Lerthai Finance Director Discussions


To,

The Members,

Lerthai Finance Limited

Your Directors have pleasure in presenting the Forty Third Directors Report of your Company together with audited statement of Accounts and the Auditors Report thereon in respect of the year ended on March 31, 2022.

1. Financial Summary

(Rs. In Lakhs)

Particulars For the FY 2021-22 ended on 31st March, 2022 For the FY 2020-21 ended on 31st March, 2021
Total Income 26.72 37.26
Total Expenditure 67.12 109.32
Profit / (Loss) before tax (40.39) (72.06)
Less: Tax Expenses 6.78 (10.09)
Profit / (Loss) after Tax (47.17) (61.95)

The Company does not have any subsidiaries and hence is not required to prepare a consolidated financial statement.

2. State of Companys Affairs

The Company has since discontinued its business activities of inter alia production, manufacture or trade refractories of all kind and bricks of all types and varieties being does not resulting as a profitable venture. During the year under consideration the company has earned income mainly from interest earned on fixed deposits placed with the nationalized Bank.

The management of your Company has been keenly looking our for viable business opportunities, however due to the COVID-19 Pandemic situation prevailing all over the world, the past two financial years have not delayed the efforts of the management in terms of availability of suitable business opportunities for the Company in the market. As the effects of the pandemic is subsiding and the world is gearing for economic growth the promoters are optimistic about the future of your Company.

Since the management is still looking of for options to revive the business of the Company, there is nothing at present which can be reported under Management Discussion and Analysis Report in so far industry structure, outlook, opportunities and risk are concerned. The Directors have dealt with the other aspects relating to financial performance, internal control and accounting treatment as far as possible elsewhere in this report.

Further, the obligations relating to compliance with corporate governance provisions does not apply to the Company as per the exemption criteria given under the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. The Company shall comply with the requirements with the said regulations within six months from the date on which it becomes applicable to it. Nevertheless, the Company follows highest governance standards in spirit and believes in philosophy of transparency and disclosure. Corporate Governance is about maximizing shareholder value legally, ethically and sustainably. Your Companys Board exercises its fiduciary responsibilities in the widest sense of the term.

3. Dividend

In view of inadequacy of profits, the Board of Directors has not recommended any dividend for the year under review.

4. Share capital

The current authorized capital of the Company is Rs.5,00,00,000/- (Rupees Five Crores Only). The paid- up share capital of the Company is Rs. 70,00,000 (Rupees Seventy Lakhs Only) consisting of 700,000 (Seven Lakhs) Equity Shares of Rs. 10 (Rupees Ten only) each. There was no change in the Share Capital of the Company during the year under review.

5. Amount to be transferred to reserves

No amount is proposed to be transferred to any reserve.

6. Subsidiary/Joint Ventures/Associate Companies

The Company did not have any subsidiaries, joint ventures or associate companies during the year under review.

7. Directors and Key Managerial personnel

The present Board of Directors consists of the following Directors:

i. Mr. Shao Xing Max Yang

ii. Mr. Jayant Goel

iii. Ms. Aparna Goel

iv. Ms. Ntasha Berry

Ms. Aparna Goel and Mr. Shao Xing Max Yang, directors retires by rotation and being eligible, offers themselves for re-appointment.

The Board has entrusted nomination committee to search for the Independent Directors in terms of the statutory provisions and the process for the same is underway as the committee is screening candidates suitable for the position.

Ms. Sneha Khandelwal is the Company Secretary and Chief Financial Officer of the Company.

8. Board Meetings

During the year under review the Board met 4 (Four) times inter alia to adopt and declare financial results to stock exchanges.

9. Declaration by Independent Directors

The Company has received necessary declarations from Ms. Ntasha Berry, an Independent Director, under Section 149(7) of the Companies Act, 2013 that she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013.

