REPORT ON CORPORATE GOVERNANCE
In Compliance with Clause 49 of Listing Agreement with Stock Exchanges, the Company Submits the report on the matters mentioned in said clause and lists the practices followed by the company.
CORPORATE GOVERNANCE PHILOSOPHY:
The Company's philosophy on Corporate Governance is very well practice fair and transparent governance to the benefit of its stakeholders at large. The Company relies on the strong Corporate Governance systems and policies of business for healthy growth, accountability and transparency.
The Directorships held by Directors in other Companies, as mentioned above do not include Directorships in Foreign Companies, Companies Registered under Section 8 of the Companies Act, 2013 and Private Limited Companies.
In accordance with Clause 49 of the Listing Agreement, memberships/chairmanships of Audit Committees and Stakeholders Relationship Committees in all public Limited companies (Supra Trends Limited) have been considered.
None of the Directors on the Board is a member on more than 10 Committees and Chairman of more than 5 Committees across all the companies in which they are Directors.
None of the Directors serve as an Independent Director in more than seven listed companies.
During the year under review, Six (6) Board meetings were held on 30th May, 2014, 11th July, 2014, 14th August, 2014, 14th November, 2014, 14th February, 2015 and 1st March, 2015.
Your Company holds minimum of four board meetings in each year with maximum time gap of 120 days between any two meetings and Additional Board Meeting was convened by giving appropriate notice to address the urgent needs of the Company. The Board may also approve permitted matters by passing resolutions by circulation.
2. Audit Committee:
The audit committee of the Company is constituted in the line with the provisions of Clause 49 of Listing Agreement entered into with the stock exchanges read with section 177 of the Companies Act, 2013.
The committee acts in accordance with the terms of reference specified in writing by the Board which shall include provisions of sub-section of (4) of section 177 of the Companies Act, 2013. The Audit Committee has adequate powers to play effective role as required under Clause 49 of the Listing Agreement entered into with Stock Exchanges. The audit Committee invites executives, as it considers appropriate, representatives of the Statutory Auditors and representatives of the internal auditors to be present at its meeting, as per provision of Sub-section (5) of section 177 of the Companies Act, 2013. The composition of the Audit Committee as on date and the attendance of each Member of the Committee at the meetings were as follows
Chairman of the Audit Committee also attended the last Annual General Meeting of the Company.
Members of Audit Committee met four times with maximum time gap of Four Months between any two Committee meetings.
Audit Committee meetings were held during the year under review, Four (4) Board meetings were held on 30th May, 2014, 14th August, 2014, 14th November, 2014 and 14th February, 2015.
Terms of reference
The terms of reference of the Audit Committee are as per the guidelines set out in the Listing Agreement entered into with Stock Exchanges read with Section 177 of the Companies Act, 2013 and includes such other functions as may be assigned to it by the Board from time to time.
i) Powers of the Audit Committee include:
• To investigate any activity within its terms of reference.
• To seek information from any employee.
• To obtain outside legal or other professional advice.
• To secure attendance of outsiders with relevant expertise, if it considers necessary.
ii) Role of the Audit Committee includes:
• Oversight of Company's financial reporting process and disclosure of its financial information to ensure that the financial statements are correct, sufficient and credible.
• Recommending to the Board, the appointment, re-appointment and if required, the replacement or removal of auditors and fixation of audit fee.
• Approval of payment to statutory auditors for any other services rendered by them.
• Reviewing, with the management, the annual financial statements before submission to the Board for approval, with particular reference to: 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 Secttion 134 of the Companies Act, 2013 changes, if any, in accounting policies and practices and reasons for the same major accounting entries involving estimates based on the exercise of judgment by management significant adjustments made in the financial statements arising out of audit findings compliance with listing and other legal requirements relating to financial statements disclosure of any related party transactions review of draft Auditors Report, in particular qualifications / remarks / observations made by the Auditors on the financial statements Management Discussion and Analysis of financial conditions and results of operations
• Review of Statement of significant related party transactions submitted by the management.
• Review of management letters/letters of internal control weaknesses issued by the statutory auditors.
• Review of internal audit reports relating to internal control weaknesses.
• Review of appointment, removal and terms of remuneration of the Chief Internal Auditor.
• Reviewing, with the management, the quarterly financial statements before submission to the Board for approval
• Review of the financial statements of subsidiary Companies
• Review and monitor the auditor's independence and performance and effectiveness of audit process
• Approval or any subsequent modification of transactions of the Company with related parties
• Scrutiny of inter-corporate loans and investments
• Valuation of undertakings or assets of the Company, wherever it is necessary
• Evaluation of internal financial controls and risk management systems
• To look into the reasons for substantial defaults in the payment to the shareholders (in case of non-payment of declared dividends) and creditors
• 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 utilization of proceeds of a public or rights issue and making appropriate recommendations to the Board to take up steps in this matter.
• Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems
• 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
• Discussion with internal auditors of any significant findings and follow up there on
• Reviewing the risk management policies, practices and 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
• 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.
• To review the functioning of the Whistle Blower Mechanism
• Approval of appointment / reappointment / remuneration of CFO (or any other person heading the finance function or discharging that function) after assessing the qualifications, experience & background, etc. of the candidate
• Carrying out any other function as may be mentioned in the terms of reference of the Audit Committee
The Audit Committee discharges its functions and obligations on regular basis and on the occurrence of the events.
3. Nomination and Remuneration Committee:
Nomination and Remuneration Committee was duly constituted in accordance with the requirements of Schedule V of the Companies Act, 2013 and Listing Agreement.
The Nomination and Remuneration Committee is authorized subject to the provisions of Companies Act, 2013 and the consent of members, to negotiate, finalize and approve the terms of appointment for Managing Director and other Senior Executives on behalf of the Company. As on date the composition of remuneration committee is as follows:
The terms of reference of the Nomination and Remuneration Committee are as under:
• Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board a policy, relating to the remuneration of the directors, key managerial personnel and other employees.
• Formulation of criteria for evaluation of Independent Directors and the Board
• Devising a policy on Board diversity.
• Identifying persons who are qualified to become directors and who may be appointed in senior management in accordance with the criteria laid down, and recommend to the Board their appointment and removal.
• To recommend/review remuneration of Key Managerial Personnel based on their performance and defined assessment criteria.
• To decide on the elements of remuneration package of all the Key Managerial Personnel i.e. salary, benefits, bonus, stock options, pensions, etc.
• Recommendation of fee / compensation if any, to be paid to Non-Executive Directors, including Independent Directors of the Board.
• Payment / revision of remuneration payable to Managerial Personnel.
• While approving the remuneration, the committee shall take into account financial position of the Company, trend in the industry, qualification, experience and past performance of the appointee.
• The Committee shall be in a position to bring about objectivity in determining the remuneration package while striking the balance between the interest of the Company and shareholders.
• Any other functions / powers / duties as may be entrusted by the Board from time to time.
The Company has adopted a Policy relating to the remuneration for Directors, Key Managerial Personnel and other employees of the Company which is disclosed on the website of the Company.
Nomination and Remuneration Policy
Supra Trends Limited, believes that an enlightened Board consciously creates a culture of leadership to provide a long-term vision and policy approach to improve the quality of governance.
Towards this, Supra Trends Limited ensures constitution of a Board of Directors with an appropriate composition, size, diversified expertise and experience and commitment to discharge their responsibilities and duties effectively. Supra Trends Limited recognizes the importance of Independent Directors in achieving the effectiveness of the Board. Supra Trends Limited aims to have an optimum combination of Executive, Non-Executive and Independent Directors.
Supra Trends Limited also recognizes the importance of aligning the business objectives with specific and measureable individual objectives and targets. The Company has therefore formulated the remuneration policy for its Directors, Key Managerial Personnel and other employees keeping in view the following objectives:
a) Ensuring that the level and composition of remuneration is reasonable and sufficient to attract, retain and motivate, to run the Company successfully.
b) Ensuring that relationship of remuneration to performance is clear and meets the performance benchmarks.
c) Ensuring that remuneration 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.
This Policy sets out the guiding principles for the Nomination and Remuneration Committee for identifying persons who are qualified to become Directors and to determine the independence of Directors, in case of their appointment as independent directors of the Company and also for recommending to the Board the remuneration of the Directors, Key Managerial Personnel and other employees of the Company.
3. Terms and References:
In this Policy, the following terms shall have the following meanings:
3.1 "Director" means a Director appointed to the Board of a Company.
3.2 "Nomination and Remuneration Committee" means the committee constituted by Supra Trends Limited Board in accordance with the provisions of Section 178 of the Companies Act, 2013 and Clause 49 of the Equity Listing Agreement.
3.3 "Independent Director" means a Director referred to in sub-section (6) of Section 149 of the Companies Act, 2013 and Clause 49(II)(B) of the Equity Listing Agreement.
