To the Members
Your Directors presents their Twenty Fifth Annual Report together with the AuditedAccounts of the Company for the Financial Year ended
March 31 2019.
FINANCIAL HIGHLIGHTS: ( Rs. lakhs)
|Particulars ||March 31 2019 ||March 31 2018 ||March 31 2019 ||March 31 2018 |
| ||Consolidated ||Consolidated ||Standalone ||Standalone |
|Income from Operations ||8794 ||26588 ||883 ||3802 |
|EBIDTA ||(24744) ||(22356) ||(6349) ||(15207) |
|Interest ||(4832) ||(6216) ||(58) ||(1047) |
|Depreciation ||(3431) ||(3707) ||(51) ||(61) |
|Impairment ||- ||- ||- ||- |
|Exceptional Items ||6039 ||(1733) ||6039 ||(20368) |
|Profit / (Loss) Before Tax & Minority Interest ||(26969) ||(34012) ||(419) ||(36683) |
|Minority Interest ||1262 ||708 ||- ||- |
|Other Comprehensive Income Adjustment Taxes ||4 ||50 ||2 ||46 |
|Current year ||(145) ||(131) ||- ||- |
|Taxes of earlier years ||- ||- ||- ||- |
|Deferred ||464 ||(79) ||254 ||(105) |
|Net Profit / (Loss) After Tax ||(25384) ||(33464) ||(163) ||(36742) |
During the year under review the income from operations on a consolidated basis wasRs. 8794 lakhs as against Rs. 26588 lakhs in the previous year. The consolidated loss ofEBIDTA was Rs. 24744 lakhs against loss of Rs. 22356 lakhs in the previous year. Theconsolidated loss before tax was Rs. 26969 lakhs against previous year loss of Rs. 34012lakhs. After providing for the minority interest of Rs. 1262 lakhs (previous year Rs. 708lakhs); the loss after tax was Rs. 25384 lakhs as against loss of Rs. 33464 lakhs in theprevious year.
The Consolidated Financial Statements (CFS) includes the financial statements of ZicomElectronic Security Systems Limited (the Company) and its subsidiarycompanies namely
a) Zicom SaaS Private Limited (Zicom SaaS);
b) Unisafe Fire Protection Specialists Singapore Pte. Ltd. (UnisafeSingapore) and its subsidiaries viz. Unisafe Fire Protection Specialists LLC Dubai(Unisafe Dubai) and its subsidiaries; and Phoenix International WLL Qatar(Phoenix Qatar);
c) Unisafe Fire Protection Specialists India Private Limited (UnisafeIndia); and
d) Zicom Security Projects Pte. Ltd. Singapore (Zicom Singapore)
The reduction in the revenue on consolidated basis is mainly caused by suspension ofwork at two Middle East subsidiaries due to slow-down in Middle East economy over the last3-4 years.
On a standalone basis the income from operations for the year under review was Rs. 883lakhs (Rs. 3802 lakhs in the previous year). In view of Exceptional Items of Rs. 6039lakhs; the Company had standalone loss of Rs. 163 lakhs (previous year loss of Rs. 36742lakhs) after provision of tax of Rs. 254 lakhs (previous year Rs. (105) lakhs).
The reduction in the standalone income from operations for the year under review ascompared to previous year is due to complete slow-down of trading business caused byincrease in competition and consequent reduction in margins.
Further during the year under review the Company has written-off amounts on accountof non-recovery of dues from distributors and channel partners; advance to suppliers anddecrease in the value of stock caused by obsolescence.
TRANSFER TO RESERVES
No amount is proposed to be transferred to the reserves during the
financial year ended March 31 2019.
BUSINESS DEVELOPMENTS AND PROSPECTS
The Company is undergoing difficult phase due to constraint of resources at Grouplevel. During the year under review the Company mainly focused on deleveraging of booksby divestment of assets both in India and Middle East. As the economic situation theMiddle East is subdued and not likely to improve in near future the Company isconsidering to sell the stake to strategic investor. Also due to lack of resources forinvestment in Zicom SaaS venture the Company is too looking for financial investor totake business forward by resolving debt of India businesses. However due to expectationmismatch of present valuation of business and unwillingness of the Lenders to proactivelysettle the loans causing delay in revival of the Group.