10. Board Evaluation

The Board of Directors have carried out an annual evaluation of its own performance, board committees, and individual directors pursuant to the provisions of the Act, SEBI Listing Regulations and the Guidance Note on Board Evaluation issued by the Securities and Exchange Board of India on January 5,2017.

The performance of the board was evaluated by the board including the independent Director after seeking inputs from all the Directors on the basis of criteria such as the board composition and structure, effectiveness of board processes, information and functioning, etc.

The Board and the Nomination and Remuneration Committee reviewed the performance of individual Directors on the basis of criteria such as education qualification, experience of the core area in which the company operates, attendance, the contribution of the individual director to the board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc.

In the board meeting that followed the meeting of the independent Directors and meeting of Nomination and Remuneration Committee, the performance of the board, its committees, and individual directors was also discussed.

Performance evaluation of independent Directors was done by the entire board, excluding the independent director being evaluated.

11. Audit Committee

Present composition of the Audit Committee is as under:

1. Ms. Ntasha Berry

2. Mr. Shao Xing Max Yang

3. Mr. Jayant Goel

During the financial year, the Audit Committee met 4 (four) times.

12. Nomination & Remuneration Committee

Present composition of the Nomination & Remuneration Committee is as under:

1. Mrs. Aparna Goel

2. Ms. Ntasha Berry

3. Mr. Shao Xing Max Yang

The Nomination & Remuneration Committee has not conducted any meetings during the year as there has been no requirement of any such meeting.

13. Stakeholders Relationship Committee

Present composition of the Stakeholders Relationship Committee is as under:

1. Mr. Shao Xing Max Yang

2. Mr. Jayant Goel

3. Ms. Ntasha Berry

The Stakeholders Relationship Committee has not conducted any meetings during the year as there has been no requirement of any such meeting.

14. Companys Policy on Directors Appointment and Remuneration

The Company has a policy, which mandates the criteria for determining qualifications, positive attributes and independence of Directors Appointment and Remuneration while considering appointment of Director and key managerial personnel. The policy inter alia takes into account: (i) the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate directors of the quality required to run the company successfully; (ii) relationship of remuneration to performance is clear and meets appropriate performance benchmarks; and (iii) remuneration to Directors and key managerial personnel involves a balance between fixed and incentive pay reflecting short and long-term performance objectives appropriate to the working of the company and its goals.

15. Remuneration Details of Directors/ Key Managerial Personnel (KMP) and Employees

Details of employees and Directors or Key Managerial Personnel who are in receipt of remuneration, as per Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is tabled below:

Sl. No. Particulars Details
1. Designation of the employee Company Secretary and Chief Financial Officer
2. Remuneration received INR 3,93,000
3. Nature of employment Full Time basis
4. Qualifications and experience of the employee Qualification: Company Secretary Experience: Working as Comp0any Secretary of Listed Company from +4 years
5. Date of commencement of employment 30th May, 2018
6. Age 35
7. Last employment held NIL
8. Percentage of equity shares held by the employee NIL
9. Whether any such employee is a relative of any director or manager of the company No

Further, other The members of Board are only entitled to sitting fees as approved by the Board pursuant to provisions of Section 203 of the Companies Act, 2013 and Rule 4 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

16. Directors Responsibility Statement

In accordance with the provisions of Section 134(5) of the Companies Act, 2013 ("the Act") and, based upon representations from the Management, the Board states that:

a) in preparing the annual accounts, applicable accounting standards have been followed and there are no material departures;

b) the Directors have selected accounting policies, applied them consistently and made judgments and estimates that are reasonable and prudent 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 loss of the Company for the year;

c) the Directors have taken proper and sufficient care in maintaining adequate accounting records in accordance with 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 of the Company on a "going concern" basis;

e) the Directors have laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and were operating effectively; and

f) the Directors have devised proper systems to ensure proper compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

17. Statutory Auditors

As per provisions of the Companies Act, 2013 M/s. B D Jokhakar & Co., Chartered Accountants have been appointed as Statutory Auditors of the Company from the conclusion of the 41st AGM of the Company till the conclusion of sixth consecutive AGM hereof on such remuneration as may be decided by the Board.

