DIRECTORS' REPORT Dear Shareholders, Your Directors have pleasure in presenting the 20th Annual Report together with the Audited Statement of Accounts of KSS Limited for the year ended March 31, 2015 Company Performance: During the financial year ended 31st March 2015, the total revenue on a consolidated basis was Rs. 6545.66 Lacs. The Company has incurred post tax Profit of Rs. 522.30 Lacs for financial year 2014-15 as against loss of Rs.1,542.45 Lacs in the previous year. On standalone basis total revenue was 90.80Lacs. The post tax loss for the financial year 2014-15 was Rs.181.14 Lacs viz-a-viz Loss of Rs.1887.07 Lacs in the previous year. Transfer to reserves; No amount is being transferred to the reserves during the Financial Year 2014-15 . Dividend: The Board of Directors did not recommended any dividend for the year ended March 31, 2015 . Management Discussion And Analysis Report The Management Discussion and Analysis of financial condition, including the results of operations of the Company for the year under review as required under Clause 49 of the Listing Agreement, is provided as a separate section forming part of the Annual Report. . Consolidated Financial Statements The audited consolidated financial statement of the Company prepared in accordance with applicable Accounting Standards speciied under Section 133 of the Companies Act, 2013read with Rule 7 of the Companies (Accounts) Rules, 2014 is provided in the Annual Report. 7. Subsidiaries: The Company has following subsidiaries: K Sera Sera Digital Cinema Private Limited - India K Sera Sera Box Office Private Limited-India K Sera SeraMiniplex Limited- India K Sera Sera Productions FZE- UAE The Company has following step-down subsidiaries: K Kampus Education Private Limited - India K Sera Sera Consultancy Private Limited - India K Sera Sera Holdings Pty Limited - Australia KSS Capital Limited - Bermuda During the period under review, the Company has sold its stake in K Bazaar Online Trading Private Limited, one of its non-material subsidiary, pursuant to which Bazaar Online Trading Private Limited ceased to be the Subsidiary of KSS Limited The Company's Policy for determining material subsidiaries is available on the Company's website at www.kserasera.com under Investor Relations>Code of conduct> Policy on Determination of Material Subsidiary(ies). The financial statements of all the subsidiary companies as on March 31, 2015, forms part of consolidated financial statements in compliance with Section 129and other applicable provisions, if any, of the Companies Act, 2013 and the same are prepared in accordance with applicable accounting standards. The inancial statements, both standalone and consolidated, are prepared in accordance with applicable accounting standards and as per Schedule III of the Companies Act,2013 and applicable rules thereto. In addition to the consolidated financial statements, a detailed financial statement containing the salient features of the financial statement of each of the subsidiary companies as included in the consolidation of financial statements as on March 31, 2015 is annexed herewith as Annexure I ( Form AOC 1) and forms part of this Report. 8. Directors Responsibility Statement : Pursuant to Section 134(5) of the Companies Act, 2013, Directors of your Company hereby state and confirm that: a) in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures; b) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit of the company for the same period; c) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities; d) they have prepared the annual accounts on a going concern basis; e) they have laid down internal financial controls in the company that are adequate and were operating effectively. f) they have devised proper systems to ensure compliance with the provisions of all applicable laws and these are adequate and are operating effectively 9. Corporate Social Responsibility The provisions of the Companies Act, 2013 regarding Corporate Social Responsibility are not attracted to the Company yet. 10. Insurance The Company's property, equipments and stocks are adequately insured against major risks after taking into account all the relevant factors 11. Internal Control Systems and their Adequacy The Company has in place adequate internal controls commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Auditors report to the Chairman of the Audit Committee of the Board. Internal Auditors monitor and evaluate the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the report of Internal Auditors, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Signiicant audit observations and corrective actions thereon are presented to the Audit Committee of the Board. 12. Directors and Key Managerial Personnel Pursuant to the provisions of Section 152 of the Companies Act, 2013 and applicable rules thereto, Mr. Satish Panchariya (DIN:00042934), Executive Director of the Company, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, seeks re-appointment. Your Directors recommend his reappointment for your approval. The Board of Directors of the Company at their meeting held on March 31, 2015 and August 14, 2015 appointed Ms. Kunti Rattanshi (DIN:07144769) and Mr. Harsh Upadhyay (DIN: 07263779) respectively, as an Additional Director (Independent) with immediate effect, who shall hold his ofice till the next Annual General meeting. Based on the application received from Ms. Kunti Rattanshi and Mr. Harsh Upadhyay proposing their candidature as Independent Director, the proposed resolution for their appointment as an Independent Director forms part of the Notice convening Annual General Meeting. Your Directors recommend their appointment for your approval. In compliance with Section 149, 152, Schedule IV and other applicable provisions of the Companies Act, 2013 read with Companies (Appointment and Qualification Confirmation of Appointment of Directors) Rules, 2014 and Clause 49 of the Listing Agreement, the shareholders of the Company at their meeting held on September 30, 2014 had approved the appointments of Mr. Hussain Shattaf (DIN: 02321306), Mr. Dushyant Kumar (DIN: 03097822) and