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Dolphin Medical Services Directors Report, Dolphin Medical Reports by Directors
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Dolphin Medical Services

BSE: 526504|ISIN: INE796B01013|SECTOR: Hospitals & Medical Services
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Directors Report Year End : Mar '15    Mar 14
The Directors hereby present the 23rd Annual Report and Accounts of
 the Company for the year ended 31st March, 2015.
 
 1.  FINANCIAL RESULTS:                              (Rs.  In Lakhs)
 
 
 Particulars                                2014-15       2013 - 14
 
 Operating Income                             37.68           95.86
 
 Other Income                                  0.06              _
 
 Profit / (Loss) before Int. 
 Depreciation & Tax                           (4.47)         (10,12) 
 
 Depreciation                                 51.69           71.39 
 
 Cash Profit / (Loss)                         (6.41)         (14.70)
 
 
 Discussion on Financial Performance:
 
 During the year under consideration the Company got a loss of Rs.4.47
 Lakhs before interest and depreciation as against loss of Rs.10.12
 Lakhs during the previous year.
 
 Management Discussion and Analysis
 
 As mentioned in one of our earlier AGM Reports, the quagmire of
 litigation the company was constrained to involve in respect of its
 leasehold due to the lower court order against the Company and also
 of late due to the mischief of the 1st less or and the 2nd less or has
 also substantially contributed to the woes of the company. In view of
 the looming uncertainty due to the said litigation, the company is not
 able to make optimum use of the premises, as there is the fear of
 losing the further investment as may be made for modifications and
 renovations to the premises from time to time if the verdict of the
 Courts is going to be adverse. This is in addition to the already
 invested huge amounts on the premises over a period of many years on
 various occasions.  The Company is now passing throw a difficult phase
 as far as competing with the players in the field. As has been
 discussed earlier, the old model and out dated equipment is one of the
 main reasons for the lack of the generation of expected revenues of the
 company. In addition to this the severe financial stress being faced by
 company is also affecting the ability to keep the modernization need
 fulfilled. While this is the state of affairs in the operational front,
 Canara Bank has assigned its rights on the loan favoring Edelweiss
 Asset Reconstruction Company Ltd (EARC). On 18.03.2015 the EARC has
 granted a Negotiated Settlement (NS) of dues at a total consideration
 of Rs.250.00 lakhs payable in installments specified therein. In terms
 of the NS the company has paid an amount of Rs.25.00 lakhs as Upfront
 payment. The company has also informed EARC that since the revenues of
 the company are not as expected, the Board will be able to pay the
 settled amount to EARC only by way of selling the landed property
 belonging to the Company near Hyderabad. Accordingly efforts are being
 made to sell the land of Ac.13.625 cents belonging to the company in
 the open market and utilize the sale proceeds to clear off the settled
 amount to EARC. As the market conditions in the Telangana State are not
 favourable for the real estate after the division of the combined state
 of Andhra Pradesh, the company is finding it difficult to get the
 buyers for the expected sale price. However a call will be soon taken
 by the Board so that the amount due to EARC may be settled at the
 earliest.
 
 Once the EARC amount is settled, the company will be debt free and will
 be attractive for new investors to infuse the required capital for
 making the company profitable once again and also for taking up new and
 different profitable projects.  The Board is aiming to reach this stage
 at the earliest.
 
 Financial Performance
 
 The Following is the Financial Performance of your Company: 
 
                                                (Rs.in Lakhs)
 
                                   2014-15      2013-14     Inc/(Dec) %
 
                                    
 
 Income: Operations                  37.68        95.86         (60.51)
 
 Other Income                         0.06          -             0.06
 
                                   
 
                        Total :      37.74        95.86         (60.63)
  
                                       
 
 Expenditure: 
 
 Material Consumed                    9.77        29.80         (67.21)
 
 Staff Cost                           3.73        25.97         (85.63)
 
 Other Expenses                      31.70        54.78         (42.13)
 
 Depreciation                        51.69        71.39         (27.59)
 
 Total :                             96.89       181.94         (46.74)
 
 Profit/(Loss)                      (59.15)      (86.08)        (31.28)
 
 
 Material changes and commitments if any affecting the financial
 position of the Company occurred between the end of the financial year
 to which this Financial Statements relate and the date of the report
 
 There have been no material changes and commitments, affecting the
 financial position of the Company which occurred during between the end
 of the financial year to which the financial statements relate and the
 date of this report.
 