Once the Company succeeds in settling its Lenders it can bounce back on the strengthof brand equity market reach and technology potency.
Zicom SaaS a wholly owned subsidiary is battling strongly to preserve the pride ofZicom Group. Zicom SaaS is offering new services and products on its technology platformusing its Command Station. Although market for security services is growing rapidly due toconstraint of up-front investment Zicom SaaS is maintaining its current position.
Our two wholly-owned subsidiaries in Singapore viz. Unisafe Fire ProtectionSpecialists Singapore Pte. Ltd. (Unisafe Singapore) and Zicom Security Projects Pte. Ltd.(Zicom Singapore) continues to hold our investments in Unisafe Dubai and Phoenix Qatar.
Keeping in view the affected performance of the Company and loss incurred during theyear under review and also with a view to conserve resources to meet the businessrequirements your Directors expresses their inability to recommend any dividend on equityshares for the financial year 2018-19.
SUBSIDIARIES AND CONSOLIDATED FINANCIAL STATEMENTS
As on March 31 2019 your Company had the following subsidiaries:
1. Zicom SaaS Private Limited (wholly owned subsidiary);
2. Unisafe Fire Protection Specialists Singapore Pte. Ltd. Singapore (wholly-ownedsubsidiary);
3. Unisafe Fire Protection Specialists LLC Dubai (step-down subsidiary);
4. Phoenix International WLL Qatar (step-down subsidiary);
5. Unisafe Fire Protection Specialists India Private Limited (wholly-owned subsidiary);and
6. Zicom Security Projects Pte. Ltd. Singapore (wholly-owned subsidiary)
A statement containing salient features of the financial statement of subsidiaries for2018-19 as required under Section 129(3) of the Companies Act 2013 read with Rule 5 ofthe Companies (Accounts) Rules 2014 and amendment thereunder is provided in Annexure Ahereto in prescribed Form AOC-1. In respect of foreign subsidiary companies figures inrupees are converted from applicable foreign currency at appropriate exchange rate as onyear end date. The Policy on Material Subsidiary as approved may be accessed on theCompany's website at the link: http://zicom.com/img/pdf/ZESSL-Policy_on_Material_Subsidiary.pdf.
The details of key subsidiaries are discussed under Management Discussion and Analysisand highlights of their workings are given below:
Zicom SaaS Private Limited
During the year under review Zicom SaaS posted Total Income of Rs. 4196 lakhs(previous year Rs. 4560 lakhs) and Net Loss after Tax of Rs. 202 lakhs (previous year NetLoss after Tax Rs. 394 lakhs) for the financial year ended March 31 2019.
Unisafe Fire Protection Specialists LLC Dubai
On account of weakening of crude prices and consequential slowdown of economy in entireMiddle East performance of Unisafe Dubai has suffered a set-back. For the financial yearended March 31 2019 Unisafe Dubai has posted Total Income of Rs. 3670 lakhs (ascompared to Rs. 14911 lakhs in the previous year) and a Net Loss after Tax of Rs. 20052lakhs (as compared to Net Loss after Tax of Rs. 9844 lakhs in the previous year).
Phoenix International WLL Qatar
For the financial year ended March 31 2019 Phoenix Qatar posted Total Income of Rs.88 lakhs (as compared to Rs. 4527 lakhs in the previous year) and a Net Loss after Tax ofRs. 5191 lakhs (as compared to Net Loss after Tax of Rs. 4325 lakhs in the previousyear). Due to business challenges caused by embargo on Qatar by UAE and Kingdom of SaudiArabia the Company has temporarily suspended its operations in Phoenix Qatar and hence norevenue has been reported by the said subsidiary.
Unisafe Fire Protection Specialists India Private Limited
During the financial year ended March 31 2019 Unisafe India has shown Rs. Nil TotalIncome (previous year Rs. 0.75 lakhs) and a Net Loss after Tax of Rs. 129 lakhs (previousyear Net Loss after Tax Rs. 317 lakhs).
