REPORT ON CORPORATE GOVERNANCE
Introduction: Corporate Governance is the mechanism by which the values, principles, management policies and procedures of a corporation are made manifest in the real world. Corporate Governance contemplates fairness, transparency, accountability and responsibility in the functioning of the management and the board of companies. Corporate Governance represents moral framework, the ethical framework and the value framework under which an enterprise takes decisions.
1. COMPANY'S PHILOSOPHY ON CORPORATE GOVERNANCE
Your company has implemented and continuously tries to improve the Corporate Governance Practices which attempt to meet stakeholders' expectations' and company's commitment to society through high standards of ethics, sound business decisions, prudent financial management practices, professionalism in decision making and conducting the business and finally with strict compliance with regulatory guidelines on corporate governance.
"Transparency, honesty, efficiency, complete and timely disclosure and sustained enhancement of shareholders value, justice to vendors, employees and the society at large are the cardinal principles of Corporate Governance for your Company"
CLAUSE 49 OF THE LISTING AGREEMENT
Clause 49 of the Listing Agreement with the Stock Exchange sets up the norms and disclosures that are to be met by the Company on the Corporate Governance front. We confirm our compliance with Corporate Governance criteria, as required under the said clause, vide this report. Certificate of the Statutory Auditors of your company regarding compliance of the conditions of Corporate Governance as stipulated in the Clause 49 of the Listing Agreement with the Stock Exchange, is enclosed.
2. COMPOSITION OF BOARD OF DIRECTORS
As at 31st March, 2015, the Board of Directors comprised 5 Directors as under:
> All Directors are Independent Non-Executive Directors except Mr. G. R. Morarka, who is Promoter & Non-Executive Chairman & Ms Priyanka G. Morarka.
> Ms. Priyanka G. Morarka is daughter of Shri G. R. Morarka. Other Directors are not related to each other.
> Shri Pranay G. Morarka has been appointed as a Vice President (Chief Executive Officer) pursuant to the requirements section 203 of the Companies Act, 2013 being Key Managerial Personnel (KMP) of the company with effect from April 2014. He is a son of Shri G. R. Morarka.
During the year, 6 Board Meetings were held on: April 1, 2014; May 30, 2014; August 14, 2014; November 14, 2014; February 6, 2015 and March 23, 2015.
Separate Meeting of Independent Directors:
A meeting of independent directors of the company was held on March 5, 2015 and the same was attended by Mr. B. J. Maheshwari, Mr. Vijay S. Banka and Mr. S. H. Nevatia.
Details Of Remuneration and sitting fees [clause 49(VII)( C ) of the listing agreement]: the details of remuneration to the executive directors and sitting fees and out of pocket expenses paid to independent directors for the year ended March 31, 2015 is as follows
3. COMMITTEES OF BOARD A. AUDIT COMMITTEE
Pursuant to Clause 49 II of the Listing Agreement and also pursuant to the provisions of section 177 Companies Act, 2013, the Committee was reconstituted on 26th September, 2000, to comprise two Independent Non-Executive Directors and one Promoter Non-Executive Director. Members of Audit Committee are eminent persons in their field. The Company Secretary acts as the secretary to the Committee.
