UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
10-K
☒
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the fiscal year ended:
March 31, 2016
☐
TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from ____________ to ____________
Commission
File Number:
333-192399
KM
WEDDING EVENTS MANAGEMENT, INC.
(Exact name of registrant as specified in its charter)
Delaware
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46-1290754
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(State or other
jurisdiction of
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(I.R.S. Employer
Identification Number)
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incorporation
or organization)
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11501
Dublin Blvd., Suite 200, Dublin, CA 94568
(Address of principal executive office and zip code)
(925)
891-8029
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
None
Securities
registered pursuant to Section 12(g) of the Act:
None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yes
☐ No ☒
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Yes
☐ No ☒
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the issuer was required to file such
reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes
☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes
☒ No ☐
Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405) is not contained
herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
¨
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller
reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
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Large
accelerated filer
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☐
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Accelerated
filer
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☐
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Non-accelerated
filer
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☐
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Smaller reporting
company
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☒
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(Do
not check if a smaller reporting company)
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Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
☐ No ☒
As
of September 30, 2015, the aggregate market value of the voting and non-voting common equity held by non-affiliates was approximately
$1,663,001.60.
As
of June 29, 2016 there were 42,096,160 shares of common stock outstanding.
FORM
10-K INDEX
PART
I
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ITEM
1.
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BUSINESS
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2
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ITEM
1A.
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RISK
FACTORS
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8
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ITEM
1B.
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UNRESOLVED
STAFF COMMENTS
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16
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ITEM
2.
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PROPERTIES
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16
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ITEM
3.
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LEGAL
PROCEEDINGS
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16
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ITEM
4.
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MINE
SAFETY DISCLOSURES
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17
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PART
II
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ITEM
5.
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MARKET
FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
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17
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ITEM
6.
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SELECTED
FINANCIAL DATA
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17
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ITEM
7.
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MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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17
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ITEM
7A.
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QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
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20
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ITEM
8.
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FINANCIAL
STATEMENTS AND SUPPLEMENTARY DATA
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20
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ITEM
9.
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CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
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20
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ITEM
9A.
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CONTROLS
AND PROCEDURES
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20
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ITEM
9B.
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OTHER
INFORMATION
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21
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PART
III
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ITEM
10.
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DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
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22
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ITEM
11.
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EXECUTIVE
COMPENSATION
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25
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ITEM
12.
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SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
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26
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ITEM
13.
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CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
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27
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ITEM
14.
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PRINCIPAL
ACCOUNTANT FEES AND SERVICES
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28
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PART
IV
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ITEM
15.
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EXHIBITS
AND FINANCIAL STATEMENT SCHEDULES
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29
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PART
I
Use
of Certain Defined Terms
In
this annual report on Form 10-K:
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•
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“We,”
“us” and “our” refer to KM Wedding Events Management, Inc. and, except where the context requires
otherwise, KM India.
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“KM”
refers to KM Wedding Events Management, Inc., a Delaware corporation.
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“KM
India” refers to KM Wedding Events Management Private Limited, India, which is majority owned by KM.
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•
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“Indian
Rupee”, Rs, and “Rupee” refers to Indian Rupee, the legal currency of India.
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“U.S.
dollar”, “$” and “US$” refer to the legal currency of the U.S.
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This
report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities
Act”) and Section 21E of the Securities Exchange Act of 1934, including, without limitation, statements regarding our expectations,
beliefs, intentions or future strategies that are signified by the words “expect,” “anticipate,” “intend,”
“believe,” or similar language. All forward-looking statements included in this document are based on information
available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. Our business and
financial performance are subject to substantial risks and uncertainties. Actual results could differ materially from those projected
in the forward-looking statements. In evaluating our business, you should carefully consider the information set forth under the
heading “Risk Factors.” Readers are cautioned not to place undue reliance on these forward-looking statements.
ITEM
1. BUSINESS
O
verview
of Our Business
We
have been involved in the wedding services industry in South India since 2004. “KM” is our brand, which is a short
form for ‘KalyanaMalai’ meaning ‘Wedding Garland’ in South Indian language. Our services include Matrimonial
(Matchmaking) Services (“Matrimonial Services”) and Wedding Services (until June 30, 2015). Considering various business
related and socio-economic aspects, the Company has decided to have a dedicated focus on Matrimonial Services business commencing
July 1, 2015.
Matrimonial
Services include matchmaking and partner identification, through multiple delivery channels via print and visual media, website,
physical centers and events. In order to increase traction in the Matrimonial services business, we started leasing wedding halls
(physical infrastructures where a wedding is conducted, similar to banquet halls of hotels). The first wedding hall has already
commenced operations.
In
India, we currently focus on the geographic locations of Tamil Nadu and Andhra Pradesh (two of the Southern States in India).
We believe that we are well positioned to utilize the potential of the Wedding Services market because of our early presence in
this market since 2004. We have conducted promotional events across the U.S.to capture the market potential. We are continuing
our efforts to expand our presence in the US. Our target customers include the Indian high-income group, higher middle-income
group, and other affluent individuals both in the U.S. and India. This segment, being upwardly mobile and comfort and service
focused, is the right target group for our business strategy.
We,
through our subsidiary KM India, have been servicing the Indian Diaspora in the U.S. through our website since 2004 which was
followed up by Community Meets (events focused on bringing together individuals who are seeking a life partner and who share similar
backgrounds (e.g., profession, socio-economic background, religion, etc.) conducted during the fiscal year 2011 in 5 cities (New
York City, South Windsor (Connecticut), Boston, Houston and San Antonio) which was attended by approximately 1,200 prospective
matrimonial customers. In October 2013, we also filmed for SUN TV across 6 different US cities (New York, South Windsor Connecticut),
New Brunswick, San Jose, Dallas and Houston), which was attended by over 5,400 South Indian community members.
Based
on the experience gained from the above activities, we believe that there is a demand and need in the Indian Diaspora in the U.S.
for our Matrimonial Services. We believe a customized and focused approach is required to market to this segment. The current
plan for exploring this business opportunity includes setting up offices in the U.S. (fiscal 2015), growing Matrimonial Services
for weddings to be fixed in India by Indians in the U.S. launching a customized website for Matrimonial Services in the U.S. market
(fiscal 2016-17).
Organizational
Structure
KM
Wedding Events Management, Inc. was incorporated in the State of Delaware on October 24, 2012.
On
February 14, 2013, KM entered into a Stock Purchase Agreement with KM Wedding Events Management Private Ltd. (formerly known as
KM Matrimony Pvt Ltd,) a company incorporated under the 1956 Companies Act of India (“KM India”), pursuant to which
KM agreed to purchase ten million (10,000,000) shares of KM India’s common stock at a price of 11 Indian Rupees (approximately
$0.21) per share for an aggregate purchase price of up to two million one hundred thousand dollars ($2,100,000) dollars. As of
July 6, 2015, pursuant to the above agreement, KM has purchased 1,393,127 shares at 11 Rupees per share ($0.201 at the time of
the sale) in KM India on April 3, 2013 for $280,000.
On
February 14, 2013, KM entered into a Stock Purchase Agreement with the shareholders of KM India, comprised of Mr. VenkatesanVaidhyanathan
(now known as T.V. Mohan), Mrs. MeeraNagarajan, Mr. Sridhar Kalyanasundaram, Mr. VenkatesanVijayaBhaskar and Mrs. NithyaVijayaBhaskar,
pursuant to which KM shall purchase Three Million One Hundred and Fifty Thousand (3,150,000) shares of KM India’s common
stock from Mr. VenkatesanVaidhyanathan, Mrs. MeeraNagarajan, Mr. Sridhar Kalyanasundaram, Mr. VenkatesanVijayaBhaskar and Mrs.
NithyaVijayaBhaskar payable in two tranches as follows: (i) Tranche A: One Million One Hundred Fifty Thousand (1,150,000) shares
of KM India’s common stock at a purchase price of 11 Indian Rupees ($0.21) per share (“Tranche A”); and, (ii)
Tranche B: Two Million (2,000,000) shares of KM India’s common stock at a purchase price equal to the fair market value
of KM India’s shares at the time of purchase (“Tranche B”). As of July 6, 2015, KM has purchased 1,120,018 shares
in KM India on April 26, 2013 from Tranche A for an aggregate of $229,000 from two of the shareholders of KM India via Mr. VenkatesanVaidhyanathan
(562,455 shares for $115,000) and Mrs. MeeraNagarajan (557,564 shares for $114,000). The remaining Tranche A shares and the Tranche
B shares have to be sold within three (3) years from February 14, 2013.
As
a result of the Stock Purchase Agreements referenced above, KM now carries on the business of KM India as its primary business
and KM India is a subsidiary of KM. KM currently holds 58.33% of KM India.
Matrimonial
Services (Matchmaking Services)
In
2004, KM India entered into the Matrimonial Services industry by acquiring three different firms involved in various aspects of
matrimonial services, as set forth below:
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Pyramid Creations,
a production firm providing matrimonial services through a TV program named KM which commenced in 2000;
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Kalyanamalai.net,
a firm providing matrimonial services through Online Platform since 2001; and
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Kalyanamalai,
a Matrimonial Magazine (Publication) firm established in 2002.
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KM
India consolidated these activities and became a single comprehensive Matrimonial Service provider with multiple delivery channels
via print and visual media, website, physical centers and events.
For
the Matrimonial Services, we use the brand name ‘Kalyanamalai’. While we continued to utilize the 3-service delivery
platforms listed above (TV, online platform and magazine publication), we also expanded our services by opening 19 centers across
South India. Further, new services such as ‘Joint Prayers’ (where those seeking a life partner seek divine intervention
for early and hurdle free wedding) and Community Meet (where those seeking a life partner falling under a similar group, e.g.,
profession, socio-economic background, etc., come together to explore the right match for them) were introduced. We believe that
the wide range of services we provide to our customers through various platforms makes us a comprehensive service provider and
a leader in the South Indian wedding market.
One
of our key strategies is to take advantage of new age technologies. Further, in order to ensure the reach of our services to our
target groups, which also include customers from Tier 2 and Tier 3 cities (explained in detail below), where significant percentages
of population have limited or no access to the internet, we have created a network of brick and mortar centers supported by an
online technology platform for enabling matchmaking. Tier 2 and Tier 3 cities are non-metro cities that are generally defined
based on their populations and commercialization as determined by a multitude of factors such as sales tax revenue, number of
bank branches, internet connections, and number of skilled workers etc. Tier 2 cities have a population of 1 to 5 million and
Tier 3 cities are those cities which have a population of less than 1 million. Tier 1 cities are cities with populations exceeding
5 million.
As
such, we have created a unique combination of technology and tradition, which we believe gives us a competitive edge in the market
place. With our commitment to servicing customers’ specific needs, we have been able to provide products ranging from $60
to $1,800 for matrimonial services. Also, since its beginning, we have been able to service a large group of customers and have
grown to become a major matrimonial service provider in South India, having successfully enabled more than 20,000 matches.
We
believe we are a leader in the industry and we credit our various “firsts” in terms of introduction of new concepts
and services, including;
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Profile introduction
on TV.
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A magazine focusing
exclusively on/dedicated to matrimony, having color photographs of the profiles.
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Conducting Community
Meets across the geographies for customer acquisition and service.
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Introducing the
concept of matrimonial services assisted by KM’s personnel who provide personalized service to the customers in their
endeavor to finding a match.
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Improved search
tools and matching logic for the online platform.
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Forward
integration of Wedding Services with the matrimonial services.
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One
aspect that sets us apart from our competitors is the introduction of profiles of individuals seeking to be matched through a
weekly TV series that has been running since 2000. The TV series is telecast on SUN TV, which is ranked No. 1 in terms of viewership
and reach in the South Indian TV Market. SUN TV operates33 channels and has the highest reach, frequency and patronage of millions
of viewership all over the world.
We
believe our weekly TV series gives us a competitive edge for driving the brand as well as providing efficient service to profile
seekers. To make the best of this, we have implemented a unique design for the program to enable the brand to reach a far larger
audience than just the profile seekers. The program design incorporates an entertainment based ‘debate show’ as an
integral part of the program, which covers various topics of social impact which are discussed and debated upon by professionals
and experts. This debate is moderated and judged by a professional and/or celebrity. By covering interesting topics, this program
has attracted large numbers of followers and has also enabled us to get over 50 celebrities on our platform, including policy
makers, administrators, politicians, actors and other celebrities. Filming for this ‘debate show’ is held in front
of a large live audience (ranging from 1,000 - 3,000 live viewers). This has created a strong brand positioning for us and has
created an ideal launching platform for our wedding services. Further, this has helped us gain recognition as a player suited
to cater to the requirements of the target customer base.
We
believe that being telecast on the SUN TV network affords us the following advantages:
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Immediate brand
recognition among the viewers of the program with our services; and
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Numerous
options for the profiles for finding the right partner filtered through a wide base.
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Strategic
Alliances
We
have entered into various strategic relationships, in an endeavor to create and position our KM brand.
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Satellite Channel
SUN TV: a leading Satellite Channel having a wide reach as well as high viewership among the Tamil Community
[1]
.
Our agreement with SUN TV (the “SUN TV Agreement”) enables us to screen the Kalyanamalai TV program wherein the
profiles of individuals seeking to be matched are introduced on TV. The TV program started in the year 2000 by the firm, Pyramid
Creations, and has continued for over 13 years as a weekly episode. The program, which includes an entertainment component,
helps promote our brand image among this audience.
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Publication:
We entered into an agreement with Print Links (the “Printing Agreement”) to print our matrimonial magazine, Kalyanamalai.
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[1]
Source: http://sunnetwork.in/tv-channel.aspx
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Expansion
in the U.S. Market
We,
through KM India, have been servicing the Non Resident Indian (“NRI”) and Persons of Indian Origin (“PIO”)
communities in the U.S. since 2004. Our SUN TV Program is popular among the South Indian NRI community in the U.S.
With
regard to the NRI and PIO population in the U.S.:
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•
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As of 2003, there
are 200,000 NRI millionaires in the U.S.
[4]
;
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As of 2003, one
out of nine Indians in the U.S. is a millionaire, which represents around 10% of all millionaires in the U.S.[5];
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As
of 2011, the American NRI median income was estimated to be over $60,000 compared to the national average of $38,885, making
it the wealthiest immigrant group in the U.S.
[6]
.
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This
is a large market for Matrimony services in the U.S.
Since
2011, our ties with the U.S. have increased substantially. Our management team visited and met with various South Indian groups
and associations across the length and breadth of the U.S. and has created close relationships with these groups/associations.
We have established relationships with a large number of associations from across the U.S., including the following:
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Federation of Tamil
Sangams of North America (FeTNA)
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Tamil Sangam of
Greater Washington
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Tamil Association
of Greater Delaware Valley
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Connecticut Tamil
Sangam
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Boston Thamil Association
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MuthamizhSangam
of Central Florida
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Greater Atlanta
Tamil Sangam (GATS)
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New Jersey Tamil
Arts and Cultural Society (NJTACS)
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Minnesota Tamil
Sangam (MNTS)
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Lexington Tamil
Cultural Association
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New England Tamil
Sangam
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Tampa Tamil Association
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The Tamil Association
of Colorado
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Harrisburg Area
Tamil Sangam
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Bharati
Tamil Sangam Fremont, CA
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4
Source:
http://www.ethnikpr.com/ss_market.php
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5
Source: http://www.nri-worldwide.com/index.cgi?cat=16&o=10
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6
Id.
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In
October 2013, we filmed our SUN TV television program in six locations throughout the U.S., including New York City, South Windsor,
New Brunswick, San Jose, Dallas and Houston. These episodes will assist in our launch throughout the U.S.
While
we have commenced our promotions in the U.S. we plan to strengthen our position in the market by providing Wedding Services for
weddings to be conducted in India by Indians in the U.S., launching a customized website for Matrimonial Services in the U.S.
market (fiscal 2016-17).
Competition
Our
industry consists of a wide spectrum of service providers. Each service provider focuses on one or a few services required for
a wedding. Hence, there are not many organized companies which focus on a providing targeted matrimonial services similar to our
services.