Unisafe Fire Protection Specialists Singapore Pte. Ltd. Singapore and Zicom SecurityProjects Pte. Ltd. Singapore
Both these companies are Company's wholly-owned subsidiaries in Singapore incorporatedwith a view to internationally align and consolidate present and future investments of theGroup. The Group overseas investment in fire business falls under the umbrella of UnisafeSingapore acting as a holding company for all such ventures whereas Zicom Singaporeaimed as a holding company for Group investment in international electronic securitybusiness.
As per Section 134 of the Companies Act 2013 your Company has provided the auditedConsolidated Financial Statements for the year ended on March 31 2019; together withAuditors' Report thereon forming part of this Annual Report which includes financialinformation of all the subsidiaries. These documents will also be available for inspectionduring the business hours at the Registered Office of your Company and the respectivesubsidiary companies. Pursuant to the provisions of the Section 129(3) of the CompaniesAct 2013 read with Rule 5 of the Companies (Accounts) Rules 2014 and amendment thereofa statement containing salient features of the financial statements of Company'ssubsidiaries for financial year 2018-19 (in Form AOC-1) is appended as Annexure A hereto.Your Company has placed the audited annual accounts and related information of subsidiarycompanies on its website and same will be made available to the Members upon request.
CHANGES IN BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL
Board of Directors:
During the year under review on March 08 2019 the Board of Directors on therecommendation of the Nomination and Remuneration Committee through Circular Resolutionappointed Mr. Dhaval Mehta (DIN: 07501194) as an Additional Director of the Companyeffective that date in the capacity of an Independent Director under Section 161 of theCompanies Act 2013 to hold office till the date of the ensuing Annual General Meeting.Mr. Mehta's appointment shall be subject to the approval of Members at the forthcomingAnnual General Meeting.
During the year under review there was change in designation of Mr. Anil Khanna fromAdditional Independent Director to Independent Director w.e.f. September 24 2018.
During the year under review the following ceased to be Directors of the Company:
1. Mr. Prabhakar Dalal (DIN: 00544948) ceased to be an Independent Director of theCompany w.e.f. August 31 2018;
2. Mrs. Sharada Sundaram (DIN: 07067040) ceased to be a Nominee Director of the Companyw.e.f. September 27 2018; and
3. Mr. Mukul Desai (DIN: 00015126) ceased to be an Independent Director of the Companyw.e.f. December 11 2018.
Further subsequent to the year end Ms. Tanvi Joshi (DIN: 07703593) ceased to be aNon-Executive Director of the Company w.e.f. August 14 2019.
The Board of Directors places on record its sincere appreciation for the support andcontribution made by aforementioned Directors during their tenure as Directors of theCompany.
In accordance with provisions of the Companies Act 2013 and Articles of Association ofthe Company Mr. Manohar Bidaye (DIN: 00010699) is the Director liable to retire byrotation at the ensuing Annual General Meeting and being eligible has offered himself forre-appointment.
Additional information on Directors recommended for appointment / re-appointment asrequired under the SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 th (Listing Regulations) is provided in the Notice convening 25 AnnualGeneral Meeting of the Company accompanying this Report.
The Company has received declarations from all Independent Directors confirming thatthey meet the criteria of independence as prescribed under provisions of the CompaniesAct 2013 Rules made thereunder and the Listing Regulations.
Your Directors recommend the above appointment / re-appointment for your approval.
Key Managerial Personnel:
During the year under review Mr. Nitin Deshpande resigned from the office of ChiefFinancial Officer and Key Managerial Personnel of the Company w.e.f. May 28 2018. Mr.Madan Kumar Chetlur was appointed as Chief Financial Officer and Key Managerial Personnelof the Company w.e.f. May 29 2018.
On February 11 2019 Mr. Madan Kumar Chetlur resigned from the office of ChiefFinancial Officer and Key Managerial Personnel of the Company. Mr. Ayalin Nadar wasappointed as Chief Financial Officer and Key Managerial Personnel of the Company w.e.f.February 12 2019.