Terms of Reference: The Audit Committee reviews and reports to the Board on the following:
1. Oversight of the company's financial reporting process and the disclosure of its financial information to ensure that the financial statement is correct, sufficient and credible;
2. Recommendation for appointment, remuneration and terms of appointment of auditors of the company;
3. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
4. Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:
a. Matters required to be included in the Director's Responsibility Statement to be included in the Board's report in terms of clause (c) of sub-section 3 of section 134 of the Companies Act, 2013
b. Changes, if any, in accounting policies and practices and reasons for the same
c. Major accounting entries involving estimates based on the exercise of judgment by management
d. Significant adjustments made in the financial statements arising out of audit findings
e. Compliance with listing and other legal requirements relating to financial statements
f. Disclosure of any related party transactions
g. Qualifications in the draft audit report
5. Reviewing, with the management, the quarterly financial statements before submission to the board for approval;
6. Reviewing, with the management, the statement of uses / application of funds raised through an issue (public issue, rights issue, preferential issue, etc.), the statement of funds utilized for purposes other than those stated in the offer document / prospectus / notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter;
7. Review and monitor the auditor's independence and performance, and effectiveness of audit process;
8. Approval or any subsequent modification of transactions of the company with related parties;
9. Scrutiny of inter-corporate loans and investments;
10. Valuation of undertakings or assets of the company, wherever it is necessary;
11. Evaluation of internal financial controls and risk management systems;
12. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
13. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;
14. Discussion with internal auditors of any significant findings and follow up there on;
15. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board;
16. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post-audit discussion to ascertain any area of concern;
17. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors;
18. To review the functioning of the Whistle Blower mechanism;
19. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the finance function or discharging that function) after assessing the qualifications, experience and background, etc. of the candidate;
20. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
The Committee also reviews the observations of the Internal and Statutory Auditors, along with the comments and action taken thereon by the Management and invites senior executives to its Meetings as necessary.
During the year, 4 Audit Committee Meetings were held on : May 30, 2014, August 14, 2014, November 14, 2014, February 06, 2015.
B. NOMINATION & REMUNERTION COMMITTEE
The Board of Directors of the Company at their meeting held on 4th March, 2003, constituted a remuneration committee of Directors, to comprise two Independent Non-Executive Directors as members and one Promoter Non-Executive Director as chairman. The committee is re-constituted / renamed as a Nomination and Remuneration Committee pursuant to the requirements of section 178(1) of the Companies Act, 2013. The Company Secretary acts as the secretary to the Committee. During the year, there are no any meeting of Nomination and Remuneration Committee taken place.
The Nomination & Remuneration Committee is required to be constituted for deciding the terms and conditions of appointment, remuneration and related matters of Managerial Personnel such as Managing Director, Executive Director & Directors etc
C. STAKEHOLDER'S RELATIONSHIP COMMITTEE
The scope of Stakeholder's Relationship Committee is as follows:
1. To attend to investors grievances of all types of security holder's grievances.
2. To appoint Registrars and Share Transfer Agent.
3. To transfer, transmit, consolidate, issue duplicate share certificates, split share certificates, etc.
4. To attend to complaints of Security holders regarding non-receipt of Balance Sheet and non-receipt of Declared dividend etc.
5. To do all such acts, things, deeds as may be required to be done in the above regard.
Out of pocket expenses @ Rs. 250/- per meeting is payable to a member for attending the committee meeting.
The Stakeholder's Relationship Committee is also required to submit their reports / suggestions to the Board of Directors of the Company from time to time.
D. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:
The company is not falling in the purview of criteria specified in section 135(1) of the Companies Act, 2013 and hence the requirements pertaining to section 135 of the Companies Act, 2013 is not applicable to the company
5. CODE OF BUSINESS CONDUCT AND ETHICS
In keeping with its proactive approach to achieve best governance standards, your company has laid down the Code of Business Conduct and Ethics pursuant to Clause 49 of the Listing Agreement. The code has been posted on the website of the company.
> The Compliance Reports of all laws applicable to the Company are periodically reviewed by the Board.
> The Company has complied with all requirements of the Listing Agreement with the Stock Exchange as well as the Regulations and Guidelines prescribed by SEBI and statutory authorities related to the capital market, during the last three years. There were no penalties or strictures imposed on the Company by any statutory authorities for non-compliance on any matter related to capital markets, during the last three years.
> Disclosure of Related party transactions
All related party transactions have been entered into in the Ordinary course of business and were placed periodically before the Audit Committee and the Board. All transactions with the related parties or others are on an arm's length basis.
> Disclosure of Accounting Treatment
All Accounting Standards mandatorily required have been followed in preparation of financial statements and no deviation has been made in following the same.
> Risk Management:
The Company has in place mechanism to inform the Board Members about the Risk Assessment and Minimisation procedures and periodical reviews, to ensure that risk is controlled by the Executive Management through the means of a properly defined policy.
