CORPORATE GOVERNANCE REPORT
The detailed report on Corporate Governance as per the format prescribed by SEBI and incorporated in Clause 49 of the Listing Agreement is set out below:
1. COMPANY'S PHILOSOPHY ON CODE OF GOVERNANCE:
The Company's Philosophy on Corporate Governance envisages the attainment of the high level of transparency and accountability in the functioning of the Company and assist the top management of the Company in the efficient conduct of its business internally and externally, including its inter-action with employees, shareholders, creditors, consumers and other stakeholders and places due emphasis on regulatory compliance.
The Company believes that its systems and actions must be dovetailed for enhancing corporate performance and maximizing shareholders value in the long term.
2. BOARD OF DIRECTORS:
i. As on March 31, 2015, the Company has five directors on its board. Four directors (i.e. 80%) are non-executive directors and Three (i.e. 60%) are independent directors. The composition of the board is in conformity with Clause 49 of the Listing Agreements entered into with the stock exchange.
ii. None of the directors on the board hold directorships in more than ten public companies. Further, none of them is a member of more than ten committees or chairman of more than five committees across all the public companies in which he is a director. Necessary disclosures regarding committee positions in other public companies as on March 31, 2015 have been made by the directors. None of the directors are related to each other.
iii. Independent directors are non-executive directors as defined under Clause 49(II)(B)(1) of the Listing Agreements entered into with the Stock Exchange. The maximum tenure of the independent directors is in compliance with the Companies Act, 2013 ("Act"). All the Independent Directors have confirmed that they meet the criteria as mentioned under clause 49 of the Listing Agreement and Section 149 of the Act.
iv. The names and categories of the directors on the board, their attendance at board meetings held during the year and the number of directorships and committee chairmanships / memberships held by them in other public companies as on March 31, 2015 are given herein below. Other directorships do not include directorships of private limited companies. Chairmanships / memberships of board committees shall include only audit committee and stakeholders' relationship committee.
v. During the financial year ended 31st March 2015, Five Board Meetings were held respectively on 30th May 2014, 13th August 2014, 6th September 2014, 14th November 2014, and 14th February 2015. There was not a gap exceeding 120 days between two consecutive board meetings.
The necessary quorum was present for all the meetings.
vi. During the year 2014-15, information as mentioned in Annexure X to Clause 49 of the Listing Agreements has been placed before the board for its consideration.
vii. The terms and conditions of appointment of the independent directors are in conformity of the provisions of the Act and Listing Agreement.
viii. A separate meeting of the independent directors was held inter-alia to review the performance of non-independent directors and the board as a whole.
ix. The Board periodically reviews compliance reports of all laws applicable to the Company, prepared by the Management of the Company.
3. COMMITTEES OF THE BOARD
a) AUDIT COMMITTEE
The Audit Committee comprises of three Non-Executive Directors, majority of them being Independent Directors. The head of finance & Accounts and the representative of the Statutory Auditors are permanent invitees to the Audit Committee. Mrs. Bina Shah the present Chairperson of the Committee is a Non-Executive Independent Director having expertise in accounting and financial matters.
MEETINGS AND ATTENDANCE:
During the financial year ended 31st March 2015 five meetings of audit committee were held respectively on 30th May 2014, 13th August 2014, 6th September 2014, 14th November 2014, and 14th February 2015.
POWERS OF AUDIT COMMITTEE:
The Audit Committee is vested with the following powers:
a. To investigate any activity within its terms of reference.
b. To seek information from any employee.
c. To obtain outside legal or other professional advice.
