29 Apr 2017 | Livemint.com

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Nettlinx Ltd.

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  • 108.00 1.30 (1.22%)
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  • BSE Code: 511658
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Nettlinx Ltd. Accounting Policy

CORPORATE GOVERNANCE REPORT FOR THE YEAR ENDED ON 31st MARCH, 2015

1. Company Philosophy:

The Company's Corporate Governance philosophy aims at assisting the management of the Company in the efficient conduct of its business and in meeting its responsibilities to all the stakeholders and to provide customer satisfaction through best quality at lowest price. It is towards this end that efforts are made to maintain high standards of disclosure to the shareholders and internal compliance guidelines for better Corporate Governance.

2. Size and composition of Board of Directors:

The current policy is to have an appropriate mix of Executive and Independent Non-Executive Directors. As on date the Board comprises of nine (8) members, one of whom are Executive Directors and five are Independent Non-Executive Directors. Four of the executive directors are the Founders. The Board periodically evaluates the need for change in the composition and size.

The Chairman of the Board is a Non Executive Director and Promoter

As required under Section 149(1) of the Companies Act, 2013 and Clause 49(ii) of Listing Agreement, Mrs. Radhika Kundur, a lady Director, has been appointed.

3. Committees of the Board:

The Board currently has 5 Committees: 1) Audit Committee, 2) Nomination and Remuneration Committee, 3) Stakeholders Relationship Committee and 4) Risk Management Committee 5)Internal Complaints Committee. The terms of reference of the Board Committees are determined by the Board from time to time. The Board is responsible for constituting, assigning and co-opting the members of the Committees. The meetings of each Board Committee are convened by the respective Committee Chairman. The role and composition of these Committees, including the number of meetings held during the financial year and related attendance is provided below.

(a) Audit Committee

The Audit Committee continued working under Chairmanship of Mr. K. Kameswara Rao with Mr. J. V. Hanumantha Rao and Mr. M. Vijay Kumar as co-members. During the year, the sub-committee met on four occasions with full attendance of all the members.

The Committee is governed by a Charter which is in line with the regulatory requirements mandated by the Companies Act, 2013 and Clause 49 of the Listing Agreement. Some of the important functions performed by the Committee are:

Financial Reporting and Related Processes

• Overview of the Company's financial reporting process and financial information submitted to the Stock Exchanges, regulatory authorities or the public.

• Reviewing with the Management the quarterly unaudited financial statements and the Auditors' Limited Review Report thereon/audited annual financial statements and Auditors' Report thereon before submission to the Board for approval. This would, inter alia, include reviewing changes in the accounting policies and reasons for the same, major accounting estimates based on exercise of judgement by the Management, significant adjustments made in the financial statements and / or recommendation, if any, made by the Statutory Auditors in this regard.

• Review the Management Discussion & Analysis of financial and operational performance.

• Discuss with the Statutory Auditors its judgement about the quality and appropriateness of the Company's accounting principles with reference to the Generally Accepted Accounting Principles in India (IGAAP).

• Review the investments made by the Company.

All the Members of the Audit Committee have the requisite qualification for appointment on the Committee and possess sound knowledge of finance, accounting practices and internal controls.

(b) Nomination and Remuneration Committee

The Committee was constituted to review the remuneration package of Managing Director/Executive Directors and to recommend suitable revision in the same, if any to the Board of Directors. During the financial year 2014-15, one committee meeting was held for review of Remuneration of working Directors.

Remuneration of Directors:

The Company pays remuneration by way of salary, perquisites and other allowances to the Managing Director/Whole-time Directors as approved by the Board and Shareholders of the Company.

The remuneration is fixed considering various factors such as qualification, experience, expertise, and prevailing remuneration in the corporate world, financial position of the Company etc. The remuneration structure comprises of Basic Salary, Commission, perquisites and allowances, Contribution to Provided Fund and other funds in accordance with the Provisions of the Companies Act, 2013. The Non-Executive Director does not draw any remuneration from the Company except sitting fees for each meeting of the Board attended by them.