3.4 "Key Managerial Personnel" means
(i) the Chief Executive Officer or the Managing Director or the Manager;
(ii) the Company Secretary;
(iii) the Whole-time Director;
(iv) the Chief Financial Officer; and
(v) such other officer as may be prescribed under the Companies Act, 2013
4. Selection of Directors and determining Directors' independence
4.1 Qualifications and criteria
4.1.1 The Nomination and Remuneration (NR) Committee, and the Board, shall review on an annual basis, appropriate skills, knowledge and experience required of the Board as a whole and its individual members. The objective is to have a Board with diverse background and experience that is relevant for the Company's global operations.
4.1.2 In evaluating the suitability of individual Board members, the NR Committee may take into account factors, such as:
General understanding of the Company's business dynamics, global business and social perspective;
Educational and professional background Standing in the profession; Personal and professional ethics, integrity and values;
Willingness to devote sufficient time and energy in carrying out their duties and responsibilities effectively.
4.1.3 The proposed appointee shall also fulfill the following requirements: Shall possess a Director Identification Number; Shall not be disqualified under the Companies Act, 2013; Shall give his written consent to act as a Director; Shall endeavour to attend all Board Meetings and wherever he is appointed as a Committee Member, the Committee Meetings; Shall abide by the Code of Conduct established by the Company for Directors and Senior Management Personnel; Shall disclose his concern or interest in any company or companies or bodies corporate, firms, or other association of individuals including his shareholding at the first meeting of the Board in every financial year and thereafter whenever there is a change in the disclosures already made; Such other requirements as may be prescribed, from time to time, under the Companies Act, 2013, Equity Listing Agreements and other relevant laws.
4.1.4 The NR Committee shall evaluate each individual with the objective of having a group that best enables the success of the Company's business.
4.2 Criteria of Independence
4.2.1 The NR Committee shall assess the independence of Directors at the time of appointment / reappointment and the Board shall assess the same annually. The Board shall re-assess determinations of independence when any new interests or relationships are disclosed by a Director.
4.2.2 The criteria of independence, as laid down in Companies Act, 2013 and Clause 49 of the Equity Listing Agreement, is as below:
An independent director in relation to a company, means a director other than a managing director or a whole-time director or a nominee director—
a. who, in the opinion of the Board, is a person of integrity and possesses relevant expertise and experience;
b. (i) who is or was not a promoter of the company or its holding, subsidiary or associate company;
(ii) who is not related to promoters or directors in the company, its holding, subsidiary or associate company;
c. who has or had no pecuniary relationship with the company, its holding, subsidiary or associate company, or their promoters, or directors, during the two immediately preceding financial years or during the current financial year;
d. none of whose relatives has or had pecuniary relationship or transaction with the company, its holding, subsidiary or associate company, or their promoters, or directors, amounting to two per cent or more of its gross turnover or total income or fifty lakh rupees or such higher amount as may be prescribed, whichever is lower, during the two immediately preceding financial years or during the current financial year;
e. who, neither himself nor any of his relatives—
i. holds or has held the position of a key managerial personnel or is or has been employee of the company or its holding, subsidiary or associate company in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed;
ii. is or has been an employee or proprietor or a partner, in any of the three financial years immediately preceding the financial year in which he is proposed to be appointed, of—
(A) a firm of auditors or company secretaries in practice or cost auditors of the company or its holding, subsidiary or associate company; or
(B) any legal or a consulting firm that has or had any transaction with the company, its holding, subsidiary or associate company amounting to ten per cent or more of the gross turnover of such firm;
iii. holds together with his relatives two per cent or more of the total voting power ofthe company; or
iv. is a Chief Executive or director, by whatever name called, of any non-profit organization that receives twenty-five per cent or more of its receipts from the company, any of its promoters, directors or its holding, subsidiary or associate company or that holds two per cent or more of the total voting power of the company; or
v. is a material supplier, service provider or customer or a lessor or lessee of the company.
f. shall possess appropriate skills, experience and knowledge in one or more fields of finance, law, management, sales, marketing, administration, research, corporate governance, technical operations, corporate social responsibility or other disciplines related to the Company's business.
g. shall possess such other qualifications as may be prescribed, from time to time, under the Companies Act, 2013.
h. who is not less than 21 years of age.
4.2.3 The Independent Directors shall abide by the "Code for Independent Directors" as specified in Schedule IV to the Companies Act, 2013.
4.3.1 The Board members are expected to have adequate time and expertise and experience to contribute to effective Board performance. Accordingly, members should voluntarily limit their directorships in other listed public limited companies in such a way that it does not interfere with their role as directors of the Company. The NR Committee shall take into account the nature of, and the time involved in a Director's service on other Boards, in evaluating the suitability of the individual Director and making its recommendations to the Board.