A
comparison chart across various organized companies and major categories of competition is as follows:
Name
|
Matrimony
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Wedding
Planning
|
Event
Management
|
Event
Infra
|
KM
|
Strong
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Medium
|
Strong
|
Medium
|
Bharat
Matrimony
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Strong
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No
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No
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No
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Shaadi.com
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Strong
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No
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No
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No
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Times
matrimony
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Strong
|
No
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No
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No
|
Event
Managers
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No
|
No
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Strong
|
No
|
Wedding
Halls
|
No
|
No
|
No
|
Strong
|
Government
Regulations
We
are subject to a number of U.S. federal and state, and foreign laws and regulations that affect companies conducting business
on the Internet, many of which are still evolving and being tested in courts, and could be interpreted in ways that could harm
our business. These may involve user privacy, rights of publicity, data protection, content, intellectual property, distribution,
electronic contracts and other communications, competition and consumer protection. In particular, we are subject to federal,
state, and foreign laws regarding privacy and protection of user data. Foreign data protection, privacy, and other laws and regulations
are often more restrictive than those in the U.S. U.S. federal and state and foreign laws and regulations are constantly evolving
and can be subject to significant change. In addition, the application and interpretation of these laws and regulations are often
uncertain, particularly in the new and rapidly-evolving industry in which we operate. There are also a number of legislative proposals
pending before the U.S. Congress, various state legislative bodies, and foreign governments concerning data protection, which
could affect our business.
As
can be expected with any revolutionary change in the landscape of global computing, certain legal issues arise. Laws and regulations
directly applicable to Internet communications, e-commerce and advertising are becoming more prevalent and, due to the increasing
popularity and use of the Internet, it is likely that additional laws and regulations will be adopted. Compliance with these laws
and regulations may involve significant costs or require changes in business practices that result in reduced revenue. Noncompliance
could result in penalties being imposed on our Company, or an order that we stop the alleged noncompliant activity, either of
which would substantially harm our business.
Further,
there are a number of legislative proposals pending before the U.S. Congress, various state legislative bodies and foreign governments
concerning data protection and many states have passed laws that require notifications to be sent to customers when there is a
security breach of personal data. The interpretation and application of current laws regarding data protection are still uncertain
and in flux. It is possible that these laws may be interpreted and applied in a manner that is inconsistent with our data practices.
If so, in addition to the possibility of fines, this could result in an order requiring that we change our data and disclosure
practices, which could have an adverse effect on our business. Complying with these various laws could cause us to incur substantial
costs or require us to change our business practices in a manner adverse to our business.
Intellectual
Property
KM
India has secured the website domain name www.kmmatrimony.com. We plan to apply for trademark protection in the U.S. of the brand
KM. We may later seek patent protection in the U.S. of the technologies that drive our services. Securing these protections
will be material to our business as it will raise awareness of our brand and services and protect our ideas from use by other
companies with a similar business model.
Companies
in the Internet, technology, and media industries own large numbers of patents, copyrights, trademarks, and trade secrets and
frequently enter into litigation based on allegations of infringement, misappropriation, or other violations of intellectual property
or other rights. We intend to protect our future intellectual property rights by relying on federal, state and common law rights,
as well as contractual restrictions. We hope to control access to our proprietary information by entering into confidentiality
agreements with our employees, consultants or any third parties we may engage.
Our
Customers
Our
services and products are sold to in India domestic markets as well as to the Indians in foreign countries such as United States
of America, UK, Europe, Singapore, Dubai and other countries where Indians have settled. In 2015 and 2016, approximately 90% and
Nil, respectively, of our sales were made domestically in approximately 10% and Nil, respectively, were to international customers,
primarily Dubai.
Employees
and Consultants
As
of June 1, 2016 we have approximately 27 full-time employees, and 3 consultants who operate as independent contractors. We intend
to increase the number of our employees and consultants to meet our needs as we grow.
Legal
Proceedings
We
know of no material, existing or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceeding
or pending litigation. There are no proceedings in which our directors, officers or any affiliates, or any registered or beneficial
stockholder is an adverse party or has a material interest adverse to our interest.
Item
1A. RISK FACTORS
RISK
FACTORS
We
are subject to various risks that may materially harm our business, prospects, financial condition and results of operations.
An investment in our common stock is speculative and involves a high degree of risk. In evaluating an investment in shares of
our common stock, you should carefully consider the risks described below, together with the other information included in this
report. The risks described below are not the only risks we face. If any of the events described in the following risk factors
actually occurs, or if additional risks and uncertainties later materialize, that are not presently known to us or that we currently
deem immaterial, then our business, prospects, results of operations and financial condition could be materially adversely affected.
In that event, the trading price of our common stock could decline, and you may lose all or part of your investment in our shares.
The risks discussed below include forward-looking statements, and our actual results may differ substantially from those discussed
in these forward-looking statements.
Business
Risks
The
market for wedding services is highly competitive, and competition is increasing as more companies, many that are larger and have
greater resources than we do, are able to capture the market from us. Further, considering that the industry is largely unorganized,
numerous small players can pose strong competition for us by underpricing the types of services that we provide.
In
regards to the wedding matchmaking services, there are various online matrimonial providers who are large players and who have
already attained significant operations compared to us. These providers have greater financial back up, investments in technology,
resources and market infrastructure to offer competitive service rates that may pose significant challenges to us. We also compete
with numerous small and mid-size online companies, and unorganized traditional brick and mortar service providers who may offer
services at cheaper price points than us, which may have an adverse effect on our business, including increased price competition
and loss of potential customers.
Our
ability to grow our business is dependent on our ability to compete effectively with other providers and requires capital investment
in marketing and advertisement. Many existing and potential competitors have longer operating histories and greater market share
and brand recognition than we do. In addition, many of our existing and potential competitors are substantially larger than we
are and may already have or could develop substantially greater financial and other resources than we have. We may also face price
competition that results in decreases in the purchase and use of our products and services. To stay competitive, we may have to
increase the incentives that we offer to our customers and decrease the prices of our products and services, which could adversely
affect our operating results and profitability.
The
wedding industry is highly dependent on social structure and practices. Any major change in the same will adversely impact the
business and thus our financial performance.
The
wedding services industry is highly dependent on the social structure, religious practices and others. Any major change in the
same by the consumers will adversely impact the business and thus our financial performance.
Our
business depends significantly on the market recognition of our Founder & Chairman, who is our brand ambassador, and if we
are not able to maintain or enhance our brand recognition, our business, financial condition, results of operations and prospects
may be materially and adversely affected.
In
the event of the demise of our Founder and Chairman, Mr. T.V. Mohan (formerly known as V. Venkatesan), who is the brand ambassador
and face of the Company, or any accident or injury or ill health caused to him, we may not be able to maintain our business and
brand recognition, or enhance our brand appeal. This could significantly affect our business and operations.
Our
ability to maintain our competitive position and to implement our business strategy is dependent to a significant extent on the
performance of our senior management team and other key functional personnel.
We
depend on our current senior management for the implementation of our strategy and the operation of our day-to-day activities.
Furthermore, relationships of members of senior management are important to the conduct of our business. Competition for experienced
management personnel in the wedding services industry is intense, the pool of qualified candidates is limited, and we may not
be able to retain the services of our senior executives or key personnel or attract and retain high-quality senior executives
or key personnel in the future. Consequently, there can be no assurance that these individuals will continue to make their services
available to us in the future. Any significant loss of senior management or key personnel could materially and adversely affect
our business, financial condition, results of operations and prospects.
In
addition, if any member of our senior management team or any of our other key personnel joins a competitor or forms a competing
company, we may consequently lose our proprietary know-how.
Our
key management personnel have entered into confidentiality and/or non-competition agreements with us. However, if any disputes
arise between any of our key management personnel and us, it may be difficult for us to enforce these agreements.
Our
profitability is substantially dependent on scalability of wedding services which may be negatively affected by various factors.
Our
profit margin is largely a function of service fees charged to our customers.These fees are affected by a number of factors, including:
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Our customer’s
perception of our ability to add value through our services;
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The introduction
of better products or services by our competitors;
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The pricing policies
of our competitors;
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General economic
recessionary conditions;
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The increase in
input cost of materials which we may not be able to pass on to the customers; and
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Increase
in lease rental costs charged by wedding infrastructure owners.
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If
our service fees are not properly priced, our revenue will decline and we will not be able to sustain our profit margin, which
could have a material adverse effect on our profitability.
We
have entered into outsourcing and other agreements related to certain business operations, and any difficulties experienced in
these arrangements could result in additional expense, loss of customers and revenue, or an interruption of our services.
We
have entered into few outsourcing agreements with third parties to provide matrimonial events. As a result, we must rely on third
parties over which we have limited control, to perform certain of our operations and, in the majority of cases, to interface with
our customers. If these third parties are unable to perform to our requirement of high quality services, we may be forced to pursue
alternative strategies to provide these services, which could result in delays, interruptions, additional expenses to us and loss
of customers. This may require us to pursue new third-party relationships. If we are unable to complete a transition to a new
provider on a timely basis, or at all, we could be forced to temporarily or permanently discontinue certain services, which could
disrupt services to our customers and adversely affect our business, financial condition and results of operations.
The
inability to maintain or strengthen our brand may reduce our ability to retain and attract customers, which could adversely affect
our business, financial condition and operating results.
The
nature of the industry requires continuous efforts to increase brand awareness among our consumers. This will be an important
part of our strategy to grow our business. Developing, promoting and maintaining our brand and image requires a consistent capital
investment and expense, and this investment in our brand and image may not be successful. If we fail to develop, promote and maintain
our brand and image, we may not be able to grow our customer base and our financial and operational results may suffer.
If
we lose key personnel or are unable to attract additional qualified personnel as we grow, our business could be adversely affected.
The
matrimonial services business is highly personnel intensive and requires constant efforts on training. We depend on the ability
and experience of a number of our key personnel who have substantial experience in our line of operations. It is possible that
the loss of the services of one or a combination of our senior executives or key managers would have an adverse effect on our
operations. Our success also depends on our ability to continue to attract, train, manage and retain other qualified management
and skilled personnel as we grow, and we may be unable to attract, manage or retain such personnel. Due to the competitive nature
of our industry, we may also be vulnerable to attempts by our competitors to hire our employees.
Business,
political and economic factors may affect our operations, the manner in which we conduct our business and our rate of growth.
The
growth rate of the Indian economy has dropped over the last two years and unemployment rates are rising. If economic conditions
and unemployment rates continue to deteriorate or do not improve, our target consumer base may be negatively affected due to the
generally lower incomes of the customers. In addition, a large proportion of our target customers work in industries that may
be disproportionately affected by a downturn in the Indian economy, which may limit their disposable incomes and consequently,
their discretionary spending. Stagnant economic growth and high unemployment are likely to negatively affect our customers' ability
to pay for our services. The resulting impact of such economic conditions on our customers and on consumer spending could have
a material adverse effect on demand for our services and on our business, financial condition and operating results.
If
we are unable to adequately protect our intellectual property and brand image we may lose a valuable competitive advantage or
be forced to incur costly litigation to protect our rights.
Our
success depends in part on our ability to protect our intellectual property rights and brand image. Currently, we have the right
to utilize certain intellectual property comprising of wedding design, catering know-how, talent pool, skilled labor, vendor supply
chain network, wedding hall owner’s network, sourcing strategy, proprietary recipe of signature dishes, etc. It is possible
that third parties will infringe upon these rights and, as a result, we may be forced to spend significant amounts of time or
money to defend these rights. Further, we have not yet obtained trademark protection of our KM brand. Securing these protections
will be material to our business as it will help protect our ideas and image from use by competitors with a similar business model.
Our
failure to anticipate rapid changes in competition may negatively affect demand for our services in the marketplace.
The
matrimonial services market may be subject to rapid and significant business changes. We expect that new services and concepts
applicable to our industry will emerge in the future, and these new services and concepts may be superior to our services. Our
future success will depend, in part, on our ability to develop new services according to changing business conditions. These initiatives
are inherently risky, and they may not be successful or may have an adverse effect on our business, financial condition and results
of operations.
Our
business and activities will be regulated by the Competition Act, 2002 (India).
The
Parliament of India enacted the Competition Act, 2002 (the “Competition Act”) for the purpose of preventing practices
having an adverse effect on competition in the relevant market in India under the auspices of the Competition Commission of India
(the “CCI”). Under the Competition Act, any arrangement, understanding or action, whether formal or informal, which
causes or is likely to cause an appreciable adverse effect on competition is void and attracts substantial penalties. On March
4, 2011, the Government notified and brought into force the combination regulation (merger control) provisions under the Competition
Act, effective from June 1, 2011. The combination regulation provisions require that acquisition of shares, voting rights, assets
or control or mergers or amalgamations which cross the prescribed asset and turnover-based thresholds shall be mandatorily notified
to and pre-approved by the CCI. In addition, on May 11, 2011, the CCI issued the final Competition Commission of India (Procedure
in regard to the transaction of business relating to combinations) Regulations, 2011 that sets out the mechanism for implementation
of the combination regulation provisions under the Competition Act.
The
effect of the Competition Act on the business environment in India is currently unclear. If we are affected, directly or indirectly,
by any provision of the Competition Act, or its application or interpretation, including any enforcement proceedings initiated
by the Competition Commission and any adverse publicity that may be generated due to scrutiny or prosecution by the Competition
Commission, it may have a material adverse effect on our business, results of operations, financial condition and prospects.
Our
ability to raise foreign capital may be constrained by Indian law.
Our
operating subsidiary, as an Indian company, will be subject to exchange controls that regulate investments in foreign currencies.
Such regulatory restrictions limit our financing sources for our business operations or acquisitions and other strategic transactions,
and consequently could constrain our ability to obtain financings. In addition, we cannot assure you that the required approvals
will be granted to us, even if granted within the normal time limits.
If
we are not able to obtain further financing, our business operations may fail.
At
March 31, 2016, our working capital deficit was $556,345 and we had $13,250 in cash and cash equivalents. We have evaluated our
expected cash requirements over the next twelve months, and have determined that our existing cash resources are not sufficient
to meet our anticipated needs during the next twelve months, and that additional financing is required to support current operations.
In addition, we anticipate that further additional financing may be required to fund our business plan subsequent to that date,
until such time as revenues and related cash flows become sufficient to support our operating costs.
The
successful implementation of our business plan is dependent upon us receiving sufficient funds from the sale of securities and/or
additional funding from management, the issuance of equity or debt, or through obtaining a credit facility. In additional, substantial
expenditures will be required to enable us to expand and scale up our operations and quality of services. We will require additional
financing from issuance of equity or debt, or through obtaining a credit facility, to execute our plan of operations. Our established
bank-financing arrangements will not be adequate. Although management believes that the additional required funding will be obtained
through the sale of securities, there is no guarantee we will be able to obtain the additional required funds in the future or
that funds will be available on terms acceptable to us, if at all. If such funds are not available, management will be required
to curtail its investments in additional sales and marketing and product development resources, and capital expenditures, which
may have a material adverse effect on our future cash flows and results of operations, and its ability to continue operating as
a going concern.
We
may enter into additional financing agreements which may have a dilutive effect on our earnings per share and the rights of certain
stockholders.
Additional
financings could result in significant dilution to our earnings per share or the issuance of securities with rights superior to
our current outstanding securities. For instance, we may grant registration rights to investors purchasing our equity or debt
securities in the future.
We
may be unable to raise additional capital.
If
we are unable to raise additional financing when needed, we may be unable to implement our long-term business plan, develop or
enhance our products and services, take advantage of future opportunities or respond to competitive pressures on a timely basis,
if at all. In addition, a lack of additional financing could force us to substantially curtail or cease operations.
It
may be difficult for our stockholders to effect service of process against our subsidiaries or our officers and directors.
Our
operating subsidiary is organized under the laws of India and substantially all of their assets are located outside the U.S. In
addition, our executive officers and directors are residents of India and substantially all of their assets are located outside
the U.S. As a result, it could be difficult for our stockholders to effect service of process in the U.S., or to enforce a judgment
obtained in the U.S., against our officers and directors.
Restrictions
on currency exchange may limit our ability to receive and use our revenues effectively.
The
majority of our revenues are settled in Indian Rupee and U.S. dollars, and any future restrictions on currency exchanges may limit
our ability to use revenue generated in Indian Rupee to fund any future business activities outside India or to make dividends
or other payments in U.S. dollars. In addition, our financial condition is affected by the foreign exchange rates, primarily the
rate between the U.S. dollar and the Indian Rupee. In the event that the Indian Rupee appreciates against the U.S. dollar, our
costs will increase.
Risks
Related To the Market For Our Stock
You
may have limited access to information regarding our business because we are a limited reporting company exempt from many regulatory
requirements and our obligations to file periodic reports with the SEC could be automatically suspended under certain circumstances.
We
are not a fully reporting company, but rather, subject to the reporting requirements of Section 15(d) of the Securities Exchange
Act of 1934. As such we are required to file periodic reports with the SEC, which are immediately available to the public for
inspection and copying. Except during the year that our registration statement becomes effective, these reporting obligations
may be automatically suspended under Section 15(d) if we have less than 300 stockholders. If this occurs after the year in which
our registration statement becomes effective, we will no longer be obligated to file periodic reports with the SEC and your access
to our business information would then be even more restricted; however, that filing obligation will generally apply even if our
reporting obligations have been suspended automatically under section 15(d) of the Exchange Act prior to the due date for the
Form 10-K. After that fiscal year and provided we have less than 300 stockholders, we are not required to file these reports.