d. To secure attendance of outsiders with relevant expertise, if it considers necessary
Terms of reference and scope of the committee:
The terms of reference of Audit Committee are broadly include:
a. 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;
b. Recommendation to the Board for appointment, remuneration and terms of appointment of auditors of the company;
c. Approval of payment to statutory auditors for any other services rendered by the statutory auditors;
d. Reviewing, with the management, the annual financial statements and auditor's report thereon before submission to the board for approval, with particular reference to:
i. 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
ii. Changes, if any, in accounting policies and practices and reasons for the same
iii. Major accounting entries involving estimates based on the exercise of judgment by management
iv. Significant adjustments made in the financial statements arising out of audit findings
v. Compliance with listing and other legal requirements relating to financial statements
vi. Disclosure of any related party transactions
vii. Qualifications in the draft audit report
e. Reviewing, with the management, the quarterly financial statements before submission to the board for approval;
f. 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;
g. Review and monitor the auditor's independence and performance, and effectiveness of audit process;
h. Approval or any subsequent modification of transactions of the company with related parties;
i. Scrutiny of inter-corporate loans and investments;
j. Valuation of undertakings or assets of the company, wherever it is necessary; k. Evaluation of internal financial controls and risk management systems;
l. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;
m. 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;
n. Discussion with internal auditors of any significant findings and follow up there on;
o. 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;
p. 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;
q. 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;
r. To review the functioning of the Whistle Blower mechanism;
s. 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;
t. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee. u. To mandatorily review the following information:
i. Management discussion and analysis of financial condition and results of operations;
ii. Statement of significant related party transactions (as defined by the Audit Committee), submitted by management;
iii. Management letters / letters of internal control weaknesses issued by the statutory auditors;
iv. Internal audit reports relating to internal control weaknesses; and
v. The appointment, removal and terms of remuneration of the Chief internal auditor.
b) NOMINATION & REMUNERATION COMMITTEE:
i. The Company has a nomination and remuneration committee of directors.
ii. The broad terms of reference of the Nomination and Remuneration Committee are as:
a. Formulation of the criteria for determining qualifications, positive attributes and independence of a director and recommend to the Board policy relating to the remuneration of the directors, key managerial personnel and other employees;
b. Formulation of criteria for evaluation of Independent Directors and the Board:
c. Devise a policy on board diversity
d. Identify persons who are qualified to become director and who may be appointed to senior management positions.
Since there was no change in the remuneration of whole time director or key managerial personnel, no meeting of the committee was held during the year.
The Remuneration Committee comprises of three Directors, of which, one is promoter, Non-Executive Director and two are independent, Non-Executive Directors. The Chairperson of the Committee is a Independent, Non-Executive Director nominated by the Board.
The present constitution of the Remuneration Committee is as follows:
1. Mrs. Bina Shah : Member, Independent, Non-Executive.
2. Mr. Neerav Merchant : Chairman, Independent, Non-Executive.
3. Mr. Rajen Desai : Member, Promoter, Non-Executive.
The remuneration policy is directed towards rewarding performance based on review of achievements. It is aimed at attracting and retaining high caliber talent. The remuneration policy of the Company is placed on its web-site.
REMUNERATION TO EXECUTIVE DIRECTORS AND/OR WHOLE-TIME DIRECTOR:
Remuneration to Executive Directors and/or Whole-time Directors is reviewed and recommended by the Remuneration Committee to the Board and thereafter, if required, approved by shareholders in General Meeting.
The Company does not currently have any stock option plan or performance linked incentives for its Directors.
c) RISK MANAGEMENT COMMITTEE:
In terms of Clause 49 of the Listing Agreement, a Risk Management Committee of the Board of Directors was constituted by the Board of Directors on May 30, 2015 presently consists of three Directors.
d) STAKEHOLDERS RELATIONSHIP COMMITTEE (Formerly known as SHARE TRANSFER & INVESTORS GRIEVANCE COMMITTEE):
The Board has re-constituted Stakeholders Relationship Committee in its meeting held on 30th May 2015 consisting of three members, chaired by the independent, Non-Executive Director. As the Company has appointed M/s. Adroit Corporate Services Pvt. Ltd as its Share Transfer Agent, the Share Transfer & Investor Grievance Committee holds meetings only occasionally when requirement arises. The Compliance Officer of the Company has been authorized to approve the transfer of shares as submitted by the Registrar & Share Transfer Agent. Details of shares transfers/ transmissions approved by the Compliance Officer are placed before the Board on regular basis.