 Details of significant and material orders passed by the regulators/
 courts/ tribunals impacting the going concern status and the Company''s
 operations in future
 
 There are no significant material orders passed by the Regulators/
 Courts which would impact the going concern status of the Company and
 its future operations except the one mentioned in detail in the
 Management Discussion.
 
 Share Capital:
 
 Authorized Share Capital: During the year under review, there was no
 change in authorized share capital of the Company. Authorized share
 capital of the company as on March 31, 2015 was Rs.25,00,00,000/-,
 comprising of 2,50,00,000 equity shares of Rs.10.00 each.
 
 Paid-up Share Capital: During the year under review, there was no
 change in paid up share capital of the Company. Paid up share capital
 of the company as on March 31, 2015 was Rs.15,09,99,520/-, comprising
 of 1,50,99,952 equity shares of Rs.10.00 each.
 
 Buy Back of Securities: The Company has not bought back any of its
 securities during the year under review.
 
 Sweat Equity: The Company has not issued any Sweat Equity Shares during
 the year under review.
 
 Bonus Shares: The Company has not issued any bonus shares during the
 year under review.
 
 Employees Stock Option: The Company has not provided any Stock Option
 Scheme to the employees.
 
 Dividend
 
 Your Directors have not recommended any dividend on Equity Shares for
 the year under review.
 
 Transfers to Reserves
 
 Your Board of Directors does not appropriate any amount to be
 transferred to General Reserves during the year under review.
 
 Fixed Deposits
 
 During the year under review, your Company has not accepted any fixed
 deposits within the meaning of Section 73 of the Companies Act, 2013
 read with rules made there under.
 
 Subsidiaries, Joint Ventures and Associate Companies
 
 In accordance with Section 129(3) of the Companies Act, 2013, a
 statement containing salient features of the financial statements of
 the subsidiary companies in Form AOC-1 is enclosed as Annexure - I of
 the Board''s Report.
 
 Particulars of Contracts & Arrangements with Related Parties
 
 During the year, the Company has not entered into any contracts or
 arrangements with Related Parties.
 
 Related party Transactions
 
 During the year, the Company has not entered into any transactions with
 Related Parties.
 
 Particulars of Loans, Guarantees or Investments
 
 During the financial year 2014-15 the Company neither has, directly or
 indirectly, given any loan to its Directors nor extended any guarantee
 or provided any security in connection with any loan taken by them.
 Further, the Company has neither given any inter-corporate loan /
 advance nor made any investments in other companies.
 
 Number of Board Meetings held
 
 The Board of Directors duly met 7 times during the financial year from
 1st April, 2014 to 31st March, 2015. The dates on which the meetings
 were held are as follows:
 
 (1) 22.05.2014, (2) 12.08.2014, (3) 03.09.2014, (4) 30.09.2014, (5)
 14.11.2014, (6) 14.02.2015 and (7)27.03.2015
 
 Directors and Key Managerial Personnel
 
 In terms of Section 152 of the Companies Act, 2013, Dr. M. Lakshmi
 Sudha, CFO & Director would retire by rotation at the forthcoming AGM
 and is eligible for re-appointment. Dr. M. Lakshmi Sudha, CFO &
 Director has offered herself for re-appointment.
 
 Mr. Narendra Seena Karkera (DIN:01916929), Mr. Vinay Vishnu Raj Nayak
 (DIN:01979345) were appointed as an independent Directors by the
 Members at the last Annual General Meeting (AGM) held on September 30,
 2014..
 
 Dr. K Ramana Kumar (DIN 00754148) has been appointed as an Additional
 Director in the category of Independent director pursuant to section
 149 of the Act w.e.f.  30.09.2014 in accordance with the provisions of
 the Companies Act, 2013 and Articles of Association of the Company, who
 shall hold office till the ensuing Annual General Meeting of the
 Company.
 
 Mr. Hemanth Kumar Manikyam resigned from the office of the Director on
 24/05/2014.
 
