30 Apr 2017 | Livemint.com

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Gujarat Hotels Ltd.

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Gujarat Hotels Ltd. Accounting Policy

REPORT ON CORPORATE GOVERNANCE

The Directors present the Company's Report on Corporate Governance.

THE COMPANY'S GOVERNANCE PHILOSOPHY

The Company firmly believes in good Corporate Governance and has made it a practice and a  continuous process of development right across the Company. The Company's philosophy on Corporate Governance envisages attainment of a high level of transparency and accountability in the functioning of the Company and conduct of business, and places  due emphasis on regulatory compliance. It has empowered the Executive Management to take decisions with regard to day to day operations and has also created checks and balances that such decisions are taken with care and responsibility to meet stakeholders' aspirations and societal expectations.

The Company's Corporate Philosophy is focused on  its people who are its most important asset and it values its employees' integrity, creativity, ability,  judgment and opinions, who in turn demonstrate the highest ethical standards and responsibility towards  the shareholders. This has helped the Company  take rapid strides in its pursuit of excellence.

The Company is committed to enhance shareholder value in a fair and transparent manner and has been in the forefront for benchmarking itself with the best business practices globally.

BOARD OF DIRECTORS

In terms of the Company's Corporate Governance Policy, all statutory and other significant and material information are placed before the Board to enable it to discharge its responsibility of strategic supervision of the Company as trustees of the shareholders

Composition

The composition of the Board of Directors of the  Company is balanced, comprising of Non-Executive  Directors including independent professionals. Directors are appointed / re-appointed with the approval of the shareholders and all Directors,  except the Independent Directors, are liable to retire  by rotation. The present strength of the Board of Directors of the Company is six.

COMMITTEES OF THE BOARD

Currently, there are three Committees of the Board -the Audit Committee, the Stakeholders Relationship Committee and the Nominations and Remuneration  Committee. The terms of reference of the Board  Committees are determined by the Board from time  to time. Meetings of each Board Committee are convened by the respective Committee Chairman.

Signed minutes of Board Committee meetings are placed for the information of the Board. The role and  composition of these Committees, including the number of meetings held during the financial year  and the related attendance, are provided below:

A. AUDIT COMMITTEE  

The Audit Committee of the Board, inter alia,  provides reassurance to the Board on the  existence  of an effective internal control environment that  ensures:

The role of the Committee includes the following:

• To oversee the Company's financial reporting  process and the disclosure of its financial information to ensure that the financial  statements are correct, sufficient and credible;

• To recommend the appointment, remuneration, terms of appointment and removal of Statutory

Auditors, and to review the manner of rotation of  Statutory Auditors;

• To approve transactions of the Company with related parties, including modifications thereto;

• To review and monitor the Statutory Auditor's independence and performance, and  effectiveness of the audit process;

• To evaluate the Company's internal financial controls and risk management systems;

• To review with the management the following:

- Annual financial statements and Auditor's

Report thereon before submission to the  Board for approval;

- Quarterly financial statements before  submission to the Board for approval;

• To review the following:

- Management discussion and analysis of  financial condition and results of operations;

- Adequacy of internal control systems and the  Company's statement on the same prior to  endorsement by the Board, such review to be  done in consultation with the management,

Statutory and Internal Auditors;

- Reports of Internal Audit and discussion with  Internal Auditors on any significant findings  and follow-up thereon;

- System / manner of maintenance, storage, retrieval, display, print out and security of  books of account of the Company maintained in the electronic form;

- Functioning of Whistle Blower mechanism in the Company.

Composition

The Audit Committee presently comprises four Non-Executive Directors, three of whom are Independent  Directors. The Chairman of the Committee is an  Independent Director. Representative of Statutory  Auditors and Key Managerial Personnel of the  Company are Invitees to the meetings of Audit  Committee.