At the end of the year under review the Company had following persons as KeyManagerial Personnel pursuant to the provisions of Sections 2(51) and 203 of the CompaniesAct 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014:
|Name of Key Managerial Personnel ||Designation |
|Mr. Pramoud Rao ||Managing Director |
|Mr. Ayalin Nadar ||Chief Financial Officer |
|Ms. Kunjan Trivedi ||Company Secretary |
In accordance with the requirements of the Companies Act 2013 and Listing Regulationsthe Board evaluation process was carried out. The Board / Nomination and RemunerationCommittee of Directors have laid down the criteria for evaluation of the performance ofthe Board its Committees and individual Director (including Independent Directors). Astructured questionnaire prepared covering various aspects of the Board's functioning suchas adequacy of the composition of the Board and its Committee Board proceduresdevelopment etc. was circulated to Directors for the purpose of evaluation.
The Board and Nomination and Remuneration Committee of Directors reviewed theperformance of the individual Directors on the basis of set criteria's.
The Independent Directors at its separate meeting carried out performance evaluationof the Chairman Managing Director and Non-Independent Directors of the Company. The samewas discussed in the subsequent Board meeting at which performance of the Board itsCommittees and individual Directors was also discussed.
REMUNERATION AND NOMINATION POLICY
The Board of Directors has framed a Policy which lays down the framework in relation toremuneration to Directors Key Managerial Personnel and Senior Management of the Company.This Policy also lays down criteria for selection and appointment of Board Member. TheNomination and Remuneration Policy can be accessed on the Company's website at the link:http://zicom.com/img/pdf/Nomination_and_Remuneration_Poli cy.pdf. The Nomination andRemuneration Policy sets the criteria for selection of candidates eligible to be appointedin the senior management and other employees of the Company and also member on the Boardof Directors and the Executive Directors of the Company. The Policy sets out the guidingprinciples for recommending to the Board the remuneration of the Directors Key ManagerialPersonnel and Senior Management of the Company.
There has been no change in the Policy during the year under review except for itsalignment with the amendment made in this regard in the Companies Act 2013 and theListing Regulations.
AUDITORS AND THEIR REPORT
M/s. S M M P & Associates Chartered Accountants was appointed as StatutoryAuditors of the Company for a term of 5 (five) consecutive years at the Annual GeneralMeeting held on September 21 2017. They have confirmed that they are not disqualifiedfrom continuing as Auditors of the Company.
Statutory Auditors' observations in Audit Report on Standalone and ConsolidatedFinancials and Directors' explanation thereto In respect of observations in StandaloneAudit Report regarding the following:
Non-provisioning of interest on bank loans and reversal of Borrowing from Banks TheBanks have classified the Company as Non Performing Assets (NPA) as per Reserve Bank ofIndia circular on assets classification. As a result the Company during the year underreview has not provided for interest amounting to Rs. 2794.23 lakhs on outstanding Bankloans. The Company is in advanced stage of negotiation / closure with its Lenders for OneTime Settlement (OTS) of its entire dues. Therefore in the opinion of the Managementliability as reflected in the financial statement is sufficient to meet proposed OTS.
In respect of observation in Consolidated Audit Report regarding the following:
Non-provisioning of interest on bank loans and reversal of Borrowing from Banks - TheCompany and its Indian Subsidiary during the year under review has not provided forinterest amounting to Rs. 2794.23 lakhs and Rs. 1154.92 lakhs respectively on itsoutstanding loans from Banks. Further the Company has also reversed outstanding dues fromBanks amounting to Rs. 6038.86 lakhs as the Company is in advanced stage of negotiation /closure with the Company's and its subsidiary Lenders for One Time Settlement (OTS) oftheir entire dues. Therefore in the opinion of the Management liability as reflected inthe financial statements is sufficient to meet proposed OTS.
In respect of common observation in Standalone and Consolidated
Audit Reports regarding the following:
1. Non-provisioning of Goodwill despite of no economic benefit During the year underreview the Company continues to show Goodwill amounting to Rs. 909 lakhs in its Bookswhich was on account of acquisition of a then subsidiary of the Company in 2010. Althoughthere is no much future economic benefits expected from the said Goodwill the Company isstill exploring use of Brands acquired under said Goodwill for economic benefits of theCompany.