Mr. Rakesh Roopram Sharma(DIN: 06384452) as an Independent Directors of the Company for a first term of five years and to hold the ofice till September 30, 2019. During the period under review Mr. Dushyant Kumar (DIN: 03097822), Non Executive Independent Director of the Company, tendered his resignation w.e.f. February 13, 2015. The Board placed on record its deep appreciation for Mr. Dushyant Kumar and thanked him for his signiicant contributions and valuable guidance during his association with the Company. The Board noted with deep regret the sad demise of Mr. Vinod Ahuja (DIN: 05214206), Non Executive Director of the Company on April 22, 2015 and recorded its appreciation towards the guidance offered by Mr. Vinod Ahuja during his life time as a member of the Board and as a Chairman of the Company During the period under review, Mr. Shailesh Bapat, resigned as Company Secretary of the Company on October 9, 2014 and Ms. Tanu Singh was appointed as a Company Secretary and Compliance Oficer of the Company with immediate effect. Ms. Vineeta Dwivedi was appointed as Chief Executive Officer (CEO) of the Company on August 14, 2015. Declaration by Independent Director(s) All Independent Directors have given declarations that they meet the criteria of independence as laid down under section 149 (6) of the Companies Act, 2013 and clause 49 of the Listing Agreement. Board Evaluation Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination & Remuneration and other Committees. The board's performance for the current year was assessed on the basis of participation of directors, quality of information provided/available, quality of discussion and contribution etc. A structured questionnaire was prepared after taking into consideration inputs received from the Directors, covering the aforesaid aspects of the Board's functioning. The overall performance of the Board and Committee's of the Board was found satisfactory. The overall performance of Chairman, Executive Directors and the Non-executive Directors of the Company is satisfactory. The review of performance was based on the criteria of performance, knowledge, analysis, quality of decision making etc. Nomination and Remuneration Policy The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Key Managerial Personnel, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. 13. Auditors & Auditors' Report Statutory Auditor M/s. Agrawal Jain & Gupta (Firm registration No : 0135838C), Chartered Accountants, Statutory Auditors of the Company, holds office till the conclusion of the ensuing Annual General Meeting and are eligible for re- appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Companies Act, 2013 and that they are not disqualified for re-appointment. The Notes on financial statements referred to in the Auditors Report are self-explanatory and do not call for any further comments. The Auditors' Report does not contain any qualification, reservation or adverse remark. Internal Auditor During the period under review Mr. Sunil Sureka (M.No. 139836),Chartered Accountant, is appointed as an Internal Auditor of the Company in order to conduct the Internal Audit of the Company Secretarial Auditor Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. Vishal N. Manseta (M.No. 25183), Practicing Company Secretary to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith marked as Annexure II (Form MR-3) to this Report. The Secretarial Audit Report does not contain any qualification, reservations or adverse remark. 14. Disclosures Audit Committee The Audit Committee comprises of Independent Directors namely Mr. Rakesh Roopram Sharma (Chairman), Mr. Hussain Shattaf and Ms. Kunti Rattanshi as members. The Audit Committee played an important role during the year. It coordinated with the Statutory Auditors, Internal Auditors and other key personnel of the Company and has rendered guidance in the areas of internal audit and control, finance and accounts. All the recommendations made by the Audit Committee were accepted by the Board. 5 meetings of the Audit Committee were held during the year. Stakeholders' Relationship Committee The Committee has met nine times during the year. With the compulsory dematerialization of the Company's shares and electronic mode of transfers, postal dispatches which led to usual complaints, have been minimized. At the year end, 97.08% of the total shares were dematerialized with no unresolved pending investor grievances. Nomination & Remuneration Committee The Nomination and Remuneration Committee recommends to the Board the suitability of candidates for appointment as Key Managerial Personnel, Directors and the remuneration packages payable to them and other employees. Nomination and Remuneration Committee met one time during the year. Vigil Mechanism/ Whistle Blower Policy In pursuant to the provisions of section 177(9) & (10) of the Companies Act, 2013, a Vigil Mechanism for directors and employees to report genuine concerns has been established. The Vigil Mechanism Policy has been uploaded on the website of the Company at www.kserasera.com under Investor Relations >Code of Conduct> Whistle Blower Policy Meetings of Board The Board of Directors duly met 13 times during the financial year from April 01, 2014 to March 31, 2015. The dates on which meetings were held are as follows: (i) 01.04.2014, (ii)16.05.2014 (iii)30.05.2014 (iv) 07.07.2014, (v) 25.07.2014, (vi) 01.08.2014 (vii) 12.08.2014, (viii) 05.09.2014, (ix) 14.11.2014,(x) 08.01.2015 (xi)11.02.2015, (xii)16.03.2015, (xiii) 31.03.2015. Particulars of Loans, Investments, Guarantees by the Company The particulars of loans, guarantees and investments made/given by the Company in the year 2014 -2015 as per Section 186 of the Companies Act, 2013 is stated in the Notes to Account which forms part of this Annual Report. Particulars of Contracts or Arrangements with Related Parties None of the transactions with related parties falls under the scope of Section 188(1) of the Companies Act,2013. Information on transactions with related parties pursuant to Section 134(3)(h) of the Act read with rule8(2) of the Companies (Accounts) Rules, 