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Frontier Capital Limited
Your Directors have pleasure in presenting the Thirty Fourth Annual Report of the Company and the Audited Statements of Accounts for the Financial Year (FY) ended 31st March, 2018.
1. Financial Results:
|Amount in Rs.)|
|Particulars||31st March, 2018||31st March, 2017|
|Profit / (Loss) before Provisions and contingencies||-85,75,865||-34,39,017|
|Less: Provisions and contingencies||7,59,65,428||1,26,33,836|
|Profit / (Loss) before tax||-8,45,41,293||-160,72,853|
|Less: Tax expenses||-||-|
|(Including deferred tax and tax for earlier years)||35,97,389||-36,52,883|
|Profit / (loss) After Taxation||-8,81,38,682||-1,24,19,970|
|Less: Proposed Dividend||-||-|
|Less: Corporate Dividend Tax||-||-|
|Less: Transfer to Statutory Reserve||-||-|
|Add: Balance Brought Forward from Last Year||21,566,014||34,157,614|
|Balance Carried Forward to Balance Sheet||-6,65,72,668||2,15,66,014|
During the period under review, the Company has earned a total revenue of Rs. 2,47,945 as against Rs. 93,54,412 in the previous year.
Due to provision of Rs. 7,59,65,428 against NPAs and Doubtful Debts, the loss before the tax was Rs. 8,45,41,293 as against the loss of Rs. 1,60,72,853 in previous year. The loss after tax was Rs. 8,81,38,682 as against the loss of Rs. 1,24,19,970 in previous year.
In view of losses incurred by the Company, your Directors do not recommend any dividend for the year under review.
4. Transfer to Reserves
The Company did not transfer any amount to reserves in view of the losses incurred by the Company during the year under review.
5. Share Capital
The Company has not issued any shares in the year 2017-18. Hence as on 31st March, 2018, the paid up share capital of the company is Rs. 14,26,21,630 divided into 2,62,163 Equity shares of Rs. 10/- each and 1,40,000 non-convertible redeemable preference shares of Rs. 1000/- each.
6. Number of Board Meetings
During the year under review, 4 Board Meetings were convened and held.
Details of the Meetings held during the financial year are as follows:
|Name of the Director||Director Identificatio n Number||Category||No. of Board Meetings attended during the year||Attendance at the last AGM|
|Mr. Nitin Chamaria||03030771||Non - Executive Director||3||Yes|
|Mrs. Usha Iyengar||03447551||Non - Executive Women Director||4||Yes|
|Mr. H.N. Choudhary||06641774||Whole Time Director (14/08/2017)||4||Yes|
|Mr. Ashok Katra Date of Appointment - 15/03/2017||07799527||Non - Executive Independent Director||4||Yes|
7. Extract of the Annual Return
As amended by Companies (Amendment Bill), 2017 web link for the MGT-9 is given below http://www.flflindia.com/investor/main investor rel.html
8. Particulars of Contracts or Arrangements with Related Parties
All Contracts/ Arrangements/ transactions entered by the Company during the Financial Year with related parties were on arms length basis, in ordinary course of business and were in the compliance with the applicable provisions of the Act and the Listing Agreement. There are no significant related party transactions made by the Company with Promoters, Directors, Key Managerial personnel or other designated persons as defined under Section 188 of the Companies Act, 2013. Accordingly there are no material transactions that are required to be reported in Form AOC 2 and as such do not form part of the report.
9. Particulars of loans, Guarantees or Investments under Section 186
Being a Non-Banking Finance Company, the provision of Section 186 of Companies Act, 2013 are not applicable to the Company.
10. Secretarial Auditors
Pursuant to the provisions of Section 204 of the Act and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed CS Manish Baldeva, Proprietor M/s M Baldeva Associates, Company Secretaries to undertake the Secretarial Audit of the company. The Report of the Secretarial Audit is annexed herewith as Annexure - I.
Your company has not accepted any Deposits during the financial year under review falling under provisions of Section 73 and 76 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014.
12. Risk Management:
The Company has constituted a Risk Management Committee (RMC) which has been entrusted with responsibility to assist the Board in overseeing the Companys Risk Management process and controls.
13. Declaration by Independent Director:
The Independent Directors has given declaration as required under the provisions of section 149(7) of the Companies Act, 2013 that they meets the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and Regulations 16 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
14. Appointment of Auditors:
Pursuant to the provision of Section 139(2) of the Act and the Rules framed thereunder, M/s A.C Bhuteria, Chartered Accountants, Kolkata (having FRN: 303105E) were appointed as the
Statutory Auditors of the Company for a period of 5 years to hold office from the conclusion of the 31st Annual General Meeting held on 25th September, 2015 till the conclusion of the 36th Annual General Meeting to be held for the year ending 31st March, 2020, subject to ratification of their appointment at every AGM.
