accordance with the provisions of Section 141 of the Companies Act, 2013. SECRETARIAL AUDITOR M/s. P. D. Pandya & Associates Company Secretraies in Practice was appointed to conduct the secretarial audit of the Company for the financial year 2014-15, as required under Section 204 of the Companies Act, 2013 and Rules there under. The Board has appointed M/s. Amarendra Mohapatra & Associates, Company Secretary in Practice, as secretarial auditor of the Company for the financial year 2015-16. AUDITORS REPORT The Auditors have not made any qualification to the financial statement. Their reports on relevant notes on accounts are self-explanatory and do not call for any comments under section 134 of the companies Act, 2013. SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE COURTS /REGULATORS: 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. CONSERVATION OF ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE: As required by the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 the relevant information pertaining to conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows: A) CONSERVATION OF ENERGY: The Company continues its policy of encouraging energy conservation measures. The regular review of energy consumption and the systems installed to control utilization of energy is undertaken. B) RESEARCH &DEVELOPMENT ACTIVITIES: There is a dedicated team being formed which conduct market research will prepare the inputs which will be used to create the R&D Pipeline. Continuous efforts are being made to improve reliability and quality through in houseR&D efforts and presently the R&D is headed by MS Karishma Jain. C) TECHNOLOGY ABSORPTION: The Company is equipped with technologies from world's leaders. VIGIL MECHANISM / WHISTLE BLOWER POLICY: The Company has a vigil mechanism named Fraud and Risk Management Policy (FRM) to deal with instance of fraud and mismanagement, if any, in staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility. A high level Committee has been constituted which looks into the complaints raised. The Committee reports to the Audit Committee and the Board. The FRM Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern. RELATED PARTY TRANSACTIONS/CONTRACTS: Pursuant to the Section 134(3)(h) of the Companies Act, 2013 and Rule 8(2) of the Companies (Accounts) Rules, 2014, the particulars of contract or arrangement entered into by the Company with related parties referred to in Section 188(1) are available in the Note 1(B)(8) to the Standalone financial statements section of the Annual Report. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS: Loans, Guarantees and Investments covered under section 186 of the Companies Act, 2013 form part of the notes to the financial statements provided in this Annual Report. EXTRACT OF ANNUAL RETURNS Pursuant to the Section 134(3)(a) of the Companies Act, 2013, the details forming part of the extract of the Annual Return is Form MGT-9 is Annexure-V. HUMAN RESOURCES MANAGEMENT: We take this opportunity to thank employees at all levels for their dedicated service and contribution made towards the growth of the company. The relationship with the workers has continued to be cordial. To ensure good human resources management at the company, we focus on all aspects of the employee lifecycle. This provides a holistic experience for the employee as well. During their tenure at the Company, employees are motivated through various skill-development, engagement and volunteering programs. As per provisions of Section 197(12) of the Companies Act, 2013, read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is Annexure-VI to this Board's report. In terms of Section 197(12) of the Companies Act, 2013, read with Rule 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, no employee(s) drawing remuneration in excess of limits set out in said rules forms part of the annual report. Considering the first proviso to Section 136(1) of the Companies Act, 2013, the Annual Report is being sent to the members of the Company and others entitled thereto. The said information is available for inspection at the registered office of the Company during business hours from 11 a.m to 2 p.m on working days of the Company up to the date of the ensuing Annual General Meeting. Any shareholder interested in obtaining a copy thereof, may write to the Company in this regard. CORPORATE GOVERNANCE: A Report on Corporate Governance along with a Certificate from M/s. Motilal & Associates Chartered Accountants. regarding compliance with the conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchange forms part of this Report and Annexure-VII to this Board's Report. INSURANCE OF ASSETS All the fixed assets and material of the company have been insured against fire and allied risks. BANK AND FINANCIAL INSTITUTIONS Directors are thankful to their bankers for their continued support to the company. ACKNOWLEDGMENTS Your Directors convey their sincere thanks to the Government, Banks, Shareholders and customers for their continued support extended to the company at all times. The Directors further express their deep appreciation to all employees for commendable teamwork, high degree of professionalism and enthusiastic effort displayed by them during the year. On behalf of the Board of Directors. Shantanu Sheorey Chairman Nayantara Sheorey Executive Director Place: Mumbai Dated: 30th May, 2015 |