2014 are given in Annexure III in Form AOC-2 and the same forms part of this report. Deposits, Loans and Advances Your Company has not accepted any Public Deposits falling within the purview of section 73 of the Companies Act, 2013. As such, no amount on account of principal or interests on public deposits was outstanding, as on March 31, 2015. The details of loans and advances, which are required to be disclosed in the Company's annual accounts, pursuant to Clause 32 of the Listing Agreement with the Stock Exchanges, are mentioned in Notes to accounts forming a part of this Report. Policy on Related Party Transactions: The Board of Directors of the Company has, on the recommendation of the Audit Committee, adopted a policy to regulate transactions between the Company and its Related Parties, in compliance with the applicable provisions of the Companies Act 2013, the Rules thereunder and the Listing Agreement. This Policy was considered and approved by the Board has been uploaded on the website of the Company at www.kserasera.com under investor relation>code of conduct>policy on related party transaction. Prevention, Prohibition and Redressal of Sexual Harassment at Workplace Company has Sexual Harassment Policy in place and available on Company's website. During the year under review, there were no complaints from any of the employee. 15. Extract of Annual Return The details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as Annexure-IV. 16. Conservation of Energy, Technology Absorption, Foreign Exchange The provisions of Section 134(3)(m) of the Companies Act, 2013, relating to conservation of energy and technology absorption are not applicable to the Company. However, the Company has been continuously and extensively using technology in its operations. There were no foreign exchange earnings and foreign exchange outgo during the year and in previous year. 17. Particulars of Employees and Directors The information required pursuant to Section 197 read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company is as follows: During the period under review the company had one Executive and one Non Executive Director and they were not paid any remuneration etc. Further, no sitting fees has been paid to any director during the year. The particulars of the employees who are covered by the provisions contained in Rule 5(2) and rule 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are: a) Employed throughout the year Nil b) Employed for part of the year Nil The remuneration paid to all Key Management Personnel was in accordance with remuneration policy adopted by the company. The information required pursuant to section 197(12) read with rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect to remuneration to the Whole time directors and Key managerial Personnel, is prepared separately forming part of this report. Having regard to the first proviso of section 136 (1) of the Companies Act, 2013 the Annual Report is being sent to the members of the Company excluding the aforesaid information. However the said information is available for inspection at the Registered Office of the Company before 21 days of the ensuing Annual General Meeting during business hours on working days. 18. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and Company's operations in future There are no signiicant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations. 19. Share Capital Increase in Share Capital The paid up Equity Share Capital as on March 31, 2015 was Rs. 2,135,875,070 (in previous year Rs. 2,079,386,340). During the period under review the company had issued and allotted 56,48,873 equity shares of face value of Rs. 10/-each at the rate of Rs. 14.16/- per share on preferential basis pursuant to the conversion of Optionally Convertible Redeemable Bonds (OCRBs). However the listing permission from the NSE and BSE for the aforesaid issue of equity shares is awaited Subdivision of face value of equity shares from Rs. 10/- each to Re. 1/- each During the period under review, the Company had passed special resolution for the purpose of sub division of face value of equity shares from Rs. 10/- each to Re. 1/- each vide postal ballot resolution result declared as on March 05, 2015. The Record date fixed for the credit of securities was on March 31, 2015 and the securities were credited as on April 01, 2015 and the new share certiicates were dispatched with face value of Re 1/- each to the shareholders holding shares in physical form. The existing share certiicates with face value of Rs. 10/- each is automatically cancelled and is of no effect on and from the record date of sub division of equity shares. Further the ISIN No. of the Company was changed from INE216D01018 to INE216D01026pursuant to sub division of face value of equity shares. 20. Corporate Governance and Shareholders Information Your Company has taken adequate steps to adhere to all the stipulations laid down in Clause 49 of the Listing Agreement. A report on Corporate Governance is included as a part of this Annual report. Certiicate from the Practicing Company Secretary, conirming the compliance with the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement is included as a part of this report. 21. Listing with Stock Exchanges The Company confirms that it has paid the Annual Listing Fees for the financial year 2015-16 to NSE and BSE where the Company's shares are listed 22. Appreciation and Acknowledgements: Your Directors wish to place on record their appreciation and sincere gratitude to the various Departments of the Central and State Government, Company's Bankers, clients, media and business constituents for their valuable assistance and support. The Directors also acknowledge the continued support received from investors and shareholders and the conidence reposed by them. The Directors place on record their appreciation for the sincere and dedicated services rendered by all the employees of the Company at all levels. For and on behalf of Board of directors Satish Panchariya Executive Chairman & Director DIN: 00042934 Rakesh Sharma Director DIN:06384452 Place: Mumbai Date: August 14, 2015 |