2. Company's inability to continue as a Going Concern
Although the accumulated losses of the Company have reached to aggregate of Rs. 36800lakhs resulting in erosion of its Net Worth the Company is still actively exploring forstrategic / financial investor(s) with its business infrastructure and with unbroken brandreputation; hence the accounts have been prepared on going concern basis.
Further with regard to emphasis of matter in the Standalone and Consolidated Auditors'Report your Directors wish to state that the said emphasis of matter read with Notes ofStandalone and Consolidated Financial Statements is self-explanatory and does not requireany further explanation. Your Directors would like to add that the said matter will nothave any material adverse effect on the functioning of the Company.
For the year under review the provisions of Section 148 of Companies Act 2013 readwith the Companies (Cost Records and Audit) Rules 2014 relating to maintenance of costrecords does not apply to your Company as it does not fall under any class of thecompanies specified by the Central Government.
Pursuant to the provisions of Section 204 of the Companies Act 2013 and Rulesthereunder the Company has appointed Ganesh Narayan & Co Company Secretaries inPractice (CP No. 2238) to conduct Secretarial Audit of the Company for the financial year2018-19. The Secretarial Audit Report for the financial year ended March 31 2019 isannexed herewith as Annexure B (as Form MR-3) to this Report. The Secretarial Audit Reportdoes not contain any qualification reservation or adverse remark.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to Section 134 of the Companies Act 2013 based on the representationsreceived from the operating management your Directors hereby state that -
a) in preparation of the annual accounts for the year ended March 31 2019 theapplicable accounting standards read with requirements set out under Schedule III to theAct have been followed and there are no material departures from the same;
b) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2019 and of the loss ofthe Company for the year ended on that date;
c) the Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Act for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and are operatingeffectively; and
f) the Directors have devised proper systems to ensure compliance with the provisionsof all applicable laws that such systems are adequate and operating effectively.
REPORTING OF FRAUDS
During the year under review no instances of fraud under Section 143(12) of theCompanies Act 2013 and Rules framed thereunder were reported by the Statutory Auditorseither to the Company or to the Central Government.
MEETINGS OF THE BOARD
Four meetings of the Board of Directors were held during the year under review. Forfurther details please refer Section II (F) Other provisions related to Board andCommittees of the Corporate Governance Report forming part of this Report.
COMMITTEES OF THE BOARD
The details of the Committees of the Board constituted under the Companies Act 2013and Listing Regulations are given under Section III Board Committees of the CorporateGovernance Report forming part of this Report.
PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIES PROVIDED
Particulars of loans given investments made guarantees given and securities providedare given in the standalone financial statements. Further following are the purposes forwhich the loans or guarantees or securities are proposed to be utilized by the recipient:
|Name of Recipient Entity ||Relation ||Purpose for which the loans guarantees and securities are proposed to be utilized |
|Unisafe Fire Protection Specialists LLC Dubai ||Subsidiary ||Business Purpose |
|Unisafe Fire Protection Specialists Singapore Pte. Ltd. Singapore ||Subsidiary ||Business Purpose |
|Zicom Security Projects Pte. Ltd. Singapore ||Subsidiary ||Cash Management |
|Phoenix International WLL Qatar ||Subsidiary ||Business Purpose |
|Zicom SaaS Pvt. Ltd. India ||Subsidiary ||Business Purpose |
|Unisafe Fire Protection Specialists India Pvt. Ltd. India ||Subsidiary ||Business Purpose |
RELATED PARTY TRANSACTIONS
All transactions entered with related parties during the year 2018-19 were on arm'slength basis and in the ordinary course of business and that the provision of Section188(1) of the Companies Act 2013 are not attracted. Hence the particulars to be disclosedin this regards in Form AOC-2 is Nil. Further during the year under review there were nomaterial related party transactions.
The Audit Committee and the Board of Directors have approved the Related PartyTransaction Policy which has been prepared in consonance with provisions of Regulation 23of the Listing Regulations and Companies Act 2013. The same has been uploaded on theCompany's website at the link: http://zicom.com/img/pdf/ZESSL-Related_Party_Transaction_Policy.pdf.
All Related Party Transactions are being placed before the Audit Committee forapproval. Omnibus approvals are also obtained for transactions which are of repetitivenature. Such transactions are placed before the Audit Committee and Board (as required)for periodical review and approval.