4.3.2 A Director shall not serve as Director in more than 20 companies of which not more than 10 shall be Public Limited Companies.
4.3.3 A Director shall not serve as an Independent Director in more than 7 Listed Companies and not more than 3 Listed Companies in case he is serving as a Whole-time Director in any Listed Company.
4.3.4 A Director shall not be a member in more than 10 Committees or act as Chairman of more than 5 Committees across all companies in which he holds directorships. For the purpose of considering
the limit of the Committees, Audit Committee and Stakeholders' Relationship Committee of all Public Limited Companies, whether listed or not, shall be included and all other companies including Private Limited Companies, Foreign Companies and Companies under Section 8 of the Companies Act, 2013 shall be excluded.
Remuneration to Executive Directors, Key Managerial Personnel, Non-Executive Directors and other employees
5.1.1 The Board, on the recommendation of the Nomination and Remuneration (NR) Committee, shall review and approve the remuneration payable to the Executive Directors of the Company within the overall limits approved by the shareholders.
5.1.2 The Board, on the recommendation of the NR Committee, shall also review and approve the remuneration payable to the Key Managerial Personnel of the Company
5.1.3 The remuneration structure to the Executive Directors and Key Managerial Personnel shall include the following components:
a. Basic Pay
b. Perquisites and Allowances
c. Commission (Applicable in case of Executive Directors)
d. Retrial benefits
e. Annual Performance Bonus
5.1.4 The Annual Plan and Objectives for Executive Directors and Senior Executives shall be reviewed by the NR Committee and Annual Performance Bonus will be approved by the Committee based on the achievements against the Annual Plan and Objectives.
5.2 Remuneration to Non-Executive Directors
5.2.1 The Board, on the recommendation of the NR Committee, shall review and approve the remuneration payable to the Non- Executive Directors of the Company within the overall limits approved by the shareholders.
5.2.2 Non-Executive Directors shall be entitled to sitting fees for attending the meetings of the Board and the Committees thereof. The Non- Executive Directors shall also be entitled to profit related commission in addition to the sitting fees.
5.3 Remuneration to other employees
5.3.1 Employees shall be assigned grades according to their qualifications and work experience, competencies as well as their roles and responsibilities in the organization. Individual remuneration shall be determined within the appropriate grade and shall be based on various factors such as job profile, skill sets, seniority, experience and prevailing remuneration levels for equivalent jobs.
The Committee is empowered to oversee the redressal of investor complaints pertaining to share transfer, non-receipt of Annual Reports, issue of duplicate share certificates, transmission of shares and other miscellaneous complaints. In accordance with Clause 49 of the Listing Agreement with Stock Exchanges, the Board has authorized the Compliance Officer, to approve share transfers/transmissions and comply with other formalities in relation thereto.
Dates: 30th May, 2014, 14th August, 2014, 14th November, 2014, 14th February, 2015
In accordance with Clause 49 of the Listing Agreement with Stock Exchanges, the Board has authorised the Company Secretary, who is also the Compliance Officer, to approve share transfers / transmissions and comply with other formalities in relation thereto.
All investor complaints, which cannot be settled at the level of the Compliance Officer, will be placed before the Committee for final settlement.
There were no complaints pending for redressel during the year under review. There were no pending transfers as on 31st March, 2015.
Terms of reference
The terms of reference of the Stakeholders Relationship Committee are as under:
i) Redressal of grievances of shareholders, debenture holders and other security holders
ii) Transfer and transmission of securities
iii) Dealing with complaints related to transfer of shares, non-receipt of declared dividend, nonreceipt of Balance Sheet etc.
iv) Issuance of duplicate shares certificates
v) Review of dematerialization of shares and related matters
vi) Performing various functions relating to the interests of shareholders/investors of the Company as may be required under the provisions of the Companies Act, 2013, Listing Agreement with the Stock Exchanges and regulations/guidelines issued by the SEBI or any other regulatory authority
In order to expedite the process and for effective resolution of grievances/complaints, the Committee has delegated powers to the Share Transfer Agents i.e., M/s. Venture Capital and Corporate Investments Pvt. Ltd. , to redress all complaints/grievances/enquiries of the shareholders/investors. It redresses the grievances/ complaints of shareholders/investors under the supervision of Company Secretary & Compliance Officer of the Company
The Committee, along with the Share Transfer Agents of the Company follows the policy of attending to the complaints, if any, within seven days from the date of its receipt.
As mandated by SEBI, the Quarterly Reconciliation of Share Capital Audit, highlighting the reconciliation of total admitted capital with National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) vis-a-vis the total issued and listed capital is being carried out by M/s. P.S. Rao& Associates, Practising Company Secretaries. This Audit confirms that the total issued and paid up capital is in agreement with the total number of shares held in physical and dematerialized form with NSDL and CDSL.