The terms of reference of the Committee inter alia, include the following:

• Succession planning of the Board of Directors and Senior Management Employees;

• Identifying and selection of candidates for appointment as Directors / Independent Directors based on certain laid down criteria;

• Identifying potential individuals for appointment as Key Managerial Personnel and to other Senior Management positions;

• Formulate and review from time to time the policy for selection and appointment of Directors, Key Managerial Personnel and senior management employees and their remuneration;

• Review the performance of the Board of Directors and Senior Management Employees based on certain criteria as approved by the Board.

(c) Stakeholders' Relationship Committee

The terms of reference of the Committee are:

• transfer/transmission of shares/debentures and such other securities as may be issued by the Company from time to time;

• issue of duplicate share certificates for shares/debentures and other securities reported lost, defaced or destroyed, as per the laid down procedure;

• issue new certificates against subdivision of shares, renewal, split or consolidation of share certificates / certificates relating to other securities;

• issue and allot right shares / bonus shares pursuant to a Rights Issue / Bonus Issue made by the Company, subject to such approvals as may be required;

• to grant Employee Stock Options pursuant to approved Employees' Stock Option Scheme(s), if any, and to allot shares pursuant to options exercised;

• to issue and allot debentures, bonds and other securities, subject to such approvals as may be required;

• to approve and monitor dematerialization of shares / debentures / other securities and all matters incidental or related thereto;

• to authorize the Company Secretary and Head Compliance / other Officers of the Share Department to attend to matters relating to non-receipt of annual reports, notices, non-receipt of declared dividend / interest, change of address for correspondence etc. and to monitor action taken;

• monitoring expeditious redressal of investors / stakeholders grievances;

• all other matters incidental or related to shares, debenture

During the year, No complaints were received from shareholders, out of which No complaints have been attended/resolved. The balance complaints were under various stages of investigation. As on March 31, 2015, no investor grievance has remained unattended/ pending for more than thirty days. The Company had no share transfers pending as on March 31, 2015.

Business Risk Evaluation and Management is an on-going process within the Organization. The Company has a robust risk management framework to identify, monitor and minimize risks as also identify business opportunities.

The objectives and scope of the Risk Management Committee broadly comprises:

• Oversight of risk management performed by the executive management;

• Reviewing the BRM policy and framework in line with local legal requirements and SEBI guidelines;

• Reviewing risks and evaluate treatment including initiating mitigation actions and ownership as per a pre-defined cycle;

• Defining framework for identification, assessment, monitoring, mitigation and reporting of risks.

Internal Complaints Committee:

The company has on 07.08.2015, formed an Internal Complaint Committee as envisaged under Section 4 of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 for receiving complaint of sexual harassment. The Committee consisting of the following members:

Independent Directors' Meeting

During the year under review, the Independent Directors met on 06th February 2015, inter alia, to discuss:

• Evaluation of the performance of Non-independent Directors and the Board of Directors as a whole.

• Evaluation of the performance of the chairman of the Company, taking into account the views of the Executive and Non-executive directors.

• Evaluation of the quality, content and timelines of flow of information between the Management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

• All the Independent Directors were present at the Meeting.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration, Stakeholders' Relationship Committee and Risk Management Committees. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering various aspects of the Board's functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligations and governance.

A separate exercise was carried out to evaluate the performance of individual Directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement safeguarding the interest of the Company and its minority shareholders etc. The performance evaluation of the Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors. The Directors expressed their satisfaction with the evaluation process.

4. Disclosures:

(a) Materially Significant related party transactions

There was no materially significant transaction with related parties entered into by the Company with its promoters, Directors or the Management, their subsidiaries or relatives etc. that may have potential conflict with the interests of the Company at large. The Register of Contracts contained the transactions in which Directors are interested is placed at the Board Meetings. Disclosures on transactions with related parties as required under Accounting Standards have been incorporated in the notes to the Accounts.

