| Dear Members,
The Directors are pleased to present Annual Report and the Company's
Audited Accounts for the financial year ended March 31,2015.
1. FINANCIAL RESULTS:
Particulars 2014-15 2013 -14
Sales & other Income 6,44,50,032 3,64,48,966
Expenditure 6,34,69,838 3,72,82,473
Profit/(Loss) before tax 9,80,194 (8,35,347)
Tax 73,34,967 (5,33,387)
Profit/(Loss) after tax (63,54,773) (3,01,960)
2. OPERATIONS
The total income for the year under review was Rs. 6,44,50,032/- as
compared to Rs. 3,64,48,966/- in the previous year. The Company has
incurred a loss of Rs. 63,54,773/- as compared to loss of Rs.
3,01,960/- in the previous year.
3. DIVIDEND
Your Directors have not recommended any dividend for the financial year
2014-15.
4. DEPOSITS
Details relating to Deposits:
a. Accepted during the year: NIL
b. Remained unpaid or unclaimed as at the end of the year - NIL
c. Default in repayment of deposits or payment of interest thereon
during the year - Not Applicable
d. Deposits not in compliance with the provisions of the Companies Act,
2013 - NIL
5. DIRECTORS
Mr. Surendra Kedia (DIN No. 00116205) retires by rotation and being
eligible, offers himself for re-appointment at the ensuing Annual
General Meeting
Board has constituted the following three Committees:
1. Audit Committee
2. Nomination & Remuneration Committee
3. Stakeholders Relationship Committee
The details in respect of the composition of the Board and its
committees as also other details in respect thereto are provided in the
Corporate Governance Report forming part of this Annual Report.
The policy in respect of appointment and remuneration of KMP's and
other employees in the Company "The Remuneration Policy" is attached
herewith as Annexure A
DECLARATION BY INDEPENDENT DIRECTORS
The Company has received necessary declaration from each Independent
Director under Section 149 (7) of the Companies Act, 2013 that he meets
the criteria of independence laid down in Section 149 (6) of the
Companies Act, 2013.
VIGIL MECHANISM
The Company has established a Vigil Mechanism for enabling the
Directors and Employees to report genuine concerns. The Vigil Mechanism
provides for (a) adequate safeguards against victimization of persons
who use the Vigil Mechanism; and (b) direct access to the Chairperson
of the Audit Committee of the Board of Directors of the Company in
appropriate or exceptional cases. The Audit Committee of the Board has
been entrusted with the responsibility of overseeing the Vigil
Mechanism.
PREVENTION OF INSIDER TRADING
The Company has adopted a Code of Conduct for Prevention of 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 of Directors and the designated employees have
confirmed compliance with the Code.
BOARD EVALUATION
The Company has devised a Policy for performance evaluation of
Independent Directors, Board, Committees and other individual
Directors. The Nomination and Remuneration Committee of the Board is
entrusted with the responsibility in respect of the same. The Committee
studies the practices prevalent in the industry and advises the Board
with respect to evaluation of Board members. On the basis of the
recommendations of the Committee, the Board carries an evaluation of
its own performance and that of its Committees and individual
Directors.
DETAILS OF REMUNERATION TO DIRECTORS
The information relating to remuneration of Directors as required under
Section 197(12) of the Act is attached herewith as Annexure B.
5. STATUTORY AUDITOR'S
The present Statutory Auditors of the Company, M/s. ASL & Company,
Chartered Accountants, were appointed as Statutory Auditors of the
Company at the previous Annual General Meeting of the Company to hold
office till the conclusion of the 26th Annual General Meeting to be
held in the year 2019, subject to ratification of their appointment at
every Annual General Meeting. Your Directors have proposed ratification
of their appointment at the forthcoming Annual General Meeting.
