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Status of Compliance of Corporate Governance.

 

 

Status of Compliance with the conditions imposed by the Commission's Notification No. SEC/CMRRCD/ 2006-158/134/admin/44 dated 07th August, 2012 issued under section 2CC of the Bangladesh Securities and Exchange Ordinance, 1969.

Report under Condition No. 7

 

Condition No.

Title

Compliance Status

Remarks

(if any)

Complied

Not Complied

1.1

Board's size: The number of the Board members of the Company shall not be less than 5 five and more than 20 (twenty)

ü   

 

20 Directors

1.2

Independent Directors

 

 

 

1.2(i)

Number of Independent Director

 

 

1 (One)

1.2(ii)(a)

Shareholding position of Independent Director

ü   

 

 

1.2(ii)(b)

Independent Director is not sponsor, nor any family member/family relationship of the sponsor.

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1.2(ii)(c)

Independent Director does not have any other relationship with the company or its subsidiary associates companies.

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1.2(ii)(d)

Independent Director is not a member, director or officer of any stock exchange

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1.2(ii)(e)

Independent Director is not a shareholder, director or officer of any member of stock exchange or any intermediary of the capital market

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1.2(ii)(f)

Independent director is not a partner or an executive or was not a partner or an executive during the preceding 3 (three) years of the concerned company’s statutory audit firm.

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1.2(ii)(g)

Independent director shall not be an independent director in more than 3 (three) listed companies.

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1.2(ii)(h)

Independent director has not been convicted by a court of competent jurisdiction as a defaulter in payment of any loan to a bank or a NBFI

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1.2(ii)(i)

Independent director has not been convicted for a criminal offence involving moral turpitude.

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1.2(iii)

The independent director(s) shall be appointed by the board, and approved by the shareholders in the Annual General Meeting (AGM)

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1.2(iv)

The post of independent director(s) cannot remain vacant for more than 90 (ninety) days.

 

 

To be complied as per rule

1.2(v)

The board shall lay down a code of conduct of all Board members and annual compliance of the code to be recorded.

ü   

 

 

1.2(vi)

The tenure of office of an independent director shall be for a period of 3 (three) years, which may be extended for 1 (one) term only.

 

 

To be complied as per rule

1.3

Qualification of Independent Director (ID)

 

 

 

1.3(i)

Independent director shall be a knowledgeable individual with integrity who is able to ensure compliance with financial, regulatory and corporate laws and can make meaningful contribution to business.

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1.3(ii)

Independent director should be a Business Leader/ Corporate Leader/ Bureaucrat/ University Teacher with economics or Business Studies or Law Background/ Professionals like Chartered Accountants, Cost & Management Accountants, Chartered Secretaries. The Independent Director must have at least 12 (twelve) years corporate management/ professional experiences.

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1.3(iii)

In special cases the above qualifications may be relaxed subject to prior approval of the Commission.

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1.4

Chairman of the Board and Chief Executive Officer shall be filled by different individuals. The Chairman of the company shall be elected from among the directors of the company. The Board of Directors shall clearly define respective role and responsibilities of the Chairman and the Chief Executive Officer.

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1.5

The Director's Report to Shareholders

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1.5(i)

Industry outlook and possible future developments in the industry.

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Available in the Annual Report

1.5(ii)

Segment-wise or product-wise performance

ü   

 

Available in the Annual Report

1.5(iii)

Risks and concerns

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Available in the Annual Report

1.5(iv)

A discussion on Cost of Goods sold, Gross Profit Margin and Net Profit Margin

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Available in the Annual Report

1.5(v)

Discussion on continuity of any Extra-Ordinary gain or loss.

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No such extra ordinary gain or loss

1.5(vi)

Basis for related party transactions- a statement of all related party transactions should be disclosed in the annual report.

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Available in the Annual Report

1.5(vii)

Utilization of proceeds from public issues, rights issues and/or through any others instruments.

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1.5(viii)

An explanation if the financial results deteriorate after the company goes for Initial Public Offering (IPO), Repeat Public Offering (RPO), Rights Offer, Direct Listing etc.

ü   

 

Financial result is not deteriorated

1.5(ix)

If significant variance occurs between Quarterly Financial Performance and Annual Financial Statements the management shall explain about variance on their Annual Report.

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No such significant variance occurs

1.5(x)

Remuneration to directors including independent directors.

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Available in the Annual Report

1.5(xi)

The financial statements prepared by the management of the issuer company present fairly its state of affairs, the result of its operations, cash flows and changes equity.

ü   

 

 

1.5(xii)

Proper books of account of the issuer company have been maintained.

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1.5(xiii)

Appropriate accounting policies have been consistently applied in preparation of the financial statements and that the accounting estimates are based on reasonable and prudent judgment.

ü   

 

 

1.5(xiv)

International Accounting Standards (IAS)/Bangladesh Accounting Standards (BAS)/International Financial Reporting Standards (IFRS)/Bangladesh Financial Reporting Standards (BFRS), as applicable in Bangladesh, have been followed in preparation of the financial statement and any departure there-from has been adequately disclosed.