If the reports are not filed, the investors will have reduced visibility as to the Company and our financial condition.
In
addition, as a filer subject to Section 15(d) of the Exchange Act, we are not required to prepare proxy or information statements,
and our common stock will not be subject to the protection of the ongoing private regulations. Additionally, we will be subject
to only limited portions of the tender offer rules, and our officers, directors, and more than ten percent (10%) stockholders
are not required to file beneficial ownership reports about their holdings in our Company, and will not be subject to the short-swing
profit recovery provisions of the Exchange Act. Further, more than five percent (5%) holders of classes of our equity securities
will not be required to report information about their ownership positions in the securities. This means that your access to information
regarding our business will be limited.
As
a reporting company under the Exchange Act, we are required to comply with the internal control evaluation and certification requirements
of Section 404 of the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act requires annual management assessments
of the effectiveness of our internal control over financial reporting, starting with the second annual report that we file with
the SEC. In connection with the implementation of the necessary procedures and practices related to internal control over financial
reporting, we may identify deficiencies that we may not be able to remediate in time to meet the deadline imposed by the Sarbanes-Oxley
Act for compliance with the requirements of Section 404. We will be unable to issue securities in the public markets through the
use of a shelf registration statement if we are not in compliance with Section 404. Furthermore, failure to achieve and maintain
an effective internal control environment could have a material adverse effect on our business and share price and could limit
our ability to report our financial results accurately and timely.
Furthermore,
as long as we remain an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS
Act”), we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other
public companies that are not “emerging growth companies” including, but not limited to, not being required to comply
with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive
compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory
vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We intend to
take advantage of these reporting exemptions until we are no longer an “emerging growth company.”
We
will remain an emerging growth company until the earliest of: (A) the last day of the fiscal year following the fifth anniversary
of our first sale of common equity securities pursuant to an effective registration statement, (B) the last day of the fiscal
year in which we have total annual gross revenue of $1.0 billion or more, (C) the date that we are deemed to be a “large
accelerated filer” as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our common
stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal
quarter, or (D) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
Rule
12b-2 of the Securities Exchange Act of 1934, as amended, defines a “smaller reporting company” as an issuer that
is not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent that is not a smaller reporting
company and that:
Had
a public float of less than $75 million as of the last business day of its most recently completed second fiscal quarter, computed
by multiplying the aggregate worldwide number of shares of its voting and non-voting common equity held by non-affiliates by the
price at which the common equity was last sold, or the average of the bid and asked prices of common equity, in the principal
market for the common equity; or
In
the case of an initial registration statement under the Securities Act or Exchange Act for shares of its common equity, had a
public float of less than $75 million as of a date within 30 days of the date of the filing of the registration statement, computed
by multiplying the aggregate worldwide number of such shares held by non-affiliates before the registration plus, in the case
of a Securities Act registration statement, the number of such shares included in the registration statement by the estimated
public offering price of the shares; or
In
the case of an issuer whose public float as calculated under paragraph (1) or (2) of this definition was zero, had annual revenues
of less than $50 million during the most recently completed fiscal year for which audited financial statements are available.
We
qualify as a smaller reporting company, and so long as we remain a smaller reporting company, we benefit from the same exemptions
and exclusions as an emerging growth company. In the event that we cease to be an emerging growth company as a result of a lapse
of the five year period, but continue to be a smaller reporting company, we would continue to be subject to the exemptions available
to emerging growth companies until such time as we were no longer a smaller reporting company.
After,
and if ever, we are no longer an “emerging growth company,” we expect to incur significant additional expenses and
devote substantial management effort toward ensuring compliance with those requirements applicable to companies that are not “emerging
growth companies,” including Section 404 of the Sarbanes-Oxley Act.
We
are an “Emerging Growth Company” and we cannot be certain if the reduced disclosure requirements applicable to Emerging
Growth Companies will make our common stock less attractive to Investors.
We
are an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012 (“JOBS Act”),
and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies,
including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute
payments not previously approved. We cannot predict if investors will find our common stock less attractive because we will rely
on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market
for our common stock and our stock price may be more volatile.
Under
the JOBS Act, “emerging growth companies” can delay adopting new or revised accounting standards until such time as
those standards apply to private companies. We have elected to “opt out” of such extended transition period and, therefore,
we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required
for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition
period for complying with new or revised accounting standards is irrevocable.
Certain
of our directors and executive officers have the ability to delay or prevent adoption of important business decisions based on
their ownership of a significant percentage of our outstanding voting securities.
Our
directors and executive officers, collectively, are the beneficial record owners of approximately 54.52% of our outstanding voting
securities. As a result, our management possesses significant influence over our business. For instance, our management may elect
our Board of Directors, authorize significant corporate transactions or prevent a future change in control of our company.
Certain
provisions of our Certificate of Incorporation may make it more difficult for a third party to effect a change- in-control.
Our
Certificate of Incorporation authorizes our Board of Directors to issue up to 10,000,000 shares of preferred stock without stockholder
approval. The preferred stock may be issued in one or more series, the terms of which may be determined at the time of issuance
by the Board of Directors without further action by the stockholders. These terms may contain voting rights, including the right
to vote as a series on particular matters, preferences as to dividends and liquidation, conversion rights and redemption rights
provisions. The issuance of any preferred stock could diminish the rights of holders of our common stock, and therefore could
reduce the value of such common stock. In addition, specific rights granted to future holders of preferred stock could be used
to restrict our ability to merge with, or sell assets to, a third party. The ability of our Board of Directors to issue preferred
stock could make it more difficult to acquire us and could negatively affect the market price of our common stock.
We
do not expect to pay dividends in the future, and any return on your investment may be limited to the value of the shares you
acquire.
We
have never declared or paid cash dividends. We do not anticipate paying any cash dividends on our common stock in the foreseeable
future and any return on your investment may be limited to the value of the shares of our common stock that you acquire. We currently
intend to retain and use any future earnings for the development and expansion of our business.
Our
stock price may be volatile
.
The
market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various potential
factors, many of which will be beyond our control, including the following:
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products and services
offered by us and our competitors;
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additions or departures
of key personnel;
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our ability to execute
our business plan;
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operating results
that fall below expectations;
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economic and other
external factors; and
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period-to-period
fluctuations in our financial results.
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In
addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated
to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market
price of our common stock.
As
a public company, we will incur substantial expenses.
So
long as our registration statement remains effective, we will continue to be subject to the information and reporting requirements
of the U.S. securities laws. The U.S. securities laws require, among other things, review, audit, and public reporting of our
financial results, business activities, and other matters. SEC regulation, including regulation enacted as a result of the Sarbanes-Oxley
Act of 2002, has also substantially increased the accounting, legal, and other costs related to becoming and remaining an SEC
reporting company. If we do not have current information about our Company available to
market
makers, they will not be able to trade our stock. The public company costs of preparing and filing annual and quarterly reports
and other information with the SEC, and furnishing audited reports to stockholders, will cause our expenses to be higher than
they would be if we were privately-held. These increased costs may be material and may include the hiring of additional employees
and/or the retention of additional advisors and professionals. Our failure to comply with the federal securities laws could result
in private or governmental legal action against us and/or our sole officer and director, which could have a detrimental effect
on our business and finances, the value of our stock, and the ability of stockholders to resell their stock.
FINRA
sales practice requirements may limit a stockholder’s ability to buy and sell our stock.
The
Financial Industry Regulatory Authority (“FINRA”) has adopted rules that relate to the application of the SEC’s
penny stock rules in trading our securities and require that a broker/dealer have reasonable grounds for believing that the investment
is suitable for that customer, prior to recommending the investment. Prior to recommending speculative, low priced securities
to their non-institutional customers, broker/dealers must make reasonable efforts to obtain information about the customer’s
financial status, tax status, investment objectives and other information. Under interpretations of these rules, FINRA believes
that there is a high probability that speculative, low priced securities will not be suitable for at least some customers. The
FINRA requirements make it more difficult for broker/dealers to recommend that their customers buy our common stock, which may
have the effect of reducing the level of trading activity and liquidity of our common stock. Further, many brokers charge higher
transactional fees for penny stock transactions. As a result, fewer broker/dealers may be willing to make a market in our common
stock, reducing a stockholder’s ability to resell shares of our common stock.
We
may be exposed to potential risks resulting from new requirements under section 404 of the Sarbanes-Oxley Act of 2002.
There
are substantial penalties that could be imposed upon us if we fail to comply with all regulatory requirements. In particular,
under Section 404 of the Sarbanes-Oxley Act of 2002, we are required to include in our annual report our assessment of the effectiveness
of our internal control over financial reporting in our Form 10-K. We expect to incur additional expenses and diversion of management’s
time as a result of performing the system and process evaluation, testing and remediation required in order to comply with the
management certification.
If
a market for our common stock does not develop, stockholders may be unable to sell their shares.
A
market for our common stock may never develop. There is no guarantee that our shares will ever be traded on the OTC Bulletin Board,
or, if traded, a public market may not materialize. If our common stock is not traded on the OTC Bulletin Board or if a public
market for our common stock does not develop, investors may not be able to re-sell the shares of our common stock that they have
purchased and may lose all of their investment.
Our
common stock may be deemed “penny stock”, which would make it more difficult for investors to sell their shares
.
If
a market develops and the price of our stock is below $5.00 per share, or we do not have $2,000,000 in net tangible assets, or
is not listed on an exchange or on the NASDAQ National Market System, among other conditions, our shares may be subject to a rule
promulgated by the SEC that imposes additional sales practice requirements on broker-dealers who sell such securities to persons
other than established customers and institutionalaccredited investors. For transactions covered by the rule, the broker-dealer
must make a special suitability determination for the purchaser and receive the purchaser’s written consent to the transaction
prior to the sale. Furthermore, if the price of our stock is below $5.00 and does not meet the conditions set forth above, sales
of our stock in the secondary market will be subject to certain additional new rules promulgated by the SEC. These rules generally
require, among other things, that brokers engaged in secondary trading of stock provide customers with written disclosure documents,
monthly statements of the market value of penny stocks, disclosure of the bid and asked prices, and disclosure of the compensation
to the broker-dealers and disclosure of the sales person working for the broker-dealer. These rules and regulations may affect
the ability of broker-dealers to sell our securities, thereby limiting the liquidity of our securities. They may also affect the
ability of our stockholders to resell their securities in the secondary market.
Additional
issuances of our securities may result in immediate dilution to existing stockholders.
We
are authorized to issue up to 300,000,000 shares of common stock, $0.001 par value per share, of which 42,096,160 shares are currently
issued and outstanding. Further, we are authorized to issue up to 10,000,000 shares of Preferred Stock, $0.001 par value per share
of which none are issued and outstanding. Our Board of Directors has the authority to cause us to issue additional shares of common
stock, and to determine the rights, preferences and privileges of our preferred stock, without consent of any of our stockholders.
We may issue either common or preferred stock in connection with financing arrangements or otherwise. Any such issuances will
result in immediate dilution to our existing stockholders’ interests, which will negatively affect the value of your shares.
The
elimination of monetary liability against our existing and future directors, officers and employees under Delaware law and the
existence of indemnification rights to our existing and future directors, officers and employees may result in substantial expenditures
by us and may discourage lawsuits against our directors, officers and employees
.
Our
Certificate of Incorporation contains specific provisions that eliminate the liability of directors for monetary damages to us
and our stockholders; further, we are prepared to give such indemnification to our existing and future directors and officers
to the extent provided by Delaware law. We may also have contractual indemnification obligations under any employment agreements
it may have with our officers and directors. The foregoing indemnification obligations could result in us incurring substantial
expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup.
These provisions and resultant costs may also discourage us from bringing a lawsuit against existing and future directors and
officers for breaches of their fiduciary duties and may similarly discourage the filing of derivative litigation by our stockholders
against our existing and future directors and officers even though such actions, if successful, might otherwise benefit us and
our stockholders.
Absence
of Public Market
There
has never been any established “public market” for shares of our common stock and no assurance can be given that any
market for our common stock will develop or be maintained. If a public market ever develops in the future, the sale of “unregistered”
and “restricted” shares of common stock pursuant to Rule 144 of the Securities Act may adversely affect the market
price, if any, for our shares and could impair our ability to raise capital through the sale of our equity securities. In order
to qualify for the resale of common stock under Rule 144, certain holding periods must be met and either legal opinions setting
forth exemptions from the Securities Act must be provided or registration statements must be in effect relating to such common
stock. Further, there is no assurance that Rule 144 will be applicable to us and investors may not be able to rely on our provisions
now or in the future.
Dividends
Payment
of dividends on the common stock and preferred stock is within the discretion of the Board of Directors, is subject to state law,
and will depend upon our earnings, if any, our capital requirements, financial condition and other relevant factors.
Item
1B. UNRESOLVED STAFF COMMENTS
None.
Item
2. PROPERTIES
We
currently rent an office located at 11501 Dublin Blvd., Suite 200, Dublin, CA 94568, at a yearly rental rate of $1,200. In the
future, we may be required to seek additional office space. We do not foresee any significant difficulties in obtaining any required
space. We currently do not own any real property.
Item
3. LEGAL PROCEEDINGS
From
time to time, we may have disputes that arise in the ordinary course of our business. Currently, there are no material legal proceedings
to which we are a party, or to which any of our property is subject, that we expect to have a material adverse effect on our financial
condition.
Item
4. MINE SAFETY DISCLOSURES
Not
applicable.
PART
II
Item
5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.
Market
for our common stock
There
is currently no public trading market for our common stock and no such market may ever develop.
Approximate
Number of Holders of Our common stock
As
of June 1, 2016, there were approximately 121 stockholders of record of our common stock.
Dividend
Policy
We
have not declared or paid cash dividends. Any future decisions regarding dividends will be made by our Board of Directors. We
currently intend to retain and use any future earnings for the development and expansion of our business and do not anticipate
paying any cash dividends in the foreseeable future.
Issuances
of Unregistered Securities
On
January 6, 2015, as consideration for consulting services provided by a consultant, the Company issued 25,000 shares of our Common
Stock which had a fair market value of $7,500. The shares were issued pursuant to Section 4(2) of the Securities Act, as they
were transactions by an issuer not involving a public offering, no underwriters were used and no commissions were paid.
Securities
Authorized for Issuance under Equity Compensation Plans
We
have no compensation plans under which equity securities are authorized for issuance.
Item
6. SELECTED FINANCIAL DATA
Not
applicable.
Item
7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THE
FOLLOWING DISCUSSION AND ANALYSIS SHOULD BE READ TOGETHER WITH THE CONSOLIDATED FINANCIAL STATEMENTS OF KM WEDDING EVENTS MANAGEMENT,
INC. AND THE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS INCLUDED ELSEWHERE IN THIS ANNUAL REPORT ON FORM 10-K.
Comparison
of Period Ended March 31, 2016 and March 31, 2015
For
the purpose of comparison, conversion of Indian Rupees to USD is done based on the average exchange rate for the period for Income
and Expenditure items and at the closing exchange rate for Balance Sheet items. The financial statements do not include any adjustments
to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should
the Company be unable to continue as a going concern.
Results
of Operations
For
the period from April 1, 2015 to March 31, 2016, the Company had $638,718 ($2,007,916 for the corresponding period in the previous
year) in revenues. The revenue decreased by 68% against the corresponding period in the previous year.
In
terms of revenue mix 90% of the revenues were generated from Matrimonial Services (68% for the corresponding period in the previous
year) and 10% from the Wedding Services (32% for the corresponding period in the previous year).
During
the period from April 1, 2015 to March 31, 2016, the Company incurred $1,615,722 of operating expenses ($1,808,428 for the corresponding
period in the previous year), which included:
|
•
|
Matrimonial Service
expenses of $357,876 ($381,822 for the corresponding period in the previous year) which represents 62% of matrimonial revenues
(increase from 38% for corresponding period in the previous year);
|
|
•
|
Wedding Service
expense of $41,976 ($512,195 for the corresponding period in the previous year) which represents 69% of wedding services revenues
(79% for the corresponding period in the previous year);
|
|
•
|
General and Administrative
expense of $919,772 ($537,783 for the corresponding period in the previous year) which represents 144% of income. These expenses
increased by 71% for the corresponding period in the previous year;
|
|
•
|
Personnel expenses
of $264,031 ($347,404 for the corresponding period in the previous period) representing 41% of income which was at 17% of
income in the corresponding period in the previous year; and
|
|
•
|
Depreciation
and Amortization expenses of $32,067 ($29,624 for the corresponding period in the previous year).
|
For
the period from April 1, 2015 to March 31, 2016, the Company had an operating loss of $977,004 ($198,988 operating income for
the corresponding period in the previous year) and a net loss of $917,857 ($134,518 net income for the corresponding period in
the previous year) and lossper share of $0.0143(compared to earnings per share of $.0010 for prior year).