Auditors' Remark/ Observation Basis for Qualified Opinion (Standalone)
1. Note No. 1 (J) regarding non provision of gratuity and leave
encashment as required by Accounting Standard 15 (AS 15) relating to
Employees Benefits. We are unable to comment upon the resultant effect
on Liabilities and Profit of the year as the amount of such benefit is
presently not ascertainable;
Management Reply
With reference to the observations made by the Auditors in their
Report, regarding Non -Provision of Gratuity, Directors wish to state
that the Company is required to make Provision of Gratuity based on
Actuarial Valuation. This exercise is very complicated and also the
Company could not find a suitable person for making actuarial valuation
at reasonable cost. Therefore hence no provision has been made.
2. Note No. 29, regarding amortization of, Deferred Revenue expenses,
which are not in accordance with Accounting Standard - 26 "Intangible
Assets" notified under the Act. Due to this Loss for the year is higher
by Rs. 7,62,236/-,; the Other Non Current Assets are higher by Rs.
45,73,415 /-; the Other Current Assets are higher by Rs. 7,62,236/-;
with consequential effect on Reserves & Surplus;
During the financial year ended 31st March 2012 the Company has
incurred certain expenses amounting to Rs. 7,622,358 for which
management was of the view that these expenses are for providing future
economic benefit and accordingly these expenses have not been charged
to the Profit and Loss Account and has been amortised over a period of
10 years. During the year, as per the accounting policy followed
consistently, the Company has amortized 1/10th of the expense amounting
to Rs. 762,236 and debited the same to the Profit and Loss Account of
the current year. As on 31st March 2015 unamortised portion of these
expenses amounting to Rs. 53,35,651/- have been reflected as "Deferred
revenue expenditure" in Note 12 & Note 17 of the financial statements.
3. Note No. 30, regarding amortization of, Pre-operative expenses,
which are not in accordance with Accounting Standard - 26 "Intangible
Assets" as notified under the Act. Due to this Loss for the year is
higher by Rs. 2,71,216/-, the Other Current Assets are higher by Rs.
1,38,481/- , with consequential effects on Reserves & Surplus;
During the financial year ended 31st March 2011 the Company has
incurred certain expenses amounting to Rs. 952,127 for which management
was of the view that these expenses are for providing future economic
benefit and accordingly these expenses have not been charged to the
Profit and Loss Account and has been amortized over a period of 5
years. During the year, as per the accounting policy followed
consistently, the Company has amortized 1/5th of the expenses amounting
to Rs. 271,216 and debited the same to the Profit and Loss Account of
the current year. As on 31st March 2015 unamortized portion of these
expenses amounting to Rs. 1,38,481/- have been reflected as
"Preoperative expense" in Note 12 & Note 17 of the financial statements
Basis for Qualified Opinion (Consolidated)
1. Note No. 1 (J) regarding non provision of gratuity and leave
encashment as required by Accounting Standard 15 relating to Employees
Benefits. We are unable to comment upon the resultant effect on the,
Liabilities and Profit for the year as the amount of such benefit is
presently not ascertainable
With reference to the observations made by the Auditors in their
Report, regarding Non - Provision of Gratuity, Directors wish to state
that the Company is required to make Provision of Gratuity based on
Actuarial Valuation. This exercise is very complicated and also the
Company could not find a suitable person for making actuarial valuation
at reasonable cost. Therefore hence no provision has been made
2. Note No. 31(a), regarding amortization of, Deferred Revenue
expenses, which are not in accordance with Accounting Standard - 26
"Intangible Assets" as notified under the Act. Due to this, the Loss
for the year is higher by Rs. 7,62,236/-, the Other Non Current Assets
are higher by Rs. 45,73,415 /-; the Other Current Assets are higher by
Rs. 7,62,236/-; with consequential effect on Reserves & Surplus;
During the financial year ended 31st March 2012 the Company has
incurred certain expenses amounting to Rs. 7,622,358 for which
management was of the view that these expenses are for providing future
economic benefit and accordingly these expenses have not been charged
to the Profit and Loss Account and has been amortised over a period of
10 years. During the year, as per the accounting policy followed
consistently, the Company has amortized 1/10th of the expense amounting
to Rs. 762,236 and debited the same to the Profit and Loss Account of
the current year. As on 31st March 2015 unamortised portion of these
expenses amounting to Rs. 53,35,651/- have been reflected as "Deferred
revenue expenditure" in Note 13 & Note 18 of the financial statements.
