Flora Textiles Ltd Directors Report.

Ladies and Gentlemen,

Your directors take pleasure in submitting to you their Twenty Sixth Financial Statements together with the Audited Balance Sheet of the Company as at 31 March, 2019 and the Profit & Loss Account and Cash Flow Statement for the Year ended on that date.

WORKING RESULTS :

The working results of the Company for the Year under review are summarized and furnished below: - Rs. in lakhs

31.03.2019 31.03.2018
Revenue from Operations 27.60 69.64
Other Income 9.83 27.70
Total Revenue from Operations 37.43 97.34
Gross Profit/(loss)before interest and Depreciation 1.27 22.62
Less : Interest 48.70 47.84
Profit before Depreciation (47.43) (25.22)
Less: Depreciation 4.18 4.18
Net Profit/ loss for the Year (51.61) (29.40)
Opening balance – Loss brought forward (1788.78) (1759.38)
Closing Balance of Reserves A/c. (1840.39) (1788.78)

REVIEW OF OPERATIONS :

During the year under review, the overall sales and other income of the Company was Rs.27.60 lakhs as against Rs.69.64 Lakhs in the last year. Gross Profit / (loss) before interest and depreciation amounted to Rs 1.27 lakhs (Previous Year Rs.22.62 lakhs). The Net loss came to Rs.51.61 lakhs (Previous Year Rs.29.40 lakhs). There is no change in the nature of operations during the year.

PROSPECTS :

The loss during the year mainly due to heavy competition in the textile industry. Now the textiles industries are slightly recovering and power position becoming stable, there may be slight improvement in the performance of the company in the current year.

The management is making all the possible efforts to bring better results in the future.

DIVIDEND:

Due to loss of the company, the company unable to declare dividend.

TRANSFER TO RESERVE:

The company has transferred a loss of Rs 51.61 Lakhs to reserve account. The reserve as on 31.03.2019 is [Rs.1840.39 Lakhs].

DIRECTORS :

Mr R.Hemchand Gupta [DIN 08270656] was appointed as additional director with effect from 31.10.2018 liable to retire by rotation and he continues upto the ensuing AGM.

Ms Nidhi Gupta [DIN 01825531] was re appointed as Managing director with effect from 04 Jan, 2019.

Mr Indarchand Prajapathi [DIN 07655675] was appointed as Independent Director with effect from 31 Jan, 2019. The Board recommends his appointment as Independent Director under Section 149 of the Companies Act, 2013 for a term of five years.

Mr Kana Ram [DIN 05332461] Independent Director of the company term has expired on 29 May, 2019. The Nomination and Remuneration Committee recommends his appointment as Independent Director not liable to retire by rotation and to hold office for a second term of 5 (five) consecutive years on the Board of the Company from 30 May, 2019 to 29 May, 2024

Necessary resolution proposing their appointments under the Companies Act, 2013 forms part of the Notice of ensuing AGM.

Mr Krishnan Venkatasubramaniam, [DIN 01356360] Independent Director and member of various committees, has conveyed his disqualification in another company. Hence the board vacated his office with effect from 31 Jan, 2019.

KEY MANAGERIAL PERSONNEL:

Mr Hemant Kumar Gupta, CFO of the company has been reappointed at the Board meeting held on 30 May, 2019.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

There were no loans, guarantees or investments made by the Company under Section 186 of the Companies Act, 2013 during the year under review and hence the said provision is not applicable.

INTERNAL CONTROL SYSTEM ANDTHEIR ADEQUACY

The Company has an Internal Control System, Commensurate with its size, scale and complexity of its operations. Audit Committee reviews internal audit reports and oversees the internal control system of the Company.

HUMAN RESOURCES

The HR strategy and initiatives of your Company are designed to effectively partner the business in the achievement of its ambitious growth plans and to build a strong leadership pipeline for the present and several years into the future.

MEETINGS

A Calendar of Meetings is prepared and circulated in advance to the Directors. The details of which are given in the Corporate Governance Report.

DETAILS OF POLICY DEVELOPED AND IMPLEMENTED BY THE COMPANY ON ITS CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The Company has not developed and implemented any policy on Corporate Social Responsibility initiatives as the provisions of section 135 of Companies Act, 2013 are not applicable

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

The Company does not have any Subsidiary, Joint venture or Associate Company during the year under review.

DECLARATION OF INDEPENDENT DIRECTORS

The details of independent directors are mentioned in the clause 7 of corporate governance report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

There are no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status and the Companys operations in future.

DIRECTORS RESPONSIBILITY STATEMENT

To the best of our knowledge and belief and according to the information and explanations obtained by us, your Directors make the following statements

1) In the preparation of the annual financial statements for the year ended March 31 , 2019, the applicable accounting standards had been followed along with the proper explanation relating to material departures.

2) For the financial year ended March 31 , 2019, such accounting policies as mentioned in the Notes to the financial statements have been applied consistently and judgments and estimates that are reasonable and prudent have been made so as to give a true and fair view of the state of affairs of the Company and of the Profit and Loss of the Company for the year ended 31 March, 2019.

3) That proper and sufficient care has been taken 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;

4) The annual financial statements have been prepared on a going concern basis.

5) That proper internal financial control was followed by the company and that such internal financial controls are adequate and were operating effectively.

6) That proper system to ensure compliance with the provisions of all applicable laws was in place and that such systems were adequate and operating effectively.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination and Remuneration Committee, framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their Remuneration.