M/s. B D Jokhakar & Co., Chartered Accountants being auditor audited the financials of the Company. There are no qualifications or adverse remarks in the Statutory Auditors Report which require any explanation from the Board of Directors.

18. Material changes and commitments

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;

19. Internal Auditors

In accordance with Section 138 of the Companies Act, 2013 read with Rule 13 of Chapter IX of the said Act, the Board appointed M/s Snehal V. Shaligram, Practicing Company Secretary (C.P. No. 10216) as Internal Auditor of the Company for the Financial Year 2021-22 to conduct internal audit.

20. Explanation on auditors qualification, reservation, adverse remark or disclaimer

There are no qualifications, reservations or adverse remarks given or disclaimers made by the auditor in his audit report for the financial year under review.

21. Secretarial Audit

The Secretarial Audit Report for the year ended March 31, 2022 issued by Ms. Snehal Shaligram, Practicing Company Secretary (C.P. No: 10216) in accordance with the provisions of Section 204 of the Companies Act, 2013, forms part of the Annual Report.

22. Orders passed by the Regulators or Courts or Tribunals

During the year under review, there have been no orders passed by any of the regulators or courts or tribunals impacting the going concern status of the Company and the Companys operations in future.

23. Related Party transactions

There have been no transactions between the Company and related parties as referred to in section 188(1) of the Companies Act, 2013 during the financial year under review. Accordingly, Form AOC-2 as per the rules prescribed under Chapter IX relating to Accounts of Companies under the Companies Act, 2013 does not form part of this report.

24. Loan, Guarantees or Investments

During the financial year under review, the Company has not granted any loans or guarantees or made any investments in respect of which the provisions of section 186 of Companies Act, 2013 are applicable.

25. Deposits from public

The Company has not accepted any deposits from public and as such, no amount on account of principal or interest on deposits from public was outstanding as on the date of the balance sheet.

26. Risk management policy

Since the Company has already closed its manufacturing operations and is in the process of identifying business opportunities, the Company has no such policy in place as of now. The Board shall take steps to formulate the requisite policy as soon as it identifies business opportunity.

27. Vigil Mechanism/Whistle Blower Policy

Your Company has in place a Whistle Blower Policy for its directors and employees to report concerns about unethical behavior, actual or suspected fraud in accordance with Section 177(9) of the Companies Act, 2013. The policy provides for protected disclosures which can be made by a complainant through e-mail or a letter to the Chairperson of the audit committee. The Company did not receive any complain during the year 2021-22.

28. Corporate Social Responsibility

For the year under review, the provisions of section 135 of the Companies Act, 2013 relating to Corporate Social Responsibility are not applicable to the Company.

29. Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) ACT, 2013

The Company has in place a policy for prevention of sexual harassment in accordance with the requirements of the Sexual Harassment of women at workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company did not receive any complain during the year 2021-22.

30. Conservation of Energy and Technology Absorption

Particulars regarding conservation of energy and technology absorption as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of Companies (Accounts) Rules, 2014 are not applicable since the Company is not engaged in any manufacturing / power intensive activity.

31. Foreign exchange earnings and Outgo:

There was no foreign exchange inflow or Outflow during the year under review.

32. Transfer of Amounts to Investor Education and Protection Fund

The Company did not have any funds lying unpaid or unclaimed for a period of seven years. Therefore, there were no funds which were required to be transferred to Investor Education and Protection Fund (IEPF).

33. Acknowledgment

The Directors take this opportunity of thanking their shareholders, bankers, business associates and government authorities for their co-operation and support during the year.

For and on behalf of the Board of Directors
Lerthai Finance Limited
Shao Xing Max Yang
Chairperson
DIN:08114903
Place: Los Angeles Date: 09.08.2022