Liquidity
and Capital Resources
At
March 31, 2016, the Company had cash equivalents of $13,250 ($97,960 in the corresponding period in the previous year). At March
31, 2016, the Company had a working capital deficit (including current portion of long-term debt) of $556,345 (positive working
capital of $370,459 for the corresponding period in the previous year) including:
|
•
|
Account payable
and accrued liabilities relating to accrued interest expense, unpaid professional fees, and unpaid general expenditures of
$270,380 ($190,087 for the corresponding period in the previous year) representing 42% increase from the corresponding period
in the previous year;
|
|
•
|
Statutory liabilities
of $284,554 ($247,731 for the corresponding period in the previous year) representing 15% increase from the corresponding
period in the previous year;
|
|
•
|
Short-term loans
and current portion in long-term debt of $212,544 ($217,843 for the corresponding period in the previous year) representing
a decrease of $5,299;
|
|
•
|
Unsecured loans
of $179,679 ($85,933for the corresponding period in the previous year);
|
|
•
|
Other current liabilities
of $174,375 ($140,796 for the corresponding period in the previous year); and
|
|
•
|
Non-current
liabilities of $260,002 ($300,355 for the corresponding period in the previous year) representing a decrease of $40,353 from
the corresponding period in the previous year.
|
Cash
flows from Operating Activities
During
the period from April 1, 2015 to March 31 2016, for operating activities the Company used cash of $156,429 (cash used of $165,493
for the corresponding period in the previous year).
Cash
flows from Investing Activities
During
the period from April 1, 2015 to March 31 2016, the Company used cash of $8,459 for investing activities (compared to $113,082
cash provided for the corresponding period in the previous year.
Cash
flows from Financing Activities
During
the period from April 1, 2015 to March 31, 2016, the Company obtained cash of $83,735 from financing activities (compared to $66,111
for the corresponding period in the previous year).
Brief
Disclosure of Long Term Contractual Obligations
As
at March 31 2016, the Company has long term debts in the form of secured loans amounting to $265,178 and repayable as under:
|
Less Than One Year
|
$28,092
|
|
One to Three Years
|
$79,770
|
|
More than Three Years
|
$157,316
|
LIQUIDITY
AND CAPITAL RESOURCES
At
March 31, 2016, our working capital deficit was $556,345 and we had $13,250 in cash and cash equivalents. We have evaluated our
expected cash requirements over the next twelve months, and have determined that our existing cash resources are not sufficient
to meet our anticipated needs during the next twelve months, and that additional financing is required to support current operations.
In addition, we anticipate that further additional financing may be required to fund our business plan subsequent to that date,
until such time as revenues and related cash flows become sufficient to support our operating costs.
The
successful implementation of our business plan is dependent upon us receiving sufficient funds from the sale of securities and/or
additional funding from management, the issuance of equity or debt, or through obtaining a credit facility. In additional, substantial
expenditures will be required to enable us to expand and scale up our operations and quality of services. We will require additional
financing from issuance of equity or debt, or through obtaining a credit facility, to execute our plan of operations. Our established
bank-financing arrangements will not be adequate. Although management believes that the additional required funding will be obtained
through the sale of securities, there is no guarantee we will be able to obtain the additional required funds in the future or
that funds will be available on terms acceptable to us, if at all. If such funds are not available, management will be required
to curtail its investments in additional sales and marketing and product development resources, and capital expenditures, which
may have a material adverse effect on our future cash flows and results of operations, and its ability to continue operating as
a going concern.
Critical
Accounting Policies
Our
financial statements and accompanying notes have been prepared in accordance with U.S. generally accepted accounting principles
applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses
during the reporting periods.
We
regularly evaluate the accounting policies and estimates that we use to prepare our financial statements. A complete summary of
these policies is included in the Notes to our audited financial statements. In general, management’s estimates are based
on historical experience, on information from third party professionals, and on various other assumptions that are believed to
be reasonable under the facts and circumstances. Actual results could differ from those estimates made by management.
Recently
Issued Accounting Pronouncements
We
have implemented all new accounting pronouncements that are in effect. These pronouncements did not have any material impact on
the financial statements unless otherwise disclosed, and we do not believe that there are any other new accounting pronouncements
that have been issued that might have a material impact on our financial position or results of operations.
Off-Balance
Sheet Arrangements
We
have no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial
condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital
resources.
Item
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Not
applicable.
Item
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY FINANCIAL DATA
The
full text of our audited consolidated financial statements as of March 31, 2016 begins on page F-2 of this Annual Report on Form
10-K.
Item
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
ITEM
9A. CONTROLS AND PROCEDURES
Disclosure
Controls and Procedures
The
SEC defines the term “disclosure controls and procedures” to mean a company’s controls and other procedures
that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Exchange
Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms. “Disclosure
controls and procedures” include, without limitation, controls and procedures designed to ensure that information required
to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to
the issuer’s management, including our principal executive and principal financial officers, or persons performing similar
functions, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures are
designed to provide reasonable assurance that such information is accumulated and communicated to our management. Our management
(with the participation of our Chief Executive Officer and Chief Financial Officer) has conducted an evaluation of the effectiveness
of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act). Based
on such evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and
procedures were effective at the reasonable assurance level as of the end of the period covered by this report.
Internal
Controls Over Financial Reporting
Management’s
Annual Report on Internal Control over Financial Reporting.
The
management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting.
The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s
principal executiveofficer and principal financial officer to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of the Company’s financial statements for external purposes in accordance with generally
accepted accounting principles. Because of its inherentlimitations, internal control over financial reporting may not prevent
or detect misstatements. All internal control systems, no matter how well designed, have inherent limitations. Therefore,
even those systems determined. to be effective can provide only reasonableassurances with respect to financial statement
preparation and presentation. Additionally, projections of any evaluation of effectiveness to future periods are subject
to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with
the policies or procedures may deteriorate. Our management of the Company is responsible for establishing and maintaining
adequate internal control over financialreporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
Act. As of March 31, 2016, management assessed the effectiveness of the Company’s internal control over financial
reporting based on the criteria for effective internal control over financialreporting established in “Internal Control
— Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (the
COSO criteria). Based on the assessment, management determined that the Company maintained effective internal control over
financial reporting as of March 31, 2016 based on the COSO criteria.
Changes
in Internal Controls over Financial Reporting.
During
the fiscal year ended March 31, 2016, there were no material changes in our internal control over financial reporting identified
in connection with the evaluation performed during the fiscal year covered by this report that has materially affected, or is
reasonably likely to materially affect, our internal control over financial reporting.
Item
9B. OTHER INFORMATION.
None.
PART
III
ITEM
10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
We
currently have three directors on our Board of Directors. There are no arrangements or understandings between any of our directors
and any other person pursuant to which any director was selected to serve as a director of our Company. Directors are elected
until their successors are duly elected and qualified. Ms. Nagarajan, our President, Chief Executive Officer and Director, is
the sister in law of Mr. Mohan, our Chairman. Mr. Bhaskar, our Chief Financial Officer and Director, is the son of Mr. Mohan.
Except as otherwise disclosed in this Form 10-K, there are no family relationships among our directors or Named Executive Officers.
Executive
Officers
The
following table sets forth the names and ages of our current director(s) and Named Executive Officer(s), the principal offices
and positions held by each person and the date such person became a director and/or executive officer. Our Board of Directors
appoints our executive officers who serve at the pleasure of the Board. Our directors serve until the earlier occurrence of the
election of his or her successor at the next meeting of stockholders, death, resignation or removal by the Board of Directors.
Name
|
Age
|
Position
|
T.V.
Mohan
|
66
|
Chairman
and Founder
|
MeeraNagarajan
|
53
|
President,
Chief Executive Officer and Director
|
VenkatesanVijayaBhaskar
|
40
|
CFO
and Director of Technologies and Operation
|
T.V.
Mohan (Formerly known as v. venkatesan).
T.V.
Mohan is the founding member of KM and brings over 30 years of experience in the Matrimonial and Wedding event management business.
He is responsible for the marketing and brand building for the Company. Before starting KM in 2004, he had worked with Binny Mills
from 1971 to 1981 in the accounts department. From 1981 to 1984, he ran his own fast food and ice cream businesses. Since 1984,
Mr. T.V. Mohan has owned a wedding event management firm and has been involved in the coordination of weddings. From 1992 to 2000,
T.V. Mohan was a partner of a TV software export firm, Nataraj Exports Corporation, where he was involved in the production of
TV Series and documentaries related to Indian culture and practice. His TV programs have been telecast over 15 countries across
the globe and have been nominated for the National Pinnacle Award, one of the top awards for TV Serial production in the 80s.
As a result of Mr. T.V. Mohan’s leadership skills and extensive experience in matrimonial services, wedding event management,
and TV production, he was appointed as our Chairman of the Board of Directors on February 15, 2013.
Meera
Nagarajan.
Ms.Nagarajan is the Co-Founder,
Managing Director and CEO of KM and is responsible for the overall management of the business. She is also the editor of Kalyanamalai,
a biweekly magazine owned by KM. Ms. Nagarajan holds a master’s degree in Public Administration, Economics and Hindi (India’s
national language). Before co-founding KM, Ms. Nagarajan was doing freelance writing (since 1990 for leading Tamil magazines including
Kalaimagal, Ananda Vikatan and Kumudam), teaching (from 1984 to 1988 for Vivekananda Vidhyalaya School & Hindu Vidhyalaya
School), and directing various TV Series (since 1993), including ‘Festivals of India,’ a multi-lingual program telecast
in over 10 countries. Currently, Ms. Nagarajan directs only the Kalyanamalai TV program. Ms. Nagarajan was appointed as our Director
and CEO on February 15, 2013 because of her in-depth knowledge of the culture, customs and language of India and her experience
as a writer and TV producer.
Venkatesan
VIJAYABhaskar.
Venkatesan VijayaBhaskar
is
the Chief Financial Officer, and is responsible for Finance and Operations for KM. Mr. Bhaskar supervises the finance unit
and reports directly to the Chief Executive Officer. He assists in all strategic and tactical matters as they relate to business
planning, budgeting, forecasting and securing of new funding.
Mr. Bhaskar was appointed as our Director and Chief
Financial Officer on February 15, 2013.
Mr. Bhaskar also handles the technology for the
Company including automation of operations, online services as well as back office support and services. Prior to joining the
Company, Mr. Bhaskar worked for Info Plus Technologies from 2006 to 2007 as Head of Indian Operations.
Involvement
in Certain Legal Proceedings
During
the past ten years none of our director, executive officer, promoter or control person has been involved in the following:
(1) A
petition under the Federal bankruptcy laws or any state insolvency law which was filed by or against, or a receiver, fiscal agent
or similar officer was appointed by a court for the business or property of such person, or any partnership in which he was a
general partner at or within two years before the time of such filing, or any corporation or business association of which he
was an executive officer at or within two years before the time of such filing;
(2) Such
person was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations
and other minor offenses);
(3) Such
person was the subject of any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining him from, or otherwise limiting, the following activities:
Acting
as a futures commission merchant, introducing broker, commodity trading advisor, commodity pool operator, floor broker, leverage
transaction merchant, any other person regulated by the Commodity Futures Trading Commission, or an associated person of any of
the foregoing, or as an investment adviser, underwriter, broker or dealer in securities, or as an affiliated person, director
or employee of any investment company, bank, savings and loan association or insurance company, or engaging in or continuing any
conduct or practice in connection with such activity;
Engaging
in any type of business practice; or
Engaging
in any activity in connection with the purchase or sale of any security or commodity or in connection with any violation of Federal
or State securities laws or Federal commodities laws;
(4) Such
person was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any Federal or State
authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described
in paragraph (f)(3)(i) of this section, or to be associated with persons engaged in any such activity;
(5) Such
person was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any Federal or State
securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended,
or vacated;
(6) Such
person was found by a court of competent jurisdiction in a civil action or by the Commodity Futures Trading Commission to have
violated any Federal commodities law, and the judgment in such civil action or finding by the Commodity Futures Trading Commission
has not been subsequently reversed, suspended or vacated;
(7) Such
person was the subject of, or a party to, any Federal or State judicial or administrative order, judgment, decree, or finding,
not subsequently reversed, suspended or vacated, relating to an alleged violation of:
Any
Federal or State securities or commodities law or regulation; or
Any
law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent
injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal
or prohibition order; or
Any
law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or
(8) Such
person was the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory
organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in
Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization
that has disciplinary authority over its members or persons associated with a member.
Audit
Committee
Our
Board of Directors has not established a separate audit committee within the meaning of Section 3(a)(58)(A) of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). Instead, the entire Board of Directors acts as the audit committee
within the meaning of Section 3(a)(58)(B) of the Exchange Act and will continue to do so until such time as a separate audit committee
has been established.
Audit
Committee Financial Expert
We
currently have not designated anyone as an “audit committee financial expert,” as defined in Item 407(d)(5) of Regulation
S-K as we have not yet created an audit committee of the Board of Directors.
Nominations
to the Board of Directors
Our
directors take a critical role in guiding our strategic direction and oversee the management of the Company. Board candidates
are considered based upon various criteria, such as their broad-based business and professional skills and experiences, a global
business and social perspective, concern for the long-term interests of the stockholders, diversity, and personal integrity and
judgment.
In
addition, directors must have time available to devote to Board of Directors activities and to enhance their knowledge in the
growing business. Accordingly, we seek to attract and retain highly qualified directors who have sufficient time to attend to
their substantial duties and responsibilities to the Company.
In
carrying out its responsibilities, the Board of Directors will consider candidates suggested by stockholders. If a stockholder
wishes to formally place a candidate’s name in nomination, however, he or she must do so in accordance with the provisions
of our Bylaws. Suggestions for candidates to be evaluated by the proposed directors must be sent to the Board of Directors, c/o
11501 Dublin Blvd., Suite 200, Dublin, California 94568.
Director
Nominations
As
of June 29, 2016, we did not effect any material changes to the procedures by which our shareholders may recommend nominees to
our Board of Directors.
Board’s
Leadership Role in Risk Oversight
Our
Chairman of the Board of Directors is Mr. T V Mohan and our Chief Executive Officer is Ms. MeeraNagarajan. We determined this
leadership structure was appropriate for us due to our small size and current operations. Our Board of Directors will continue
to evaluate our leadership structure and modify as appropriate based on our size, resources and operations. It is anticipated
that our Board of Directors will establish procedures to determine an appropriate role for the Board of Directors in our risk
oversight function.
Compensation
Committee Interlocks and Insider Participation
No
interlocking relationship exists between our Board of Directors and the board of directors or compensation committee of any other
company, nor has any interlocking relationship existed in the past.
Communications
with the Board
We
have a process for stockholders and other interested parties who wish to communicate with the Board of Directors. Stockholders
and other interested parties who wish to communicate with our Board of Directors maycontact our Board of Directors, or specific
members of our Board, by writing to: KM Wedding Events Management, Inc., c/o Board of Directors Office, 11501 Dublin Blvd., Suite
200, Dublin, California 94568.
Section
16(a) Beneficial Ownership Reporting Compliance
Section
16(a) of the Exchange Act requires the directors, executive officers and persons who beneficially own 10% or more of a class of
securities registered under Section 12 of the Exchange Act to file reports of beneficial ownership and changes in beneficial ownership
with the SEC. Directors, executive officers and greater than 10% stockholders are required by the rules and regulations of the
SEC to furnish the Company with copies of all reports filed by them in compliance with Section 16(a). Our securities are not registered
with the SEC under Section 12(b) or 12(g) of the Exchange Act. Accordingly, our officers, directors and beneficial owners of ten
(10) percent or more of any class of stock are not subject to Section 16(a) of the Exchange Act.
Code
of Ethics
Our
Board of Directors has not yet adopted a Code of Ethics that applies to all of our directors, executive officers, including our
principal executive officer, principal financial officer and principal accounting officer, and employees. We intend to adopt a
Code of Ethics that addresses, among other things, honesty and ethical conduct, conflicts of interest, compliance with laws, regulations
and policies, including disclosure requirements under the federal securities laws, confidentiality, trading on inside information,
and reporting of violations of the code. Once adopted, the Code of Ethics will be available on the Corporate Governance page of
our website under the Investor link at www.kmweddingevents.com and a copy of the Code of Ethics will be available to any stockholder
requesting a copy by writing to: KM Wedding Events Management, Inc., c/o Board of Directors,11501 Dublin Blvd., Suite 200, Dublin,
California 94568. Once adopted, we intend to disclose on our website, in accordance with all applicable laws and regulations,
amendments to, or waivers from, our Code of Ethics.