ü   

 

 

1.5(xv)

The system of internal control is sound in design and has been effectively implemented and monitored.

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1.5(xvi)

There are no significant doubts upon the issuer company’s ability to continue as a going concern. If the issuer company is not considered to be a going concern, the fact along with reasons thereof should be disclosed.

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1.5(xvii)

Significant deviations from the last year’s operating results of the issuer company shall be highlighted and the reasons thereof should be explained.

ü   

 

No such significant deviation observed

1.5(xviii)

Key operating and financial data of at least preceding 5 (five) years shall be summarized.

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Available in Annual Report

1.5(xix)

If the issuer company has not declared dividend (cash or stock) for the year, the reasons thereof shall be given.

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Dividend declared regularly

1.5(xx)

The number of Board meetings held during the year and attendance by each director shall be disclosed.

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8 Board meeting held with 100% attendance

1.5(xxi)(a)

Shareholding position Parent/Subsidiary/Associated Companies and other related parties (name wise details).

ü   

 

Available in the Annual Report

1.5(xxi)(b)

Shareholding position of Directors, Chief Executive Officer, Company Secretary, Chief Financial Officer, Head of Internal Audit and their spouse and minor children.

ü   

 

Available in the Annual Report

1.5(xxi)(c)

Shareholding position of Executive of the Company

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Available in the Annual Report

1.5(xxi)(d)

Shareholders holding ten percent (10%) or more voting interest in the Company. 

ü   

 

Available in the Annual Report

1.5(xxii)(a)

A brief resume of appointed/re-appointed director.

ü   

 

Available in the Annual Report

1.5(xxii)(b)

Nature of his/her expertise is specific functional areas.

ü   

 

Available in the Annual Report

1.5(xxii)(c)

Names of Companies in which the person also holds the directorship and the membership of Committee of the board.

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2.1

The Company shall appoint a Chief Financial Officer (CFO), a Head of Internal Audit (Internal Audit and Compliance) and a Company Secretary (CS). The Board of Directors should clearly define respective roles, responsibilities and duties of the CFO, the Head of Internal Audit and the CS.

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2.2

Requirement to attend the Board Meeting. The CFO and Company Secretary of the Companies attend meetings of the Board of the Directors.

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3

Audit Committee:

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3(i)

The company shall have an Audit Committee as a sub-committee of the Board of Directors.

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3(ii)

The Audit Committee shall assist the Board of Directors in ensuring that the financial statements reflect true and fair view of the state of affaire of the company and in ensuring a good monitoring system within the business.

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3(iii)

The Audit Committee shall be responsible to the Board of Directors. The duties of the Audit Committee shall be clearly set forth in writing.

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3.1(i)

The Audit Committee shall be composed of at least 3 (three) members

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4 (four) Members

3.1(ii)

The Board of Directors shall appoint members of the Audit Committee who shall be directors of the Company and shall include at least 1 (one) independent director

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3.1(iii)

All members of the audit committee should be “financial literate” and at least 1 (one) member shall have accounting or related financial management experience.

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3.1(iv)

When the term of service of the Committee members expires or there is any circumstance causing any Committee member to be unable to hold office until expiration of the term of service, thus making the number of the Committee members to be lower than the prescribed number of 3 (three) persons, the Board of Directors shall appoint the new Committee member(s) to fill up the vacancy(ies) immediately or not later than 1 (one) month from the date of vacancy(ies) in the Committee to ensure continuity of the performance of work of the Audit Committee.

 

 

There has been no such occurrence

3.1(v)

The company secretary shall act as the secretary of the Committee.

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3.1(vi)

The quorum of the Audit Committee meeting shall not constitute without at least 1 (one) independent director.

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3.2(i)

The Board of Directors shall select 1 (one) member of the Audit Committee to be Chairman of the Audit Committee, who shall be an independent director.

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3.2(ii)

Chairman of the audit committee shall remain present in the Annual General Meeting (AGM).

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3.3

Role of the Audit Committee:

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3.3(i)

Oversee the financial reporting process.

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3.3(ii)

Monitor choice of accounting policies and principles.

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3.3(iii)

Monitor Internal Control Risk Management process.

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3.3(iv)

Oversee hiring and performance of external auditors.

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3.3(v)

Review along with the management, the annual financial statements before submission to the board for approval.

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3.3(vi)

Review along with the management, the quarterly and half yearly financial statements before submission to the board for approval.

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3.3(vii)

Review the adequacy of internal audit function.

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3.3(viii)

Review statement of significant related party transactions submitted by the management.

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3.3(ix)

Review Management Letters/ Letter of Internal Control weakness issued by statutory auditors.

