CORPORATE GOVERNANCE COMPLIANCE REPORT

Status of compliance with the conditions imposed by the Securities and Exchange Commission’s Notification No. SEC/CMRRCD/2006-158/134/Admin/44 dated 07 August 2012.

Condition No. Title Compliance Status

(Put ü in the appropriate column)

Remarks

(if any)

Complied Not Complied
1.1 Board’s Size ü   The Intech  Board is comprised of 5 Directors.
1.2 (i) At least one fifth (1/5) of the total number of directors in the company’s board shall be Independent Director

 

ü   There is one Independent Director in the Intech Board, namely: Mr. M.A. Haque
1.2 (ii) a) “Independent Director” means a director-

who either does not hold any share in the company or holds less than one percent (1%) shares of the total paid-up shares of the company.

 

ü    
1.2 (ii) b) who is not a sponsor of the company and is not connected with the company’s any sponsor or director or shareholder who holds one percent (1%) or more shares of the total paid-up shares of the company on the basis of family relationship. His/her family  members also should not hold above mentioned shares in the company

 

ü

 

   
1.2 (ii) c) who does not have any other relationship, whether pecuniary or otherwise, with the company or its subsidiary/associated companies

 

ü    
1.2 (ii) d) who is not a member, director or officer of any stock exchange ü    
1.2 (ii) e) who is not a shareholder, director or officer of any member of stock exchange or any intermediary of the capital market

 

ü    
1.2 (ii) f) who 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

 

ü    
1.2 (ii) g) who shall not be an independent director in more than 3 (three) listed companies

 

ü    
1.2 (ii) h) who has not been convicted by a court of competent jurisdiction as a defaulter in payment of any loan to a bank or a Non-Bank Financial Institution (NBFI)

 

ü    
1.2 (ii) i) who has not been convicted for a criminal offence involving moral turpitude ü    
1.2 (iii) the independent director(s) shall be appointed by the board of directors and approved by the shareholders in the Annual General Meeting (AGM)

 

ü    
1.2 (iv) the post of independent director(s) can not remain vacant for more than 90 (ninety) days

 

    No vacancy occurred

 

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

 

ü   The Independent Director (ID) is in first term of office.
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

 

ü    
1.3 (ii) The person 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 of corporate management/professional experiences

 

 

ü    
1.3 (iii) In special cases the above qualifications may be relaxed subject to prior approval of the Commission

 

Not Applicable    
1.4 The positions of the Chairman of the Board and the Chief Executive Officer of the companies 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 roles and responsibilities of the Chairman and the Chief Executive Officer

 

ü    
1.5 The Directors’ Report to Shareholders on:      
1.5 (i) Industry outlook and possible future developments in the industry ü    
1.5 (ii) Segment-wise or product-wise performance ü    
1.5 (iii) Risks and concerns ü    
1.5 (iv) A discussion on Cost of Goods sold, Gross Profit Margin and Net Profit Margin ü    
1.5 (v) Discussion on continuity of any Extra-Ordinary gain or loss ü    
1.5 (vi) Basis for related party transactions- a statement of all related party transactions should be disclosed in the annual report

 

ü    
1.5 (vii) Utilization of proceeds from public issues, rights issues and/or through any others instruments

 

ü   No IPO/RPO/ Rights Issue was made this year
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   No IPO/RPO/ Rights Issue was made this year
1.5 (ix) If significant variance occurs between Quarterly Financial performance and Annual Financial Statements the management shall explain about the variance on their Annual Report

 

ü    
1.5 (x) Remuneration to directors including independent directors ü    
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 in equity

 

ü    
1.5 (xii) Proper books of account of the issuer company have been maintained ü    
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 statements 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

 

ü    
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

 

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

 

ü    
1.5 (xix) Declaration of dividend ü    
1.5 (xx) The number of Board meetings held during the year and attendance by each director shall be disclosed ü    
1.5 (xxi) The pattern of shareholding:      
1.5 (xxi) a) Parent/Subsidiary/Associated Companies and other related parties (name wise Details)

 

ü    
1.5 (xxi) b) Directors, Chief Executive Officer, Company Secretary, Chief Financial Officer, Head of Internal Audit and their spouses and minor children (name wise details)

 

ü    
1.5 (xxi) c) Executives ü    
1.5 (xxi) d) Shareholders holding ten percent (10%) or more voting interest in the company (name wise details)

 

ü    
1.5 (xxii) In case of the appointment/re-appointment of a director the company shall disclose

the following information to the shareholders:

     
1.5 (xxii) a) A brief resume of the director ü    
1.5 (xxii) b) Nature of his/her expertise in specific functional areas ü    
1.5 (xxii) c) Names of companies in which the person also holds the directorship and the membership of committees of the board

 

ü    
2.1 Appointment:

The company shall appoint a Chief Financial Officer (CFO), a Head of Internal Audit (Internal Control 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

 

ü    
2.2 Requirement to attend the Board Meetings:

The CFO and the Company Secretary of the companies shall attend the meetings of the Board of Directors, provided that the CFO and/or the Company Secretary shall not attend such part of a meeting of the Board of Directors which involves consideration of an agenda item relating to their personal matters

 

ü    
3 (i) The company shall have an Audit Committee as a sub-committee of the Board of Directors

 

ü    
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 affairs of the company and in ensuring a good monitoring system within the business

 

ü    
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

 

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

 

ü    
3.1 (iii) All members of the audit committee should be “financially literate” and at least 1(one) member shall have accounting or related financial management experience: The term Financially literate means the ability to read and understand the financial statements i.e. Balance Sheet, Income Statement and Cash Flow Statement and a person will be considered to have accounting or related financial management expertise if (s)he possesses professional qualification or Accounting/finance graduate with at least 12 (twelve) years of corporate management/professional experiences.