ITEM
11. EXECUTIVE COMPENSATION
Executive
Compensation Summary Compensation Table.
The table set forth below summarizes the annual and long-term compensation payable
to our Named Executive Officers and directors for the fiscal years ended March 31, 2016 and 2015 for services. Our Board of Directors
may adopt an incentive stock option plan for our executive officers that would result in additional compensation. None of our
Named Executive Officers earned compensation that exceeded $100,000 during the fiscal years ended March 31, 2016 and 2015.
Name
|
|
Title
|
|
Year
|
|
Salary
($)
|
|
Bonus
($)
|
|
Stock
Awards
($)
|
|
Option
Awards
($)
|
|
Non-Equity
Incentive
Plan
Compensation
($)
|
|
Nonqualified
Deferred
Compensation
Earnings
($)
|
|
All
other
Compensation
($)
|
|
Total
($)
|
|
T.V.
Mohan
|
|
|
Chairman
and Founder
|
|
|
2016
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
29,453
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
29,453
|
|
|
MeeraNagarajan
|
|
|
President
and Chief Executive Office
|
|
|
2016
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
29,453
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
29,453
|
|
|
Venkatesan
VijayaBhaskar
|
|
|
Chief
Financial Officer, Director of Technologies and Operations
|
|
|
2016
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,668
|
|
|
|
|
|
|
|
|
2015
|
|
|
|
29,453
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
0
|
|
|
|
29,453
|
|
Narrative
Disclosure to Summary Compensation Table
There
are no employment contracts, compensatory plans or arrangements, including payments to be received from the Company with respect
to any executive officer, that would result in payments to such person because of his or her resignation, retirement or other
termination of employment with the Company, or our subsidiaries, any change in control, or a change in the person’s responsibilities
following a change in control of the Company.
Outstanding
Equity Awards at Fiscal Year-End
There
are no current outstanding equity awards to our executive officers as of March 31, 2016.
Long-Term
Incentive Plans
There
are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers.
Compensation
Committee
We
currently do not have a compensation committee of the Board of Directors. The Board of Directors as a whole determines executive
compensation.
Compensation
of Directors
The
compensation paid to our directors for their services on our Board of Directors is set forth above in the Summary Compensation
Table. We currently do not have any non-executive directors.
Security
Holders Recommendations to Board of Directors
Stockholders
can send direct communications to our Chief Executive Officer at our executive offices. However, while we appreciate all comments
from stockholders, we may not be able to individually respond to all communications. We attempt to address stockholder questions
and concerns in our press releases and documents filed with the SEC so that all stockholders have access to information about
us at the same time. Mr. Mohan collects and evaluates all stockholder communications. All communications addressed to our directors
and executive officers will be reviewed by those parties unless the communication is clearly frivolous.
Director
Independence
We
currently do not have any directors that qualify as an independent director in accordance with the published listing requirements
of the NASDAQ Global Market.The NASDAQ independence definition includes a series of objective tests, such as that the director
is not, and has not been for at least three years, one of our employees and that neither the director, nor any of his family members,
has engaged in various types of business dealings with us. In addition, our Board of Directors has not made a subjective determination
as to each director that no relationships exist which, in the opinion of our Board of Directors, would interfere with the exercise
of independent judgment in carrying out the responsibilities of a director, though such subjective determination is required
by the NASDAQ rules. Had our Board of Directors made these determinations, our Board of Directors would have reviewed and discussed
information provided by the director with regard to his or her business and personal activities and relationships as they may
relate to the Company and our management.
Committees
We
do not currently have an audit, compensation or nominating committee. The Board of Directors as a whole currently acts as our
audit, compensation and nominating committees. We intend to establish an audit, compensation and nominating committee of our Board
of Directors once we expand the Board of Directors to include one or more independent directors and intend to adopt a charter
for each committee.
Our
audit committee will be primarily responsible for reviewing the services performed by our independent auditors, evaluating our
accounting policies and our system of internal controls. Our compensation committee will assist the Board in reviewing and approving
the compensation structure, including all forms of compensation, relating to our directors and executive officers and periodically
reviewing and approving any long-term incentive compensation or equity plans, programs or similar arrangements. Our nominating
committee will assist the Board in selecting individuals qualified to become our directors and in determining the composition
of the Board and our committees.
ITEM
12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
Security
Ownership of Certain Beneficial Owners and Management
The
following table sets forth certain information at June 10, 2016, with respect to the beneficial ownership of shares of common
stock by (i) each person known to us who owns beneficially more than 5% of the outstanding shares of common stock (based upon
reports which have been filed and other information known to us), (ii) each of our Directors, (iii) each of our Executive Officers,
and (iv) all of our Named Executive Officers and Directors as a group. Unless otherwise indicated, each stockholder has sole voting
and investment power with respect to the shares shown. Unless otherwise specified, the address of each of the persons set forth
below is c/o KM Wedding Events Management, Inc., 11501 Dublin Blvd., Suite 200, Dublin, CA 94568. As of June 10, 2016, we had
42,096,160 shares of common stock issued and outstanding.
Title
of class
|
Name
and address of
beneficial
owner
|
Amount
and Nature of Beneficial Ownership
|
Percentage
of common stock
(1)
|
common
stock
|
T.V.
Mohan (formerly known as V. Venkatesan)
|
16,200,000
|
38.48
%
|
common
stock
|
MeeraNagarajan
|
5,400,000
|
12.83%
|
common
stock
|
Venkatesan
VijayaBhaskar
|
1,350,000
|
3.21%
|
Officers
and Directors as a Group (3)
|
22,950,000
|
54.52%
|
common
stock
|
Unifina
Capital Partners LP
|
6,000,000
|
14.25%
|
_______________________
(1)
Under
Rule 13d-3 promulgated under the Exchange Act, a beneficial owner of a security includes any person who, directly or indirectly,
through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the
power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the
disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons
share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person
if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which
the information is provided. In computing the percentage ownership of any person, the amount of shares is deemed to include the
amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights.
Changes
in Control
We
are not aware of any arrangements that could result in a change of control.
Equity
Compensation Plan Information
We
have no compensation plans under which equity securities are authorized for issuance.
ITEM
13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
.
Related
Party Transactions
During
the last quarter ended March 31, 2015, the Company, its directors and relatives of directors have availed a term loan on a joint
and several liability basis for an amount of $715,521. The Company’s liability has been initially recognized in the financial
statements at $275,989 under secured loans. The personal property of the directors has been provided as security for availing
the said loan. The loan is repayable in 120 equated monthly instalments and carries interest at the base rate plus a margin of
1.75%. The loan arrangement has been approved by the Board of Directors, as provided by Board resolution dated January 12, 2015
and a Memorandum of Understanding has been entered into between the Company and its co-obligors. The total outstanding amount
as at March 31, 2016 and March 31, 2015 towards this debt arrangement is $643,177 and $723,746 respectively.. The carrying amount
of the Company’s liability as at March 31, 2016 and March 31, 2015 is $249,347 and $279,261 respectively..
At
March 31, 2016 and 2015, we had loans payable to related parties in the amount of $179,679 (net) and $85,933 (net), respectively.
We do not have signed notes with the related party lenders, there are no specific due dates, and no interest is paid on the loans.
Money is loaned to us mainly for cash flow purposes. The amounts loaned and borrowed are short-term in nature and the balances
at both year-ends are considered at the fair market value of the amounts owed.
On
February 14, 2013, KM entered into a Stock Purchase Agreement with KM Wedding Event Management Private Limited (formerly known
as KM Matrimony Pvt Ltd,) a company incorporated under the 1956 Companies Act of India (“KM India”), pursuant to which
KM agreed to purchase ten million (10,000,000) shares of KM India’s common stock at a price of 11 Indian Rupees ($0.21 )
per share for an aggregate purchase price of up to two million one hundred thousand dollars ($2,100,000 ). As of July 6, 2015,
pursuant to the above agreement, KM has purchased 1,393,127 shares at 11 Rupees per share ($0.201 at the time of the sale) in
KM India on April 3, 2013 for $280,000.
On
February 14, 2013, KM entered into a Stock Purchase Agreement with the shareholders of KM India, comprised of Mr. Venkatesan Vaidhyanathan
(now Known as T.V. Mohan), Mrs. MeeraNagarajan, Mr. Sridhar Kalyanasundaram, Mr. Venkatesan VijayaBhaskar and Mrs. NithyaVijayaBaskar,
pursuant to which KM shall purchase Three Million One Hundred and Fifty Thousand (3,150,000) shares of KM India’s common
stock from Mr. Venkatesan Vaidhyanathan, Mrs. MeeraNagarajan, Mr. Sridhar Kalyanasundaram, Mr. Venkatesan VijayaBhaskar and Mrs.
NithyaVijayaBaskar payable in two tranches as follows: (i) Tranche A: One Million One Hundred Fifty Thousand (1,150,000) shares
of KM India’s common stock at a purchase price of 11 Indian Rupees ($0.21 ) per share (“Tranche A”); and, (ii)
Tranche B: Two Million (2,000,000) shares of KM India’s common stock at a purchase price equal to the fair market value
of KM India’s shares at the time of purchase (“Tranche B”). As of July 6, 2015, KM has purchased 1,120,018 shares
in KM India on April 26, 2013 from Tranche A for an aggregate of $229,000 from two of the shareholders of KM India via Mr. Venkatesan
Vaidhyanathan (562,455 shares for $115,000 ) and Mrs. MeeraNagarajan (557,564 shares for $114,000 ). The remaining Tranche A shares
and the Tranche B shares have to be sold within three (3) years from February 14, 2013.
ITEM
14. PRINCIPAL ACCOUNTING FEES AND SERVICES
.
Our
Board of Directors is responsible for the selection of our independent registered public accounting firm. The Board of Directors
has determined to appoint the public accounting firm of Manohar Chowdhry& Associates (“MCA”) as our independent
registered public accountant, to audit our financial statements for the fiscal years ending March 31, 2016 and 2015. The following
table sets forth the aggregate fees billed by MCA for audit and non-audit services rendered to us in 2016 and 2015. These fees
are categorized as audit fees, audit-related fees, tax fees, and all other fees. The nature of the services provided in each category
is described following the table.
|
|
|
2016
|
|
|
|
2015
|
|
Audit
Fees
|
|
$
|
10,124
|
|
|
$
|
8,330
|
|
Audit-Related
Fees
|
|
|
0
|
|
|
|
0
|
|
Tax
Fees
|
|
|
0
|
|
|
|
0
|
|
Total
Fees
|
|
$
|
10,124
|
|
|
$
|
8,330
|
|
Audit
Fees.
Audit fees are the aggregate fees billed for professional services rendered by our independent auditors for the audit
of our annual financial statements, the review of the financial statements included in each of our quarterly reports and services
provided in connection with statutory and regulatory filings or engagements.
Audit-Related
Fees.
Audit related fees are the aggregate fees billed by our independent auditors for assurance and related services that
are reasonably related to the performance of the audit or review of our financial statements and are not described in the preceding
category.
Tax
Fees.
Tax fees are billed by our independent auditors for tax compliance, tax advice and tax planning
All
Other Fees
.
All other fees include fees billed by our independent auditors for products or services other than as described
in the immediately preceding three categories.
Board
of Directors Approval Policies and Procedures
The
Company’s Board of Directors serves as the Audit Committee and has unanimously approved all audit and non-audit services
provided by the independent auditors. The independent accountants and management are required to periodically report to the Board
of Directors regarding the extent of services provided by the independent accountants, and the fees for the services performed
to date. The Company has not adopted a Charter for the Audit Committee as of March 31, 2016.
PART
IV
Item
15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
(a)
(1 and 2)
Financial Statement and Schedules
The
financial statements contained in the “Audited Financial Statements” begin on page F-2 of this Annual Report on Form
10-K.
(b)
Exhibits
3.1
|
Certificate
of Incorporation of KM Wedding Events Management, Inc.
(1)
|
3.2
|
Bylaws of KM Wedding
Events Management, Inc.
(1)
|
10.1
|
Agreement between
KM India and SUN TV dated March 31, 2008
(2)
|
10.2
|
Stock Purchase
Agreement between KM India and the Company dated February 14, 2013
(2)
|
10.3
|
Stock Purchase
Agreement among the Company and VenkatesanVaidhyanathan, MeeraNagarajan, Sridhar Kalyanasundaram, VijayaBhaskar Venkatesan
&NithyaVijayaBaskar dated February 14, 2013
(2)
|
10.4
|
Lease Agreement
(3)
|
10.5
|
Termination
Agreement
(4)
|
21.1
|
List of Subsidiaries
(1)
|
23.1
|
Auditor Consent
*
|
31.1
|
Certifications
of the Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act.*
|
31.2
|
Certifications
of the Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act.*
|
32.1
|
Certifications
of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act.*
|
32.2
|
Certifications
of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act.*
|
|
|
101.INS
|
XBRL Instance Document
*
|
101.SCH
|
XBRL Taxonomy Extension
Schema
*
|
101.CAL
|
XBRL Taxonomy Extension
Calculation Linkbase
*
|
101.DEF
|
XBRL Taxonomy Extension
Definition Linkbase
*
|
101.LAB
|
XBRL Taxonomy Extension
Label Linkbase
*
|
101.FRE
|
XBRL Taxonomy Extension
Presentation Linkbase
*
|
|
(1)
|
Incorporated
by reference to Registration Statement on Form S-1 filed with the SEC on November 18, 2013.
|
|
(2)
|
Incorporated by
reference to Registration Statement on Form S-1/A Filed with the SEC on January 21, 2014.
|
|
(3)
|
Incorporated by reference to Form 10-K filed
with the SEC on July 13, 2015
|
|
(4)
|
Incorporated by reference to Form 10-Q filed
with the SEC on November 23, 2015.
|
SIGNATURES
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
|
KM WEDDING EVENTS MANAGEMENT,
INC.
|
|
|
Date: July 14, 2016
|
By:
/s/ Meera Nagarajan
|
|
Meera Nagarajan, Chief Executive Officer
|
Pursuant
to the requirements of the Securities Exchange Act of 1934, this annual report has been signed by the following persons in the
capacities and on the dates indicated.
Signature
|
Title
|
Date
|
|
|
|
|
|
|
|
President, Director
and
|
July 14, 2016
|
|
Chief Executive Officer
|
|
/s/
Meera Nagarajan
|
(Principal Executive
Officer)
|
|
Meera Nagarajan
|
|
|
|
|
|
|
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial
Officer and
|
|
/s/
Venkatesan VijayaBhaskar
|
Principal
Accounting Officer) and Director
|
July
14, 2016
|
Venkatesan VijayaBhaskar
|
|
|
|
|
|
|
|
|
/s/
T V Mohan
|
Director
|
July 14, 2016
|
T V Mohan
|
|
|
|
|
|
|
|
|
KM
WEDDING EVENTS MANAGEMENT, INC.
