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Your Directors have pleasure in presenting the 18th Annual Report of your Company together with the Audited Accounts for the year ended 31st March 2015.
REVIEW OF OPERATIONS AND PERFORMANCE :
Your company has reported a turnover of Rs.. 3032.91 lacs during the financial year 2014–15 compared to the turnover of Rs.. 2908.52 lacs in the previous financial year 2013.14. Your Company incurred a net loss of Rs..198.08 lacs during the financial year 2014–15 against a net profit of Rs.. 3.90 lacs during the previous financial year 2013.14. Your directors will take further effort to increase the turnover and net profit.
Dividend: Your Director has not recommended any dividend for the year under review.
The Paid up equity capital as on 31s' March, 2015 was Rs.. 2, 079.63 Lacs. During the year under review the Company has not issued any shares to the Shareholders. The company has not issued shares with different voting rights nor granted stock option nor sweat equity,
Cash and cash equivalents as at 31s' March, 2015 was Rs.. 51.55 Lacs. The Company continues to focus on judicious management of its working capital, Receivables, Inventories and other working capital parameters were kept under strict check through continuous monitoring.
Your company has not accepted any deposits within the meaning of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposit) Rules, 2014.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
The Company has not given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.
The detail of the investments made by the company is given in the notes to the financial statements.
OUTLOOK FOR THE CURRENT YEAR:
Your company will establish infrastructure facilities for separate super speciality for Cornea and Retina at Peelamedu Main Hospital, Coimbatore.
Your Company is planning to establish the new center at Gobichettipalayam, Erode District.
CORPORATE SOCIAL RESPONSIBILITIES:
Your company always places greater importance to manage its affairs with highest levels of transparency, accountability and integrity and is committed to achieve and maintain the high standards of corporate governance on sustained basis. Your Company reaches out to the needy sections of the society in many ways. In line with this policy, your Company has been continuously organizing many free eye camps along with trust to provide free eye treatment to people below the poverty line.
OPPORTUNITIES AND THREATS:
Through there is a stiff competition in eye care, our company is reasonably doing well. It is because of the established name for quality eye care and increase in demand for eye care in the public.
Our company is situated at South India and faces competition from other hospitals in the home town. We have introduced new departments in Ophthalmology and additional facilities for patients in Coimbatore and other centers.
The competition from the un–organized sector would be met by delivering quality eye care on par with international standards which the un–organized sector lacks in view of constraints in investment to create a quality eye hospital.
Because of increased opportunities, many private players are entering into this sector. Your Company can counter this challenge by providing focused eye care delivery and by deploying the state of the art equipments backed by panel of expert Doctors.
SHORTAGE OF SKILLED MANPOWER:
Increasing demand for health care services combined with the aggressive expansion by the Indian private health care players is expected to significantly increase the demand for medical professionals. Similarly there is a shortage of medical and para–medical staff. We have a talented and skilled manpower in terms of Doctors, Nurses and para–medical staff. We continue to attract talented and skilled medical professionals.
The health care sector is a capital intensive sector and need significant funding to grow.
FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE:
Financial performance with respect to operational performance has been dealt with in the Directors' Report which should be treated as forming part of this Management Discussion and Analysis Report.
INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY:
The company has established internal control systems to ensure optimum use in protecting its resources and ensuring adherence to its policies, procedures and statutes. There is proper and adequate system of internal control for the company and its branches. The company has employed its own internal audit department to review the adequacy of the internal control system, procedures and policies. The internal auditor evaluates the adequacy of the internal control systems by testing the control mechanism and gives their recommendations to the management.
FOREIGN EXCHANGE EARNINGS AND OUTGO:
During the period under review your company has incurred the foreign exchange outgo to the tune of Rs.. 275.75 Lacs. (Previous year : Nil)
During the year under review, your company enjoyed cordial relationship with the employees at all levels.
Dr.Kavetha Sundaramoorthy retires by rotation at the forthcoming Annual General Meeting and being eligible, offer herself for re–appointment.
All Independent Directors have given declaration 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 evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration Committee. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.
REMUNERATION POLICY: The Board has, on the recommendation of the Nomination and Remuneration Committee framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration policy is stated in the Corporate Governance Report.
BOARD MEETINGS: During he year five Board Meeting, four Audit Committee Meetings and two Nomination and Remuneration Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.
AUDIT COMMITTEE: The composition of audit committee, number of meetings hold and the attendance of directors there to have been provided under an identical head in the Corporate Governance Report.
DIRECTORS' RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act, 2013, the directors would like to state that:
I. In the preparation of the annual accounts the applicable accounting standards have been followed.
II. Appropriate accounting policies have been selected and applied consistently, and judgments and estimates that have been made are reasonable and prudent so as to give a true and fair view of the company at the end of the financial year and of the company for that period.