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3.3(x)

When money is raised through Initial Public Offering (IPO)/Repeat Public Offering (RPO)/Rights Issue the company shall disclose to the Audit Committee about the uses/applications of funds by major category (capital expenditure, sales and marketing expensed. Working capital etc), on a quarterly basis, as a part of their quarterly declaration of financial results. Further, on a annual basis, the company shall prepare a statement of funds utilized for the purposes other than those stated in the offer document/prospectus. 

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3.4

Reporting of the Audit Committee:

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3.4.1

Reporting to the Board of Directors

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3.4.1(i)

The Audit Committee shall report on its activities to the Board of Directors.

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3.4.1(ii)(a)

The Audit Committee Shall immediately report to the Board of Directors on conflicts of interest.

ü   

 

No conflict of interest occured

3.4.1(ii)(b)

Suspected or presumed fraud or irregularity or material defect in the internal control system

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No such finding

3.4.1(ii)(c)

Suspected infringement of laws, including securities related laws, rules and regulations.

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No such finding

3.4.1(ii)(d)

Any other matter which shall be disclosed to the Boars of Directors immediately.

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3.4.2

If the Audit Committee reported to the Board of Directors about anything which has material impact on the financial condition as result of operation. Audit Committee finds that such rectification has been unreasonably ignored, the Audit Committee shall such finding to the Commission

ü   

 

No such finding

3.5

Report on activities carried out by the Audit Committee, under condition 3.4.1 (ii) above during the year, shall be signed by the Chairman of the Audit Committee.

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4

External/Statutory Auditors:

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4(i)

Appraisal or valuation service of fairness opinions

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4(ii)

Financial information systems design and implementation

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4(iii)

Book-keeping or other services related to the accounting records of financial statements

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4(iv)

Broker-dealer service

 

 

N/A

4(v)

Actuarial services

 

 

N/A

4(vi)

Internal audit services

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4(vii)

Any other services that the audit committee determined

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4(viii)

No partner or employees of the external audit firms shall possess any share of the Company they audit at least during the tenure of their audit assignment of that Company.

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5

Subsidiary Company:

 

 

 

5(i)

The Composition of the Board of Directors of the holding company shall be made applicable to the composition of the Board of Directors of the subsidiary company.

 

 

No subsidiary Company

5(ii)

At least 1 (one) independent director shall be a director on the Board of Directors of the subsidiary Company.

 

 

No subsidiary Company

5(iii)

The minutes of the Board meeting of the subsidiary Company shall be placed for review at the following Board meeting of the holding Company.

 

 

No subsidiary Company

5(iv)

The minutes of the respective Board meeting of the holding company shall state that they have reviewed the affairs of the subsidiary company also. 

 

 

No subsidiary Company

5(v)

The Audit Committee of the holding company shall also review the financial investments made by the subsidiary company.

 

 

No subsidiary Company

6

Duties of Chief Executive Officer (CEO) and Chief Financial Officer (CFO): (The CEO and CFO shall certify to the Board that they have reviewed financial statements during the year and that to the best of their knowledge and belief:

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6(i)(a)

These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading.

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6(i)(b)

These statements together present a true and fair view of the company’s affairs and are in compliance with existing accounting standards and applicable laws.

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6(ii)

There are, to the best of knowledge and belief, no transactions entered into by the company during the year which are fraudulent, illegal or violation of the company’s code of conduct.

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7

Reporting and Compliance of Corporate Governance

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7(i)

The company shall obtain a certificate from a practicing Professional Accountant/Secretary (Chartered Accountant/Cost and Management Accountant/ Chartered Secretary) regarding compliance of conditions of Corporate Governance Guidelines of the Commission and shall send the same to the shareholders along with the Annual Report.

ü   

 

Certificate are available in the Annual Report

7(ii)

The directors of the Company shall state, in accordance with the Annexure  attached, in the directors, report whether the company has complied with these conditions.

ü   

 

Available in the Annual Report

 Forming Part of Corporate Governance Report

Sl

Name of Directors

Number of Meetings

Number of Attendance

Percentage

Remuneration

1

Al-haj Mohammad Sayeed

08

 

08

 

 

100%

 

 

 

 

 

 

 

 

Remuneration

Tk. 5000/- per meeting for each.

 

 

 

5000X8X20= 8,00,000.00

2

Al-haj Md. Ismail Nawab

3

Al-haj M. Tajul Islam

4

Janab Nur Mohammad Mamun

5

Mrs. Anjumon Ara Begum

6

Janab Tofazzal Hossain

7

Al-haj Md. Abdul Halim

8

Janab Gazi Belayet Hossain

9

Mrs. Asma Nur

10

Al-haj Mohammad Abdul Hannan

11

Mrs. Shayla Parbin

12

Janab Mohammad Murtaza Kamal

13

Mrs. Nostaren Jamila

14

Mrs. Farhana Alam

15

Mrs. Shahana Hanif

16

Rifa Nanzeba Sayeed

17

Janab Nurul Absar

18

Janab Sajjadul Islam Tanvir

19

Janab Usama Fida

20

Janab Javed Ahmed