VIGIL MECHANISM / WHISTLE BLOWER POLICY
Pursuant to Section 177(9) of the Companies Act 2013 and Regulation 22 of the ListingRegulations the Company has formulated Vigil Mechanism / Whistle Blower Policy forDirectors and employees to report to the management about the unethical behavior fraud orviolation of Company's Code of Conduct. The mechanism provides for adequate safeguardsagainst victimization of employees and Directors who use such mechanism and makesprovision for direct access to the Chairperson of the Audit Committee in exceptionalcases. The said Committee oversees implementation of the Whistle Blower Policy of theCompany. The said Policy as approved may be accessed on the Company's website at the link:http://zicom.com/img/pdf/ZESSL-WhistleBlowerPolicy.pdf.
MATERIAL CHANGES AND COMMITMENTS
There have not been any material changes and commitments affecting the financialposition of the Company between the end of the financial year of the Company as on March31 2019 and the date of this Report.
The Company already has in place the system to inform the Board about the riskassessment and minimization procedure. The risk management system identifies and assessesvarious risks associated with the Company and its business and finds out and suggestsmeasures to mitigate them. This also includes mechanisms for their proper and timelymonitoring and reporting. In this regard the Company has framed policy to identify andevaluate business risks and to mitigate them. The Policy defines the risk managementapproach at various levels including documentation and reporting. The Policy helps inidentifying risks trend exposure and potential impact analysis at Company level and alsoseparately for each business division of the Company. The risk management system isperiodically evaluated by the Audit Committee / Board in the light of changing businessscenario. Accordingly new risks are identified and modified mechanism & procedurefor risk assessment and minimization are adopted to ensure that executive managementcontrols risk by means of properly defined framework. Progress in this regard isperiodically reported to Audit Committee / Board for their review and corrective actionsrequired if any. This is a continuous process which enables the Company to keep its riskmanagement system updated and robust in view of fast changing economic and businessscenario affecting the Company.
EXTRACT OF ANNUAL RETURN
The Extract of Annual Return of the Company as on the financial year ended on March 312019 in Form MGT-9 as required under Section 92 of the Companies Act 2013 read withRule 12 of the Companies (Management and Administration) Rules 2014 is appended herewithas Annexure C to this Report.
A separate section on Corporate Governance together with a certificate from yourCompany's Auditors confirming compliance of the conditions of Corporate Governance asstipulated under Listing Regulations is appended herewith as Annexure E forming part ofthis Report.
CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
Pursuant to the provisions of Section 134(m) of the Companies Act 2013 read with Rule8(3) of the Companies (Accounts) Rules 2014 relevant information are given hereunder:
A. Conservation of Energy
The Company's operations include selling distributing marketing and installing ofelectronic security systems gadgets and equipments and monitoring them; and as can beobserved such operations do not involve much use of energy. However your Company makesevery possible effort to conserve energy at all levels of its operations.
(i) The steps taken or impact on conservation of energy:
At offices and workplaces creating awareness among employees contractual workers andcustomers about modes and means of energy saving through utilization of energy savingsystems devices and equipments; and inculcating a habit in them to strive forconservation and saving of energy. The above has helped the Company in keeping its energycost under control.
(ii) The steps taken by the Company for utilizing alternate sources of energy:
As the operations of your Company does not involve much use of energy the possibilityof using alternate source of energy as a measure of conservation of energy in itsoperations are minimal.
(iii) The capital investment on energy conservation equipments:
No material capital investment on energy conservation equipments has been made duringthe year by your Company.
B. Technology Absorption
As your Company has not imported any technology the required information to beprovided in this regard is Nil. Your Company is continuously working on improving itsindigenous products and software. Your Company continuously strives to provide electronicsecurity systems gadgets and equipments based on latest technology. Further the detailsof expenditure incurred on the research and development are Nil.
C. Foreign Exchange Earnings and Outgo and Export Market Developments
Your Company has not earned any amount in foreign currency (previous year Rs. Nil) andhas spent Rs. 1 lakh (previous year Rs. 709 lakhs) in foreign exchange during the yearunder review. The details of the same are available at Note 28.10 being Notes forming partof the Financial Statements.