 

ü    
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

 

ü   No such vacancy or expiry occurred.
3.1 (v) The company secretary shall act as the secretary of the Committee ü    
3.1 (vi) The quorum of the Audit Committee meeting shall not constitute without at least 1 (one) independent director

 

ü    
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

 

ü    
3.2 (ii) Chairman of the audit committee shall remain present in the Annual General Meeting (AGM)

 

ü    
3.3 (i) Oversee the financial reporting process ü    
3.3 (ii) Monitor choice of accounting policies and principles ü    
3.3 (iii) Monitor Internal Control Risk management process ü    
3.3 (iv) Oversee hiring and performance of external auditors ü    
3.3 (v) Review along with the management, the annual financial statements before submission to the board for approval

 

ü    
3.3 (vi) Review along with the management, the quarterly and half yearly financial statements before submission to the board for approval

 

ü    
3.3 (vii) Review the adequacy of internal audit function ü    
3.3 (viii) Review statement of significant related party transactions submitted by the management

 

ü    
3.3 (ix) Review Management Letters/ Letter of Internal Control weakness issued by statutory auditors

 

ü    
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 expenses, working capital, etc), on a quarterly basis, as a part of their quarterly declaration of financial results. Further, on an annual basis, the company shall prepare a statement of funds utilized for the purposes other than those stated in the offer document/prospectus

 

    There was no IPO/RPO/ Rights Issue in 2014 or in recent past.
3.4.1 (i) The Audit Committee shall report on its activities to the Board of Directors ü    
3.4.1 (ii) a) Report on conflicts of interests     There was no reportable case of conflict of interest in 2014
3.4.1 (ii) b) Suspected or presumed fraud or irregularity or material defect in the internal control system

 

    No such incident happened.
3.4.1 (ii) c) Suspected or presumed fraud or irregularity or material defect in the internal control system

 

    No such incident happened.
3.4.1 (ii) d) Any other matter which shall be disclosed to the Board of Directors immediately     No such incident happened.
3.4.2 If the Audit Committee has reported to the Board of Directors about anything which has material impact on the financial condition and results of operation and has discussed with the Board of Directors and the management that any rectification is necessary and if the Audit Committee finds that such rectification has been unreasonably ignored, the Audit Committee shall report such finding to the Commission, upon reporting of such matters to the Board of Directors for three times or completion of a period of 6 (six) months from the date of first reporting to the Board of Directors, whichever is earlier

 

    No such incident happened.
3.5 Report on activities carried out by the Audit Committee, including any report made to the Board of Directors under condition 3.4.1 (ii) above during the year, shall be signed by the Chairman of the Audit Committee and disclosed in the annual report of the issuer company

 

ü   The Audit Committee (AC) report is disclosed in the Annual Report and signed by the Chairman of the AC
4 The external /statutory auditor shall not be engaged in the following:      
4 (i) Appraisal or valuation services or fairness opinions ü    
4 (ii) Financial information systems design and implementation ü    
4 (iii) Book-keeping or other services related to the accounting records or financial statements

 

ü    
4 (iv) Broker-dealer services ü    
4 (v) Actuarial services ü    
4 (vi) Internal audit services ü    
4 (vii) Any other service that the Audit Committee determines ü    
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

 

ü    
4 (ix) Audit/certification services on compliance of corporate governance as required under clause (i) of condition no. 7 ü    
5 (i) Provisions relating to 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

 

    Intech does not have any subsidiary Company.
5 (ii) At least 1 (one) independent director on the Board of Directors of the holding company shall be a director on the Board of Directors of the subsidiary company

 

    Intech does not have any 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

 

    Intech does not have any 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

 

    Intech does not have any subsidiary Company.
5 (v) The Audit Committee of the holding company shall also review the financial statements, in particular the investments made by the subsidiary company

 

 

    Intech does not have any subsidiary Company.
6 (i) a) These statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading

 

ü   CEO and CFO certified to the Board during finalization of Financial Statements which is stated in the “Directors declaration as to financial statements’ in the Directors Report.
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

 

ü   CEO and CFO certified to the Board during finalization of Financial Statements which is stated in the “Directors declaration as to financial statements’ in the Directors Report.
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

 

ü    
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 on a yearly basis

 

ü   Certificate duly obtained and  included in 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   Annexure included in annual report