3. Note No. 31(b), regarding amortization of, Deferred Revenue
expenses, which are not in accordance with Accounting Standard - 26
"Intangible Assets" as notified under the Act. Due to this, the Loss
for the year is higher by Rs. 24,96,302/-, the Other Current Assets
are higher by Rs. 24,03,609/-, with consequential effect on Reserves &
Surplus
During the earlier years, one of the Subsidiaries of the Company have
incurred certain expenses amounting to Rs. 1,25,78,391/- for which
management was of the view that these expenses are for providing future
economic benefit and accordingly these expenses have not been charged
to the Profit and Loss Account and has been amortised over a period of
5 years. During the year, as per the accounting policy followed
consistently, the Company has amortized 1/5th of the expense amounting
to Rs. 24,96,302/- and debited the same to the Profit and Loss Account
of the current year. As on 31st March 2015 unamortised portion of these
expenses amounting to Rs. 24,03,609/- have been reflected as "Deferred
revenue expenditure" in Note 18 of the financial statements.
4. Note No. 32 (a), regarding amortization of, Pre- operative expenses,
which are not in accordance with Accounting Standard - 26 "Intangible
Assets" as notified under the Act. Due to this, the Loss for the year
is higher by Rs. 2,71,216/-; the Other Current Assets are higher by Rs.
1,38,481 /-. with consequential effect on Reserves & Surplus;
During the financial year ended 31st March 2011 the Company has
incurred certain expenses amounting to Rs. 952,127 for which management
was of the view that these expenses are for providing future economic
benefit and accordingly these expenses have not been charged to the
Profit and Loss Account and has been amotized over a period of 5 years.
During the year, as per the accounting policy followed consistently,
the Company has amortized 1/5th of the expenses amounting to Rs.
271,216 and debited the same to the Profit and Loss Account of the
current year. As on 31st March 2015 unamortized portion of these
expenses amounting to Rs. 1,38,481/- have been reflected as
"Preoperative expense" in Note 13 & Note 18 of the financial statements
5. Note No. 32(b), regarding amortization of, Pre- operative expenses,
which are not in accordance with Accounting Standard - 26 "Intangible
Assets" as notified under the Act. Due to this the Loss for the year is
lower by Rs. 3,57,78,111/- with consequential effect on the Reserves &
Surplus; the Other Non Current Assets are higher by Rs.
10,97,11,815/-.
During the earlier years and the current financial year, one of the
Subsidiaries of the Company have incurred certain expenses amounting to
Rs. 10,97,11,815/- for which management was of the view that these
expenses are for providing future economic benefit and accordingly
these expenses have not been charged to the Profit and Loss Account and
has been amortised over a period of 5 years. As on 31st March 2015
unamortised portion of these expenses amounting to Rs. 10,97,11,815/-
have been reflected as "Deferred revenue expenditure" in Note 13 of the
financial statements.
7. SECRETARIAL AUDITORS:
Ms. Avani S. Popat, Practicing Company Secretary has been appointed as
the Secretarial Auditor of the Company for Financial Year 2014-15. The
Secretarial Audit Report issued by her has been attached herewith as
Annexure C.