15. Remarks or qualifications by Statutory Auditors and Secretarial Auditors:
There are no negative remarks or qualification from Statutory Auditors. In respect to the Secretarial Auditors remarks in their report, the Company would like to state as under:
1. Delay in filing of some forms with the ROC was by oversight;
2. The Company was in search of suitable candidates for the post of CFO, and Independent Director.
3. The Constitution of Audit Committee was not proper due to non-availability of suitable candidate to be appointed as an Independent Director of the Company.
4. Inadvertently some information or details as required under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 was not filed / delayed. Though this does not affect defacto compliance as the script ha not traded throughout the last year.
5. As company does not have any Foreign Direct investment, half yearly Returns on Foreign Direct Investment was not filed with the Reserve Bank of India.
16. Internal Audit
Pursuant to provision of section 138 of the Companies Act, 2013 & Rule 13 of Companies (Accounts) Rules, 2014, management is in search for the right candidature to appoint as an int4rnal auditor for Financial Year 2017-18.
17. Material changes and commitment if any affecting the financial position of the company occurred between the end of the financial year to which this financial statements relate and the date of the report
No material changes and commitments affecting the financial position of the Company occurred between the ends of the financial year to which this financial statement relate on the date of this report.
18. Formal Annual Evaluation:
Pursuant to the provisions of the Companies Act, 2013, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit and Nomination & Remuneration Committees.
19. Significant / material orders passed by the regulators or court or tribunals impacting the going concern status and companys operations in future:
During the period under review, no significant or material order was passed by any regulatory authority or court or tribunals which may have bearing on going concern status or on operations of the company in future.
20. Internal Control Systems And Their Adequacy
The Company has an internal control system, commensurate with the size, scale and complexity of its operations. The Company monitors and evaluates the efficacy and adequacy of internal control system in place, its compliance with operating systems, accounting procedures and policies.
21. Corporate Social Responsibility Report (CSR):
As per Section 135 of the Companies Act, 2013 every Company having net worth of Rs. 500 Crore or more, or turnover of Rs. 1000 Crore or more, or a net profit of Rs. 5 Crore or more during any financial year is required to constitute a CSR Committee. As your Company does not fall under any of above limits, the Corporate Social responsibility (CSR) is not applicable to Company.
22. Audit Committee:
i. The Audit Committee functions accordingly to its charter defines its composition, authority, responsibility and reporting functions in accordance with the Act, listing requirements and the regulations applicable to the Company and is reviewed from time to time. As on 31st March, 2017, the Audit Committee comprised of 3 Directors viz. Mr. Ashok Katra, Mr. Nitin Chamaria, and H.N. Choudhary. All of them are financially literate and have relevant finance and / or audit exposure.
ii. During the period under review, 4 Audit Committee meetings were held on May 29th, 14th August, 14th November and 14th February.
iii. Each Board Meeting which considers financial results is preceded by meeting of Audit Committee Members along with Auditors.
Composition of the Audit Committee and attendance at its meetings are as follows:
|Mr. Nitin Chamaria||3|
|Mr. H.N. Choudhary||4|
|Mr. Ashok Katra||4|
23. Vigil Mechanism:
The Company has adopted a Whistle Blower Mechanism Policy establishing vigil mechanism, to provide a formal mechanism to the Directors and employees to report their concerns about unethical behavior, actual or suspected fraud or violation of the companys code of conduct or ethics policy. The policy provides for adequate safeguard against victimization of employees who avail the mechanism. No employee or directors of the Company has been denied access to the Audit Committee.
24. Prevention of Sexual harassment
The company has zero tolerance for sexual harassment at work place and has adopted a policy on prevention, prohibition and redressal of sexual harassment at workplace in line with the provisions of the Sexual harassment of women at workplace (prevention, prohibition ad Redressal) Act, 2013 and the rules thereunder for prevention and redressal of complaints of sexual harassment at workplace. The Company is committed to provide equal opportunities to their race, caste, sex, religion, color, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as women visiting the companys office premises or women service providers are covered under this policy. All are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.
During Fiscal Year 2018, the Company has not received any complaint on sexual harassment.
A) A During the year, the following Directors/ KMPs were appointed:
|Sr. No.||Name of the Director||DIN / PAN||Designation||Date of Appointment|
|1||Mr. H.N Choudhary||6641774||Whole Time Director||14th August, 2017|
B) During the year, Mr. Nitin Chamaria resigned on 12th March, 2018.
The Company is registered with RBI as an Asset Financing Non Deposit Accepting NBFC. The Company has complied with and continues to comply with the applicable Regulations and Directions of the RBI and it does not carry on any activities other than those specifically permitted by the RBI.
27. Directors Responsibility Statement:
Pursuant to the requirement under Section 134 (5) of the Companies Act, 2013 the Directors, based on the representation received from the Operating management, confirm that:
(i) in the preparation of the annual accounts for the financial year ended 31st March, 2018, the applicable accounting standards had been followed along with proper explanation relating to material departures;
(ii) 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 as at 31st March, 2018 of the Company for that period;
(iii) the directors had 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) the directors had prepared the annual accounts on a going concern basis;
(v) 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 opening effectively; and
(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.