(A
Development Stage Company)
Index
to Consolidated Financial Statements
For
the period ended March 31, 2016
Index
|
Page
|
Report
of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated
Balance Sheets
|
F-3
|
Consolidated
Statement of Income
|
F-4
|
Consolidated
Statement of Changes in Equity
|
F-5
|
Consolidated
Statement of Comprehensive Income
|
F-6
|
Consolidated
Statement of Cash Flow
|
F-8
|
Notes
to the Consolidated Financial Statements
|
F-9
|
KM Wedding
Events Management, Inc
|
Consolidated Balance Sheets
|
(in US Dollars $ unless otherwise
stated)
|
|
|
|
|
As
at March 31,
|
|
|
Notes
|
|
2016
|
|
2015
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
|
3
|
|
|
|
13,250
|
|
|
|
97,960
|
|
Accounts
receivable
|
|
|
4
|
|
|
|
448,809
|
|
|
|
551,575
|
|
Other
current assets
|
|
|
5
|
|
|
|
103,128
|
|
|
|
603,314
|
|
Total
current assets
|
|
|
|
|
|
|
565,187
|
|
|
|
1,252,849
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
Property,
plant and equipment, net
|
|
|
6
|
|
|
|
102,387
|
|
|
|
124,073
|
|
Intangible
assets, net
|
|
|
7
|
|
|
|
12,530
|
|
|
|
22,465
|
|
Goodwill
|
|
|
22
|
|
|
|
762,235
|
|
|
|
685,007
|
|
Film
costs
|
|
|
25
|
|
|
|
3,337
|
|
|
|
12,289
|
|
Deferred
tax assets, net
|
|
|
|
|
|
|
61,032
|
|
|
|
4,066
|
|
Other
non-current assets
|
|
|
8
|
|
|
|
63,459
|
|
|
|
97,903
|
|
Total
non-current assets
|
|
|
|
|
|
|
1,004,980
|
|
|
|
945,803
|
|
Total
assets
|
|
|
|
|
|
|
1,570,167
|
|
|
|
2,198,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts
payable and accrued liabilities
|
|
|
9
|
|
|
|
270,380
|
|
|
|
190,087
|
|
Statutory
liabilities
|
|
|
10
|
|
|
|
284,554
|
|
|
|
247,731
|
|
Short-term
loans & current portion of long-term debt
|
|
|
11
|
|
|
|
212,544
|
|
|
|
217,843
|
|
Unsecured
loans from related parties, net of advances
|
|
|
21
|
|
|
|
179,679
|
|
|
|
85,933
|
|
Other
current liabilities
|
|
|
13
|
|
|
|
174,375
|
|
|
|
140,796
|
|
Total
current liabilities
|
|
|
|
|
|
|
1,121,532
|
|
|
|
882,390
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current
liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
12
|
|
|
|
237,086
|
|
|
|
279,943
|
|
Other
non-current liabilities
|
|
|
15
|
|
|
|
22,916
|
|
|
|
20,412
|
|
Total
non-current liabilities
|
|
|
|
|
|
|
260,002
|
|
|
|
300,355
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock par
value $0.001
|
|
|
|
|
|
|
|
|
|
|
|
|
(shares outstanding:
42,096,160
|
|
|
|
|
|
|
|
|
|
|
|
|
as at March 31,
2016 and March 31, 2015)
|
|
|
16
|
|
|
|
42,096
|
|
|
|
42,096
|
|
Additional
paid-in capital
|
|
|
|
|
|
|
1,165,712
|
|
|
|
1,165,712
|
|
Accumulated
deficit
|
|
|
|
|
|
|
(749,919
|
)
|
|
|
(228,981
|
)
|
Equity
attributable to equity holders of the Company
|
|
|
|
|
|
|
457,889
|
|
|
|
978,827
|
|
Non-controlling
interest
|
|
|
|
|
|
|
(269,256
|
)
|
|
|
37,080
|
|
Total
equity
|
|
|
|
|
|
|
188,633
|
|
|
|
1,015,907
|
|
Total
liabilities and equity
|
|
|
|
|
|
|
1,570,167
|
|
|
|
2,198,652
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part to these consolidated financial statements.
|
For
and on behalf of the Board of Directors
|
of
KM Wedding Events Management, Inc
|
|
MEERA
NAGARAJAN V. VIJAYA BHASKAR
|
Managing
Director Director
|
Place
: Chennai, Tamil Nadu, India
|
Date :
July 13, 2016
|
See
accompanying notes to the consolidated financial statements
KM Wedding
Events Management, Inc
|
Consolidated Statements of Income
|
(in US Dollars $ unless otherwise
stated)
|
|
|
|
|
For
the year ended March 31,
|
|
|
Notes
|
|
2016
|
|
2015
|
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
Matrimonial
service income
|
|
|
17
|
|
|
|
577,779
|
|
|
|
1,000,884
|
|
Wedding
event management income
|
|
|
|
|
|
|
38,896
|
|
|
|
651,788
|
|
Wedding
infrastructure lease income
|
|
|
|
|
|
|
22,043
|
|
|
|
—
|
|
Sale
of rights
|
|
|
|
|
|
|
—
|
|
|
|
355,244
|
|
Total
|
|
|
|
|
|
|
638,718
|
|
|
|
2,007,916
|
|
Costs
and expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Matrimonial
service expenses
|
|
|
18
|
|
|
|
357,876
|
|
|
|
381,922
|
|
Wedding
event management expenses
|
|
|
|
|
|
|
32,058
|
|
|
|
512,195
|
|
Wedding
infrastructure maintenance expenses
|
|
|
|
|
|
|
9,918
|
|
|
|
—
|
|
Personnel
expenses
|
|
|
|
|
|
|
264,031
|
|
|
|
347,404
|
|
General
and administrative expenses
|
|
|
19
|
|
|
|
919,772
|
|
|
|
537,783
|
|
Depreciation
and amortization
|
|
|
|
|
|
|
32,067
|
|
|
|
29,624
|
|
Total
|
|
|
|
|
|
|
1,615,722
|
|
|
|
1,808,928
|
|
Operating
income/(loss)
|
|
|
|
|
|
|
(977,004
|
)
|
|
|
198,988
|
|
Other
income/(expenses)
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign
exchange gain/(loss)
|
|
|
|
|
|
|
16,530
|
|
|
|
10,901
|
|
Interest
income
|
|
|
|
|
|
|
—
|
|
|
|
7,756
|
|
Provision
no longer required written back
|
|
|
|
|
|
|
43,484
|
|
|
|
—
|
|
Finance
charges
|
|
|
|
|
|
|
(89,217
|
)
|
|
|
(66,254
|
)
|
Total
other income/(expenses), net
|
|
|
|
|
|
|
(29,203
|
)
|
|
|
(47,597
|
)
|
Income/(loss)
before income tax expense
|
|
|
|
|
|
|
(1,006,207
|
)
|
|
|
151,391
|
|
Income
taxes
|
|
|
|
|
|
|
88,350
|
|
|
|
(16,873
|
)
|
Net
income/(loss)
|
|
|
|
|
|
|
(917,857
|
)
|
|
|
134,518
|
|
Attributable
to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
holders of the Company
|
|
|
|
|
|
|
(602,141
|
)
|
|
|
41,934
|
|
Non-controlling
interest
|
|
|
|
|
|
|
(315,716
|
)
|
|
|
92,584
|
|
Net
income/(loss)
|
|
|
|
|
|
|
(917,857
|
)
|
|
|
134,518
|
|
Earnings/(loss)
per share - basic and diluted
|
|
|
20
|
|
|
|
(0.0143
|
)
|
|
|
0.0010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part to these consolidated financial statements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
and on behalf of the Board of Directors
|
|
|
|
|
|
|
|
|
|
|
|
|
of
KM Wedding Events Management, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MEERA
NAGARAJAN V. VIJAYA BHASKAR
|
|
|
|
|
|
|
|
|
|
|
|
|
Managing
Director Director
|
|
|
|
|
|
|
|
|
|
|
|
|
Place
: Chennai, Tamil Nadu, India
|
|
|
|
|
|
|
|
|
|
|
|
|
Date :
July 13, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to the consolidated financial statements
KM
Wedding Events Management, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
Statement of Changes in Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
US Dollars $ unless otherwise stated)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number
of shares
|
|
|
|
Common
stock
|
|
|
|
Additional paid-in
capital
|
|
|
|
Accumulated
deficit
|
|
|
|
Equity
attributable to equity holders of the company
|
|
|
|
Non
- controlling interest
|
|
|
|
Total
equity
|
|
Balance
as at March 31, 2014
|
|
|
41,646,160
|
|
|
|
41,646
|
|
|
|
1,031,162
|
|
|
|
(268,403
|
)
|
|
|
804,405
|
|
|
|
(53,710
|
)
|
|
|
750,695
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fresh
issue of equity shares
|
|
|
450,000
|
|
|
|
450
|
|
|
|
134,550
|
|
|
|
—
|
|
|
|
135,000
|
|
|
|
—
|
|
|
|
135,000
|
|
Net
income / (loss) for the period
[After adjusting Comprehensive Income/(Loss)]
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
39,422
|
|
|
|
39,422
|
|
|
|
90,790
|
|
|
|
130,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
as at March 31, 2015
|
|
|
42,096,160
|
|
|
|
42,096
|
|
|
|
1,165,712
|
|
|
|
(228,981
|
)
|
|
|
978,827
|
|
|
|
37,080
|
|
|
|
1,015,907
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
as at March 31, 2015
|
|
|
42,096,160
|
|
|
|
42,096
|
|
|
|
1,165,712
|
|
|
|
(228,981
|
)
|
|
|
978,827
|
|
|
|
37,080
|
|
|
|
1,015,907
|
|
Adjustment
on account of Goodwill
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
68,073
|
|
|
|
68,073
|
|
|
|
—
|
|
|
|
68,073
|
|
Net
income / (loss) for the period
[After adjusting Comprehensive Income/(Loss)]
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(589,011
|
)
|
|
|
(589,011
|
)
|
|
|
(306,336
|
)
|
|
|
(895,347
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance
as at March 31, 2016
|
|
|
42,096,160
|
|
|
|
42,096
|
|
|
|
1,165,712
|
|
|
|
(749,919
|
)
|
|
|
457,889
|
|
|
|
(269,256
|
)
|
|
|
188,633
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part to these consolidated financial statements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For
and on behalf of the Board of Directors
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
of
KM Wedding Events Management, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MEERA
NAGARAJAN V. VIJAYA BHASKAR
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managing
Director Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Place
: Chennai, Tamil Nadu, India
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date :
July 13, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to the consolidated financial statements
KM
Wedding Events Management, Inc
|
|
|
|
|
Consolidated Statements
of Comprehensive Income
|
|
|
|
|
(in US Dollars $ unless
otherwise stated)
|
|
|
|
|
|
|
For
the year ended March 31,
|
|
|
2016
|
|
2015
|
|
|
|
|
|
Net
income/(loss)
|
|
|
(917,857
|
)
|
|
|
134,518
|
|
|
|
|
|
|
|
|
|
|
Foreign
currency translation gain/(loss)
|
|
|
22,510
|
|
|
|
(4,306
|
)
|
|
|
|
|
|
|
|
|
|
Total
other comprehensive income/(loss)
|
|
|
22,510
|
|
|
|
(4,306
|
)
|
|
|
|
|
|
|
|
|
|
Attributable
to:
|
|
|
|
|
|
|
|
|
Equity
holders of the Company
|
|
|
13,130
|
|
|
|
(2,512
|
)
|
Non-controlling
interest
|
|
|
9,380
|
|
|
|
(1,794
|
)
|
|
|
|
|
|
|
|
|
|
Comprehensive
income/(loss)
|
|
|
(895,347
|
)
|
|
|
130,212
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part to these consolidated financial statements.
|
|
|
|
|
|
|
|
|
|
For
and on behalf of the Board of Directors
|
|
|
|
|
|
|
|
|
of
KM Wedding Events Management, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MEERA
NAGARAJAN V. VIJAYA BHASKAR
|
|
|
|
|
|
|
|
|
Managing
Director Director
|
|
|
|
|
|
|
|
|
Place
: Chennai, Tamil Nadu, India
|
|
|
|
|
|
|
|
|
Date :
July 13, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See
accompanying notes to the consolidated financial statements
KM Wedding Events
Management, Inc
|
|
|
|
|
Consolidated Statements of Cash Flow
|
|
|
|
|
(in US Dollars $ unless otherwise stated)
|
|
|
|
|
|
|
For
the year ended March 31,
|
|
|
2016
|
|
2015
|
Cash
flows from operating activities
|
|
|
|
|
|
|
|
|
Net
income/(loss)
|
|
|
(917,857
|
)
|
|
|
134,518
|
|
Adjustments
to reconcile net income to net cash
|
|
|
|
|
|
|
|
|
provided
by operating activities
|
|
|
|
|
|
|
|
|
Depreciation
and amortization
|
|
|
32,067
|
|
|
|
29,624
|
|
Business
promotion expenses
|
|
|
—
|
|
|
|
75,000
|
|
Deferred
tax expense
|
|
|
(58,962
|
)
|
|
|
(35,831
|
)
|
Unrealized
foreign exchange (gain)/loss
|
|
|
(16,318
|
)
|
|
|
(9,764
|
)
|
Bad
debts
|
|
|
81,012
|
|
|
|
47,157
|
|
Amortization
of film costs
|
|
|
35,990
|
|
|
|
19,209
|
|
|
|
|
|
|
|
|
|
|
Changes
in operating assets and liabilities
|
|
|
|
|
|
|
|
|
(Increase)/Decrease
in accounts receivable
|
|
|
17,746
|
|
|
|
(322,616
|
)
|
(Increase)/Decrease
in other current assets
|
|
|
481,416
|
|
|
|
(112,286
|
)
|
(Increase)/Decrease
in film costs
|
|
|
(27,518
|
)
|
|
|
(12,529
|
)
|
(Increase)/Decrease
in other non-current assets
|
|
|
29,499
|
|
|
|
(64,108
|
)
|
Increase/(Decrease)in
accounts payable and accrued liabilities
|
|
|
86,822
|
|
|
|
73,386
|
|
Increase/(Decrease)
in statutory liabilities
|
|
|
53,136
|
|
|
|
119,563
|
|
Increase/(Decrease)
in other current liabilities
|
|
|
42,238
|
|
|
|
(109,137
|
)
|
Increase/(Decrease)
in other non-current liabilities
|
|
|
3,851
|
|
|
|
2,321
|
|
Net
cash provided by/(used in) operating activities
|
|
|
(156,878
|
)
|
|
|
(165,493
|
)
|
|
|
|
|
|
|
|
|
|
Cash
flows from investing activities
|
|
|
|
|
|
|
|
|
Additions
to property, plant and equipment
|
|
|
(8,459
|
)
|
|
|
(19,457
|
)
|
Redemption/Investments
in long-term investments
|
|
|
—
|
|
|
|
132,539
|
|
Net
cash provided by/(used in) investing activities
|
|
|
(8,459
|
)
|
|
|
113,082
|
|
See
accompanying notes to the consolidated financial statements
Cash
flows from financing activities
|
|
|
|
|
|
|
|
|
Proceeds
from/(repayment of) short term debts
|
|
|
110,747
|
|
|
|
(258,826
|
)
|
Proceeds
from issue of Equity Shares
|
|
|
—
|
|
|
|
60,000
|
|
Proceeds
from/(repayment of) long term debts
|
|
|
(27,012
|
)
|
|
|
264,937
|
|
Net
cash provided by financing activities
|
|
|
83,735
|
|
|
|
66,111
|
|
Effect
of exchange rate changes on cash
|
|
|
(3,108
|
)
|
|
|
(4,356
|
)
|
Net
increase in cash and cash equivalents
|
|
|
(84,710
|
)
|
|
|
9,344
|
|
Cash
and cash equivalents at beginning of the year
|
|
|
97,960
|
|
|
|
88,616
|
|
Cash
and cash equivalents at end of the year
|
|
|
13,250
|
|
|
|
97,960
|
|
|
|
|
|
|
|
|
|
|
Supplementary
disclosures of cash flow information
|
|
|
|
|
|
|
|
|
Cash
paid during the year for:
|
|
|
|
|
|
|
|
|
Interest
paid
|
|
|
89,217
|
|
|
|
66,254
|
|
Income
taxes paid
|
|
|
10,867
|
|
|
|
18,808
|
|
|
|
|
|
|
|
|
|
|
Non-cash
items:
|
|
|
|
|
|
|
|
|
Allotment
of common stock
|
|
|
—
|
|
|
|
75,000
|
|
|
|
|
|
|
|
|
|
|
The
accompanying notes are an integral part to these consolidated financial statements.
|
|
|
|
|
|
|
|
|
|
For
and on behalf of the Board of Directors
|
|
|
|
|
|
|
|
|
of
KM Wedding Events Management, Inc
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MEERA
NAGARAJAN V. VIJAYA BHASKAR
|
|
|
|
|
|
|
|
|
Managing
Director Director
|
|
|
|
|
|
|
|
|
Place
: Chennai, Tamil Nadu, India
|
|
|
|
|
|
|
|
|
Date :
July 13, 2016
|
|
|
|
|
|
|
|
|
See
accompanying notes to the consolidated financial statements
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
1.
General
KM
Wedding Events Management, Inc ('the Company') was incorporated on October 24, 2012 in the state of Delaware, United States
of America.
The
Company is a leading service provider in the matrimonial industry and entered in to wedding event management and allied services
segments including wedding catering services through its subsidiary (KM Wedding Events Management Private Limited formerly known
as "KM Matrimony Private Limited", India) in Tamil Nadu, India. As at March 31, 2016, the Company maintains a 58.33%
ownership interest in KM Wedding Events Management Private Limited, India. The Company became one of the earliest entrants in the industry to provide an integrated wedding service
in Tamil Nadu, India.
2.
Significant accounting policies
a.
Basis of consolidation
The
Company has invested $569,000 to acquire 2,841,398 equity shares of KM Wedding Events Management Private Limited, India. Subsequent
to this investment, KM Wedding Events Management Private Limited, India has become subsidiary of this Company. The agreement for
such acquisition was entered in the month of February 2013 and executed in the month of April 2013.
b.
Form and Content of the Financial Statements
The
Company maintains its books and records in accordance with generally accepted accounting policies in USA (“US GAAP”).