As on 31st March, 2015, 2151680 Equity Shares of v 10/- each representing 43.03% of the total no. of shares are in dematerialized form. Vigilance Mechanism / Whistle Blower Policy
The Whistle Blower (Vigil) mechanism provides a channel to the employees to report to the management concerns about unethical behaviour, actual or suspected fraud or violation of the Codes of Conduct or policy and also provides for adequate safeguards against victimization of employees by giving them direct access to the Chairman of the Audit Committee in exceptional cases.
The Policy covers malpractices and events which have taken place / suspected to have taken place, misuse or abuse of authority, fraud or suspected fraud, violation of Company rules, manipulations, negligence causing danger to public health and safety, misappropriation of monies, and other matters or activity on account of which the interest of the Company is affected and formally reported by whistle blowers concerning its employees.
The Whistle Blower Policy is of the Company is also posted on the website of the Company. Meeting of Independent Directors
During the year under review, the Independent Directors met on 14th 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.
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 and Stakeholder Relationship Committee.
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 who also reviewed the performance of the Secretarial Department. The Directors expressed their satisfaction with the evaluation process.
A. Disclosures on Materially Significant Related Party Transactions
There were no materially significant related party transactions compared to the business volume of the Company during the year conflicting with the interest of the Company.
B. As per the Internal Code of Conduct the employees have been given access to the Audit Committee.
C. Code of Conduct
The Company has framed the Code of Conduct for Directors and Senior Management. The Code of Conduct is applicable to all Directors and senior Management of the Company. All the members of the Board and Senior Management of the Company have affirmed compliance with their respective Codes of Conducts for the financial year ended 31st March, 2015.
D. CEO Certification:
The Managing Director (CEO) has certified and submitted a certificate on the financial results and other compliance of statutory requirements to the Board in accordance with Clause 49(V) of the Listing Agreement pertaining to CEO certification for the financial year ended 31st March, 2015.
E. Details of Compliances with Mandatory Requirements and Adoption of the non-Mandatory Requirements
The Company has complied with all the mandatory requirements of Clause 49 and is in the process of implementation of Non-Mandatory requirements.
F. Relationship inter-se among directors
There is no relation between each one directors in the Company.
6. MEANS OF COMMUNICATION
A. The financial results are regularly submitted to the Stock Exchanges in accordance with the Listing Agreement.
B. Management Discussion and Analysis forms part of this Annual Report.
7. GENERAL SHAREHOLDER'S INFORMATION
A. Financial Year : 1st April 2014 to 31st March 2015.
B. Book Closure : 23.09.2015 to 30.09.2015
C. Listing on Stock Exchange : 1. BSE Limited
F. Registrar and Share Transfer Agent/ Common Agency for Share Registry work:
Venture Capital and Corporate Investments Pvt Ltd 12-10-167, Bharat Nagar, Hyderabad- 500018 Phones: 040-23818475 / 476 ; Fax: 040-23868024 Email: firstname.lastname@example.org; Website: www.vccilindia.com
G. Share Transfer System:
The Company is taking care to ensure that the Share Transfer work gets completed within the stipulated time of one month. The Board of Directors has delegated the power of approving transfer of Shares severally to Managing Director and one Director. The Board has also constituted a Share Transfer Committee which has been assigned the task of approving splitting of Shares, Issue of duplicate Share Certificates, consolidation of Share Certificates, change of status of a shareholder and other allied matters.
H. Dematerialization of shares and liquidity:
The Company has made necessary arrangements with Central Depository Services (India) Limited (CDSL) National Securities Depository Limited (NSDL) for dematerialization facility. Shareholders can open an account with the depository participant registered with this depository.
I. Address for Correspondence
Venture Capital and Corporate Investments Pvt Ltd 12-10-167, Bharat Naga r, Hyderabad - 500018 Tel: 040-23818475 / 476 ; Fax: 040-23868024 Email: email@example.com Website: www.vccilindia.com
Madhav Reddy Community Hall, Near Victoria Anglo School, Chaitanyapuri, Hyderabad- 500060, Telangan
DECLARATION ON COMPLIANCE WITH CODE OF CONDUCT
As provided under Clause 49 of the Listing Agreement with the Stock Exchanges, all Board members and Senior Management personnel have affirmed the compliance with Code of Conduct for the year ended 31st March, 2015.
By Order of the Board
Sd/- M V K Sunil Kumar
Date: 12th August 2015