 Dr. M. Lakshmi Sudha has been appointed as the Chief Financial Officer
 of the Company pursuant to section 203 of the Act w.e.f. 14.02.2015 in
 accordance with the provisions of the Companies Act, 2013 Based on the
 confirmations received from Directors, none of the Directors are
 disqualified from appointment under Section 164 of the Companies Act
 2013.
 
 Declaration by Independent Directors
 
 The Independent Directors of the Company have submitted their
 declarations as required under Section 149(7) of the Companies Act,
 2013 stating that they meet the criteria of independence as per
 sub-section (6) of Section 149 of the Act.
 
 Familiarization programme for Independent Directors
 
 The Company proactively keeps its Directors informed of the activities
 of the Company, its management and operations and provides an overall
 industry perspective as well as issues being faced by the industry.
 
 Independent Directors'' Meeting
 
 The Independent Directors met on 14.02.2015 without the attendance of
 Non-Independent Directors and members of the Management. The
 Independent Directors reviewed the performance of Non- Independent
 Directors and the Board as a whole; the performance of the Chairman of
 the Company, taking into account the views of Executive Director and
 Non-Executive Directors and assessed the quality, quantity and
 timeliness of flow of information between the Company Management and
 the Board that is necessary for the Board to effectively and reasonably
 perform their duties.
 
 Board Evaluation:
 
 The Board adopted a formal mechanism for evaluating its performance as
 well as that of its Committees and individual Directors, including the
 Chairman of the Board. The exercise was carried out through a
 structured evaluation process covering various aspects of the Board
 functioning such as composition of the Board & committees, experience &
 competencies, performance of specific duties & obligations,
 contribution at the meetings and otherwise, independent judgment,
 governance issues etc.
 
 Directors Responsibility Statement as required under Section 134(5) of
 the Companies Act, 2013:
 
 Pursuant to the provisions of Section 134(5) of the Companies Act, 2013
 the Board of Directors states that:
 
 (a) In the preparation of annual accounts, 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 and loss
 for that period;
 
 (c) They have taken proper and sufficient care for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Act 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 to be followed by
 the Company and that such internal financial controls are adequate and
 were operating effectively and
 
 (f) They have devised proper systems to ensure compliance with the
 provisions of all applicable laws and that such systems were adequate
 and operating effectively.
 
 Nomination and Remuneration policy
 
 In compliance to the provisions of Section 178 of the Companies Act,
 2013 and Clause 49 of the Listing Agreement entered into with the Stock
 Exchanges, the Nomination and Remuneration Committee has recommended to
 the Board a Nomination and Remuneration policy with respect to
 appointment / nomination and remuneration payable for the Directors,
 Key Managerial Personnel and senior level employees of the Company. The
 said policy has been adopted by the Board and the same will form part
 of the Annual Report as Annexure - II to the Board''s Report.
 
 Auditors Statutory Auditors
 
 At the Annual General Meeting held on September 30, 2014, M/s.
 Pinnamaneni & Co, Chartered Accountants (Firm Reg. No: 002661S), were
 appointed as Statutory Auditors of the Company to hold office for a
 period of three years i.e., till the conclusion of the Annual General
 Meeting to be held in the calendar year 2017. In terms of the first
 proviso to Section 139 of the Companies Act, 2013 the appointment of
 the auditors shall be placed for ratification at every Annual General
 Meeting. Accordingly, the said appointment of M/s. Pinnamaneni & Co,
 Chartered Accountants, as statutory auditors of the Company is placed
 for ratification by the Shareholders. In this regard, the Company has
 received a certificate from the auditors to the effect that if their
 appointment is ratified, it would be in accordance with the provisions
 of Section 141 of the Act.  The Auditors have also confirmed that they
 hold a valid certificate issued by the Peer Review Board of the
 Institute of Chartered Accountants of India.
 
 Qualification by Statutory Auditor
 
 There were no qualifications, reservations or adverse remarks made by
 the Auditors in their report.
 