The accompanying financial statements were derived from the Company’s statutory books and records. The financial statements
are presented in US Dollars ($), the national currency of USA.
Revenue
and related expenses generated from our international subsidiary is generally denominated in the currency of Indian Rupee (Rs.).
The statement of income of our international subsidiary is translated into U.S. dollars at exchange rates indicative of market
rates during each applicable period.
Subsequent
events have been evaluated through July 13, 2016, the date these financial statements were issued.
The
closing exchange rate as at March 31, 2016 and March 31, 2015 was Rs. 66.25 and Rs. 62.31 to $1 respectively. The average exchange
rate for the year ended March 31, 2016 was Rs. 64.28 to $1.
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
c
.
Management Estimates
The
preparation of the financial statements in conformity with US GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities as well as the amounts of revenues and expenses recognized during the period.
Management believes it has a reasonable and appropriate basis for its judgment pertaining to its estimates and assumptions. However,
actual results could differ from those estimates.
d.
Comprehensive Loss
The
Company's other comprehensive loss consists of unrealized gains(losses) on foreign currency translation adjustments.
e.
Cash and cash equivalents
Cash
represents cash on hand and balances with banks in current accounts.
f.
Accounts receivable
Accounts
receivable are unsecured and are stated at their principal amounts outstanding. The Company writes off accounts receivable based
on its age and collectability.
g.
Inventories
Inventories
are valued at lower of cost and net realisable value. Cost is determined using weighted average method.
h.
Property, plant and equipment
Property,
plant and equipment are stated at historical cost, net of accumulated depreciation. The cost of maintenance, repairs and replacement
of minor items of property is charged to operating expenses. Renewals and betterments of assets are capitalized.
Upon
sale or retirement of property, plant and equipment, the cost and related accumulated depreciation are eliminated from the accounts.
Any resulting gains or losses are included in the statement of income. All assets are periodically reviewed for possible impairment
losses.
i.
Intangible assets
Intangible
assets acquired separately are measured at cost of acquisition. Following initial recognition, intangible assets are carried at
cost less any accumulated amortization and impairment losses, if any.
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
j.
Depreciation and amortization
Depreciation
with respect to property, plant and equipment and amortization with respect to amortizable intangible assets is computed using
the straight line method over the estimated useful lives.
Depreciation
and amortization rates are applied to groups of assets with similar economic characteristics, as shown below:
Asset
Group
|
|
Estimated
Useful Life
|
Property,
plant and equipment
|
|
|
Vehicles
|
|
11
years
|
Computers
& peripherals
|
|
6 years
|
Furniture
and Fixtures
|
|
10
years
|
Office
Equipments
|
|
7
years
|
Leasehold
improvements
|
|
10
years
|
Plant
& Machinery
|
|
5
years
|
Intangible
assets
|
|
|
Software
|
|
3-6
years
|
k.
Goodwill
Goodwill
represents excess of purchase price over fair value of the net tangible and intangible assets acquired in a business combination.
Goodwill is not amortized, but it is tested for impairment at least annually or more frequently if events or changes in circumstances
indicate that the assets may be impaired. The Company’s impairment test is based on a single operating unit or reporting
unit structure. The goodwill impairment test involves two step processes. The first step involves comparing the fair value of
the Company’s reporting unit to its carrying value, including goodwill. If the carrying value of the reporting unit exceeds
its fair value, the second step of the test is performed by comparing the carrying value of the goodwill in the reporting unit
to its implied fair value. An impairment charge is recognized for the excess of the carrying value of goodwill over its implied
fair value.
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
l.
Income Taxes
The
major tax jurisdictions for the Company are United States of America and India. The Company offsets current tax assets and current
tax liabilities, where it has legally enforceable right to set off the recognized amounts and where it intends either to settle
on a net basis.
Deferred
tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements
carrying amounts of assets and liabilities and their respective tax bases, operating loss carry forwards and tax credits. Deferred
tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. A valuation allowance for a deferred tax asset is recorded when
management believes that it is more likely than not that this tax asset will not be realized. The effect on deferred tax assets
and liabilities of a change in tax rates is recognized in the Statements of Income in the period of change.
The
Company accounts for interest and penalties related to income taxes in the statement of income as part of income taxes.
m.
Employee benefits
Provident
fund (defined contribution plan)
In
accordance with Indian law, all employees are entitled to receive benefits under the provident fund scheme, which is a defined
contribution plan. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (presently
12%) of the employees' basic salary. The Company has no further obligations under the plan beyond its monthly contributions. These
contributions are made to fund administered and managed by the Government of India. The monthly contributions are charged to the
statement of income in the year they are incurred.
Employees
state insurance fund (defined contribution plan)
In
addition to the above benefit, all employees who are drawing gross salary of less than Rs. 15,000 per month are entitled to receive
benefit under employee state insurance fund scheme. The employer makes contribution to the scheme at a predetermined rate (presently
4.75%) of employee's gross salary to the ESI Corporation. There are no further obligations under the scheme beyond
its monthly contributions. The monthly contributions are charged to the statement of income in the year they are incurred.
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
Gratuity
plan (defined benefit plan)
In
addition to the above benefits, the Company provides for a gratuity obligation, a defined benefit retirement plan (the "Gratuity
Plan") covering all its employees in India. The Gratuity Plan provides a lump sum payment to vested employees at retirement
or termination of employment based on the respective employee's salary, and the years of employment with the Company. The Company
provides for the Gratuity Plan on the basis of actuarial valuation. This defined benefit plan is unfunded as on the date of these
financial statements. Net periodic gratuity cost is recorded in the Statements of Income and includes service cost, interest cost
and actuarial gains/losses.
n.
Revenue recognition
Revenue
from services is recognized over the period the service is contracted to be rendered. Advance amounts received from customers
against billings for the period of service yet to be rendered on time proportion basis is disclosed as 'unearned revenues'.
Revenue
from products is recognized when the significant risks and rewards of ownership have transferred to the buyer.
All
revenues are recognized only when collectability of the resulting receivable is reasonably assured, and are reported net of discounts
and service taxes.
o.
Revenues and costs - filmed entertainment
Television
series are initially produced for a specific television network and may be subsequently licensed for foreign or domestic telecast.
The Company has entered into telecast rights transactions for the television series it produces. Revenues from distribution or
exploitation of the television series are recognised as revenues when (i) an arrangement has been signed with a customer; (ii)
the customer’s right to use or otherwise exploit the intellectual property has commenced and there is no requirement for
significant continued performance by the Company; (iii) arrangement fees are either fixed or determinable and (iv) collectability
of the fees is reasonably assured.
Film
costs include the unamortized cost of completed television episodes and television series in production. Film costs are stated
at the lower of cost, less accumulated amortization, or fair value. The amount of capitalized film costs for a given period is
determined using the individual film-forecast-computation method. Under this method, the amortization of capitalized costs is
based on the proportion of the film’s actual revenues recognized for such period to the film’s estimated remaining
unrecognized ultimate revenues. All exploitation costs of the Company are expensed as incurred.
With
respect to the "Kalyanamalai" television series, the fair value of the film (after considering estimated future exploitation
costs) is less than its unamortized film costs and hence, the Company has written off to the income statement the amount by which
the unamortized capitalized costs exceed the fair value.
Revenues
earned from and costs incurred in production of the television series have been presented under the heads 'matrimonial service
income' and 'matrimonial service expense' in the financial statements.
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
p.
Leasing agreements
Leases
where the lessor retains substantially all the risks and benefits of ownership of the assets are classified as operating leases.
Operating lease payments are recognized as an expense in the statements of income on a straight-line basis over the lease term.
q.
Earnings per share
Basic
earnings per share is computed by dividing net income attributable to shareholders by the weighted average number of shares outstanding
during the period.
Diluted
earnings per share are computed on the basis of the weighted average number of common and dilutive common equivalent shares outstanding
during the period except where the results will be anti-dilutive.
r.
Accounting for contingencies
Certain
conditions may exist as of the date of these financial statements which may further result in a loss to the Company, but which
will only be resolved when one or more future events occur or fail to occur. Management of the Company makes an assessment of
such contingent liabilities which is based on assumptions and is a matter of opinion. In assessing loss contingencies relating
to legal or tax proceedings that involve the Company or unasserted claims that may result in such proceedings, the Company, after
consultation with legal or tax advisors, evaluates the perceived merits of any legal or tax proceedings or unasserted claims as
well as the perceived merits of the amount of relief sought or expected to be sought therein.
If
the assessment of a contingency indicates that it is probable that a loss will be incurred and the amount of the liability can
be estimated, then the estimated liability is accrued in the Company’s financial statements. If the assessment indicates
that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated,
then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material,
would be disclosed.
Loss
contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee
would be disclosed. However, in some instances in which disclosure is not otherwise required, the Company may disclose contingent
liabilities or other uncertainties of an unusual nature which, in the judgment of management after consultation with its legal
or tax counsel, may be of interest to shareholders or others.
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
3.
Cash and cash equivalents
Cash
and cash equivalents as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31, 2016
|
|
March
31, 2015
|
|
(a)
|
|
|
Cash on
hand
|
|
|
3,515
|
|
|
|
89,219
|
|
|
(b)
|
|
|
Balance
with banks on current accounts
|
|
|
9,735
|
|
|
|
8,741
|
|
|
Total
|
|
|
|
|
|
13,250
|
|
|
|
97,960
|
|
4.
Accounts receivable
Accounts
receivable as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31, 2016
|
|
March
31, 2015
|
|
(a)
|
|
|
Customers
(trade)
|
|
|
448,809
|
|
|
|
551,575
|
|
|
Total
|
|
|
|
|
|
448,809
|
|
|
|
551,575
|
|
5.
Other current assets
Other
current assets as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31, 2016
|
|
March
31, 2015
|
|
(a)
|
|
|
Event advances
|
|
|
19
|
|
|
|
216,312
|
|
|
(b)
|
|
|
Staff advances
|
|
|
29,715
|
|
|
|
39,802
|
|
|
(c)
|
|
|
Advance tax (net of
provision for income tax)
|
|
|
10,543
|
|
|
|
—
|
|
|
(d)
|
|
|
Loans and advances
|
|
|
51,949
|
|
|
|
333,562
|
|
|
(e)
|
|
|
Rental Advance
|
|
|
10,755
|
|
|
|
—
|
|
|
(f)
|
|
|
Prepaid
expenses
|
|
|
147
|
|
|
|
13,638
|
|
|
Total
|
|
|
|
|
|
103,128
|
|
|
|
603,314
|
|
6.
Property, plant and equipment, net
Property,
plant and equipment comprises of the following:
Particulars
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
carrying value
|
|
Accumulated
depreciation
|
|
Net
carrying value
|
|
|
|
|
March
31, 2016
|
|
March
31, 2015
|
|
March
31, 2016
|
|
March
31, 2015
|
|
March
31, 2016
|
|
March
31, 2015
|
|
(a)
|
|
|
Vehicles
|
|
|
39,613
|
|
|
|
42,118
|
|
|
|
9,716
|
|
|
|
6,502
|
|
|
|
29,897
|
|
|
|
35,616
|
|
|
(b)
|
|
|
Computers & Peripherals
|
|
|
69,412
|
|
|
|
73,802
|
|
|
|
65,668
|
|
|
|
68,367
|
|
|
|
3,744
|
|
|
|
5,435
|
|
|
(c)
|
|
|
Furniture & Fixtures
|
|
|
13,388
|
|
|
|
14,234
|
|
|
|
7,392
|
|
|
|
6,432
|
|
|
|
5,996
|
|
|
|
7,802
|
|
|
(d)
|
|
|
Office Equipments
|
|
|
63,982
|
|
|
|
61,173
|
|
|
|
37,152
|
|
|
|
32,533
|
|
|
|
26,830
|
|
|
|
28,640
|
|
|
(e)
|
|
|
Leasehold improvements
|
|
|
75,822
|
|
|
|
80,616
|
|
|
|
47,344
|
|
|
|
42,254
|
|
|
|
28,478
|
|
|
|
38,362
|
|
|
(f)
|
|
|
Plant & Machinery
|
|
|
10,502
|
|
|
|
9,295
|
|
|
|
3,060
|
|
|
|
1,077
|
|
|
|
7,442
|
|
|
|
8,218
|
|
|
|
|
|
Total
|
|
|
272,719
|
|
|
|
281,238
|
|
|
|
170,332
|
|
|
|
157,165
|
|
|
|
102,387
|
|
|
|
124,073
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
Operating
leases
The
total amount of operating lease expenses is as follows:
Particulars
|
|
For
the year ended
|
|
For
the year ended
|
|
|
March
31,
2016
|
|
March
31,
2015
|
Lease
Expenses
|
|
|
64,565
|
|
|
|
44,159
|
|
7.
Intangible assets, net
Intangible
assets as at March 31 comprise of the following:
Particulars
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross
carrying value
|
|
Accumulated
amortization
|
|
Net
carrying value
|
|
|
|
|
March
31, 2016
|
|
March
31,
2015
|
|
March
31,
2016
|
|
March
31,
2015
|
|
March
31, 2016
|
|
March
31, 2015
|
|
(a)
|
|
|
|
Software
|
|
|
|
50,467
|
|
|
|
53,658
|
|
|
|
37,937
|
|
|
|
31,193
|
|
|
|
12,530
|
|
|
|
22,465
|
|
|
|
|
|
|
Total
|
|
|
|
50,467
|
|
|
|
53,658
|
|
|
|
37,937
|
|
|
|
31,193
|
|
|
|
12,530
|
|
|
|
22,465
|
|
The
charge to income resulting from amortization of intangible assets is included with depreciation and amortization in statement
of income for 2016 and 2015 amounting to $8,837.46 and $5,490.35.
The
following represents the estimated aggregate amortization expense for intangible assets subject to amortization as
at March 31, 2016:
Particulars
|
|
As
at
March
31, 2016
|
|
|
|
|
2017
|
|
|
|
8,576
|
|
|
2018
|
|
|
|
3,690
|
|
|
2019
|
|
|
|
199
|
|
|
2020
|
|
|
|
65
|
|
|
2021
|
|
|
|
—
|
|
|
Total
amortization expense
|
|
|
|
12,530
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
8.
Other non-current assets
Other
non-current assets as at March 31 comprises of the following:
Particulars
|
|
As
at
|
|
As
at
|
|
|
|
|
|
|
|
March
31,
2016
|
|
|
|
March
31,
2015
|
|
|
(a)
|
|
|
Rental
advance
|
|
|
—
|
|
|
|
25,156
|
|
|
(b)
|
|
|
Deposits
|
|
|
50,512
|
|
|
|
63,536
|
|
|
(c)
|
|
|
Software
under application development stage
|
|
|
12,947
|
|
|
|
9,211
|
|
|
Total
|
|
|
|
|
|
63,459
|
|
|
|
97,903
|
|
9.
Accounts payable and accrued liabilities
Accounts
payable and accrued liabilities as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31,
2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Accounts
payable
|
|
|
227,525
|
|
|
|
87,895
|
|
|
(b)
|
|
|
Salary payable
|
|
|
9,437
|
|
|
|
24,094
|
|
|
(c)
|
|
|
Current portion of
provision for gratuity
|
|
|
2,307
|
|
|
|
1,701
|
|
|
(d)
|
|
|
General
and administrative expenses payable
|
|
|
31,111
|
|
|
|
76,397
|
|
|
Total
|
|
|
|
|
|
270,380
|
|
|
|
190,087
|
|
10.
Statutory liabilities
Income
tax and other statutory liabilities as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31,
2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Service
tax
|
|
|
184,508
|
|
|
|
156,573
|
|
|
(b)
|
|
|
Provident fund
|
|
|
34,300
|
|
|
|
25,192
|
|
|
(c)
|
|
|
Employees state insurance
|
|
|
4,932
|
|
|
|
6,291
|
|
|
(d)
|
|
|
Professional tax
|
|
|
6,555
|
|
|
|
5,554
|
|
|
(e)
|
|
|
Tax deducted at source
|
|
|
54,259
|
|
|
|
31,350
|
|
|
(f)
|
|
|
Income
tax (net of advance tax)
|
|
|
—
|
|
|
|
22,771
|
|
|
|
|
|
Total
|
|
|
284,554
|
|
|
|
247,731
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
11.