(b) Details of non compliance by the company, penalties, and strictures imposed on the company by the Stock Exchange or SEBI or any authority on any matter related to capital markets during last 3 years.

There was no instance of levy of any penalties during the last three years.

(c) Pecuniary relationship or transactions of Non-Executive Directors

Non-executive Directors do not have any material pecuniary relationship or transactions with the company, its promoters or its management which in the judgment of the board may affect independence of judgment of the director.

Compliance with Accounting Standards

In the preparation of the financial statements, the Company has followed the Accounting Standards notified pursuant the relevant provision of the Companies Act, 2013 read with applicable Accounting Standards, issued by the Ministry of Corporate Affairs. The significant accounting policies which are consistently applied have been set out in the Notes to the Financial Statements.

Internal Controls

The Company has a formal system of internal control testing which examines both the design effectiveness and operational effectiveness to ensure reliability of financial and operational information and all statutory / regulatory compliances. The Company's business processes have a strong monitoring and reporting process resulting in financial discipline and accountability.

CEO / CFO Certification

The CEO and the CFO have issued certificate pursuant to the provisions of Clause 49 of the Listing Agreement certifying that the financial statements do not contain any untrue statement and these statements represent a true and fair view of the Company's affairs. The said certificate is annexed and forms part of the Annual Report.

Code of Conduct

The Board of Directors has approved a Code of Business Conduct which is applicable to the Members of the Board and all employees. The Code has been posted on the Company's website www.nettlinx.com  

Vigil Mechanism / Whistle Blower Policy

In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility. The Company has a Fraud Risk Management Policy (FRM) to deal with instances of fraud and mismanagement, if any. The FRM Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.

PREVENTION OF INSIDER TRADING:

The Company has adopted a Code of Conduct for Prevention of unfair Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

All Board Directors and the designated employees have confirmed compliance with the Code.

Means of Communication

Quarterly Results

The quarterly results of the Company are generally published in a leading English Newspaper & in a local language Newspaper.

Newspapers in which Published

Business Standard (English) and Andhra Prabha (Telugu)

Website where the results and other official news releases are displayed

www.nettlinx.com

5. General Shareholder Information Market Information Listing on Stock Exchanges

The Company's shares are listed on the following Stock Exchanges and the Listing Fees have been paid to the Exchange.

Name & Address of the Stock Exchanges

 (Dematerialised share)

BSE Limited

Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai 400001

Stock Code/Scrip Code

511658

ISIN Number for NSDL/CDSL

INE027D01019

Share Transfer System / Dividend and Other Related Matters Share transfers

Share transfers in physical form are processed and the share certificates are generally returned to the transferees within a period of fifteen days from the date of receipt of transfer provided the transfer documents lodged with the Company are complete in all respects.

Nomination facility for shareholding

As per the provisions of the Companies Act, 2013, facility for making nomination is available for Members in respect of shares held by them. Members holding shares in physical form may obtain nomination form, from the Share Department of the Company or download the same from the Company's website. Members holding shares in dematerialized form should contact their Depository Participants (DP) in this regard.

Permanent Account Number (PAN)

Members who hold shares in physical form are advised that SEBI has made it mandatory that a copy of the PAN card of the transferee/s, members, surviving joint holders / legal heirs be furnished to the Company while obtaining the services of transfer, transposition, transmission and issue of duplicate share certificates.

Reconciliation of Share Capital Audit

As required by the Securities & Exchange Board of India (SEBI) quarterly audit of the Company's share capital is being carried out by an independent external auditor with a view to reconcile the total share capital admitted with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) and held in physical form, with the issued and listed capital. The Auditors' Certificate in regard to the same is submitted to BSE Limited and is also placed before Stakeholders' Relationship Committee and the Board of Directors.

Outstanding GDRs/ADRs/Warrant or any convertible instruments, conversion date and likely impact on Equity: The Company has neither issued any of these instruments during the year nor any such outstanding instrument is pending for conversion.

During the year under review, no resolution has been passed through the exercise of postal ballot.