 Secretarial Auditors
 
 Pursuant to the provisions of Section 204 of the Act and the Companies
 (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the
 Board of Directors has appointed M/s.  B S S & Associates, Practicing
 Company Secretaries for conducting Secretarial Audit of the Company for
 the financial year 2014-2015. The Secretarial Audit Report is annexed
 herewith as
 
 Annexure - III.
 
 There were no qualifications, reservations or adverse remarks made by
 the Auditors in their report.
 
 The Secretarial Auditor''s Report contains qualifications, reservation
 or adverse remarks except noncompliance of Section 203 of the
 Companies Act, 2013 in respect of appointment of Company Secretary as
 Key Managerial Person. The Board has made utmost effort for appointment
 of the Company Secretary as KMP but has not been able to appoint a
 Company secretary due to lack of suitability of the candidate to the
 profile of the Company in terms of Job profile and remuneration.
 Company is in the process of filing various e-forms/reports/documents
 with Registrar of Companies and stock exchange.
 
 Internal Auditors
 
 In pursuance of Section 138 of the Companies Act, 2013 read with rules
 made there under, the Board has appointed Dr. M Lakshmi Sudha, CFO of
 the Company as Internal Auditors of the Company to carry out internal
 auditing of books of accounts periodically.
 
 Internal Control Systems
 
 The Company has a well-established system of internal control in
 operations which complies with the relevant provisions of ''Internal
 Control'' under the Company''s Auditor''s Report Order 2003 and as
 prescribed under revised Clause 49 of the Listing Agreement with Stock
 Exchanges.  Internal Audit department put in place and adequate
 controls are continuously reviewed and risks of inaccurate financial
 reporting and fraud, if any, are dealt with immediately and eliminated.
 The status of implementation of recommended solutions are regularly
 reviewed and presented to the Audit Committee of the Board.
 
 Vigil Mechanism / Whistle Blower Policy
 
 Pursuant to Section 177(9) of the Companies Act, 2013 read with Rule 7
 of the Companies (Meetings of Board and its Powers) Rules, 2014 and
 Clause 49 of the Listing Agreement, the Board has adopted Whistle
 Blower Policy. This policy aims for conducting the affairs in a fair
 and transparent manner by adopting highest standards of
 professionalism, honesty, integrity and ethical behavior.
 
 A mechanism has been established for employees to report concerns about
 unethical behavior, actual or suspected fraud or violation of Code of
 Conduct and Ethics. The policy also provided adequate safeguards
 against the victimization of employees who avail of the mechanism and
 allows direct access to the Chairman of the Audit Committee in
 exceptional cases.
 
 Your Company hereby affirms that during the year no Director / employee
 have been denied access to the Chairman of the Audit Committee and that
 no complaints were received.
 
 Management Discussion and Analysis
 
 The Management Discussion and Analysis given below discusses the key
 issues concerning the business and carried on by the Company.
 
 Management of Risks
 
 There is considerable pressure to keep up the realization from the
 services in view of highly competitive market.
 
 Audit Committee
 
 The Composition of the Audit Committee is provided in the Corporate
 Governance Report forming part of this report. All the recommendations
 made by the Audit Committee were accepted by the Board.
 
 Risk Management
 
 The Risk Management Committee duly constituted by the Board had
 formulated a Risk Management Policy for dealing with different kinds of
 risks attributable to the operations of the Company. Risk Management
 Policy of the Company outlines different kinds of risks and risk
 mitigating measures to be adopted by the Board. The Company has
 adequate internal control systems and procedures to combat the risk.
 The Risk Management procedure will be reviewed periodically by the
 Audit Committee and the Board.
 
 Corporate Social Responsibility (CSR) Initiatives:
 
 Section 135 of the Companies Act, 2013 provides the threshold limit for
 applicability of the CSR to a Company ie. (a) network of the Company to
 be '' 500 crore or more; or (b) turnover of the company to be '' 1,000
 crore or more; or (c) net profit of the company to be '' 5 crore or
 more. As the Company does not fall under any of the threshold limits
 given above, the provisions of section 135 are not applicable to the
 Company.
 
 Extract of Annual Return
 
 In accordance with the provisions of Section 134(3(a) of the Companies
 Act, 2013, an extract of the Annual Return in Form MGT-9 is appended as
 Annexure - IV to the Board''s Report.
 