Short-term loans & current portion of long-term debt
Short
term loans and borrowings as at March 31 comprises of the following:
|
|
As
at
|
|
As
at
|
Particulars
|
|
March
31, 2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Bank
overdraft
1
|
|
|
156,678
|
|
|
|
172,122
|
|
|
(b)
|
|
|
Secured
loan
|
|
|
—
|
|
|
|
196
|
|
|
(c)
|
|
|
Unsecured
loan
|
|
|
27,774
|
|
|
|
23,469
|
|
|
(d)
|
|
|
Current
portion of long-term debt
|
|
|
28,092
|
|
|
|
22,056
|
|
|
|
|
|
Total
|
|
|
212,544
|
|
|
|
217,843
|
|
1
The bank overdraft facility as at March 31, 2016 is secured by way of hypothecation of trade receivables, current assets
and fixed assets of the Company except vehicles financed by other banks/financial institutions.
12.
Long-term debt
Long-term
debt as at March 31 comprise of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31,
2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Secured
loans
1
|
|
|
249,347
|
|
|
|
279,161
|
|
|
(b)
|
|
|
Vehicle
loans
2
|
|
|
15,831
|
|
|
|
22,838
|
|
|
|
|
|
|
|
|
265,178
|
|
|
|
301,999
|
|
|
(c)
|
|
|
Current
portion of long-term debt
|
|
|
(28,092
|
)
|
|
|
(22,056
|
)
|
|
Total
|
|
|
|
|
|
237,086
|
|
|
|
279,943
|
|
1
During the last quarter ended March 31, 2015, the Company, its directors and relatives of directors have availed a term
loan on a joint and several liability basis from ICICI Bank for an amount of $715,521. The Company’s liability has been
initially recognized in the financial statements at $275,989 under secured loans. The personal property of the directors has been
provided as security for availing the said loan. The loan is repayable in 120 equated monthly instalments and carries interest
at the base rate plus a margin of 1.75%. The loan arrangement has been approved by the Board of Directors, as provided by Board
resolution dated January 12, 2015 and a Memorandum of Understanding has been entered into between the Company and its co-obligors.
The total outstanding amount as at March 31, 2016 & March 31, 2015 towards this debt arrangement is $643,177 and $723,745.
The carrying amount of the Company’s liability as at March 31, 2016 and March 31, 2015 is $ 249,347 and $ 279,161.
2
The interest rates of these vehicle loans range from 11 % to 16 %. These loans are repayable in monthly instalments ranging
from 36 months to 60 months. These loans are secured against the respective assets.
The
scheduled aggregate maturity of long-term debt outstanding as at March 31 is as follows:
Particulars
|
|
As
at
March
31, 2016
|
|
2017
|
|
|
|
28,092
|
|
|
2018
|
|
|
|
26,073
|
|
|
2019
|
|
|
|
27,605
|
|
|
2020
|
|
|
|
26,092
|
|
|
2021
|
|
|
|
29,141
|
|
|
Thereafter
|
|
|
|
128,175
|
|
|
Total
long term debt
|
|
|
|
265,178
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
13.
Other current liabilities
Other
current liabilities as at March 31 comprises of the following:
Particulars
|
|
As
at
|
|
As
at
|
|
|
|
|
|
|
|
March
31, 2016
|
|
|
|
March
31, 2015
|
|
|
(a)
|
|
|
Unearned
revenues (i.e. billings in excess of revenue)
|
|
|
69,985
|
|
|
|
95,538
|
|
|
(b)
|
|
|
Advances
received
|
|
|
104,390
|
|
|
|
45,258
|
|
|
Total
|
|
|
|
|
|
174,375
|
|
|
|
140,796
|
|
14.
Income taxes
Income
taxes for the years ended March 31 comprise of the following:
Particulars
|
|
|
|
For
the period ended
|
|
For
the period ended
|
|
|
|
|
March
31,
2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Current
tax expense
|
|
|
—
|
|
|
|
(33,273
|
)
|
|
(b)
|
|
|
Prior period taxes
|
|
|
(29,388
|
)
|
|
|
(19,431
|
)
|
|
(c)
|
|
|
Deferred
tax expense/(benefit)
|
|
|
(58,962
|
)
|
|
|
35,831
|
|
|
|
|
|
Total
income tax expense
|
|
|
(88,350
|
)
|
|
|
(16,873
|
)
|
Deferred
income taxes
The
components of deferred tax assets and liabilities as at March 31 are as follows:
Particulars
|
|
|
|
|
|
|
|
2016
|
|
|
|
2015
|
|
Deferred tax assets
arising from tax effect of:
|
|
|
|
|
|
|
|
|
Property,
Plant and equipment (non-current)
|
|
|
22,030
|
|
|
|
—
|
|
Minimum
alternate tax
7
|
|
|
39,002
|
|
|
|
30,681
|
|
Deferred
tax asset, net
|
|
|
61,032
|
|
|
|
30,681
|
|
Deferred tax liability
arising from tax effect of:
|
|
|
|
|
|
|
|
|
Property,
plant and equipment (non-current)
|
|
|
—
|
|
|
|
(26,615
|
)
|
Deferred tax asset,
net
|
|
|
61,032
|
|
|
|
4,066
|
|
Deferred
tax liabilities
|
|
|
—
|
|
|
|
—
|
|
7
Under
the Indian Income-tax Act, 1961, the Company is liable to pay Minimum Alternate Tax (MAT). The excess tax paid as per MAT over
and above the regular tax liability can be carried forward for a period of 10 years and can be set off against the future tax
liabilities computed under regular tax provisions.
Income
tax expense compared to Statutory expectations
A
reconciliation of expected income tax expense to the actual tax expense for the years ended March 31 is as follows:
Particulars
|
|
|
|
|
|
|
|
|
|
|
2016
|
|
2015
|
|
Income
before income taxes
|
|
|
(820,344
|
)
|
|
|
158,89
1
|
|
|
Theoretical
income-tax expense
|
|
|
—
|
|
|
|
73,985
|
|
|
Add
/ (deduct) effect of:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
|
|
Unrecognized
income-tax benefits
|
|
|
(58,962
|
)
|
|
|
(35,412
|
)
|
|
(b)
|
|
|
Other items
|
|
|
(29,388
|
)
|
|
|
(2,269
|
)
|
|
(c)
|
|
|
Adjustments
of income-tax for prior periods
|
|
|
—
|
|
|
|
(19,431
|
)
|
|
|
|
|
Total
income tax expense
|
|
|
(88,350
|
)
|
|
|
16,873
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
15.
Other non-current liabilities
Other
non-current liabilities as at March 31 comprises of the following:
Particulars
|
|
|
|
As
at
|
|
As
at
|
|
|
|
|
March
31,
2016
|
|
March
31,
2015
|
|
(a)
|
|
|
Trade Deposits
|
|
|
5,435
|
|
|
|
5,856
|
|
|
(b)
|
|
|
Provision
for gratuity
|
|
|
17,481
|
|
|
|
14,556
|
|
|
Total
|
|
|
|
|
|
22,916
|
|
|
|
20,412
|
|
16.
Common Stock
The
Company has only one class of equity shares having par value of $0.001 per share. Each holder of equity shares is entitled to
one vote per share. The authorized equity share capital (number of shares) of the Company is 300,000,000 shares as at March 31,
2016 and March 31, 2015. The issued, subscribed and paid-up equity share capital (number of shares) of the Company is 42,096,160
shares as at March 31, 2016 and 41,646,160 shares as at March 31, 2015.
The
shares issued are as follows:
(i)
33,000,000 numbers of shares at par value of $ 0.001 per share are issued for consideration other than cash.
(ii)
4,596,160 number of shares are issued at a price of $ 0.05 per share
(iii)
4,050,000 number of shares are issued at a price of $ 0.20 per share
(iv)
200,000 number of shares are issued at a price of $ 0.30 per share
(v)
250,000 number of shares are issued at a price of $ 0.30 per share for consideration other than cash
The
Shareholders who have subscribed 4,050,000 number of shares at the rate of $0.20 per share have an option to purchase a warrant
for every two shares held which entitles the holder to purchase an additional share at the rate of $0.40 per share for the period
of two years from the date of issuance.
Preferred
Stock
The
authorized preference share capital (number of shares) of the Company is 10,000,000 shares having a par value of $0.001 per share
as at March 31, 2016. The issued, subscribed and paid-up preference share capital is Nil as at March 31, 2016.
17.
Matrimonial service income
Particulars
|
|
|
|
For
the Year ended
|
|
|
|
|
2016
|
|
2015
|
|
(a)
|
|
|
Profile
Registration and Event Incomes
|
|
|
453,819
|
|
|
|
712,290
|
|
|
(b)
|
|
|
Sponsorship Income
and advertisement Income
|
|
|
33,051
|
|
|
|
197,168
|
|
|
(c)
|
|
|
Sale of space or time
slot - Television series
|
|
|
90,909
|
|
|
|
89,341
|
|
|
(d)
|
|
|
Sale
of products (magazines)
|
|
|
—
|
|
|
|
2,085
|
|
|
Total
|
|
|
|
|
|
577,779
|
|
|
|
1,000,884
|
|
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
18.
Matrimonial service expenses
Particulars
|
|
|
|
For
the Year ended
|
|
|
|
|
2016
|
|
2015
|
|
(a)
|
|
|
Event expenses
|
|
|
146,285
|
|
|
|
135,892
|
|
|
(b)
|
|
|
Production and telecast
expenses - Television series
|
|
|
88,721
|
|
|
|
148,080
|
|
|
(c)
|
|
|
Publication expenses
|
|
|
25,777
|
|
|
|
59,979
|
|
|
(d)
|
|
|
ARC commission
|
|
|
5,714
|
|
|
|
18,762
|
|
|
(e)
|
|
|
Amortization of film
cost
|
|
|
35,990
|
|
|
|
19,209
|
|
|
(f)
|
|
|
Subcontracting
Charges
|
|
|
55,389
|
|
|
|
—
|
|
|
Total
|
|
|
|
|
|
357,876
|
|
|
|
381,922
|
|
19.
General and administrative expenses
Particulars
|
|
|
|
For
the Year ended
|
|
|
|
|
2016
|
|
2015
|
|
(a)
|
|
|
Lease expenses
|
|
|
64,565
|
|
|
|
44,159
|
|
|
(b)
|
|
|
Repairs and maintenance
|
|
|
16,255
|
|
|
|
21,626
|
|
|
(c)
|
|
|
Insurance charges
|
|
|
1,337
|
|
|
|
572
|
|
|
(d)
|
|
|
Electricity charges
|
|
|
7,592
|
|
|
|
10,660
|
|
|
(e)
|
|
|
Audit fees
|
|
|
10,124
|
|
|
|
10,636
|
|
|
(f)
|
|
|
Filing charges
|
|
|
—
|
|
|
|
29,891
|
|
|
(g)
|
|
|
Bank charges
|
|
|
7,136
|
|
|
|
9,113
|
|
|
(h)
|
|
|
Bad debts
|
|
|
81,012
|
|
|
|
47,157
|
|
|
(i)
|
|
|
Travelling and conveyance
|
|
|
5,696
|
|
|
|
14,425
|
|
|
(j)
|
|
|
Professional charges
|
|
|
91,090
|
|
|
|
72,435
|
|
|
(k)
|
|
|
Printing and stationery
|
|
|
4,514
|
|
|
|
4,872
|
|
|
(l)
|
|
|
Telephone, courier
and postage
|
|
|
14,232
|
|
|
|
24,386
|
|
|
(m)
|
|
|
Security charges
|
|
|
4,096
|
|
|
|
4,320
|
|
|
(n)
|
|
|
Business promotion
expenses
|
|
|
120,301
|
|
|
|
228,367
|
|
|
(o)
|
|
|
Rates and taxes
|
|
|
—
|
|
|
|
1,802
|
|
|
(p)
|
|
|
Advances Written off
|
|
|
441,162
|
|
|
|
—
|
|
|
(q)
|
|
|
Others
|
|
|
50,660
|
|
|
|
13,362
|
|
|
Total
|
|
|
|
|
|
919,772
|
|
|
|
537,783
|
|
20.
Earnings/(loss) per share (EPS)
Particulars
|
|
|
For
the Year ended
|
|
|
|
2016
|
|
2015
|
(a)
|
Net income/(loss)
|
|
|
(602,141
|
)
|
|
|
41,934
|
|
(b)
|
Weighted average
number of equity shares outstanding
|
|
|
42,096,160
|
|
|
|
41,939,585
|
|
Earnings/(loss)
per share - basic and diluted
|
|
|
(0.0143
|
)
|
|
|
0.0010
|
|
KM
Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
21.
Related party disclosures
(a)
Names of related party and relationship
(i) Key
Management Personnel ('KMP')
(a)
Mr. T V Mohan - Chairman and Director
(b)
Ms. Meera Nagarajan - President, CEO and Managing Director
(c)
Mr. Vijaya Bhaskar Venkatesan- CFO, Director, Treasurer and Director of technologies
(ii) Relatives
of KMP
(a)
Mr. Sridhar Kalyanasundaram
(iii) Affiliated
Entity
(a)
Naaga Entertainemnt Media Private Limited ( Company Under Common Control )
(b)
Transactions with related parties
Transactions during the year ending March 31
Particulars
|
|
KMP
and Relative of KMP
|
|
Affiliated
Entity
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Transactions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances
given for business purposes
|
|
|
16,146
|
|
|
|
296,272
|
|
|
|
—
|
|
|
|
—
|
|
Settlement of advances
given for business purposes
|
|
|
393,661
|
|
|
|
206,187
|
|
|
|
—
|
|
|
|
—
|
|
Repayment of unsecured
loans
|
|
|
133,360
|
|
|
|
36,827
|
|
|
|
—
|
|
|
|
—
|
|
Sale of Television
Rights
|
|
|
—
|
|
|
|
—
|
|
|
|
4,154
|
|
|
|
—
|
|
Closing
balances
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Advances received from
Directors (credit bal.)
|
|
|
83,258
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Advances given for
business purposes (debit balance)
|
|
|
—
|
|
|
|
158,378
|
|
|
|
—
|
|
|
|
—
|
|
Unsecured
loans received (credit balance)
1
|
|
|
96,421
|
|
|
|
244,311
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
Unsecured loans from related parties are repayable on demand.
22.
Goodwill
Particulars
|
|
|
Goodwill
1
|
|
|
762,235
|
|
Add:
Adjustment in additional acquisition and translation reserve
|
|
|
—
|
|
Balance as at
March 31, 2016
|
|
|
762,235
|
|
1
Goodwill
arises in the process of acquiring KM Wedding Events Management Private Limited. In April 2013, the Company acquired 55.32% interest
of KM Wedding Events Management Private Limited, India (formerly known as "KM Matrimony Private Limited", India). As
of March 31, 2016, 58.33% of the shares of KM Wedding Events Management Private Limited are being held by the Company. This acquisition
has been accounted as a business combination.
Goodwill
represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired in a business
combination. It is assigned to reporting units as of the acquisition date. As per ASC 805-20-55-6, the value of an acquired intangible
asset which are not identifiable as of the acquisition date is subsumed into Goodwill. The assets and liabilities are acquired
at book value as there is no significant deviation from fair value. There are no related contingent consideration arised.
Impairment
of Goodwill will be tested on annual basis at the end of the year.
KM Wedding Events Management, Inc.
Notes
to Consolidated financial statements
(in
US Dollars $ unless otherwise stated)
23.
Employee benefits
Defined
benefit plan
The
liability recognized in the balance sheets as at March 31 is as follows. The obligations are unfunded as on the dates of balance
sheets.
|
|
|
|
As
at March 31
|
|
|
Particulars
|
|
2016
|
|
2015
|
|
(a)
|
|
|
Gratuity
liability recognized in the balance sheet
|
|
|
19,788
|
|
|
|
16,257
|
|
Weighted
average assumptions used to determine net gratuity cost and benefit obligations:
|
|
|
|
|
|
|
For
the Year ended
|
|
|
|
|
|
Particulars
|
|
|
2016
|
|
|
|
2015
|
|
|
(a)
|
|
|
Discount
rate
|
|
|
7.80%
p.a.
|
|
|
|
7.80%
p.a.
|
|
|
(b)
|
|
|
Long-term rate of compensation
increase
|
|
|
7.50%
p.a.
|
|
|
|
7.50%
p.a.
|
|
|
(c)
|
|
|
Rate
of return on plan assets
|
|
|
N.A.
|
|
|
|
N.A.
|
|
24.
Going concern
The
financial statements have been prepared on the basis that the Company is a going concern and thereby no adjustments are required
to be made to the carrying amount of assets and liabilities.
25.
Film costs
The
amount of unamortized film costs disclosed in the balance sheet pertains to completed and not released films with respect to the
television series. The entire amount of unamortized film costs is expected to be amortized in the financial year 2016-17.
26.
Commitments and contingencies
Service
tax and other statutory dues
Penalties,
if any, on account of delay in payment of service tax and other statutory dues are unascertainable.
27.
Previous period figures
Figures
of previous year have been regrouped rearranged, wherever required to confirm to the current period presentation.
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