PARTICULARS OF EMPLOYEES
The disclosure required pursuant to Section 197(12) of the Companies Act 2013 readwith Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014 in respect of employees of the Company is appended as Annexure D to thisReport.
In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 and amendment thereof during the year under review there was noemployee under the employment of your Company who was in receipt of remuneration of Rs.102 lakhs or more per annum if employed for the entire year or a remuneration of Rs.8.50 lakhs or more per month if employed during any part of the said year. Hence theinformation required to be furnished in this regard is Nil.
At present the Company does not have any Employee Stock Option Plan / Scheme nor doesit have any live stock options pending to be exercised.
The Human Resource (HR) is truly a strategic business partner in the growth of yourCompany. Our HR philosophy is developed around the fundamental of creating value throughour most valued resource Zi-Champ to drive profitable growth and make Zicom apreferred choice of employer. HR has developed and maintained friendly transparent andprofessional work culture woven into the fabric of the company's environment with strongbusiness ethics.
HR has time and again used innovation in hiring talent in Zicom. HR has hired the bestfresh enthusiastic and well proven experienced talent from the industry at competentcompensation & benefits. It has created benchmark in the Electronic Security Industryby hiring the fresh engineering graduates through Pool Campus from Tier II and III citieslike Kanpur (Uttar Pradesh) Hooghly (near Kolkata) Ratnagiri (Maharashtra) Bhopal(Madhya Pradesh).
During the year under review the Head Human Resources was honored with Top 100HR Minds in India from world HRD congress. It started rewards and recognition foremployees by appreciating their achievements to motivate employees in their deliverables.
As on March 31 2019 the total number of direct and indirect employees were standingat 27.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
For the year under review the provisions of Section 135 of Companies Act 2013 readwith the relevant Rules relating to Corporate Social Responsibility does not apply to yourCompany as it does not fall under any of the criteria specified under them.
INTERNAL FINANCIAL CONTROLS AND ITS ADEQUACY
Your Company follows current best practices in internal audit and risk managementsystem. Internal Audit System monitors the adequacy and effectiveness of the internalcontrol as per the policy and procedures framed and also under the supervision andguidance of the Audit Committee. It is supported by the enterprise resource planningplatform for all business process.
All transactions are properly authorized recorded and presented to the Management.Your Company observes all the accounting standards prescribed for proper maintenance ofbooks of accounts and reporting of financial statements.
The Internal Control inter-alia facilitates:
Review of long-term business and annual plans
Adherence to applicable accounting standards and policies
Periodic review and rolling forecasts
Proper accounting and review mechanism
Compliance with applicable statutes listing requirement and internal policiesand procedures
Audit on concurrent basis carried out by an internal auditor covering allstatutes and compliance requirements
IT systems with adequate in-built controls and security
PREVENTION OF SEXUAL HARASSMENT AT WORKPLACE
As per the requirement of the Sexual Harassment of Women at Workplace (PreventionProhibition & Redressal) Act 2013 (POSH Act) and Rules made thereunderthe Company has formed
Internal Complaints Committee to address complaints pertaining to sexual harassment inaccordance with the POSH Act. The Company has in place Policy as per the provisions ofPOSH Act. During the year no case was reported to the Committee constituted under thesaid Act.
Your Directors state that no disclosure or reporting is required in respect of thefollowing items as there were no transactions on these items during the year under review:
1. Details relating to deposits covered under Chapter V of the Act.
2. Issue of equity shares with differential rights as to dividend voting or otherwise.
3. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.
4. No significant or material orders were passed by the Regulators or Courts orTribunals that would impact the going concern status of the Company and its futureoperations.
Your Directors wish to place on record their sincere appreciation and thanks for thevaluable co-operation and support received from the employees of your Company at alllevels Company's Bankers lenders suppliers Government authorities business partnersand Members of the Company; and look forward for the same to even greater extent in thecoming year.
For and on behalf of the Board of Directors
Date: August 14 2019
501 Silver Metropolis
Western Express Highway
Goregaon (East) Mumbai 400063.