All members of the Committee are financially literate  and two members have accounting and financial  management expertise. The names of the members of the Audit Committee, including its Chairman, are  provided under the section 'Board of Directors &  Committees' in the Report and Accounts

B. STAKEHOLDERS RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee of the Board (earlier known as 'Investor Services Committee') oversees redressal of shareholder and  investor grievances and, inter alia, approves sub­division / transmission of shares, rematerialisation of shares, issue of duplicate share certificates etc.

Composition

The Stakeholders Relationship Committee  presently comprises two Directors, both of them are Non-Executive Directors. The names of the members of the Stakeholders Relationship Committee, including its Chairman,  are provided under the section 'Board of Directors & Committees' in the Report and Accounts.

C. NOMINATIONS AND REMUNERATION COMMITTEE

The Nominations and Remuneration Committee of the Board, inter alia, identifies persons qualified to become Directors and formulates criteria for evaluation of performance of the Independent  Directors and the Board. The Committee's role also  includes recommending to the Board the appointment, remuneration and removal of Directors.

Composition

The Nominations and Remuneration Committee comprises five Non-Executive Directors, three of  whom are Independent Directors. The Chairman of the Committee is an Independent Director.

The names of the members of the Nominations and  Remuneration Committee, including its Chairman,  are provided under the section 'Board of Directors & Committees' in the Report and Accounts.

Remuneration of Directors

Non-Executive Directors are entitled to sitting fees for attending meetings of the Board and Committees  thereof the quantum of which is determined by the  Board. The sitting fees payable to Non-Executive Directors as determined by the Board with effect  from 11th November, 2014 are Rs. 7,500/- and Rs. 5,000/- for each meeting of the Board and  Committee respectively.

DISCLOSURES

Materially significant related party transactions which may have potential conflict with the  interests of the Company at large: None

Details of non-compliances, penalties, strictures by Stock Exchanges / SEBI / Statutory Authorities on any matter related to capital  markets during the last three years: None

Inter-se relationships between Directors of the Company: None

Material financial and commercial transactions of senior management, where they may have had personal interest, and which had potential  conflict with the interest of the Company at large:  None

MEANS OF COMMUNICATION

Timely disclosure of consistent, comparable, re le van t a nd reliable information on corporate financial performance is at the core of good governance. Towards this end, the quarterly results of the Company were announced within forty five days of the end of each quarter for the first three quarters. The audited annual results along with the  results for the fourth quarter were announced within  sixty days of the end of the financial year. Such results are normally published in 'The Financial Express' (all editions) including its Gujarati edition. All these results, including the entire Report and Accounts, information relating to shareholding pattern etc. are posted on Company's website  www.gujarathotelsltd.in

The Report of the Board of Directors, forming part of the Report and Accounts, includes all aspects of the  Management Discussion and Analysis Report as  required under Clause 49 of the Listing Agreement.

GHL CODE OF CONDUCT FOR PREVENTION OF INSIDER TRADING - 2015

The GHL Code of Conduct for Prevention of Insider  Trading - 2015, as approved by the Board of Directors, inter alia, prohibits purchase / sale of securities of the Company by Directors and  employees while in possession of unpublished price sensitive information in relation to the Company.

GHL CODE OF CONDUCT

The GHL Code of Conduct, as adopted by the Board  of Directors, is applicable to Directors, senior  management and employees of the Company. The  Code is derived from three interlinked fundamental principles, viz. good corporate governance, good corporate citizenship and exemplary personal conduct in relation to the Company's business and  reputation. The Code covers GHL's commitment to sustainable development, concern for occupational  health, safety and environment, transparency and  audit ability, legal compliance and the philosophy of leading by personal example. The Code is available on the Company's website.

Declaration as required under Clause 49 of the Listing Agreement

All Directors and senior management of the Company have affirmed compliance with the GHL Code of Conduct for the financial year  ended 31st March, 2015.  New Delhi Ragthunathan Murali  15th April, 2015 Chief Executive Officer

WHISTLEBLOWER POLICY

Synopsis of the Whistleblower Policy of the Company is provided in the 'Report of the Board of Directors & Management Discussion and Analysis' in the Report and Accounts. The Whistleblower Policy is also available on the Company's website.