E-Voting Facility to members

In compliance with provisions of Section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules, 2014, the Company is pleased to provide members the facility to exercise their right to vote at the 22nd Annual General Meeting (AGM) by electronic means and the business may be transacted through e-Voting Services provided by Central Depository Services Limited (CDSL). Pursuant to the amendments made in clause 35B of the Listing Agreement by SEBI, the company has sent assent/dissent forms to the members to enable those who do not have access to e-Voting facility to cast their vote on the shareholders resolution to be passed at the ensuing Annual General Meeting, by sending their assent or dissent in writing.

Outstanding GDRs/ADRs/Warrant or any convertible instruments, conversion date and likely impact on Equity:

The Company has neither issued any of these instruments during the year nor any such outstanding instrument is pending for conversion

FINANCIAL CALENDAR 2015:

AGM - Date, time and venue

28th September 2015 10.30 a.m. ICWA Bhavan

Financial Calendar (Tentative) 2015-16

1st Quarter 30/06/2015 - by 2nd week of August, 2015

2nd Quarter 30/09/2015 - by 2nd week of November, 2015

3rd Quarter 30/12/2015 - by 2nd week of February, 2016

4th Quarter 31/03/2016 - by 4th week of May, 2016

Book Closure Date

18/09/2015 to 28/09/2015 (both days inclusive)

Listing of Eq. shares on stock exchanges

Bombay Stock Exchange Ltd

Stock Code

511658

Registrar & Transfer Agents

Venture Capital and Corporate Investments Pvt. Ltd.,

Regd. Off: 12-10-167, Bharat Nagar, Hyderabad - 500 018, Telangana

Tel: 91-40-23818475/23818476/2386808023 Fax: 040 - 23868024

E - Mail: info@vccilindia.com  

Posting of Annual Reports

05.09.2015

Last date for receipt of Proxy Forms Probable date of dispatch of warrants

25.09.2015

ADDRESS FOR CORRESPONDENCE

Shareholders Correspondence for

Addressed to

1. Transfer/Dematerialization/ Consolidation/Split of Shares, Issue of Duplicate Share Certificate, Change of Address of members and beneficial owners and any other query relating to the shares of the Company

Venture Capital and Corporate Investments Pvt. Ltd.,

Regd. Off: 12-10-167, Bharat Nagar, Hyderabad - 500 018, Telangana

Tel: 91-40-23818475/23818476/2386808023 Fax: 040 - 23868024

E - Mail: info@vccilindia.com <mailto:info@vccilindia.com>

2. Investor Correspondence/Query on Annual Report

M/s. Nettlinx Limited

5-9-22, Flat No.303, 3rd Floor my home Sarovar Plaza, Secretariat, Saifabad, Hyderabad, Telangana-500063.

Ph: 91-040-23232200 Fax: 23231610

E - Mail: secretarial@nettlinx.org  Website:www.nettlinx.com

Depository Services:

For guidance on depository services, Shareholders may write to the Company or to the respective Depositories:

National Securities Depository Ltd. Trade World, 4th Floor Kamala Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai-400013.

Tel : 091-022-24994200 Fax:091-022-24972993/24976351

Email : info@nsdl.co.in

Central Depository Services (India) Ltd. Phiroze Jeejeebhoy Towers,

17th Floor, Dalal Street, Mumbai - 400023.

Tel : 091-022-22723333 Fax : 091-022-22723199 Email: investors@cdslindia.com

Place: Hyderabad

Date : 07/08/2015

Compliance with Code of Business Conduct and Ethics

for Nettlinx Limited

Dr. Manohar Loka Reddy

Chairman DIN : 00140229

As provided under Clause 49 of the Listing Agreement with the Stock Exchanges, the Board Members and the Senior Management Personnel have confirmed compliance with the Code of Conduct and Ethics for the year ended December 31, 2014.

for Nettlinx Limited

Dr. Manohar Loka Reddy

Chairman DIN:00140229

Place: Hyderabad

Date : 07/08/2015