III. Proper and sufficient care has been taken 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 the preventing and detecting fraud and other irregularities.
IV. Annual accounts have been prepared on going concern basis.
V. Internal financial controls to be followed by the company and that such internal financial control are adequate and were operating effectively.
VI. Devised proper system to ensure compliance with the provisions of all applicable laws and that such system were adequate and operating effectively.
RELATED PARTY TRANSACTIONS:
All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the company at large.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS:
There are no significant and material orders passed by the Regulators / Courts / Tribunals which would impact the going concern status and the Company's operations in future.
The Company does not have any subsidiary Company.
CHANGE IN THE NATURE OF BUSINESS, IF ANY:
During the year, there was no change in the nature of business of the Company
MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY:
There are no material changes and commitments affecting financial position of the Company which have occurred between the end of the financial year of the Company to which the Financial Statements relate and date of the report.
CODE OF CONDUCT:
The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviors of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "Code of Conduct" which forms an Appendix to the Code. The Code has been posted on the Company's website www.lotuseye.org
The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders. The Code gives guidance through examples on the expected behavior from an employee in a given situation and the reporting structure.
All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard.
KEY MANAGERIAL PERSONNEL:
The Key Managerial Personnel of the Company as stipulated under the Companies Act, 2013 are Dr.S.K.Sundaramoorthy, Managing Director, Ms.Sangeetha Sundaramorthy, Whole–time Director, CA.M.Venkatachalapathi, Chief Financial Officer and CS.K.Rangasamy, Company Secretary.
VIGIL MECHANISM / WHISTLE BLOWER POLICY:
The Company has a vigil mechanism named Fraud and Risk Management Policy to deal with instance of fraud and mismanagement, if any.
In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.
The Company has a Fraud Risk and Management Policy to deal with instances of fraud and mismanagement, if any.
The FRM Policy ensures that strict confidentiality is maintained whilst dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern.
A high level Committee has been constituted which looks into the complaints raised. The Committee reports to the Audit Committee and the Board.
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 Directors and the designated employees have confirmed compliance with the Code.
AUDITOR'S REPORT / SECRETARIAL AUDIT REPORT:
The observation made in the Auditors' Report read together with relevant notes thereon are self explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.
As required under section 204 (1) of the Companies Act, 2013 the Company has obtained a secretarial audit report. There are no observations made in the report for the relevant period. However, the company would ensure that all the provisions are complied to the fullest extent
The Statutory Auditors M/s.V E K A M and Associates, Chartered Accountants, Coimbatore, retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re–appointment.
Pursuant to 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.P.Eswaramoorhy, Company Secretary in practice to undertake the Secretarial Audit of the Company. The Secretarial Audit report is annexed herewith as "Annexure A"
EXTRACT OF ANNUAL RETURN:
The details forming part of the extract of the Annual Return in form MGT–9 is annexed herewith as "Annexure B".
BUSINESS RISK MANAGEMENT:
Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the company has constituted a Risk Management Committee. The details of the committee and its terms of reference are set out in the corporate governance report forming part of the Boards report.
At present the company has not identified any element of risk which may threaten the existence of the company.
PARTICULARS OF EMPLOYEES:
As on 31st March, 2015, none of the employees were in receipt of remuneration in excess of the limits prescribed in Section 197 read with Rule 5, 5(2) and 5(3) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 .
The remuneration paid to all Key management Personnel was in accordance with remuneration policy adopted by the company
CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION & ANALYSIS REPORTS:
The Corporate Governance and Management Discussion & Analysis Report, which form an integral part of this Report, are set out as separate Annexure, together with the Certificate from the auditors of the Company regarding compliance with the requirements of Corporate Governance as stipulated in Clause 49 of the Listing Agreement.
INFORMATION AS PER SECTION 134 (3) (M) OF THE COMPANIES ACT, 2013:
Since the Company is in service industry and does not do any manufacturing activity, the particulars regarding conservation of energy and technology absorption stipulated under section 134(3)(m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014, are not applicable.
The particulars regarding foreign exchange inflow and outflow appear as item no.12 in General Notes on Accounts.
Statement in this Management Discussion and Analysis describing the health care sector's objectives, projections, estimates and expectations may constitute "forward looking statements" within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied.
Your Company and its Directors wish to extend their sincerest thanks to the Members of the Company, Bankers, State Government, Local Bodies, Customers, Suppliers, Executives, Staff at all levels for their continuous cooperation and assistance.
for and on behalf of the Board
Dr. S.K. Sundaramoorthy
Chairman and Managing Director
Date : 30th May, 2015
Place : Coimbatore (Sd.)