FAMILIARISATION PROGRAMME

GHL believes that a Board, which is well informed /  familiarised with the Company, can contribute significantly to effectively discharge its role of trusteeship in a manner that fulfills stakeholders' aspirations and societal expectations. In pursuit of  this, the Directors are updated on a continuing basis on changes / developments in the domestic / global  corporate and industry scenario including those pertaining to statutes / legislations and economic environment, to enable them to take well informed  and timely decisions.

The details of the familiarisation programme may be accessed on the Company's  website:<http://www.gujarathotelsltd.in/policies/Dire>  ctors_Familiarisation_Programme.pdf

NON-MANDATORY RECOMMENDATIONS

UNDER CLAUSE 49 OF THE LISTING AGREEMENT

The status of compliance with the non-mandatory recommendations under Clause 49 of the Listing Agreement with Stock Exchanges is provided below:

1. Non-Executive Chairman's Office: The

Company has a Non-Executive Chairman but he does not maintain any separate office, hence no  expense in this regard is being incurred by the Company.

2. Shareholder Rights: The quarterly, half-yearly and annual financial results of the Company are  published in newspapers on an all India basis and are also posted on the Company's website www.gujarathotelsltd.in The complete Report  and Accounts is sent to every Shareholder of the  Company.

3. Audit Qualifications: It has always been the  Company's endeavour to present unqualified financial statements. There are no audit qualifications on the Company's financial  statements for the year ended 31st March, 2015.

4. Separate posts of Chairman and Managing

Director: The Company has appointed a Non­ Executive Chairman and a Chief Executive  Officer.

5. Reporting of Internal Auditor: The Internal Auditor reports to the Audit Committee.

SHAREHOLDER INFORMATION

Registrars & Share Transfer Agents

Messrs MCS Share Transfer Agent Limited are the Registrars and Share Transfer Agents (RTA) of the  Company for carrying out share registration and  other related activities of the Company.

Address for Correspondence

MCS Share Transfer Agent Limited  10, Aram Apartment  12, Sampatrao Colony  Alkapuri Vadodara - 390 007  Tel No. : 0265-2314757  E-mail : mcsltdbaroda@yahoo.com

Shareholders holding shares in the electronic form  should address their correspondence, except those  relating to dividend, to their respective Depository Participants.

Compliance Officer

Rohan Singh, Chief Financial Officer, is the Compliance Officer under Clause 47 of the Listing Agreement with Stock Exchanges.

Share Transfer Committee

The Share Transfer Committee of the Company met 15 times during the financial year. The processing activities with respect to requests received for share  transfer are completed within the statutory time prescribed. There were no share transfers pending  as on 31st March, 2015

Dematerialisation of Shares and Liquidity

The shares of the Company are available for trading  in dematerialised form under both the Depository Systems in India - NSDL and CDSL. The  International Securities Identification Number (lSIN)  allotted to the Company's shares under the

Depository System is INE621C01011. The annual custody fees for the financial year 2015-16 have been paid to NSDL and CDSL, the Depositories.

As on 31st March, 2015, a total of 33,38,549 Equity Shares of the Company, which forms 88.15% of the  Share Capital, stands dematerialised. The processing activities with respect to requests received for dematerialisation are completed within  10-15 days.

Shareholder / Investor Complaints

The Company attends to Shareholder / Investor complaints, queries and other correspondence generally within a period of 10-15 working days except in cases where constrained by disputes or legal impediments.