28. Corporate Governance Report:
With the introduction of the Companies Act, 2013 and the issue of SEBI circular no. CIR/CFD/POLICY CELL/2/2014 dated April 17, 2014, the provisions of amended Clause 49 of the Listing Agreement and Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 related to the corporate governance would not be applicable to the Companies having paid up equity share capital not exceeding Rs.10 crore and Net Worth not exceeding Rs. 25 crore, as on the last day of the previous financial year. Though these provisions are not applicable to the Company, as a measure of good governance, the Company complies with most of the requirements specified under Clause 49 and Regulation 15 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.
A summary of the Corporate Governance measures adopted by the Company is given below:-
I. The Board of Directors along with its Committees provides leadership and guidance to the Companys management and directs, supervises the activities of the Company.
II. The size of the Board is commensurate with the size and business of the Company. As on 31st March, 2018, the Board comprises of Mr. Nitin Chamaria, and Mrs. Usha Iyengar, Mr. H N Choudhary as Directors and Mr. Ashok Katra as an Independent Director of the Company.
III. The Board has constituted Committees with specific terms of reference to focus on specific issues and ensure expedient resolution of diverse matters. These include the Audit Committee, Nomination & Remuneration Committee.
IV. As on 31st March 2018, the Audit Committee comprised of 3 Directors viz. Mr. Nitin Chamaria, Mr. Ashok Katra and Mr. H.N. Choudhary and Nomination and Remuneration Committee comprised of 4 Directors viz. Mr. Nitin Chamaria, Mrs. Usha Iyengar, Mr. Ashok Katra and Mr. H.N. Choudhary.
V. The Company, Directors (including the Independent Directors) and its employees have adopted the Code of Conduct and the same will be posted on the Companys website.
VI. The Company has adopted a Whistle - Blower Policy which provides a formal mechanism for all employees of the Company to make protected disclosures to the management about unethical behavior, actual or suspected fraud or violation of the Companys Code of Conduct. No employee of the Company has been denied access to the Audit Committee.
VII. The Companys website is www.flflindia.com.
29. Accounts and Accounting Standards
The Company adheres to the Accounting Standards as prescribed under section 133 of the Companies Act, 2013 and Rule 7 of the Companies (Accounts) Rules, 2014 in the preparation of its financial statements and also to the guidelines prescribed by the RBI.
30. Conservation of energy, technology absorption, foreign exchange earnings and outgo:
Considering the nature of business activities of the Company, your Directors have nothing to report with respect to conservation of energy and technology absorption.
During the year under review, the Company had NIL foreign exchange earnings (Previous Year: NIL) and outgo (Previous Year: NIL).
31. Particulars of Employees
The necessary details / disclosures of Ratio of Remuneration to each directors to the median employees remuneration and other details pursuant to the section 197(12) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is annexed herewith as Annexure II.
32. Subsidiaries, Joint Ventures Or Associate Companies
The Company has no subsidiaries, Joint Venture or associate company during the period under review within the meaning of Section 2(6) of the Companies Act, 2013.
The Company continues to be subsidiary of Inimitable Capital Finance Private Limited.
The Company has made adequate disclosures regarding related party transactions, contingent liabilities, and significant accounting policy in the Notes to Accounts as an integral part of the Balance Sheet and Statement of Profit & Loss.
34. Stock Exchanges - Compliance of Listing Agreements/ SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015
The Companys shares are listed at the BSE Ltd. and the Company has paid the listing fees to the Stock Exchange. Further, the Company has demat connectivity with both the Depositories, NSDL and CDSL and paid Annual Fees to both the Depositories.
35. Green Initiative
Section 136 of the Companies Act, 2013 and the Rules made there under allow the Company to send its financial statements by electronic mode to such members whose shareholding is in dematerialized format and whose email addresses are registered with Depository for communication purposes. As a responsible corporate citizen, the Company proposes to effect electronic delivery of the Annual Report of the Company in lieu of the paper form to the Members who have registered their email IDs with the Depositories. However, as a matter of practice, a physical copy of the Annual Report has also been sent to the members at their address registered with the Company and the Depository Participants.
A copy of this Annual Report along with the Annual Report of each of the Company for FY 201718 will be placed on the website of the Company.
36. Companys Policy Relating To Directors Appointment And Remuneration
There has been no change in the policy on Directors appointment and remuneration including criteria for determining qualification, positive attributes and remuneration of Key Managerial Personnel and other employees. The same is attached herewith and marked as Annexure III.
The Directors would like to place on record their gratitude for the valuable guidance and support received from the Reserve Bank of India, Securities and Exchange Board of India, Bombay Stock Exchange Limited and other Government and Regulatory Authorities and convey their appreciation to all the stakeholders, customers, bankers, lenders, vendors and all business associated for their valuable and continuous support and encouragement towards the conduct of the efficient operations of the company.
|For and on behalf of the Board of Directors|
|Hemendranath Rajendranath||Usha Iyengar|
|Place: Mumbai||Mnaging Director||Director|
|Date: 31th August, 2018||DIN:6641774||DIN:03447551|