Nomination and Remuneration policy is guided by a common reward framework and set of principles and objectives as particularly envisaged under section 178 of the Companies Act 2013, inter alia principles pertaining to determining qualifications, positives attributes, integrity and independence etc.

RELATED PARTY TRANSACTIONS

All related party transactions that were entered during the year under review were on an arms length basis and were in ordinary course of business. All related party transactions are placed before the Audit Committee for approval. There are no materially significant related party transactions during the year which may have a potential conflict with the interest of the company at large. Necessary disclosures as required under Accounting Standard (Ind, AS) have been made in the notes to the Financial Statements.

ANNUAL PERFORMANCE EVALUATION

In line with the criteria evolved by the Nomination and Remuneration Committee, the performance of all Directors, Committees, Chairman etc., have been evaluated pursuant to the provisions of the Act, Listing Agreement and SEBI (LODR) Regulations 2015.

As part of the performance evaluation process, an evaluation questionnaire based on the criteria as finalized in consultation with the Directors together with supporting documents was circulated to all the Board members, in advance. The Directors evaluated themselves, the Chairman, other Board Members, the Board as well as functioning of the Committees viz., Audit, Nomination & Remuneration, Risk Management, Stakeholders Relationship Committees on the basis of well-defined evaluation parameters as set out in the questionnaire. The duly filled questionnaire received back from the Chairman and all the other Directors.

To take the evaluation exercise forward, all the Independent Directors of the Company met on 27 March 2019, without the attendance of the Non-Independent Directors and members of the management to discuss inter alia the matters specified under Schedule IV of the Companies Act, 2013.

The Board reviewed the process of evaluation of the Board of Directors and its Committees including Chairman and the Individual Directors.

VIGIL MECHANISM/WHISTLE BLOWER POLICY

Pursuant to the requirements of Section 177 of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has established a vigil mechanism (Whistle Blower Policy) for the employees and Directors as an avenue to voice concerns relating to unethical behavior, actual or suspected fraud or violation of the Companys code of conduct. The Ombudsperson appointed by the Board deals with the complaints received and ensures appropriate action. The mechanism also provides adequate safeguards against victimisation of persons using the mechanism and provides direct access to the chairperson of the Audit Committee in appropriate or exceptional cases. No employee was denied access to the Audit Committee.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 (12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, will be provided upon request. In terms of Section 136 of the Act, the Report and Accounts are being sent to Members and others entitled thereto excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company upto the date of the ensuing Annual General Meeting.

There are no employees drawing salaries in excess of the limit prescribed under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rule, 2014.

CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

A. The company is making continuous efforts to conserve and optimize energy wherever practicable by economizing on fuel and power.

B. The Company has not absorbed any technology during the year C. The foreign exchange earnings for the year: nil D. The foreign exchange outgo for the year : nil

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an anti sexual harassment policy in line with the requirement of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. Internal Compliance Committee (ICC) has been set up to redress complaints received regarding sexual harassment. All employees (Permanent, contractual, temporary and trainees) are covered under this policy. The company has not received any compliant about sexual harassment during the year 2018-19.

AUDITORS

The Members appointed M/s TV Subramanian and Associates (FRN No. 007433S) as the Statutory Auditors of the Company for a period of 5 years from the conclusion of 24th AGM (2017) till the conclusion of 29 AGM ( 2022).

The Company has received confirmation from the firm regarding their consent and eligibility under sections 139 and 141 of the Companies Act, 2013 read with the Companies (Accounts) Rules, 2014 for appointment as the Auditors of the Company.

EXTRACT OF ANNUAL REPORT

The Details forming part of the extract of the Annual Report form MGT 9 is annexed herewith as Annexure A.

EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS / SECRETARIAL AUDITOR IN THEIR REPORTS

There were no qualifications, reservations or adverse remarks made by the Auditors in their report.

Mr A C Saravan, Practicing Company Secretary was appointed to undertake the Secretarial Audit of the Company. The Report of Secretarial Audit is annexed herewith as Annexure B.

Reply To Qualification Given By The Secretarial Auditor :

1) The Company is in the process of allotment of unsecured loan including share application money received as per BIFR order.

2) Appointment of Company Secretary as per Sec 203 of the Companies Act, 2013 – You are aware that our company is sick company and there is immense shortage number of company secretary in comparison to the needs of industry and also. But board is taken serious steps to comply the same in the current year.

3) Regarding fine, the board is requested to waive the same to BSE.

4) For other non compliances, the Board has taken all necessary steps to comply the same in future period.

CORPORATE GOVERNANCE

Your Company is committed to maintaining high standards of Corporate Governance. A report on Corporate Governance, along with a certificate from the Statutory Auditors on compliance with Corporate Governance norms forms a part of this report.

The Corporate Governance Report of your company as on 31.3.2019 is enclosed for your perusal as Annexure – C.

MATERIAL CHANGES AND COMMITMENTS

There are no material changes and commitments in the business operations of the Company from the financial year ended 31 March, 2019 to the date of signing of the Directors Report.

SECRETARIAL STANDARDS

During the year under review, your company has compiled with all the applicable Secretarial Standards issued by The Institute of Company Secretaries of India from time to time.

ACKNOWLEDGEMENT

The Board wishes to place on record of their appreciation for the good work done by the employees of the company.

Place : Coimbatore By Order of the Board.
Date : 30.05.2019 Nidhi Gupta
Managing Director
(DIN 01825531)