 Information on Conservation of Energy, Technology Absorption & Foreign
 Exchange Earnings and outgo
 
 Pursuant to the provisions of Section 134 (3) (m) of the Companies Act,
 2013 read with Rule 3 of Companies (Accounts) Rules, 2014, the relevant
 information pertaining to conservation of energy, technology
 absorption, foreign exchange earnings and outgo is appended hereto as
 Annexure - V and forms part of the Board''s Report.
 
 Company''s Policy on Prohibition, Prevention and Redressal of Sexual
 Harassment of Women at Workplace
 
 The Company prohibits any form of sexual harassment and any such
 incidence is immediately investigated and appropriate action taken in
 the matter against the offending employee(s) based on the nature and
 the seriousness of the offence. The Company has a policy on
 Prohibition, Prevention and Redressal of Sexual Harassment of Women at
 Workplace (the Policy) and matters connected therewith or incidental
 thereto covering all the aspects as contained under The Sexual
 Harassment of Women at Workplace (Prohibition, Prevention and
 Redressal) Act, 2013 notified by the Government of India vide Gazette
 Notification dated 23rd April, 2013.  There was no case of sexual
 harassment reported during the year under review.
 
 Remuneration ratio of the Directors / Key Managerial Personnel (KMP) /
 Employees:
 
 The information required under Section 197 of the Companies Act, 2013
 read with rule 5(1) of the Companies (Appointment and Remuneration of
 Managerial Personnel) Rules, 2014 are provided in separate annexure
 forming part of this Report as Annexure - VI.
 
 There were no employee in the company throughout the financial year who
 were in receipt of remuneration of Rs.60 lacs or more, employees
 employed for part of the year and in receipt of Rs.5 lac or more per
 month. Hence the provisions of Rule 5(2) The Companies (Appointment and
 Remuneration of Managerial Personnel) Rules, 2014 are not applicable.
 
 Corporate Governance
 
 The Company is committed to good corporate governance in line with the
 Listing Agreement and Provisions, Rules and Regulations of the
 Companies Act, 2013. The Company is in compliance with the provisions
 on corporate governance specified in the Listing Agreement with BSE.
 The certificate dated 02.12.2015 was obtained from Mr.
 P.V.V.Satyanarayana, Partner, Pinnamaneni & Co., Chartered Accountants
 and the report on Corporate Governance form part of this Directors''
 Report as Annexure - VII.
 
 Disclosures as per the Listing Agreement & SEBI Regulations Cash flow
 statement In due compliance of the listing agreements and in accordance
 with the requirements prescribed by SEBI, the cash flow statement is
 prepared and is appended to this Annual Report.
 
 Stock exchanges
 
 Company''s equity shares are listed in the Bombay Stock Exchange
 Limited.  There is an outstanding Listing Fee of Rs.2,27,453/- to
 Bombay Stock Exchange Ltd.
 
 Share transfer agency
 
 The Company has appointed M/s XL Softech Systems Ltd, #3, Sagar
 Society, Road No.2, Banjarahills, Hyderabad - 500034 as its share
 transfer agency for handling both physical and electronic transfers.
 
 Code of conduct
 
 The Company has adopted Code of Conduct for the Board and for the
 Senior level employees of the Company and they are complying with the
 said code. A declaration by the Managing Director to this effect is
 furnished as Annexure - VIII to the Board''s Report.
 
 Acknowledgments
 
 The Directors wish to place on record their gratitude to shareholders
 and thank the customers, vendors, bankers, hops of other State and
 Central Government Departments, Security Exchange Board of India and
 Stock Exchanges at Mumbai, and others for their continued support to
 the Company''s growth. The Directors also wish to place on record, their
 appreciation for the contribution made by the employees at all levels,
 for their sincerity, hard work, solidarity and dedicated support to the
 Company.
 
                          For and on behalf of the Board of Directors of 
 
                                        Dolphin Medical Services Limited
 
 
 
 Place: Hyderabad             Sd/-                        Sd/-
 
 Date : 30.11.2015     G.V.Mohan Prasad              M.Lakshmi Sudha
 
                       Managing Director         Whole-time director
Source : Dion Global Solutions Limited
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