Auditors' Remark/ Observation Management Reply
1. Company has not appointed Internal Shall shortly comply
Auditor
2. Company has not appointed Company The Company is on the look
Secretary and Chief Financial Officer out of a suitable candidate
for the posts and shall
appoint one as soon as
possible
3. The composition of the Board and its The Company is on the
Committees is not as required under the lookout of suitable
provisions of the Companies Act, 2013 as candidates and shall
also the Listing Agreement entered into shortly fulfill the
with Stock Exchanges requirement
4. Company has not convened Meeting of By virtue of point 3 above
its Independent Directors as required (reply given thereat)
under Clause 49 of the Listing Agreement
5. None of the Independent Directors Shall shortly comply
of the Company have been appointed on the
Board of Subsidiary Companies
6. There been no Company Secretary in the Shall shortly comply
Company, Compliance Officer is acting as
the Secretary to the Audit Committee
7. The Website of the Company is not Shall shortly comply
properly updated
8. EXTRACT OF ANNUAL RETURN
The Extract of Annual Return in Form MGT -9 in accordance with the
provisions of Section 134 (3) (a) of the Companies Act, 2013 is
attached herewith as Annexure D
9. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
Particulars of loans, guarantees given and investments made during the
year are provided in the financial statements forming part of this
Annual Report.
10. RELATED PARTY TRANSACTION
Details of related party transaction in Form AOC -2 as per the
provisions of Section 134 (3)(h) of the Companies Act, 2013 are
attached herewith as Annexure E.
11. INTERNAL FINANCIAL CONTROL:
The Board has adopted the policies and procedures for ensuring the
orderly and efficient conduct of its business, including adherence to
the Company's policies, the safeguarding of its assets, the prevention
and detection of frauds and errors, the accuracy and completeness of
the accounting records and the timely preparation of reliable financial
disclosures.
12. ENERGY CONVERSATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
The information required under section 134 (3) (m) of the Companies
Act, 2013, read with Rule 8 of Companies (Accounts) Rules, 2014 is not
applicable in case of the Company. There are no foreign exchange
earnings and outgoes in the Company.
13. RISK MANAGEMENT POLICY:
Your Company recognizes that risk is an integral part of business and
is committed to managing the risks in a proactive and efficient manner.
Your Company periodically assesses risks in the internal and external
environment and takes all measures necessary to effectively deal with
incidences of risk.
14. DIRECTOR'S RESPONSIBILITY STATEMENT:
In compliance to the requirements of Section 134 (3) (c) of the
Companies Act, 2013, your Directors confirm that:
a. The Company has followed the applicable accounting standards in the
preparation of the Annual Accounts and there has been no material
departure.
b. That the Directors had 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 or loss of the Company for that period.
c. That the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities.
d. That the Directors had prepared the annual accounts on a going
concern basis.
e. That the Directors had laid down internal financial control which
are adequate and were operating effectively;
f. That the Directors had devised proper systems to ensure compliance
with provisions of all applicable laws and that such systems were
adequate and operating effectively.
15. DETAILS OF SUBSIDIARY, JOINT VENTURE AND ASSOCIATE COMPANY:
The Company has two Subsidiary Companies:
1. KDJ Hospital Limited
2. KDJ Hospitality Private Limited
Statement containing salient features of the financial statement of
Subsidiary Companies in Form AOC - 1 forms part of the financial
statements attached to this report.
16. CORPORATE GOVERNANCE:
Your Company ensures best adherence to the requirement set out by the
Securities and Exchange Board of India. Pursuant to Clause 49 of the
Listing Agreement with the Stock Exchange, the Management Discussion
and Analysis Report, Corporate Governance Report and Practicing Company
Secretary's Certificate regarding compliance of the conditions of
Corporate Governance are annexed hereto and form part of the Annual
Report.
17. ACKNOWLEDGEMENTS:
The Board of Directors expresses their deep gratitude for the co -
operation and support extended to your Company by its customers,
suppliers, Bankers and various Government agencies. Your Directors also
place on record the commitment and involvement of the employees at all
levels and looks forward to their continued co - operation.
By order of the Board
KDJ Holidayscapes and Resorts Limited
Place: Mumbai
Date: 31.08.2015
Surendra Kedia
(Chairman)
(DIN No.: 00116205
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