Since no material complain was received during the year no meeting of Stakeholders Relationship Committee (Formerly Known as Share Transfer & Investors Grievance Committee) was held.
e) COMPLIANCE COMMITTEE:
To monitor the Compliance of the provisions of all applicable rules and regulations Company has also constituted a Compliance Committee Chaired by Independent director and consisting of director and compliance officer as its members.
i) Related Party Transactions
Except payment of remuneration to executive director and key managerial personnel and sitting fee to non-executive directors Company has not entered into any other related party transaction. Policy of related party transaction of the company is placed at its website at www.transchem.net
During the year company has not raised any fund through public, right or preferential issue of securities.
ii) Accounting treatment
The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 2013. The financial statements have been prepared on accrual basis under the historical cost convention.
vi) Proceeds from public issue, rights issue, preferential issues:
During the financial year company has not made any issue of securities.
vii)CEO / CFO certification
A certificate given by the Executive Director and Head of Accounts Department was placed before the Audit Committee and the Board. The Certificate verifies that according to best of the knowledge and belief of Executive
Director and Head of accounts department there was no transaction entered into by the Company during the year which was fraudulent, illegal or in violation of the Company's Code of Conduct.
Compliances by the Company
The Company has complied with the requirements of the Stock Exchanges, SEBI and other statutory authorities on all matters related to capital markets during the last three years. No penalties have been imposed on the Company by the Stock Exchanges or SEBI or any other statutory authorities relating to the above.
Code of Conduct for Directors and Senior Management
The Board has prescribed Code of Conduct ("Code") for all Board Members and Senior Management of the Company.
All Board Members and Senior Management personnel have confirmed compliance with the Code for the year 2014-15. A declaration to this effect as included in CEO & CFO Certificate is reproduced hereunder:
"We further declare that all the board members and senior managerial personnel have affirmed compliance with the code of conduct for the current year"
Status of compliance of Non-Mandatory requirements of clause 49 of the listing agreement.
The Company complies with the following non mandatory requirements of clause 49 of the listing agreement:
1. Company is having non-executive Chairperson, however no expenses are being incurred towards maintain of Chairperson's office.
2. The Auditors have expressed no qualification in their report.
3. The Company has appointed separate persons to the post of Chairman and Managing Director/CEO.
4. The Internal auditor periodically reports to the Audit Committee.
Whistle Blower Policy
The Board of Directors of the Company has adopted a Whistle Blower Policy and the same is available on Company's website at www.transchem.net
5. MEANS OF COMMUNICATION
The quarterly financial results are forthwith communicated to Bombay Stock Exchange Limited, the Stock Exchange with whom the company has listing agreement, as soon as they are approved and taken on record by the Board of Directors of the Company. Further, the results are published in the newspapers namely The Free Press Journal (English) and Nav-Shakti (Marathi) and also being posted at the web-site of the Company.
Management Discussion and Analysis Report forms part of the Annual Report, which is being posted to the shareholders of the Company.
6. SHAREHOLDERS' INFORMATION
1. Information about Annual General Meeting
AGM DATE : 30.09.2015
TIME : 9.30 a.m.
VENUE : Hotel Ginger (Formerly known as Hotel Royal Inn), Gokul Nagar, L B S Marg, Thane (W)- 400601.
2. Financial Calendar: 1st April-31st March.
3. Date of Book Closure: From 28.09.2015 to 02.10.2015 (both days inclusive).
4. Dividend Payment Date: Not Applicable.
5. Listing on Stock Exchanges: Bombay Stock Exchange Limited, Mumbai
With Stock Code (Stock Code. 500422)
6. Company has not issued any debenture or accepted deposits so the rating from CRISIL or any other agency was not required to be obtained.
7. Registrar and Transfer Agent:
M/s. Adroit Corporate Services Pvt. Ltd. 19, Jaferbhoy Industrial Estate, 1st Floor, Makwana Road, Marol Naka, Andheri (E), MUMBAI - 400 059. Contact Person: Mr. Pratap Pujare, Phone No. 022-2859 6060
Distribution Schedule & Shareholding pattern of Equity Shares as on 31.03.2015 is enclosed as Annexure-1.
Dematerialization of shares and liquidity: As on 31st March 2015, 88.10% of the shares capital of the Company has been dematerialized. All requisitions for dematerialization of shares are being accepted well within the time limit of 21 days. Shares of the Company are regularly been traded at the Bombay Stock Exchange Limited, Mumbai.
Outstanding GDRs/ADRs etc.: Not Applicable.
Plant Location: Gat No 379, Village Bebadahol, Taluka Maval, Dist Pune - 410 506. Address for correspondence:
304, Ganatra Estate, Pokhran Road No 1, Khopat, Thane (W) - 400 601. Phone No. 022-25478601/25477077, Email: firstname.lastname@example.org Web Site: www.transchem.net