> Subsidiary Companies:
There are no subsidiary companies.
> Disclosures regarding appointment or reappointment of Directors [Pursuant to clause 49 of the Listing Agreement with the Stock Exchange] :
Given below are the brief resumes of the directors retiring by rotation and / or seeking appointment / re-appointment.
Ms Priyanka Morarka : aged 30 years has done her BMS and MBA. She is daughter of Shri G. R. Morarka and thus related to the director of the company. She has an excellent academic record and is presently engaged as Vice President (Corporate Affairs) in Dwarikesh Sugar Industries Limited ".
MR G. R. Morarka : aged 53 years has done his ICWA Inter. A born entrepreneur with tremendous potentials and inner urge to lead the company. He is also Managing Director of Dwarikesh Sugar Ind Ltd who set up his massive sugar venture in just 14 months short span. He is father of Ms Priyanka Morarka and Pranay Morarka
7. MEANS OF COMMUNICATION
The Company's quarterly results in the pro-forma prescribed by the Stock Exchanges pursuant to clause 41 of the Listing Agreement are approved and taken on record by the Board within the prescribed time frame, and sent forthwith to all Stock Exchanges on which the Company's shares are listed. These results are being published in leading newspapers - Free Press Journal in English & Navshakti in Marathi.
All the data related to quarterly financial results, shareholding pattern etc. has been posted on the Company's website: (www.morarkafinance.in). The Company's website also displays the official news releases.
Management discussion and Analysis report included in the Annual Report for the year.
8. GENERAL SHAREHOLDER INFORMATION
Annual General Meeting 30th Annual General Meeting
Date, time and venue: Monday, 28th September, 2015 at 12 noon at Indian Merchants’ ChambersBuilding Trust, IMC Building, IMC Marg, Churchgate,Mumbai – 400 020.
Financial Calendar Particulars (April-March) Date of Approval/publication
First Quarter Results On or before 14th August, 2015
Second Quarter Results On or before 14th November, 2015
Third Quarter Results On or before 14th February, 2016
Last Quarter Results On or before 30th May, 2016
Dates of Book Closure: Friday, 18th September, 2015 to Monday, 28th September, 2015 (both days inclusive).
Listing Details BSE
Name Address Stock Code
The Bombay Stock Exchange Ltd. Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai – 400 001
International Securities Identification Number (ISIN) INE 367A 01015
Registrar and Transfer Agents:
Universal Capital Securities Pvt.Ltd;1, Shakil Niwas, Mahakali Caves Road Andheri (East), Mumbai - 400 093.
Share Transfer System
Effective November 29, 1999, the Company’s shares are compulsorily traded in dematerialised form.All share transfers and other share related issues are approved by a Director authorised by the Board; approvals areobtained at intervals not exceeding 15 days and during the last financial year, 4 Approvals were obtained.
The total number of shares in physical form transferred during the year under review was 1800.
Dematerialisation of Shares
The company was amongst the first few companies to sign an agreement with the National Securities Depository Limited for joining the Depository System. The company has also signed an agreement with the Central Depository Services (India) Limited. As intimated by SEBI, trading in the shares of the company is compulsorily to be in the dematerialised form for all the investors with effect from November 29, 1999. As on 31st March, 2015, 93.62% of the total shares of the Company have been dematerialised.
Address for Correspondence
Corporate Secretarial Department
The Corporate Secretarial Department is located at the Company’s Registered Office situated at 511, Maker Chambers- V, 221,Nariman Point, Mumbai - 400 021. Tel: 22832468; Fax: 22047288.
The shareholders may address their communications/grievances/ queries to Mr. Hemalkumar Shah, Company Secretary at the above mentioned address. Results
Quarterly & Half-yearly results as published in the newspapers are made available to the Members on request.
Non-Mandatory Requirements (As per clause 49 of the Listing Agreement):
Adoption of non-mandatory requirements of clause 49 of the Listing Agreement is being reviewed by the Board from time to time.
On behalf of the Board of Directors