The Company received no complaint during the  financial year ended 31st March, 2015. The e-mail ID earmarked for investor complaints:  ghlinvestors@yahoo.co.in

Listing of Shares on Stock Exchanges (with

Stock Code)

Vadodara Stock Exchange Ltd. (107) Fortune Towers, 3rd Floor, Sayajigunj Vadodara-390 005 Telephone no. : 0265-2361534 Fascimile no. : 0265-2361542 E-mail : vse@d2visp.com Website : www.vselindia.com

BSE Limited (507960) Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001 Telephone nos.: 022-22721233/34 Fascimile no. : 022-22721919 E-mail : is@bseindia.com Website : www.bseindia.com

The Listing Fees for the financial year 2015-16 have been paid to the aforesaid Stock Exchanges.

Financial Calendar

Financial Year 2015-16

1 First Quarter Results : August 2015

2 Second Quarter and Half Year Results : November 2015

3 Third Quarter Results : February 2016

4 Fourth Quarter and Annual Results : May 2016

Postal Ballot

No special resolution requiring postal ballot was proposed last year. No special resolution requiring postal ballot is being proposed for the ensuing AGM.

SHAREHOLDER REFERENCER

Unclaimed Dividend

Unclaimed dividend for the years prior to and including the financial year 2006-07 has been  transferred to the General Revenue Account of the  Central Government / the Investor Education and Protection Fund established by the Central Government (IEPF), as applicable.

The dividend for the undernoted years, if remaining  unclaimed for 7 years, will be statutorily transferred  by the Company in accordance with the schedule  given below, to IEPF

Shareholders who have not so far encashed their dividend warrant(s) or have not received the same  are requested to seek issue of duplicate warrant(s)  by writing to the Company confirming non-  encashment / non-receipt of dividend warrant(s).

Service of documents through Electronic Mode

The Notice, along with the Report and Accounts has been sent in electronic mode to those Shareholders who have registered their e-mail addresses with the  Company or with the Depositories and in physical  mode to the remaining Shareholders. Shareholders who wish to update or register their e-mail addresses with the Company or with the Depositories are once again requested to register the same. The form for such registration can be downloaded from the Company's website www.gujarathotelsltd.in

Depository Services

Shareholders may write to the respective Depository or to RTA for guidance on depository services.

Address for Correspondence with Depositories

National Securities Depository Limited Trade World, 'A' Wing, 4th & 5th Floors Kamala Mills Compound Senapati Bapat Marg, Lower Parel Mumbai 400 013 Telephone no. : 022-24994200 Facsimile no. : 022-24976351 E-mail : info@nsdl.co.in Website : www.nsdl.co.in

Central Depository Services (India) Limited

Phiroze Jeejeebhoy Towers 17th Floor, Dalal Street , Fort Mumbai 400 001 Telephone no. : 022-22723333 Facsimile no. : 022-22723199 / 2272207 E- mail : helpdesk@cdslindia.com Website : www.cdslindia.com

Remittance of Dividend through Electronic Mode

The Company provides the facility for remittance of dividend to Shareholders through NECS (National Electronic Clearing Service) / RTGS (Real Time Gross Settlement) / NEFT (National Electronic Funds Transfer). Shareholders who have not yet availed the NECS / RTGS / NEFT facility and wish to avail the same may have their bank details, including MICR (Magnetic Ink Character Recognition) and IFSC (Indian Financial System Code) number updated with their respective Depository Participants (DPs) or RTA where shares are held in the dematerialised form and in the physical form, respectively. A mandate form for such updation can be downloaded from the Company's website www.gujarathotelsltd.in  

Permanent Account Number (PAN)

Shareholders holding shares in the Certificate form are advised that it is mandatory to furnish copy of PAN card in the following cases :

i) Transferees' PAN Cards for transfer of shares,

ii) Surviving joint holders' PAN Cards for deletion of name of deceased shareholder,

iii) Legal heirs' PAN Cards for transmission of shares, and

iv) Joint holders' PAN Cards for transposition of shares.

Nomination Facility

Shareholders who hold shares in the physical form and wish to make any nomination / change nomination made earlier in respect of their shareholding in the Company, should submit to the RTA the prescribed Form; such Form can be downloaded from the Company's website under the section 'Financial Reports'.